Goldman Sachs MetaX (688802): New Platforms and Clients to Drive Growth; 1Q26 Revenue Guidance +25% to +87% YoY - Buy
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Goldman Sachs maintains a Buy rating on MetaX (688802.SS) with a 12-month target price of 804 yuan, slightly lowered from 811 yuan, based on a discounted 2030E EV/EBITDA valuation method with an unchanged target multiple of 62x. The company released its 1Q26 revenue guidance of 400 to 600 million yuan, representing 25% to 87% year-over-year growth. However, this falls below Goldman Sachs' prior estimate of 753 million yuan due to seasonal weakness and a heavier concentration of new client contributions expected in 2H26. The 1Q26 net loss guidance narrowed significantly to between 18 million and 90 million yuan, a substantial improvement from the 233 million yuan net loss recorded in 1Q25. Goldman Sachs remains positive on MetaX's positioning as a leading domestic GPU provider, leveraging its proprietary architecture, IP, and comprehensive full-stack solutions. The company has commenced mass production of its C500 and C500 GPU products and is actively collaborating with multiple clients on its C600 platform, which is expected to gradually ramp up through 2026. Earnings estimates for 2026-2030 were revised down by 1% to 17% to reflect an extended timeline for new GPU volume production, though gross margins and operating expense ratios remain broadly unchanged. Key downside risks include slower-than-expected Chinese cloud capex growth, intensifying AI chip competition, and potential constraints within the advanced process supply chain. The target price implies 50.6% upside from the current trading price of 533.72 yuan.