Pot of gold: Japanese toilet maker could greatly profit from ongoing memory shortage

With the recent AI boom decimating just about every conceivable part of the semiconductor supply chain, investors are constantly looking for new industries that could become the ‘next big thing’. Palliser Capital (H/T Financial Times) has found one such player in one of the most unlikely places. Toto, a Japanese company that makes high-end toilets, is sitting on a veritable gold mine.

Apparently, Toto’s ‘chuck’ technology allows ceramics to withstand incredibly low temperatures, making it ideal for cryogenic etching of silicon wafers. Cryogenic etching is a key step in the manufacturing of NAND chips for memory/storage because it is excellent at creating deep grooves/vertical structures in silicon wafers. Logic processes, such as the ones employed by TSMC to make CPU/GPUs, typically rely on the older Bosch process, although a cryogenic approach might be needed as newer technologies like CFET emerge.

Palliser Capital says Toto has a competitive advantage of at least five years, and that it could ride on the ongoing memory shortage. Ceramics already have multiple applications in semiconductor manufacturing and packaging thanks to their high thermal conductivity, electrical insulation, chemical stability, and mechanical strength.