TDK - Company History

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Financial history 1956–2026 — revenue, cost structure, balance sheet, cash flow and key ratios, year by year →

Founded 1935
Founder Saito Kenzo
Founding location 東京都
Core business at founding Manufacture of ferrite cores
Listed 1961
President & CEO Saito Noboru President & CEO since 2022 (age 60, as of 2026)
Current priority Capital efficiency · M&A Selecting businesses by ROIC and finding the next area of growth
Founding
On 7 December 1935 Saito Kenzo established Tokyo Denki Kagaku Kogyo in Shiba-ku, Tokyo with capital of ¥20,000. Ferrite, the world's first oxide magnetic material, had been invented in 1930 by Kato Yogoro and Takei Takeshi of Tokyo Institute of Technology, but neither its uses nor its market were settled, and five years after the invention no company had come forward to industrialise it. Saito took over from the two men the right to work the ferrite patents and set about industrialising it, and he took the company name from the English initials of the university's department of electro-chemistry. The ¥100,000 the equipment required was more than the capital could cover, so Tsuda Shingo, president of Kanegafuchi Spinning, put up ¥100,000 of his own money; capital was raised to ¥120,000 in October 1936, and in July 1937 the Kamata plant became the first in the world to reach volume production of the ferrite core. The core was adopted for Matsushita Electric radios in 1940, the company listed on the Tokyo Stock Exchange in September 1961, and in March 1983 it changed its name to TDK.
The Decision
The proceeds of the business it sold became the purchase price of the business that replaced it. Production of magnetic recording tape began in October 1952, and in June 1966 the company entered Philips-standard cassette tape and so held a finished product under its own brand. Developing its own materials — the new magnetic material Avilyn among them — lifted the brand, and in 1982 it took first place in the world with a 31.5 per cent share of magnetic tape; that June it used its New York listing to move its position to that of a global electronic-components maker. In 1997 it sold Silicon Systems, a profitable subsidiary, for $522.2M (¥63bn) and concentrated the money on magnetic heads, and with those profits it acquired ATL, a lithium-polymer battery maker in Hong Kong, for about $79M (¥9bn) in May 2005. That a small acquisition generated the funds for the next large one is what turned withdrawal from a loss into the capital for the next mainstay.
Today
More than half of revenue comes from batteries, and those batteries are made in China. Of revenue of $15.8B (¥2.5tn) in the year to March 2026, energy application products accounted for $8.7B (¥1.37tn), or 54.7 per cent, and $1.6B (¥247bn) of the $1.7B (¥272bn) of operating profit came from that segment alone. By region China accounted for $8.7B (¥1.38tn), 55.0 per cent of the total, while Japan came to only $1.2B (¥184bn). Passive components, at $3.8B (¥599bn), is the area the company filled out by buying EPCOS of Germany for about $1.6B (¥170bn) in 2008, which added high-frequency components, sensors and a European sales network. Magnetic application products at $1.7B (¥263bn) and sensor application products at $1.4B (¥225bn) follow. The shape of 1982, when magnetic tape made up half of sales, has come back with the product changed to the battery.
Competition
In passive components the company is the one chasing; in batteries it is the one being chased. In high-frequency components and sensors for mobile phones it fell behind Murata Manufacturing and others, and its European sales network was thin as well, so in 2008 it bought EPCOS to fill the weak area from outside. ATL, acquired for $79M (¥9bn) in 2005, has meanwhile grown into one of the largest makers of batteries for smartphones, with a world share in the fifties. That same Murata acquired Sony's battery business in 2017 and came into the same battery market. Murata, Kyocera and the other electronic-component makers that stand alongside TDK all assemble by acquisition the areas they lack. Filling the weak areas from outside while the strong area was grown by the company it had bought is what let the position of the chaser and the position of the chased sit inside one firm.

Timeline

1935–1997From industrialising ferrite to the top of the world tape market

  1. 1930Kato Yogoro and Takei Takeshi invent ferrite, the world's first oxide magnetic material
  2. 1935Tokyo Denki Kagaku Kogyo founded with capital of ¥20,000 to industrialise ferrite
  3. 1937First in the world to commercialise the ferrite core; Kamata plant built
  4. 1946GHQ issues the superheterodyne order, making ferrite cores essential to radios
  5. 1951Ceramic-capacitor production begins
  6. 1952Shimizu plant built; magnetic-tape production begins
  7. 1957Tape approved for broadcast use by NHK
  8. 1961Divisional structure adopted; shares listed on the Tokyo Stock Exchange
  9. 1966Patent agreement with Philips; Japan's first domestic cassette tape produced
  10. 1968The SD Cassette, the world's first music cassette tape, announced
  11. 1977Emergency order for 50,000 VHS video tapes taken and delivered by summer
  12. 1979Operating margin of 20.1 per cent recorded
  13. 1982World share of 31.5 per cent in magnetic tape; listed on the New York Stock Exchange
  14. 1983Company renamed TDK Corporation; listed in London
  15. 1985Japan's first fully unsecured straight corporate bond issued
  16. 1986SAE Magnetics acquired; entry into hard-disk head manufacture
  17. 1997Profitable subsidiary Silicon Systems sold; proceeds concentrated on magnetoresistive heads

1998–2014Through the digital slump, with a battery business installed as the new pillar

  1. 2002First operating loss since listing; 853 jobs cut and restructuring costs booked
  2. 2003Zero emissions achieved at all domestic sites; return to profit
  3. 2005Lithium-polymer battery maker ATL of Hong Kong acquired
  4. 2005Lambda Power, the power-supply business of Invensys, acquired
  5. 2007TDK-brand recording-media sales business transferred to Imation
  6. 2007Magnecomp Precision Technology of Thailand acquired
  7. 2008Densei-Lambda made a wholly owned subsidiary
  8. 2008German components maker EPCOS acquired, the largest deal in company history
  9. 2009TDK-EPC Corporation created by company split
  10. 2013Head office moved to Shibaura, Minato-ku; magnetic-tape production ended
  11. 2014Subsidiary Mediatech liquidated, closing the magnetic-tape business

2015–2026A ¥2 trillion group built on batteries, and the search for the next axis

  1. 2016Swiss magnetic-sensor maker Micronas acquired, becoming TDK-Micronas
  2. 2017High-frequency components transferred to RF360 Holdings, the Qualcomm joint venture
  3. 2017InvenSense of the United States acquired for about ¥142.7bn, creating a sensor segment
  4. 2018Head office moved to Nihonbashi, Chuo-ku, Tokyo
  5. 2019Stake in RF360 Holdings sold
  6. 2020TDK-EPC merged into TDK; four-segment structure settled
  7. 2023Consolidated revenue passes ¥2 trillion for the first time
  8. 2025Ninetieth anniversary; consolidated revenue of ¥2,204.8bn

Founding Story

1935–1997From industrialising ferrite to the top of the world tape market

TDK spent its first sixty years turning a single laboratory material into three successive businesses — the ferrite core, the ceramic capacitor and magnetic tape — and rode the last of them to the number-one share in the world. The habit that mattered more than the tape, though, was formed at the end of this stretch: the company began spending the money the tape earned on the business meant to replace it.

Industrialising ferrite, and fast growth as a post-war radio-components maker

In 1930 Kato Yogoro (加藤与五郎) and Takei Takeshi (武井武) of Tokyo Institute of Technology invented ferrite, the world's first oxide magnetic material[1]. Saito Kenzo (齋藤憲三), who shared Kato's conviction that only industry with genuine originality deserves the name, founded Tokyo Denki Kagaku Kogyo in Shiba-ku, Tokyo on 7 December 1935 with capital of ¥20,000[2]. The road to volume production opened when Tsuda Shingo (津田信吾), president of Kanegafuchi Spinning, put up ¥100,000 of his own money; the company built the Kamata plant in 1937 and there became the first in the world to commercialise the ferrite core[3], selling it under the trade name Oxide Core[4]. The Hirasawa plant followed in 1940[5], and by the end of the war the company had shipped roughly five million ferrite cores in all, for military and civilian use. Yamazaki Teiichi (山崎貞一), its second president, later recalled that this great invention simply would not sell, and that in 1940 it was adopted for the first time by Matsushita Electric[6].

After the war the superheterodyne order issued by the General Headquarters of the Allied Powers made the ferrite core an indispensable part at the core of intermediate-frequency transformers[7], and the company grew as a maker of radio components. Keizai Jidai reported that after the war, superheterodyne receivers in particular developed, and the wave of what is called the wireless age came rolling in, and described the Hirasawa works as a plant producing ferrite, the magnetic material regarded as the mainstay of the electronics industry[8]. The company opened the Meguro research laboratory in 1951 to put basic research on a proper footing[9], commercialised a barium-titanate capacitor under the name Alcon[10], began production of Synchro Tape magnetic recording tape at the Shimizu plant in Tokyo in October 1952[11][12], and in March the following year concentrated all of its ceramic-capacitor production equipment at the Kotoura plant in Akita Prefecture[13]. Out of the single material technology of ferrite it opened two fields in parallel — ceramic capacitors and magnetic tape — and a management style that placed materials technology at the origin of every business became the company's backbone.

In June 1961 the company adopted a divisional structure[14], and in September of the same year it listed on the Tokyo Stock Exchange[15]. In 1965 it established TDK Electronics Corporation in New York as a local subsidiary[16], laying the foundation for its overseas business, and in 1967 it set down a corporate motto in writing: contribute to culture and industry through creativity. When the Yomiuri Shimbun wrote in 1965 that the integrated circuit had brought a technological revolution to the history of the computer[17], the rise of semiconductors looked capable of shaking the company's business base. Yamazaki Teiichi was categorical: the appearance of the IC will have almost no effect on this company[18], setting out a policy of keeping the centre of gravity in the storage field with memory ferrite for storage devices and with magnetic tape. In December 1969 the Chikumagawa plant was completed in Saku, Nagano Prefecture, putting magnetic-tape production onto a full scale[19], and in June 1970 magnet production started at the Shizuoka plant in Sagara, Shizuoka Prefecture[20].

The video-tape ramp-up, and a headlong run to the world's number-one share

In 1966 the company produced Japan's first domestically made cassette tape[21], and in 1968 it announced the SD Cassette, the world's first cassette tape made for music[22]. In September 1977 Shukan Toyo Keizai reported that magnetic tape is propping up profit, noting that tape had grown into the pillar supporting earnings through the oil-shock recession[23]. The company had reached the top of the world in audio cassette tape at ten million units a month when, in April 1977, an urgent request for fifty thousand video tapes arrived from Inai Takayoshi (稲井隆義), president of Matsushita Kotobuki Electronics Industries. Its capacity was under three thousand units a month, yet executive vice-president Otoshi Yutaka (大歳寛) took the order on the spot — I will take the responsibility[24] — and put the plant on a round-the-clock footing with days off cancelled, delivering the full quantity by the summer. President Sono Fukujiro (素野福次郎) described the company's habit of investing ahead of the cycle in a downturn as doing the thing everyone else was against, wasn't it[25].

By the end of 1977 output had reached a hundred thousand units a month, then five hundred thousand the next year and a million the year after, holding a pace close to doubling for four consecutive years. In October 1982 the Mikumagawa plant was completed in Hita, Oita Prefecture to start volume production of magnetic tape[26], which together with the Akita plant gave the company a full mass-production system. In the same year it took a world share of just over 30 per cent in magnetic tape and moved into first place[27], and tape's share of turnover rose from about 20 per cent in 1970 to about 50 per cent in 1982. The operating margin passed 20 per cent in 1979, a record high, and in June 1982 the company listed its shares on the New York Stock Exchange[28], so that an international base for raising capital fell into place at much the same time. Superiority in the world tape market and a thick financial base reinforced one another, and this was the period that settled the company's standing as an international electronic-components maker.

In March 1983 the company changed its name to TDK Corporation[29], and in May of the same year it listed in London as well[30]. In May 1983, with the company at the top of the world in magnetic tape, Nikkei Business asked whether TDK has a high-margin product ready to follow tape, and chairman Sono Fukujiro answered: we have harvested every seed we sowed. The seeds we sow from here may grow, but none of them look likely to become a thick trunk[31]. In January 1985 it issued Japan's first fully unsecured straight corporate bond[32], and the depth of its balance sheet stood out even among domestic manufacturers. In November 1982 the Kofu Minami plant had been completed in Kosai, Yamanashi Prefecture to begin production of magnetic heads[33] — the first move in a swap of pillars that would direct the cash flow earned by magnetic tape into capital spending on the next generation of magnetic-application products.

A maturing recording-media market, and the first shift of weight to magnetic heads

From the middle of the 1980s the rise of the compact disc and the magneto-optical disc slowed demand for audio cassettes, and the limits of growth in the magnetic-tape business began to show. In August 1986 the company bought SAE Magnetics (H.K.), a magnetic-head manufacturer in Hong Kong, entering the business of magnetic heads for hard disk drives in earnest[34], and moving ahead of the maturing recording-media market. It was an application of technology at the level of the material itself — turning what the company knew about magnetic materials into thin-film formation for hard-disk heads — and the template for the swapping of businesses that would eventually run all the way to the entry into batteries took shape here. The method of directing the money earned by magnetic tape into magnetic heads was itself the concrete form of a philosophy of seeding the next pillar while the current one is still growing.

In the recession of the early Heisei years, the year to March 1993 brought both lower revenue and lower profit: turnover fell about 10 per cent against the previous year and ordinary profit by more than 40 per cent. The fifth president, Sato Hiroshi (佐藤博), set out a policy of concentrating on priority fields and selected four strategic businesses: magnetoresistive heads, optical discs, high-frequency components and semiconductor-application products. In May 1990 a basic materials research laboratory was built in Narita, Chiba Prefecture[35], and in September of the same year the Ichikawa Technical Center was launched[36], strengthening the research and development base. From around this time the company settled on a policy of using materials technology as the keyword for seeding next-generation businesses and pruning existing ones at the same time. In the harsh conditions that followed the collapse of the bubble economy, this was also the turning point at which a distinctive style of management — searching for the next area of growth by following a chain of technologies — began to acquire an outline.

In 1997 the company sold Silicon Systems, a profitable subsidiary, for $522.2M (¥63bn), and concentrated the proceeds on investment in magnetoresistive heads. The decision produced three consecutive years of double-digit growth, and the recording-devices division grew until it accounted for close to 30 per cent of consolidated turnover. In March 2000 the company also acquired Headway Technologies, a magnetic-head manufacturer in the United States, extending the technology base of the hard-disk head business to the American side as well[37]. A shift in the business portfolio took shape — away from dependence on tape alone, and towards magnetic-application products as the main line. The bold allocation of capital that sent the proceeds of a profitable subsidiary into a next-generation business became the basic pattern of the company's M&A strategy thereafter.

Read the full history in Japanese →

Notes

  1. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩
  2. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩
  3. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩
  4. 企業の歴史 : 明治百年 (Corporate Histories: A Century of Meiji, Keizai Shunju-sha, 1968)↩
  5. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩
  6. Keizai Orai (経済往来), May 1963↩
  7. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩
  8. Keizai Jidai (経済時代), November 1959↩
  9. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩
  10. 企業の歴史 : 明治百年 (Corporate Histories: A Century of Meiji, Keizai Shunju-sha, 1968)↩
  11. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩
  12. 企業の歴史 : 明治百年 (Corporate Histories: A Century of Meiji, Keizai Shunju-sha, 1968)↩
  13. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩
  14. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩
  15. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩
  16. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩
  17. Yomiuri Shimbun (読売新聞), 7 September 1965↩
  18. Securities Analysts Journal (証券アナリストジャーナル), October 1966↩
  19. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩
  20. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩
  21. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩
  22. Shukan Toyo Keizai (週刊東洋経済), 10 September 1977, on the company's resistance to recession↩
  23. Shukan Toyo Keizai (週刊東洋経済), 10 September 1977↩
  24. Nagata Kiyotoshi, TDK: The Secret of Being Number One in the World (TDK世界一の秘密), Toto Shobo↩
  25. Nikkei Business (日経ビジネス), 6 June 1977↩
  26. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩
  27. Nagata Kiyotoshi, TDK: The Secret of Being Number One in the World (TDK世界一の秘密), Toto Shobo↩
  28. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩
  29. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩
  30. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩
  31. Nikkei Business (日経ビジネス), 16 May 1983↩
  32. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩
  33. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩
  34. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩
  35. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩
  36. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩
  37. TDK, securities report for the 129th term (FYE March 2025), corporate history section↩

References & sources

  1. TDK Corporation (annual securities reports), including the corporate-history section and the consolidated segment disclosures for the years to March 2023 and March 2025.
  2. Nikkei Business (Nikkei-McGraw-Hill / Nikkei BP): 6 Jun 1977; 16 May 1983 (on the model student who noticed how unstable its own footing was); 23 Jun 2003 (the Sawabe Hajime interview).
  3. Shukan Toyo Keizai (Toyo Keizai Inc.), 10 Sep 1977:, an examination of the company's resistance to recession.
  4. Keizai Jidai, Nov 1959:, on the company at the leading edge of the electronics industry. Keizai Orai, May 1963, the Yamazaki Teiichi recollections.
  5. Securities Analysts Journal, Oct 1966: Yamazaki Teiichi on the impact of the integrated circuit.
  6. Yomiuri Shimbun, 7 Sep 1965:, the “word of the moment” column on the integrated circuit.
  7. Corporate Histories: A Century of Meiji, Keizai Shunju-sha (1968), the Tokyo Denki Kagaku Kogyo entry.
  8. Nagata Kiyotoshi — TDK: The Secret of Being Number One in the World.

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