Citi Lifts MediaTek Target to NT$6,800 on AI ASIC Demand

MediaTek is accelerating its expansion from smartphone chips into the AI data-center market. Its AI ASICs can be tailored as dedicated accelerators for cloud providers, drawing attention to their potential margins and revenue scale. If the Meta order materializes, it would strengthen MediaTek’s position in the custom-chip market and reduce its dependence on smartphone industry cycles.

As of July 20, 2026, market reports again indicated that MediaTek had secured an order for Meta AI accelerator chips. Goldman Sachs reiterated its “Buy” rating and sharply raised its price target to NT$6,800. The firm estimates that MediaTek’s AI ASIC business could generate $20.3 billion in revenue in 2027, close to half of total revenue, and become a major driver of earnings growth.

MediaTek has long focused on smartphone chips but has expanded into custom AI chips, or ASICs, and projects for cloud service providers in recent years as it seeks a second growth engine. With smartphone demand and its 5G business under pressure, the company's ability to grow ASIC revenue and improve profitability has become critical to a valuation upgrade.

Macquarie Securities sharply raised its MediaTek price target to NT$10,000 from NT$5,850 on June 29, 2026. It forecasts ASIC revenue could reach $40 billion in 2028, up from its previous estimate of $18 billion, and raised its earnings-per-share forecast for that year by 71%. However, it cut its 2026 and 2027 forecasts by 16% and 11%, respectively.

MediaTek has long focused on smartphone chips but has moved aggressively into custom AI accelerator ASICs developed by cloud providers. The market expects the company to secure a major Google order, with its first project already in mass production and forecast to generate $2 billion in revenue in 2026, providing an important growth engine beyond its handset business.

Optimism over AI ASICs drove MediaTek shares higher for several consecutive sessions, with the stock at one point opening limit-up at NT$2,870 per share, a record high. The company also forecast that the related market could reach $80 billion in 2027. The Taiwan Stock Exchange subsequently placed the shares under trading restrictions after their rapid gains, and the stock fell nearly 4% at one point after the open.

MediaTek has traditionally relied on smartphone chips for most of its revenue, leaving growth and profitability vulnerable when market demand weakens. AI ASICs are custom chips designed for specific artificial-intelligence workloads. Goldman Sachs believes the business could become a major engine for MediaTek to diversify away from smartphone-market risks and expand its long-term earnings.

In its latest research report, Goldman Sachs said it expects strong growth in MediaTek’s AI ASIC business and forecast that the segment’s share of revenue will rise to 39% by 2027. Despite continued near-term pressure from the weak smartphone market, the bank sharply raised its MediaTek price target to NT$2,454, citing the AI business’s long-term earnings potential.

MediaTek is a major semiconductor heavyweight in Taiwan. In recent years, it has expanded beyond mobile chips into artificial intelligence application-specific integrated circuits, or ASICs. Growing optimism over the business has lifted MediaTek’s valuation and, given its index weighting, helped drive the Taiwan Stock Exchange Capitalization Weighted Stock Index higher.

On July 20, 2026, MediaTek shares gapped up to hit the daily limit, reaching a record NT$3,155 apiece. Gains in MediaTek and other heavyweight stocks pushed the benchmark index up 179 points to close at 40,885, setting another all-time high.