Quanta: AI Servers Ramping Up

Quanta reported 1Q26 gross margins of 4.8%, missing expectations despite massive revenue growth from AI server shipments. Goldman Sachs maintains a Neutral rating with an unchanged NT$299 price target, citing margin pressure from component costs and server mix.

Key Takeaways

• 1.AI server revenue is ramping up significantly, with April 2026 revenue 121% higher year-over-year, driven by rack-level server shipments.
• 2.1Q26 Gross Margins fell to 4.8%, missing estimates due to a higher mix of lower-margin AI servers and rising memory costs.
• 3.Goldman Sachs maintains a Neutral rating, preferring competitor Hon Hai due to superior scale and capability in meeting complex AI data center requirements.

Table of Contents

• 2Q26 outlook
• 1Q26 GM down to 4.8%
• Earnings revision
• GS vs. BBG
• Valuation
• Price Target Risks and Methodology - Quanta
• Disclosure Appendix

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