Third-Quarter Revenue Far Beat Expectations
AI server maker Wiwynn (6669) recently fell below the 1900 mark, but a domestic investment advisor maintains a positive view. The advisor noted that, benefiting from improved customer order visibility, September revenue reached 172.6 billion yuan, up 19.6% MoM and 100% YoY; third-quarter revenue reached 434.6 billion yuan, up 56.2% QoQ and 63% YoY, representing 135% of the advisor's estimate and 128% of market consensus, mainly driven by strong shipments of Meta general-purpose servers and AWS T3 air-cooled racks. The third-quarter gross margin estimate was raised from 8.1% to 8.9%, with single-quarter EPS of about 45.56, mainly due to a higher general-server mix and improved product mix.
Fourth-Quarter Momentum to Continue
Looking to the fourth quarter, liquid-cooled racks will only ramp gradually from year-end to the first half of 2027, but shipment momentum for T3 air-cooled racks and general-purpose servers remains strong, with revenue estimated at 466.6 billion yuan, up 7.4% QoQ and 59.5% YoY. The gross margin estimate was raised from 7.3% to 8.2%, with EPS of about 45.18. The advisor believes that in the second half of 2026, driven by both ASIC air-cooled racks and general-purpose servers, operations will be significantly stronger than in the first half.
Liquid-Cooling Penetration to Take Over
According to supply-chain checks, AWS T3 liquid-cooled racks saw shipment plans for this year revised down due to initial production-line tuning issues, but 2027 shipments are still expected to rise quarter by quarter, with chip-side liquid-cooling penetration rising to 50% to 70%. Liquid-cooled racks are priced at more than 3 to 4 times air-cooled racks and are expected to become the main revenue growth driver next year. Wiwynn continues to participate in the design of AWS next-generation T4 racks, with a chance to adopt a fully liquid-cooled architecture, expected to ship in 2028.
Revenue Revised Up With Target Price of 3010
The Meta MI450 rack project is concentrated for delivery in 2027, with a single-rack price of about US$4.5 million to US$5 million and an order size of about 5,000 to 7,000 racks; an additional Oracle VR200 order of about 2,500 racks is expected to start contributing to revenue in 2027. The advisor revised up 2026 and 2027 revenue estimates from 1.27 trillion yuan and 2.38 trillion yuan to 1.46 trillion yuan and 3.07 trillion yuan; the 2027 gross margin was lowered from 7.1% to 6.5%. Considering share capital expansion after stock dividends, diluted EPS was raised to 143.16 and 241.16. The current P/E of about 8 to 9 times is at the low end of valuation, and with a 12.5-times P/E, the implied target price is 3010.