GUC (3443.TW): CPUs and automotive set to drive next two-year growth

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31 Jul 2026 09:56:21 ET │ 14 pages

GUC (3443.TW)

CPUs and automotive set to drive next two-year growth

CITI'S TAKE

GUC’s 2Q26 earnings of NT$1.56bn (down 6% QoQ, up 99% YoY) was inline

with our estimate but better than consensus. The company expects a

stronger 2H26 ahead, supported by better wafer allocation from TSMC,

continued AI demand, and increasing production ramps from existing cloud

ASIC programs. Following its major CPU projects, GUC is working on its next

growth phase including ASICs, automotive and CPO. Although quarterly

GM will continue to fluctuate with the mix between high-margin NRE and

lower-margin production revenue, management remains confident in

maintaining healthy full-year profitability. More importantly, the new

chairman outlined a long-term strategy of leveraging GUC’s close

partnership with TSMC and advanced packaging expertise to expand its

role across customers’ chip development flow rather than competing

directly with traditional full-service ASIC vendors.

CPU Becomes the Next Strategic Growth Engine Beyond AI Accelerators — GUC’s

management believes CPU will become another meaningful growth driver over the

next several years. They specifically noted improving CPU market dynamics and

highlighted increasing customer interest in Arm-based CPU designs. Although

current projects remain at an early stage, they confirmed active engagements with

major customers and see solid visibility on the company’s CPU business as an

important long-term trend. We expect its CPU revenue to double next year thanks

to better capacity allocation and rising demand from its key customers and forecast

the revenue contribution would be more than 30%/50% for 2026/2027.

n

Buy / High Risk

Price (31 Jul 26 13:30)

Target price

from NT$6,000.00

Expected share price

return

Expected dividend yield

Expected total return

Market Cap

Laura (Chia Yi) Chen AC

Earnings Summary

80.8%

0.5%

81.3%

NT$509,915M

US$15,737M

Price Performance

(RIC: 3443.TW, BB: 3443 TT)

Automotive Pipeline Expands with Both US and Chinese Clients — Management

provided a more constructive outlook for automotive than previous quarters. GUC

…