Mitsubishi Heavy Industries, Ltd.

Mitsubishi Heavy Industries announced on the 2nd that it will invest approximately 100 billion yen to expand the construction capacity of its Shimonoseki Shipyard. The company will acquire industrial land on Choshu Dejima, an artificial island being developed by the city of Shimonoseki in Yamaguchi Prefecture, and build a new factory there. The move is aimed at strengthening its shipbuilding business, which the government is seeking to promote, and at the Shimonoseki Shipyard, the company's subsidiary Mitsubishi Shipbuilding builds ferries and car carriers. In addition to transferring some of the shipyard's functions to the newly acquired land, the company will build a factory to manufacture hull blocks, the components that make up a ship, with operations targeted to begin in 2030.

The Nikkei Average rebounded slightly, closing at 63,957.53 yen, up 0.32% from the previous trading day. Amid a flurry of corporate earnings announcements, buying of stocks with strong results supported the market, while caution over the yen's appreciation capped gains, leaving the index lacking clear direction. Toyota Motor fell over 1% as its full-year net profit forecast missed market expectations, while Mitsubishi Heavy Industries and Yamaha Motor surged following their earnings reports. Trading value on the Tokyo Stock Exchange Prime Market was 10.283736 trillion yen.

Mitsubishi Heavy Industries has raised its order forecast for the fiscal year ending March 2027 to 7 trillion yen, up from the previous 6.8 trillion yen. The company kept its consolidated earnings outlook unchanged, planning a net profit of 380 billion yen, which fell short of the average analyst estimate of 418.8 billion yen. At the same time, it reported a net profit of 134.6 billion yen for the April-to-June quarter of 2026, a 97.4 percent increase from the same period a year earlier, driven by demand for gas turbines amid the spread of generative AI, growth in nuclear power, and a weaker yen.

Space startup ispace announced on the 29th that it will use Japan's mainstay H3 rocket for the launch of its lunar lander scheduled for 2028. It has signed a launch transport service contract with Mitsubishi Heavy Industries.

OKI has signed a supply contract with Mitsubishi Heavy Industries for towed passive sonar and related equipment to be installed on Australia’s new general-purpose frigates. The contract covers equipment for the first three vessels in a planned fleet of eleven new general-purpose frigates. This marks OKI’s first overseas transfer of defense equipment, following the Australian Government’s selection of Japan’s improved Mogami-class frigate design in August 2025. OKI will leverage over 90 years of underwater acoustic technology development and its experience supplying sonar systems to the Japan Maritime Self-Defense Force.

The global pressure vessels market is projected to grow from USD 57.55 billion in 2026 to USD 73.24 billion by 2031, a compound annual growth rate of 4.9 percent. Storage vessels are expected to hold the second-largest market share by type in 2026, driven by demand from oil and gas, chemical manufacturing, and power generation. Within the processing vessels segment, reactors are forecast to be the fastest-growing subcategory through 2031, supported by increased investment in controlled chemical and industrial processes. North America is positioned as the second-fastest-growing regional market, with growth fueled by clean energy projects, infrastructure modernization, and tighter safety regulations. Major companies in the market include Babcock & Wilcox Enterprises, GE Vernova, Larsen & Toubro, Mitsubishi Heavy Industries, and IHI Corporation.

Entergy and Mitsubishi Heavy Industries Group have signed a memorandum of understanding aiming to develop a near-term roadmap for a 50% reduction in overall costs for carbon capture and storage solutions. The collaboration will leverage MHI Group's integrated gas turbine combined cycle and carbon capture technology, including M501JAC gas turbines from Mitsubishi Power Americas and carbon capture technology from Mitsubishi Heavy Industries America, to support decarbonization at Entergy's power generation sites. Entergy's operations are located near the largest existing carbon dioxide pipeline network in the United States and in a region with suitable subsurface geology for permanent CO2 storage. The partnership builds on a long collaboration between Entergy and Mitsubishi Power Americas and positions the companies as early leaders in the commercialization of integrated gas turbine and CCS technology.

Nvidia and Mitsubishi Heavy Industries are considering a collaboration in which the Japanese industrial conglomerate would supply cooling systems and energy management equipment for AI data centers, Nikkei reported. Nvidia calls its next-generation AI data centers AI factories and intends to set them up with partner companies globally. Mitsubishi Heavy manufactures air conditioning, high-efficiency cooling, and emergency power supply equipment for data centers, and offers energy management systems that combine these technologies. The collaboration could help improve the efficiency of Nvidia's data centers by addressing the rapid increase in power consumption and heat generation from high-performance GPUs. Neither company immediately responded to a request for comment.

Japanese stocks may maintain their upward trend in the second half of 2026. With the Takamichi administration's Basic Policy as a backdrop, there are views that the market's focus will broaden beyond the technology stocks that drove record highs in the first half of the year to include a wide range of sectors such as defense and infrastructure. The draft presented at the end of June outlined support not only for AI but also for broad areas like disaster prevention and national resilience, with coordination underway with the ruling parties aiming for a cabinet decision in mid-July. Dilin Wu, research strategist at Pepperstone Group, pointed to the Basic Policy as the most underappreciated catalyst for the second half of the year, citing its direct spillover effects on the stock market. The defense sector has lagged behind AI-related areas so far this year, with the Mirae Asset Japan Defense Tech Index up only 15 percent year-to-date and Mitsubishi Heavy Industries shares down 0.5 percent, but Takuro Hayashi of Iwai Cosmo Securities sees room for a reassessment. That said, AI-related themes remain a key pillar supporting Japanese stocks, with the government projecting public-private investment of 10.5 trillion yen in physical AI and 68 trillion yen in semiconductors among its 17 strategic fields.

The UK government announced on the 3rd that it has signed a £4.6 billion contract with Edgewing, the joint venture responsible for design and development, to manufacture the next-generation fighter jet being co-developed with Japan and Italy. This moves the Global Combat Air Programme into the next phase of development, and Minister for Defence Procurement Pollard described signing the contract alongside Italy and Japan as a major step forward towards delivery. On the 30th of last month, the UK decided to contribute £8.6 billion over four years as its share of GCAP funding. Under GCAP, the UK's BAE Systems, Italy's Leonardo, and Mitsubishi Heavy Industries are developing a sixth-generation stealth fighter with the aim of operational deployment by 2035, and Edgewing is jointly funded by BAE, Leonardo, and the Japan Aircraft Industrial Enhancement Organization.