AI server liquid-cooling ramp drives Auras growth; Goldman Sachs maintains Buy and raises target price to NT$1,353
AI summary card
AI server liquid-cooling ramp drives Auras growth; Goldman Sachs maintains Buy and raises target price to NT$1,353
Goldman Sachs expects AI server liquid-cooling component shipments, higher content per unit, and capacity expansion to accelerate Auras's growth in 2H26, despite new-product trial production weighing on gross margin in 2Q.
- July 2026 revenue rose 117% YoY and 39% MoM, mainly driven by AI server liquid-cooling and air-cooling components.
- Revenue is expected to increase 19% QoQ and 6% QoQ in 3Q26 and 4Q26, respectively, benefiting from demand for next-generation GPU and ASIC AI servers.
- The QoQ decline in 2Q gross margin mainly reflected trial production of next-generation liquid-cooling components; gross margin is expected to recover in 2H26 as the liquid-cooling product mix improves.
- Goldman Sachs raised its 2026-2028 revenue forecasts by 5%, 7%, and 11%, respectively, while revising net profit forecasts by -3%, +1%, and +7%.
- The 12-month target price was raised from NT$1,283 to NT$1,353, based on 19.4x 2027E EPS.
Report interpretation
Overview
Auras's growth thesis centers on AI server thermal-management upgrades. Goldman Sachs believes that higher computing density, rising penetration of liquid-cooled AI servers, greater content per server for liquid-cooling components, and the company's capacity expansion will support continued revenue growth in 2H26.
Core views
Goldman Sachs maintains its Buy rating. In the near term, trial production of new liquid-cooling components weighed on 2Q gross margin, while higher-than-expected taxes caused net profit to miss expectations. However, as new GPU and ASIC AI servers ramp, a higher mix of liquid-cooling products should gradually improve gross margin and operating margin.
Analysis framework
The report revises earnings forecasts using monthly revenue, quarterly results, AI server liquid-cooling component shipments, and product-mix changes, and derives the target price using a recent P/E valuation approach.
Methodology notes
2027E EPS multiplied by the target P/E multiple
The 12-month target price is NT$1,353, implying 19.4x 2027E EPS; the target valuation references the relationship between technology hardware peers' P/E multiples and forward net profit growth.
Liquid-cooling penetration, content per unit, and capacity utilization
Revenue forecasts are mainly raised based on growth in AI server liquid-cooling component shipments, higher liquid-cooling solution penetration, and increased component value, while incorporating the short-term gross-margin impact of trial production.
Asset mapping & comparison
Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).
- Auras (3324.TWO)Direct beneficiary of AI server liquid-cooling upgrades
- Strengths
- Has exposure to AI server liquid-cooling and air-cooling components, benefiting from higher liquid-cooling penetration, increased component value, and capacity expansion.
- Weaknesses
- New-product trial production may pressure near-term gross margin, and tax-rate volatility may also affect net profit delivery.
- Comparison
- The target P/E is determined based on the relationship between technology hardware peers' trading P/E multiples and forward net profit growth; 19.4x is near the company's historical average trading P/E.
- Risks
- Lower-than-expected liquid-cooling penetration, weak AI server demand, a weaker-than-expected PC market, and competition from incumbent and new suppliers.
Key data
- July 2026 Revenue Growth+117% YoY, +39% MoMDriven by demand for AI server liquid-cooling and air-cooling components.
- 3Q26 Revenue Forecast+19% QoQMainly driven by next-generation GPU and ASIC AI servers.
- 4Q26 Revenue Forecast+6% QoQContinued growth in demand for AI infrastructure and liquid-cooling components.
- 2026-2028 Revenue Forecast Revision+5% / +7% / +11%Mainly from higher liquid-cooling component shipments and content per unit.
- 2026-2028 Net Profit Forecast Revision-3% / +1% / +7%2026 is affected by trial-production gross-margin pressure and a higher tax rate, while subsequent periods are supported by scale and product-mix improvement.
- Target PriceNT$1,353Raised from NT$1,283; based on 19.4x 2027E P/E.
- 2027-2028 EPS YoY Growth23%An important input for deriving the target P/E multiple through peer valuation correlations.
Impact & implications
If AI server deployment continues to accelerate, rising liquid-cooling penetration and content per server will be key catalysts for Auras's revenue and margin expansion. In the near term, gross-margin volatility during trial production warrants attention; in the medium term, the higher valuation depends on successful mass production of new products, demand realization, and sustained improvement in earnings growth.
Risks
- Liquid-cooling solution penetration is below expectations.
- AI server demand is below expectations.
- Weak PC market demand.
- Intensifying competition from incumbent suppliers and new entrants.
- New liquid-cooling product trial-production or mass-production progress falls short of expectations, delaying gross-margin improvement.
What to watch
- Whether monthly revenue sustains high growth driven by AI server liquid-cooling components.
- Whether 3Q26 and 4Q26 QoQ revenue growth meets expectations of 19% and 6%, respectively.
- Mass-production and customer-adoption progress for liquid-cooling components used in next-generation GPU and ASIC AI servers.
- Whether an improved liquid-cooling product mix can drive gross-margin recovery in 2H26.
- Whether capacity expansion can effectively capture AI infrastructure demand.
- Changes in AI server demand, liquid-cooling penetration, and the competitive landscape.