Woofun AI reports that Nomura issued an Anchor Report on June 30, raising the target price for TSMC from 2,820 NT to 3,425 NT, asserting that the AI infrastructure investment cycle has 'not yet peaked.' Based on a closing price of 2,340 NT recorded on June 26, this adjustment implies an approximate 46.4% upside potential for the semiconductor giant. The firm argues that despite significant market gains, fundamental drivers including data center construction, AI chip demand, server revenue, and advanced packaging requirements continue to climb. The SOX index has surged roughly 85% since the March cycle update and approximately 211% since the AI theme was reintroduced in May 2025, even as institutions lift demand forecasts following recent pullbacks.

Structurally, the report expands its bullish thesis to the broader AI semiconductor and hardware supply chain, raising target prices for MediaTek, ASE, EMC, and ZDT. These upward adjustments rely on assumptions regarding expanded data center capacity and tightening supplies of advanced packaging and critical components. Global tracked self-owned data center projects have increased from about 240 at the end of March to around 280, while GW-scale projects rose from over 40 to approximately 50. Consequently, additional deployment capacity for 2027 was revised upward to roughly 32GW from 28GW, and for 2028 from 21GW to around 23GW. This surge in capacity corresponds to an annual demand for approximately 4 to 6 million AI chips.

Woofun AI data shows that global server revenue growth rates for 2026 and 2027 were revised up to 74% and 65% year-on-year, respectively. Within this sector, AI server revenue growth is projected at 78% and 76%, while general or CPU server revenue growth was raised to 67% and 43%.

Furthermore, shipment assumptions for 2026 GB/VR cabinets were increased from 50,000 units to 54,500 units, with an estimated 62,000 units expected in 2027. These figures underscore the accelerating pace of hardware deployment required to support the expanding AI ecosystem.

Regarding supply constraints, Nomura estimates TSMC's CoWoS capacity will reach about 1.1 million pieces in 2026, with a targeted capacity of 2 million pieces in 2027. Long-term capacity may need to expand to between 2.5 and 3.5 million pieces by 2029 to match anticipated AI revenue growth. The bottleneck is expected to shift from TSMC-controlled processes to Wafer-on-Substrate (WoS) and components such as CCL, IC substrates, high-end capacitors, PMIC, and optical components. This transition suggests that future growth will be dictated by the availability of these specific upstream materials rather than fabrication alone.

In terms of capacity allocation for 2027, Nvidia is expected to command about 55% of TSMC's CoWoS capacity. Google TPU's share is projected to increase to around 26%, up from 23% in 2026, while AMD's share may see slight improvement. Conversely, AWS's share is expected to decline. MediaTek's TPU outsourcing-related share is anticipated to rise from about 15% in 2026 to over 30%. Reflecting these dynamics, Nomura raised MediaTek's target price from NT$3,400 to NT$5,800, representing approximately 49.5% upside. ASE's target price was raised to NT$730, EMC to NT$6,880, and ZDT to NT$720.

Risks identified include soaring memory costs potentially leading to free cash flow pressure for hyperscalers in 2027, alongside the impact of rising yields on funding costs. Future growth depends heavily on the maturation of technologies such as EMIB-T, CoPoS, GPU-on-GPU SoIC, CPO, higher-speed SerDes, and next-generation PCB materials. This marks a critical juncture where technological execution will determine whether the projected revenue trajectories can be sustained against mounting cost pressures.