Nitto Boseki: long-term performance & turning pointsSales (revenue) and profit-margin ratio
Sales (¥ bn)Net margin (%)
1898A silk spinner that went inorganic
Revenue (¥ bn, bars) · net margin (%, line)
Source: securities reports
1923Two Fukushima silk spinners merge as Nitto Boseki
1937Rayon staple production begins
1938Japan’s first industrialisation of glass fibre — second in the world
1939Volume glass-fibre production at Fukuyama
The company descends from two Fukushima silk-spinning firms — one founded at Koriyama in 1898, the other at Fukushima in 1918 — which combined in April 1923 under the name Nitto Boseki. It was an ordinary provincial spinner of the late Meiji and Taisho pattern, except in one respect: its first president, Katakura Sanpei, declined to treat silk as the thing to be protected.
Instead he kept changing the material. Rayon staple went into volume production at the new Fukuyama plant in 1937; a dyeing and finishing works followed at Itami; the merger of a Nagoya spinning company that October brought cotton spinning and a plant network spanning Fukushima, Aichi, Niigata and Hyogo. Wartime consolidation added more mills, and in 1944 two plants in Wakayama bought from Toyota.
The decisive move was inorganic. In December 1938 Nitto Boseki, under Katakura, achieved Japan’s first industrialisation of glass fibre — the same year Owens Corning did so in the United States, making it the second company in the world to manage it. Volume production began at Fukuyama in February 1939, and a rock-wool plant in Tokyo took it into insulation that November. A silk spinner had walked into the most advanced materials field of its day, and the demand was immediate: electrical insulation and radio equipment for military aircraft.
1969Glass cloth for printed circuit boards launched
1979The “specialisation campaign”: quality over volume
The shares listed in Tokyo, Osaka, Nagoya and Niigata in May 1949. Through the 1950s and early 1960s the company built outward: cotton weaving in Shizuoka, synthetic-fibre spinning at Koriyama and Fukuyama, and from 1962 building materials — non-combustible acoustic ceiling board at Chiba and melamine decorative panels at Suzuka. By 1965 Katakura’s portfolio ran across silk, chemical fibre, glass fibre and building materials.
That year it broke. Nitto Boseki fell to a net loss in the year to March 1965, as the cost of the plants built for reconstruction-era textile demand met the start-up cost of building materials, and Katakura stepped down as chairman. Being first in the industry into the red turned out to matter: it started a habit of selection.
The response, under Nagashima Takeo, was the tokka sakusen — the specialisation campaign — which put the ability to survive a downturn ahead of profits in a boom, moved the company from a cost-first to a quality-first stance and narrowed the spread of diversification. Plants were sold and built in combination, headcount held down, and resources concentrated on products that could compete on quality. In parallel the glass business found its future market: a glass-fabric weaving plant opened at Fukushima in 1969, and glass cloth for printed circuit boards went on sale the same year, just as colour television was spreading.
1986Exit from rayon; entry into in vitro diagnostics
1998Last cotton mill closes; NE glass and flat fibre developed
2008Melamine panels exited; 560 early retirements
2010Building-materials division abolished
In June 1986 Nitto Boseki withdrew from rayon staple and chemical filament after forty-nine years — leaving, in effect, the field Katakura had entered in 1937. The same year it bought an American immunoassay company and began in vitro diagnostics, opening a pharmaceutical plant at Fukuyama in 1987: as the fibre businesses shrank, a new one was deliberately started.
Then the spinning itself went, mill by mill. Synthetic spinning at Koriyama closed in 1990, cotton at Wakayama in 1992, synthetic at Fukuyama in 1993, cotton weaving in Shizuoka in 1995, and finally cotton at Tomari in 1998 — the site converted to beverage production. Seventy-five years after its founding, a company with “spinning” in its name no longer spun anything. Several of the closed sites were redeveloped as shopping centres, turning mill land into rental income.
What replaced it had been in the building since 1938. In 1998 the company developed NE glass, a high-value speciality glass later used in data-centre and smartphone antenna packages, and launched flat fibre for reinforcing resins in car parts and phone housings. The remaining legacy businesses were then unwound in turn: melamine panels into a joint venture with Sumitomo Bakelite in 2001 and out altogether in 2008; Wakayama closed in 2006 after sixty-two years; asbestos in past rock-wool products disclosed in 2005 brought compensation obligations; 560 employees took early retirement in 2008, contributing to a $88.1M (¥9bn) net loss in the year to March 2009. In 2010 the building-materials division was abolished outright, half a century after the first ceiling board.
2023Beverage business sold; centenary of the 1923 merger
2024Record results on AI data-centre glass cloth
2025$100.2M (¥15bn) plant expansion at Fukushima announced
Smartphones carried the first wave. Flat fibre went into handset housings as the global market expanded, and consolidated operating profit held above $91.9M (¥10bn) through the years to March 2016, 2017 and 2018, with the base-fibre segment hitting a record $58M (¥7bn) of segment profit. Production was pushed offshore where the customers were: the Chinese operation was sold in 2019, a Taiwanese maker consolidated the same year, and a Taiwan glass-fibre plant costing about $109.3M (¥12bn) completed in 2021 for speciality NE yarn. The base-fibre business itself then turned down, falling to a $12.2M (¥2bn) segment loss in the year to March 2023 as smartphone demand slowed and Chinese competition intensified.
The second wave was larger and came from an unexpected direction. Generative AI raised the computing load in data centres, which demanded faster, finer server boards, which demanded ultra-fine, ultra-thin speciality glass cloth — a product Nitto Boseki had spent decades learning to weave. Revenue reached $663.3M (¥93bn) with operating profit of $59.1M (¥8bn) in the year to March 2024, then a record $719.5M (¥109bn) and $108.3M (¥16bn) the following year, of which the electronic-materials segment alone contributed $91.1M (¥14bn) — more than 80% of the group total.
The last legacy business, the beverage company created out of the Tomari cotton mill in 1998, was sold in January 2023, twenty-five years after it was founded. Tada Hiroyuki became president in April 2024 and set a mid-term plan through fiscal 2027 targeting ¥20bn of operating profit, with about ¥80bn of investment over four years; in October 2025 a $100.2M (¥15bn) new glass-cloth building was announced for the Fukushima plant. Eighty-seven years after a silk spinner learned to draw glass, the company’s centre of gravity sits in a material it invented for aircraft insulation and now sells to the semiconductor industry.
The heart of this decision lies in converting the injury of being the first in the industry to sink into loss into a management asset, by shifting from volume to quality. President Nagashima Takeo put a constitution able to endure a downturn ahead of profits in a boom, moving from cost-centred thinking to an emphasis on quality and narrowing the spread of diversification into specialisation. Combining plant sales with new construction, holding headcount down, concentrating resources on items that could compete on quality — an accumulation of unglamorous, steady substitutions can be seen as what supported the recovery in earning power.
This way of thinking — not chasing volume but seeking quality — runs through the later Nitto Boseki as well. The business selection that began with the 1965 loss nurtured the non-textile divisions and led on to the structural reform of the 1990s, when cotton spinning itself was let go and resources narrowed to glass fibre. A management pattern of continually asking what to discard and where to concentrate took shape within this specialisation campaign. Whether an early fall can be turned into the wisdom to recover repeatedly has remained this materials maker’s central question.
Closing the founding trade, as a settling of accounts
The core of this decision is not how to shrink a loss-making founding business but that the company’s main business itself was exchanged for another. Abandoning commodity cotton spinning and concentrating resources on glass fibre, where technology creates a difference — president Sagara Atsuhiko deliberately declined the role of speaking about dreams of expansion and committed himself to compressing bad assets and narrowing to a single point. Closing the founding trade carries the pain of a company that had lived by cotton spinning. In his remark about settling accounts with a business that could not stand in the future, one senses a readiness to bear that pain.
What made the shift possible was that the company had held, from early on, a technology entirely separate from textiles: the glass fibre industrialised in 1938. Because there was a business inside the company that could be grown and installed as the mainstay — not merely a refuge — the cotton withdrawal became a change of pillars rather than simple contraction. How far a lightened company, narrowed to glass fibre, can fight on that single point is the question this shift left behind. Whether the concentration gained by letting go of the founding trade leads to the next phase of growth is something the subsequent development of the glass-fibre business has had to answer.
Each heading links to the full Japanese analysis — background, decision and outcome, with sources.
This is a condensed English edition. The full, source-by-source history — with the detailed narrative, financial tables, shareholders and executives — is maintained in Japanese: 日本語版（詳細）— Nitto Boseki full history in Japanese →
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