Summary of Global PCB and CCL Market for AI Servers Industry Overview - The global PCB (Printed Circuit Board) and CCL (Copper Clad Laminate) market for AI servers is projected to reach **US$27 billion** and **US$19 billion** respectively by **2027E**, up from **US$17 billion** and **US$8 billion** in previous estimates, indicating a **140%** and **178% CAGR** from **2025-2027E** [2][8][40]. Key Drivers of Growth 1. **Demand Drivers**: - The demand is primarily driven by the rise of high-end AI servers, including GPU and ASIC servers, which require advanced PCBs and CCLs [1][40]. - High-end products such as **30+ layer multilayer PCBs**, **6L+ HDI**, and **M9+ CCL** are expected to account for **16%**, **23%**, and **14%** of total shipments for AI server applications by **2027E** [1][42]. 2. **Specification Upgrades**: - The transition to next-generation high-end AI servers is expected to significantly increase the value TAM (Total Addressable Market) [1][42]. - The adoption of **M9 materials** and **6L HDI** is anticipated to enhance product value and performance [42]. 3. **Capex Growth**: - Capex for PCB suppliers is expected to grow by **24%** YoY in **2025**, **23%** in **2026E**, and **15%** in **2027E**; for CCL suppliers, growth is projected at **38%**, **22%**, and **7%** respectively [1][57]. 4. **Utilization Rates**: - Utilization rates for PCB and CCL are expected to remain high despite capacity expansions, driven by the ramp-up of AI infrastructure [1][41]. Market Dynamics - **Shipment Growth**: - PCB shipments are projected to increase by **69% CAGR** to **2.5 million square meters** by **2027E**, while CCL shipments are expected to grow by **72% CAGR** to **78 million sheets** [2][41]. - **Average Selling Price (ASP) Increases**: - The ASP of AI server PCBs is expected to grow at **42% CAGR**, reaching **US$11,062** per square meter by **2027E**; CCL ASP is projected to increase by **62% CAGR** to **US$239** per sheet [43][40]. Gross Margins and Profitability - Major PCB and CCL companies are expected to see higher gross margins due to increasing sales of high-margin AI server products, tight supply, and rapid transitions to newer generations [44][40]. Investment Recommendations - Companies recommended for investment include **Shennan (002916.SZ)**, **GCE (2368.TW)**, **EMC (2383.TW)**, and **TUC (6274.TWO)**, which are positioned to benefit from the growth in the AI server PCB and CCL market [3]. Conclusion - The global PCB and CCL market for AI servers is poised for robust growth driven by technological advancements, rising demand, and significant increases in average selling prices. This presents a compelling investment opportunity in the sector, particularly for companies that are adapting to the evolving specifications and demands of AI infrastructure.

Summary of Key Points from J.P. Morgan's Research on PCB, CCL, and Substrates Industry Overview - The report focuses on the PCB (Printed Circuit Board), CCL (Copper Clad Laminate), and substrates markets, particularly in the context of AI applications and supply chain dynamics [1][3]. Core Insights 1. **Tight Supply Chain for PCBs**: The PCB supply chain is expected to remain tight or face shortages due to rising specifications and modest capacity additions, particularly in Southeast Asia, which is not yet equipped to produce AI PCBs [3][8]. 2. **New Entrants in AI PCB Market**: There is potential for new suppliers to enter the AI supply chain, especially for major ASIC projects that require high layer count PCBs. Current leading GPU servers utilize HDIs but may revert to multi-layer PCB designs by 2026, which could exacerbate supply tightness [3][8]. 3. **Cooling Methods for ASICs**: Shipments for major ASIC servers are expected to rise in the second half of the year. Liquid-cooled motherboards are anticipated to start shipping in Q3, while air-cooled boards will remain dominant. This dual approach may mitigate the impact of design changes on CCL/PCB suppliers [3][8]. 4. **BT Substrate Price Trends**: The utilization rate (UTR) of BT substrates has increased to 80-90%, contrasting with sluggish performance in previous years. Price hikes are likely due to rising gold prices, although widespread price increases for BT substrates have not yet been observed [3][4][8]. 5. **Impact of Midplane PCB**: The introduction of midplane PCBs in future AI GPU servers is seen as a significant opportunity for the PCB/CCL industry, potentially creating a USD 1 billion annual market. However, the high capacity required for ultra-high layer count designs poses challenges [3][8]. 6. **Capex Expansion Expectations**: PCB and CCL manufacturers are expected to announce further capital expenditure expansions in the next six months due to sustainable supply tightness. China may become a focal point for these expansions, moving away from Southeast Asia [3][8]. Additional Considerations - **Substrate Expansion Outlook**: Substrate expansions are expected to be more subdued due to uncertainties in T-glass supply and modest UTR. The growth rate for ABF supply may fall below the current expectation of 7-8% per annum as some tier-2 suppliers consider suspending or disposing of tools [3][8]. - **Market Dynamics**: The report emphasizes the structural nature of the current supply shortages, driven by increasing board design complexity and the need for advanced materials [3][8]. This summary encapsulates the critical insights and projections regarding the PCB, CCL, and substrates markets as discussed in the J.P. Morgan research report.