Toilet manufacturer hits big thanks to AI.

Toto's stock surged thanks to its semiconductor manufacturing segment. Photo: Bloomberg .

The memory shortage is creating a ripple effect across the semiconductor supply chain, leading to price fluctuations for many related businesses. Unexpectedly, Toto, a Japanese brand known for its bathroom fixtures, is being mentioned as a beneficiary, thanks to its lesser-known semiconductor business.

On January 22nd, Toto's stock surged 11%, its biggest gain since February 2021. This move came after Goldman Sachs analysts upgraded the stock, suggesting that the expansion of AI infrastructure is driving demand for NAND memory chips, creating a tighter supply and demand environment in the storage industry.

According to Goldman Sachs, the aforementioned shortage is driving up demand for chip manufacturing components, including electrostatic chucks, a product Toto has long been involved in. Analysts Sachiko Okada and Sayako Tominaga report that the tight supply and demand environment will support this manufacturing segment and help Toto achieve significant profitability.

Representatives from Toto also confirmed that the continued construction of AI data centers is expected to sustain demand for electrostatic chucks.

The unusual surge in Toto's stock not only made the company the best-performing stock on the Tokyo Stock Exchange on the afternoon of January 22nd, but it also demonstrated the ability of many traditional Japanese manufacturers to participate in the semiconductor supply chain. Besides Toto, companies like Ajinomoto and Kao were also cited as prime examples of diversified business models, participating in many key stages of the global chip supply chain.

Although widely known for its smart toilets, Toto has actually been supplying materials and components for the semiconductor and display industries for decades. According to data compiled by Bloomberg , these new business areas account for 42% of the company's total revenue in the fiscal year ending March 2025.

Few people know about Toto's semiconductor component manufacturing division. Photo: Bloomberg .

Electrostatic chucks, a product Toto began mass-producing in 1988, use electrostatic force to attract and hold silicon wafers in place during chip fabrication. This device also helps control temperature and reduce contamination risks in high-precision manufacturing environments.

With tech giants like Meta and Amazon increasing their investments in AI-powered data centers, widespread semiconductor demand is projected to continue to surge. Goldman Sachs suggests this is driving memory chip manufacturers such as SK Hynix, Samsung, and Kioxia Holdings to expand production, thereby boosting demand from upstream suppliers like Toto.