AI computing power demand drives PCB third-quarter results, with Shengyi Technology and WUS Printed Circuit seeing sharp profit increases

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With the 2026 third-quarter reports now finalized, the old paradigm in which the printed circuit board (PCB) industry was long tied to the consumer electronics cycle is being rewritten. The logic that AI computing infrastructure is driving expanded demand for high-end PCBs has been clearly corroborated in the financial reports of multiple listed companies, with orders related to AI servers, high-speed switches, optical modules and IC substrates continuing to surge, becoming the core variable supporting the sector's upward earnings trend.

Continued heating up of AI-related demand is pushing the PCB industry to accelerate its upgrade toward high-end directions such as high-frequency high-speed, high-layer-count and high-order HDI, but the supply chain pressure this brings in the short term cannot be ignored. A company in the industry chain told a Cailianshe reporter that the company's existing HDI and high-layer-count PCB production lines currently have full order books, with order volumes exceeding the upper limit of what existing capacity can handle, and that a new round of capacity expansion has been launched.

At the same time, tight supply of upstream raw materials and cost disruptions are still continuing. This means that under the AI structural market, whether a company can bind itself to core tracks and achieve orderly release of high-end capacity and effective cost pass-through will be the key to whether PCB companies can win in future competition.

Concept stocks post rosy earnings

At the individual stock level, Shengyi Technology (600183.SH) leads the sector with RMB 6.727 billion in net profit attributable to shareholders for the first three quarters, a year-on-year increase of 175.36%; close behind is Wus Printed Circuit (002463.SZ), whose main products are enterprise communications market boards (for data center switches and AI servers), with net profit attributable to shareholders for the first three quarters up 106.87% year on year to RMB 5.622 billion.

Shennan Circuits (002916.SZ), Shengyi Electronics (688183.SH), Kinwong Electronic (603228.SH), Guanghe Technology (001389.SZ), Xingsen Technology (002436.SZ) and other companies also recorded substantial earnings growth, with net profits for the first three quarters of RMB 4.129 billion, RMB 1.912 billion, RMB 1.616 billion, RMB 1.488 billion and RMB 439 million respectively, with year-on-year growth rates ranging from 70.42% to 233.7%.

Behind this collective upward earnings trend is the continued rise in the PCB industry's prosperity. A Prismark report shows that in 2025 China's PCB market output value is expected to grow fastest in the world, up about 19.2% year on year, with growth particularly prominent in AI-driven high-layer-count (HLC) PCBs, high-density interconnect (HDI) PCBs and packaging substrates.

The market holds an optimistic view of the outlook for AI PCBs. According to calculations in a Citi research report published during the year, the global AI PCB market is expected to reach RMB 152 billion in 2026, up 86% year on year. Guojin Securities believes that strong AI demand is driving both PCB prices and volumes higher; at present, multiple AI-PCB companies have strong orders, are selling all they produce, and are vigorously expanding capacity, and high earnings growth is expected to continue.

The operating experience of frontline companies also corroborates the industry's high level of prosperity. The minutes of the 2026 third-quarter results briefing disclosed by Hongban Technology (603459.SH) show that the company's capacity is currently full, and 1.6T high-speed optical module PCBs have already achieved mass supply.

Kinwong Electronic said that at present, customer projects in the AI computing field are still advancing at a relatively fast pace, and delivery schedules for high-end products are very tight. The company stressed that the process difficulty brought by product iteration and upgrading in the AI computing field has increased markedly, placing higher demands on PCB manufacturers' process technology capabilities, refined control capabilities and first-pass product yield, and that high-end capacity supply is relatively limited.

A head of a company mainly engaged in HDI and high-layer-count products also told a Cailianshe reporter that existing capacity is already fully booked with orders and cannot take on more, and that the company is in a relatively tight state in terms of capacity expansion and overall capacity.

Looking across the high-end capacity layout moves disclosed by listed companies in the PCB sector, the core focus is AI.

Kexiang Co., Ltd. (300903.SZ) recently announced three planned investment and construction projects in succession, with total investment amounting to RMB 8.5 billion, concentrated in high-value-added AI computing hardware substrates such as PCBs for AI servers, mSAP substrates and high-order HDI. Earlier, Xingsen Technology announced a plan to raise no more than RMB 3.9 billion for the high-order mSAP substrate intelligent manufacturing and industrialization project (Phase I) of Zhuhai Xingsen Semiconductor Co., Ltd., among others.

Zhen Ding Technology Holding (002938.SZ) is also accelerating the construction of AI-related capacity. In recent years it has continued to advance capacity expansion at multiple parks in Huai'an, Shenzhen and Thailand, matching order demand for high-value-added products such as AI servers, high-speed optical modules and AI edge products. In the first three quarters of this year, its capital expenditure was RMB 11.206 billion, an increase of about RMB 6.234 billion year on year.

However, there is still a long way to go from capacity construction to actual release. The stability of upstream material supply, lead times for core manufacturing equipment and high-end product production capacity all directly affect the efficiency of releasing new capacity.

On the substrate side, industry insiders say that tight supply of raw materials centered on copper-clad laminate (CCL) is the actual situation currently facing the entire industry, and that the related supply-demand imbalance is expected to be difficult to fully resolve before the second half of 2027.

The supply-demand imbalance has further transmitted to prices. Copper-clad laminate leader Kingboard Laminates (01888.HK) has issued eight rounds of price increase notices during the year, and prices of prepreg (PP), a core intermediate raw material and upstream semi-finished product for high-end copper-clad laminates, have risen significantly. Institutions predict that the monthly CCL price increase pace will, on a conservative expectation, continue until June 2027.

Constrained by factors such as material price increases and equipment lead times, the commissioning timing of companies' new capacity also shows a phased release pattern.

Zhen Ding Technology Holding said in its latest investor minutes that it currently has more than ten new plants under construction, which are expected to be commissioned and released successively starting in 2027. Kinwong Electronic disclosed that its high-order HDI plant and UHC plant under construction in Zhuhai are planned to enter mass production in the fourth quarter of 2026 and the first quarter of 2027 respectively. Hongban Technology said that its Ganzhou Hongban high-order HDI precision circuit board production line equipment upgrade and intelligent transformation project is expected to be commissioned in early 2027.

Jia Pang, senior partner and managing director of Frost & Sullivan China, said in an interview with a Cailianshe reporter that as new industry capacity is gradually released, competition among PCB companies will shift from simple capacity expansion to comprehensive competition in technology, efficiency and customer structure, and that profit advantages will ultimately depend on whether companies can continuously create differentiated value.

Jia Pang further noted that technical barriers are the core of maintaining profitability; AI computing-related PCB products such as high-layer-count, high-frequency high-speed and high-order HDI place higher demands on materials, precision processing, interlayer alignment, signal integrity and yield control, and companies with advanced processes and stable mass production capabilities are more likely to obtain high-quality orders and reasonable product premiums. In addition, yield improvement, automated production, equipment utilization optimization and lean management can effectively reduce unit manufacturing costs, forming a cost advantage when price competition intensifies.

(Source: Cailianshe) Middle of the main text Embedded advertisement