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Morgan Stanley Bullish on MediaTek, Alchip, and Faraday Amid Google TPU Expansion
Electronic Technology · Semiconductors · economic_daily · 2026-08-25
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Morgan Stanley upgrades targets for MediaTek, Faraday, and Alchip, citing increased demand for design services driven by the complexity of Google's TPU v10.
What Happened
Industry Outlook: Morgan Stanley's latest Asia-Pacific technology report highlights that the increasing complexity of Google's TPU v10 chip will create significant opportunities for design service providers. MediaTek remains the primary coordinator, while the project's structure allows partners to handle specific design blocks, boosting the overall ecosystem.
Analyst Ratings: The firm maintains an 'Overweight' rating on MediaTek, Faraday, and Alchip-KY, while raising price targets for the latter two to NT$6,288 and NT$5,888 respectively. Analysts believe these companies are well-positioned to capitalize on the surging demand for custom AI silicon.
Faraday's Strategy: Faraday is expected to benefit from improved access to TSMC's 3nm capacity by 2027 and potential wins in projects for Meta and Microsoft. The company's recent decision to issue convertible bonds is seen as a strategic move to scale its operations and support long-term growth.
Alchip's Growth: Alchip-KY is projected to see strong revenue contributions from the Trainium 4 project, estimated at $8 billion. Analysts forecast a 60% year-over-year growth in earnings per share by 2028, underscoring the company's robust position in the high-performance computing market.
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