ViTrox Delivers Strong 1QFY26, Driven by AI Demand

ViTrox posted a stellar 1QFY26 performance, with core net profit surging 120% year-on-year to RM60.8 million, exceeding expectations and achieving 31% of its full-year forecast. Revenue jumped 89% YoY to RM267.1 million, supported by stronger billings from both ABI and MVS segments, margin expansion, and a lower effective tax rate of 17.6% following the MIDA pioneer incentive. Management expects the effective tax rate to decline further, targeting single digits by year-end.

ViTrox

The MVST segment is forecast to deliver RM85–95 million in Q2 revenue, with production capacity ramped to 40 units monthly. Backlog remains strong at RM125 million, with demand led by China, the Philippines, and Malaysia. Service revenue is expected to sustain above RM30 million per quarter, while new AI-enabled features should support premium pricing.

ABI is also in a ramping phase, with Q2 revenue projected at RM150–160 million and a backlog of RM233 million. Demand is driven by AI servers requiring larger-format platforms, with product mix expected to shift toward higher-speed QX1 models by 2H2026.

Supply chain challenges

ViTrox plans to establish a wholly-owned China entity within six months to capture domestic demand, leveraging government incentives. Supply chain challenges remain, with shortages in chips, GPUs, and manpower, but management is mitigating through supplier diversification and extended procurement.

Despite capacity constraints, ViTrox’s outlook remains robust, with AI-related orders comprising 50% of its book. Analysts maintain a BUY call with a target price of RM7.04, reflecting strong earnings visibility and expansion opportunities.

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