Japan's century-old Fujikura rides AI data centre boom to become Nikkei standout

Fujikura

24/10/2025 02:06

Shares in optical fibre maker up 160% since start of 2025

Founded in 1885, Fujikura started out making silk and insulated wires

Investors looking for next batch of winners in AI supply chain

By Junko Fujita

TOKYO, Oct 24 (Reuters) - Japan's Fujikura 5803.T has become a standout in the red-hot Nikkei share gauge on expectations the century-old wire maker will benefit from increased investment in artificial intelligence data centres that use its optical fibres.

The firm got another leg up this week, rising 6% after Sanae Takaichi was elected prime minister following pledges of targeted investment in AI and other key industries.

Since the start of 2025, shares in Fujikura are up more than 160%, outpacing the Nikkei's .N225 22% advance to an all-time high. Its market value of about $33 billion now rivals that of better-known Japanese manufacturers such as air-conditioning maker Daikin 6367.T and construction equipment manufacturer Komatsu 6301.T.

Ups and downs in global equities have been increasingly tied to the fortunes of the so-called "Magnificent Seven" U.S. technology companies at the forefront of AI development, including Nvidia NVDA.O, Amazon AMZN.O, and Microsoft MSFT.O.

In Japan, that euphoria has filtered down to major suppliers and investors in the AI sector, such as Advantest 6857.T, Tokyo Electron 8035.T and SoftBank Group 9984.T. Those firms alone account for most of the Nikkei's gain since early September.

Fujikura, founded in 1885 during Japan's Meiji Era of modernisation, has been a focus for investors searching through the AI supply chain to find the next batch of winners.

"Generative AI is a big theme and key driver for the Japanese market," said Kazuaki Shimada, chief strategist at IwaiCosmo Securities. "Now investors have started looking for new targets that may become the next Fujikura."

     Mitsui Kinzoku 5706.T, which makes materials for data centre servers, is another AI-related high-flyer in the Japanese market, jumping 192% so far in 2025. Another supplier JX Advanced Metals 5016.T has soared fourfold since its market debut in March.

Starting out as a maker of silk and insulated wires, Fujikura went on to produce the world's first optical fibre in 1959. Those fibres are now a key component of AI data centres, with about 75% of the company's output going to overseas customers, such as Google owner Alphabet GOOGL.O.

A spokesperson said Fujikura had added capacity for fibre production at its existing facility in February, and it announced in August it would spend 45 billion yen ($298.45 million) to add another factory.

($1 = 150.7800 yen)

AI euphoria in the Japanese market https://fingfx.thomsonreuters.com/gfx/mkt/znpnnygdmpl/Pasted%20image%201761262544906.png

 (Reporting by Junko Fujita; Editing by Rocky Swift and Jamie Freed)

 ((junko.fujita@thomsonreuters.com))