Why is Screen Holdings stock plunging today?

Screen Holdings' stock plummeted 18.6% to ¥9,253 on Monday following a disappointing second-quarter fiscal 2027 results, despite strong AI-driven growth. The company's operating profit for the July–September quarter, valued at approximately ¥40.1 billion, surpassed last year's figures yet fell short of market expectations, which had anticipated ¥42 billion.

Management maintained an unchanged full-year operating profit target of ¥94.3 billion, which proved to be the main source of investor dissatisfaction as analysts had been expecting a revision upward. This discrepancy widened due to Goldman Sachs' previous downgrade of the stock to a Sell rating, citing limited memory exposure as a structural concern, reducing the stock's resilience when the earnings miss occurred.

The unchanged guidance, juxtaposed with an analyst consensus that had been surpassing the company's own estimates, further accentuated the gap between market expectations and management's announced outlook. The tech sector's downward trend, triggered by a broader tech selloff across markets, exacerbated the situation, with Japanese technology and semiconductor-related shares, including Ibiden and Sumco, among the day's steepest decliners.