According to Taiwan media Juheng.com, the hot demand for AI server products has led to a significant increase in the performance of PCB, HDI (high-density interconnect board) and copper foil substrate manufacturers in Taiwan. Nvidia's improvement of server specifications has further increased the demand for PCB and HDI components. Products with new specifications require more high-end HDI products to speed up computing and connection speeds.
According to Taiwan media, the PCB and HDI industries in Taiwan, China have obvious competitive advantages. With its leading technology and the application of copper foil substrates, Taiyao Company has driven the development of Taiguang and Jinxiang Electric. As one of the world's leading manufacturers of cloud servers, Jinxiangdian has seen an increase in demand for its high-end products such as 20-layer PCBs, which has further increased the company's gross profit.
As the third largest supplier of HDI boards in the world, Jianding is not an industry leader, but it can still enter the future AI server product market. As Intel's "Eagle Stream" fourth-generation scalable processors began to ramp up, the gross profit margin of high-end servers increased. From the perspective of revenue ratio, Jianding's main product server/network communication accounted for 21.1%, automotive products accounted for 29.6%, and DRAM/SSD accounted for 18.5%. Despite the pressure on revenue in the first half of the year, the company's revenue is expected to pick up as destocking progresses and new product development takes place. Taiwan media said that Jianding, as a part of the AI server market, has production capacity advantages and is also top-notch in technology. At present, customers have successively conducted product verification, and new products are expected to contribute to revenue in the fourth quarter.
Taiyao is actively embracing the business opportunity of server specification upgrades. In the current CCL (copper clad laminate) market, Taiyao and Taiguang are both roles that cannot be ignored. At present, most PCB manufacturers have locked in Southeast Asia, among which Taiwan companies such as Trident, Jingpeng, and Jingguo have established production bases in Thailand. At the same time, PCB upstream material manufacturers have also begun to deploy, and Lianmao and Taiyao have also invested and built factories in Thailand. As for Tai Optoelectronics, it is still evaluating in Southeast Asian countries such as Malaysia, Thailand, and Vietnam, and plans to actively expand overseas production lines.
The surge in demand for high-end copper foil substrate materials for AI servers led to a 2.85% quarter-on-quarter increase in Taiyao’s second-quarter consolidated revenue. With the gradual increase in production of high-end products, it is expected that the revenue will further increase next year. Taiyao's factory expansion project in mainland China has come to an end, and its future performance is worth looking forward to.
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