Murata Manufacturing posted sales of ¥467.5 billion in the third quarter of fiscal 2025, a 4.3% rise year on year driven by demand for multilayer ceramic capacitors used in AI servers. The company recorded operating profit of ¥37.9 billion, about half the level a year earlier after roughly ¥50 billion of one-off costs, including a ¥43.8 billion goodwill impairment tied to its surface acoustic wave filter business, the company said. Excluding the impairment, operating profit was ¥87.7 billion. Murata raised its full-year sales forecast to ¥1.8 trillion but trimmed its operating profit outlook because of the charge, signalling a mixed picture for its tech-facing businesses.

Results in brief

Murata reported third-quarter sales of ¥467.5 billion. That's up 4.3% from the same quarter a year earlier. The components division expanded, helped by higher demand for MLCCs in AI servers. Orders received stood at ¥570.7 billion. The order backlog was ¥336.1 billion and the overall book-to-bill ratio was 1.07. For capacitors alone, the book-to-bill ratio was 1.12.

Operating profit fell to ¥37.9 billion. The company said that figure included roughly ¥50 billion of one-time costs. That included a ¥43.8 billion goodwill impairment tied to the surface acoustic wave filter product business. Excluding the impairment, operating profit would have been ¥87.7 billion.

Where the profit drop came from

The company pointed to a large, non-recurring charge as the main cause of the decline. President Norio Nakajima said, "We recorded one-time costs of approximately ¥50 billion, including a ¥43.8 billion goodwill impairment related to the surface acoustic wave filter product business. As a result, operating profit has been halved."

The impairment pushed the Devices & Modules business into an operating loss for the quarter. At the same time, the Components business grew on stronger sales of MLCCs for AI server use. Currency movements helped too. Foreign exchange effects added about ¥15.0 billion to sales and roughly ¥7.5 billion to operating profit for the quarter.

Orders and demand drivers

Murata's order intake and backlog show continuing commercial momentum. Orders received of ¥570.7 billion exceeded sales for the quarter. The backlog of ¥336.1 billion gives revenue visibility into coming quarters.

The book-to-bill ratios above one indicate demand outpaced shipments in the quarter, especially for capacitors.

Mastheads

Management said MLCC demand has been driven by AI server build-outs. Those servers use large numbers of capacitors for power and signal conditioning. So the surge in AI infrastructure spending translated into higher component orders. But the high-frequency communications side of the business faced structural problems, the company acknowledged.

Guidance and strategic shifts

Murata lifted its full-year sales forecast by ¥60.0 billion to ¥1.8 trillion. At the same time it trimmed its operating profit forecast by ¥10.0 billion to ¥270.0 billion. The company said the profit cut reflects the impairment charge and continued weakness in parts of the Devices & Modules portfolio.

Executives signalled a two-track focus going forward. They want to expand share in high-frequency modules. And they plan to strengthen power supply solutions aimed at data centres. Management also set a target to return the high-frequency communications business to profitability by fiscal 2027. That suggests the company will reallocate resources toward higher-growth pockets while dealing with underperforming assets.

The goodwill write-down is a consequence of a past acquisition and shows management is reassessing that deal's value. The charge reduced reported profit sharply for the quarter. But the company provided the counterfactual figure: operating profit excluding the impairment rose to ¥87.7 billion, which implies underlying operations remained profitable.

That split between headline and adjusted profit matters for investors and customers. Headline figures reflect the hit from legacy decisions. Adjusted figures show ongoing demand for core components tied to AI infrastructure. Murata's order metrics and raised sales forecast back that interpretation.

Data-centre builders and cloud providers are buying more AI servers. That lifted demand for MLCCs, which are widely used in server power modules and signal lines. Murata benefited from that trend in its Components business. The company also flagged power supply solutions as a priority, which links directly to data-centre equipment needs.

But the Devices & Modules weakness shows not every product line is profiting from the AI cycle. Surface acoustic wave filters are used in wireless communications gear. Murata's impairment related to that product group points to difficulties in that market or in past strategic bets. The company said it will aim to regain profitability in high-frequency communications by fiscal 2027, which means costs, product mix, or market share will likely be adjusted.

Investors will likely watch several concrete metrics in coming quarters. Sales growth tied to MLCCs and power modules. Order backlog trends and book-to-bill ratios. Progress on reducing losses in Devices & Modules, especially the high-frequency segment. And management's ability to hit its fiscal 2027 profitability target for that business.

For now, Murata's guidance tells a complicated story. Sales are being upgraded. Reported profit is lower because of the impairment. The company is signalling it will push for market share in high-frequency modules and for stronger offerings to data centres.

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Murata raised its full-year sales forecast to ¥1.8 trillion but trimmed profit guidance after roughly ¥50.0 billion of one-off costs, including the ¥43.8 billion goodwill impairment. Management has said it aims to return the high-frequency communications business to profitability by fiscal 2027, a milestone investors will watch.

This article was created with AI assistance.