MiTAC Computing Technology (MCT), a subsidiary of MiTAC Holdings, has been actively expanding production capacity to meet the demands of US-based data center clients. After leasing new facilities last month, the company's first new plant will commenc...
MiTAC Computing Technology (MCT), a subsidiary of MiTAC Holdings, has been actively expanding production capacity to meet the demands of US-based data center clients. After leasing new facilities last month, the company's first new plant will commence operations this month, with a second plant soon to follow.
In contrast to the weak consumer electronics market, the server supply chain is anticipating even stronger momentum in the second half of 2024. The fervent demand for AI servers has also positively impacted the non-AI server segment.
In addition to MCT, Wiwynn is also ramping up its non-AI server production: despite initially having low expectations for this segment due to stagnating demand for general-purpose servers, the company's results for the first half of 2024 show that orders for non-AI servers have far exceeded projections.
As a server OEM and brand vendor, MCT contributes more than 80% to the overall revenue of MiTAC Holdings; the other main subsidiary is MiTAC Digital Technology (MDT), which specializes in automotive, IoT, and industrial PC (IPC) applications.
The corporate group has seen its 2024 revenues soar to new heights, driven largely by orders reaching full capacity at MCT. For August 2024, MiTAC Holdings reported NT$5.076 billion (US$158 million) in revenue, marking the highest monthly revenue in the past seven years, while also growing 5.59% sequentially and 69.88% year over year. Total revenue across the first eight months of 2024 reached NT$32.646 billion (US$1.014 billion), a year-over-year increase of 37.64%.
MCT already operated a server plant in Silicon Valley which focused primarily on final assembly, but with capacity fully booked due to high demand from a US server customer, the company has leased new facilities near its current site, with first phase production set to begin this September.
Although MCT has declined to provide further details, supply chain sources say that Oracle is the US-based client placing additional orders. MCT reportedly has a long-standing partnership with Oracle, with relevant shipment volumes steadily increasing recently.
Growth momentum from rumored partners
According to Oracle's recently released financial report, its cloud computing division reported a better-than-expected 21% year-over-year growth in revenue, and is rapidly closing in on leading competitors such as Amazon Web Services (AWS), Microsoft Azure, and Google Cloud Platform (GCP).
Some investment analysts predict that Oracle will soon join the ranks of the above three cloud service providers, with cloud computing operations expanding tenfold by 2032. Oracle currently has 162 data centers worldwide either in operation or under construction, with capex in the first quarter of fiscal year 2025 increasing year over year by 75.6% to US$1.5 billion.
In addition to non-AI servers, MCT also saw AI server shipments account for double-digit percentages of total shipments, and order numbers are expected to grow in the upcoming months. Aside from Nvidia-equipped machines, MCT also has orders for AMD's Ryzen AI 300 processors.
After AMD's recent acquisition of ZT Systems and the sale of its manufacturing division, many have been speculating that MCT might be a potential buyer, given MCT's long-standing relationship with AMD. In response to these rumors, MCT merely stated that it will continue to evaluate its options.
Beyond the North American market, MCT is also seeing strong momentum from its server clients in China, echoing observations from Inventec. Both MCT and Inventec have manufacturing facilities in China, which mostly serve local clients. Due to strong demand from clients in China and the US, Inventec is also optimistic about server-related revenue this year, with projections aiming for a year-over-year increase of 20%.