On June 3, reports indicated that the global artificial intelligence (AI) boom is reshaping the competitive landscape among Japanese enterprises, with Kioxia Holdings Corporation experiencing a significant surge in market value, bringing it close to claiming the second spot among Japan’s most valuable companies. On Wednesday, shares of this memory chip manufacturer soared, with its market valuation temporarily climbing by 7.2%—reaching parity with Toyota Motor Corporation and even surpassing it for a brief period, with a valuation exceeding ¥45 trillion (approximately US$281 billion). Remarkably, this milestone was achieved just 18 months after Kioxia’s initial public offering (IPO).

Junpei Tanaka, Head of Investment Strategy at Pictet Asset Management Japan, commented that such a transformation in the lineup of Japan’s largest companies could reshape overseas investors’ views of Japanese equities. This evolution might shift the Japanese market from being primarily driven by manufacturing-led cyclical stocks to being led by AI-driven semiconductor growth stocks. Such a change could prompt global investors to increase their allocations to Japanese AI-related sectors, thereby attracting greater capital inflows.