Qihong Predicts 100% Water Cooling Adoption for AI Chips by End of 2027

Qihong (3017-TW) announced at its investor conference on November 10, 2026, that water cooling adoption for all GPU and ASIC computing chips in projects will reach 100% by the end of 2027. The company stated that current market conditions show supply remains far below demand. This projection reflects the ongoing transformation in AI server thermal management as computing power requirements increase.

Water Cooling Adoption Expands to Additional Components

Beyond computing chips, water cooling adoption rates for CPUs, memory, optical transceiver modules, and power supplies will gradually increase, according to Qihong. The company noted that the progression will vary based on individual customer planning for cabinets and systems. Qihong stated that system complexity increases with each generation of trays, and the value of thermal management rises accordingly.

Qihong Maintains Supplier Position Amid Market Changes

The company indicated that supplier increases are a natural result of demand expansion. When demand was smaller, Qihong served as the sole supplier for many projects. As demand expanded and products transitioned from small to large volumes, customers naturally considered additional suppliers to distribute risk, representing a structural change that occurs during volume scaling. Qihong stated it maintains a leading position in the thermal management field and will continue developing and advancing ASIC projects with customers as the primary supplier. At the August 2026 investor conference, the company also stated it maintains core supplier status with key ASIC and GPU customers.

Delivery Priority Exceeds Price Considerations for Customers

Qihong stated that customers prioritize delivery schedules over pricing. For ASIC customers and all AI projects, delivery timing is currently most important, as gaining advantage in AI competition matters more than price. The company noted that thermal management has consistently represented a small proportion of AI server bill of materials (BOM), placing price lower in customer priorities. Qihong has not experienced significant pricing pressure. The company stated that pricing is determined by supply and demand, and "supply is still far below demand."

Qihong described material shortages (where some components in an order arrive early while others arrive late) as normal in the supply chain. The company stated that AI servers have moved away from the Toyota-style just-in-time production model of several years ago, instead focusing on obtaining components and supplying as much as possible, then overcoming shortages through aggressive methods. When bottlenecks appear at any point, the entire supply chain works together to resolve single-point issues.

Qihong Reports Revenue Growth Through October 2026

According to TrendForce research from August 2026, major cold plate suppliers include Cooler Master, BOYD, and Qihong (AVC). The research firm predicted GPU cabinet shipments will grow over 30% year-over-year in 2027, with overall demand unaffected even if NVIDIA's next-generation cabinet solution Kyber NVL144 timeline may be delayed.

Demand is reflected in revenue performance. Cumulative revenue for the first 10 months reached 179.35 billion TWD, up 65.58% year-over-year, already exceeding the full-year 2025 revenue of 139.6 billion TWD. The company expressed optimism about fourth quarter and 2027 operations. October single-month revenue of 22.103 billion TWD was the highest of the year, with year-over-year growth rate converging from 57.39% in July to 34.35%, indicating continued shipment growth alongside rising baseline comparisons.

FAQ

What did Qihong announce at its November 10, 2026 investor conference?

Qihong announced that water cooling adoption for all GPU and ASIC computing chips in projects will reach 100% by the end of 2027. The company stated that current supply remains far below market demand.

How did Qihong perform financially through October 2026?

Qihong reported cumulative revenue of 179.35 billion TWD for the first 10 months of 2026, representing 65.58% year-over-year growth. October single-month revenue reached 22.103 billion TWD, the highest monthly figure of the year.

Why do Qihong's customers prioritize delivery over pricing?

According to Qihong, ASIC customers and AI project clients consider delivery timing more important than price because gaining competitive advantage in AI matters more than cost. Thermal management represents a small proportion of AI server bill of materials, placing price lower in customer priorities.