Taiwan's printed circuit board (PCB) industry is forecasting a significant 15.1% growth in 2026, with output expected to reach NT$1.05 trillion, driven primarily by the artificial intelligence boom.
The core of this optimism stems from the explosive growth in AI infrastructure. First, as tech giants like Nvidia roll out powerful new chips like the Blackwell series, the demand for AI servers is surging. TrendForce projects AI server shipments to grow by about 28% in 2026. Second, these high-performance servers require much more complex and valuable PCBs, such as high-layer-count boards and advanced IC substrates, which directly translates to higher revenues for Taiwanese manufacturers who are leaders in this segment.
However, this growth story is not without its challenges, particularly on the supply side. A major headwind is the rising cost of raw materials. The price of copper, a fundamental component of PCBs, has increased by over 60% since early 2025. Additionally, the price of ABF (Ajinomoto Build-up Film), a critical insulating material for high-performance chip substrates, is set to increase by around 30%. These cost pressures could significantly squeeze the profit margins of PCB makers, even as their sales grow.
Another significant risk is operational, centered on Taiwan's energy supply. The immense power consumption of AI data centers and semiconductor fabs is straining the national grid, leading to concerns about potential power shortages or rationing. In response, the Taiwanese government has mandated that large industrial users develop their own power generation or storage facilities. While this policy helps ensure a stable power supply for production, it also adds to the capital and operational expenses for companies.
Finally, the ongoing geopolitical landscape, including U.S. tariffs on Chinese goods and new defense sourcing rules, provides a subtle tailwind. These policies may encourage some American companies to shift their supply chains away from China and towards Taiwan, further bolstering demand. In essence, the industry is navigating a path of strong, AI-driven growth that is balanced against the very real risks of rising costs and power constraints.
- PCB (Printed Circuit Board): The foundational green board inside almost all electronic devices, which connects components like chips and resistors.
- IC Substrate: A miniature PCB that acts as the base for a powerful semiconductor chip, connecting it to the main circuit board.
- ABF (Ajinomoto Build-up Film): A specialized, high-performance insulating film essential for creating the intricate circuitry in modern IC substrates used for CPUs and AI accelerators.