Renesas (TSE:6723) drops 12% on weak semiconductor demand
Chipmaker from Japan underperforms peers as growth slows, Wolfspeed risks mount, and dividend stays flat
Renesas Electronics (TSE:6723), one of Japan’s largest semiconductor companies, saw its stock plunge 12% to 1,735 yen on Thursday — marking one of its steepest daily declines in recent years. The sharp fall leaves the stock down 15% year-to-date and trading near its lowest level of 2025, far below the 52-week high of 3,400 yen. While rivals like Lasertec continue to rally, Renesas is clearly lagging behind.
Renesas operates across two main divisions:
The Automotive segment, which supplies chips for engine control, vehicle systems, and infotainment.
The Industry, Infrastructure & IoT segment, providing solutions for industrial automation and connected devices.
Investor sentiment took a hit after Renesas announced a five-year delay in its long-term revenue goal, now aiming for $20 billion in sales by 2035 instead of 2030. For fiscal 2024, the company posted revenue of 1.348 trillion yen (around $9.3 billion), underscoring slower-than-expected growth, particularly in automotive and industrial chip markets.
Further weighing on the stock is the company’s exposure to struggling U.S. chipmaker Wolfspeed. Renesas expects to book a ¥250 billion loss related to a restructuring deal that involves converting a $2.06 billion deposit into equity, convertible notes, and warrants as part of a broader debt reduction plan.
Adding to investor disappointment, Renesas maintained its annual dividend at 28 yen per share — the same level as last year when it initiated its dividend policy. This flat payout signals a lack of dividend growth, especially when compared to peers that have recently raised their dividends. Based on the current share price, Renesas offers a dividend yield of 1.4%.
With slowing momentum, financial headwinds, and limited shareholder returns, Renesas is struggling to keep pace with the broader semiconductor rally in Japan.
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