Photo is unrelated to the article. [Getty Images Bank]
Photo is unrelated to the article. [Getty Images Bank]

Employees at a Japanese chipmaker that once teetered on the edge of bankruptcy have emerged as millionaires, each holding assets worth more than 10 billion won ($6.47 million), riding the AI chip boom.

About 600 employees at Kioxia Holdings, a Japanese memory chip company, now each hold assets exceeding 1 billion yen ($6.18 million), according to the Nikkei Shimbun on Sunday.

Kioxia traces its origins to Toshiba Memory. Toshiba was the first company to develop NAND flash memory, a type of storage that retains data even when powered off.

Losses from a struggling US nuclear power plant business and an accounting scandal pushed Toshiba to cumulative losses of more than 1 trillion yen between 2016 and 2017, forcing it to sell its semiconductor division. In 2018, a US-Japan-Korea consortium led by Bain Capital acquired Toshiba Memory, giving rise to Kioxia. SK hynix was also part of that consortium.

At the time of the acquisition, Bain Capital granted stock options not only to executives but also to about 600 mid-level managers, including department heads and section chiefs. The exercise price ranged from 1,667 to 2,600 yen per share.

Private equity funds typically limit stock options to senior management when acquiring a company. Although Bain's US headquarters raised objections, the firm's Japan investment team argued that frontline leaders play a critical role in Japanese corporate culture and persuaded the firm to share the rewards with employees.

Surging demand for AI memory chips drove Kioxia's share price sharply higher. When the company listed on the Tokyo Stock Exchange in December 2024, its IPO price stood at 1,455 yen — but the stock has since climbed past 100,000 yen.

On June 1, Kioxia overtook Toyota Motor to become Japan's most valuable listed company by market capitalization. A memory chipmaker surpassing Toyota — a symbol of Japanese manufacturing — showed how rising expectations for NAND flash and enterprise SSD demand, driven by the spread of AI data centers, are reshaping the leadership of Japan's stock market.

The roughly 7 million stock options originally granted are valued at approximately 790 billion yen based on the year's intraday high of 112,700 yen per share, with unrealized gains alone reaching about 778 billion yen. That works out to average paper assets of more than 1 billion yen per employee across the 600 recipients.

The Nikkei noted that the AI era is also changing how the fruits of corporate growth are distributed, and highlighted cases from South Korea and the United States.

Employees in Samsung Electronics' semiconductor division are expected to receive combined performance and special bonuses exceeding 600 million won ($387,000) per person this year. SK hynix employees are also expected to receive an average of more than 600 million won per person this year.

In the United States, about 4,400 SpaceX employees who received stock compensation became millionaires through the company's listing process. Elon Musk founded SpaceX in 2002.

"The AI revolution is not simply creating new industries — it is also upending the existing order of who captures the gains from corporate growth," the Nikkei said.


dbsdn1110@heraldcorp.com