Kioxia Holdings Corp.’s shares fell as much as 15% on Monday after the Japanese memory maker’s cautious outlook disappointed investors, flaring up concerns that the explosive growth driven by artificial intelligence may be levelling off.

The Tokyo-based firm said Friday it expects operating profit of ¥2 trillion ($12.7 billion) for the December quarter, below the analyst consensus of ¥2.35 trillion. The forecast suggests scant growth from the September quarter, when it recorded ¥1.99 trillion. Kioxia’s operating profit had been on a steep upward trend over the past several quarters.

The rival to Samsung Electronics Co., SK Hynix Inc. and Micron Technology Inc. attributed the lacklustre momentum largely to the timing of shipments rather than a deterioration in demand.

Some orders originally scheduled for the current quarter were brought forward into the September period due to customer requests, while others have been pushed into the March quarter as a growing mix of enterprise storage requires longer production lead times.

Chief Financial Officer Yoshihiko Kawamura said during a conference call last week that the company expects to return to rapid growth in the March quarter and that demand from AI data centre operators remains robust.

The company has already sold out its planned output for next year, while more than half of its production for the following year has also been allocated, he said. Some large customers have also begun negotiations for contracts covering 2029 and beyond.

But investors are increasingly sceptical of the growth story laid out by the company, as executives have repeatedly struck a cautious note in their comments on the outlook.

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