AI Data Growth Pushes PCB Transmission Limits and Sparks a Materials Revolution

Table of Contents

• You might want to know
• Main Topic
• Key Insights Table
• Afterwards...

You might want to know

• Why are AI computing demands bringing PCB transmission limits into focus sooner than expected?
• Which material and substrate technologies could help the industry respond to higher speeds and larger advanced-package designs?

Main Topic

The rapid expansion of artificial intelligence computing is intensifying pressure on data transmission across servers, networking equipment, and advanced semiconductor packages. As processing capacity grows, moving data quickly and reliably becomes an increasingly important engineering challenge. The printed circuit board (PCB) industry is therefore moving toward more system-level integration, in which materials, board architectures, and semiconductor packaging must work together. This shift is encouraging a combination of new material approaches, including M10-grade copper-clad laminate (CCL), quartz glass cloth, resin-coated copper (RCC) solutions, and emerging glass-core substrates.

High-frequency, high-speed CCL is entering the M10 generation. These materials are designed to support extreme low loss and high reliability as signals travel through increasingly demanding systems. Manufacturers are evaluating quartz glass cloth (Q-Glass), polytetrafluoroethylene (PTFE) resin formulations, and backing copper foil without glass-fiber cloth, including RCC/ZRCC solutions. The aim is to reduce dielectric constant (Dk) and dissipation factor (Df), while also improving resistance to electrical stress. These approaches represent different paths toward better signal performance; the optimal choice depends on the system’s design requirements, manufacturing process, and reliability targets.

At the same time, conventional server motherboard layouts are approaching practical limits in routing density and layer count. To address these constraints, designs are increasingly combining high-layer-count boards (HLC) with high-density interconnect (HDI) structures. Some development paths extend toward substrate-like manufacturing using modified semi-additive process (mSAP) techniques. The broader objective is to increase interconnection density and improve transmission performance without relying solely on conventional board structures. This is a hybrid transition: PCB manufacturing is adopting capabilities associated with semiconductor packaging, while still serving the scale and functional needs of system boards.

Advanced packaging is also driving changes in IC substrate architecture. As package and chip dimensions expand, maintaining structural rigidity and controlling warpage become more difficult. Warpage can affect alignment and reliability during manufacturing and assembly, so substrate design must account for mechanical behavior as well as electrical performance. Multilayer-core (MLC) structures, glass-core substrates, and ceramic substrates are among the options receiving attention as the industry explores ways to meet these demands. They are not interchangeable solutions; each brings its own material properties, process requirements, and manufacturing challenges.

Supply availability is another important part of the transition. High-grade glass-fiber cloth, very-low-profile copper foil, including HVLP4/5, and precision drill bits designed for wear resistance are described as tight-supply inputs. When specialized materials or tools are difficult to source, manufacturers may face higher costs, longer lead times, and additional pressure to qualify alternatives. Suppliers with differentiated products and the ability to pass through costs may gain stronger bargaining positions. However, shortages alone do not guarantee improved financial results: pricing, customer qualification, yields, and capacity utilization also matter.

For PCB manufacturers, technical capability must be matched by consistent process control. Thick-board lamination and precise alignment are especially demanding when structures become more complex and tolerances tighten. A process that performs well in a laboratory or at limited production scale may still face yield challenges when output increases. The ability to control material variation, registration, drilling, lamination, and inspection can determine whether a manufacturer converts advanced designs into dependable production. Consequently, scarce high-end capacity reflects not only equipment availability but also the expertise needed to achieve acceptable yields.

Several end markets are contributing to the demand outlook. AI servers require increasingly capable internal connections, while 1.6T/3.2T switches and co-packaged optics (CPO) are part of the developing high-bandwidth networking ecosystem. Together, these applications support a potential multi-year structural upgrade cycle for the PCB supply chain. The source article describes this as a period in which both product mix and pricing could strengthen. That outlook is contingent, however, on continued deployment, successful qualification of new materials, and the industry’s ability to expand production without compromising quality.

Among the Taiwan-listed companies identified in the source, Taiwan Union Technology (台光電, 2383-TW) is described as an early M10 materials presenter, with proprietary core materials entering the cloud service provider (CSP) chip supply chain. TUC (台燿, 6274-TW) and ITEQ (聯茂, 6213-TW) are positioned in next-generation high-speed CCL and optical interconnect materials. Elite Material (金居, 8358-TW) is associated with the upgrade of copper foil used in high-end servers. These examples illustrate how the materials segment may benefit when system performance requirements increase, while also highlighting the importance of product qualification and supply execution.

Substrate and board makers are also exposed to this transition. Unimicron (欣興, 3037-TW) and Kinsus (景碩, 3189-TW) are identified as beneficiaries of larger substrate dimensions and capacity secured through long-term agreements. Compeq Manufacturing (華通, 2313-TW) and Zhen Ding Technology Holding (臻鼎-KY, 4958-TW) are noted for capabilities in thick-board HDI, substrate-like boards, and optical-module boards. These areas require specialized engineering and manufacturing know-how, which can form technical barriers to entry. Still, the presence of a technical barrier does not remove normal business risks, including customer concentration, project timing, capital needs, and manufacturing yield.

The central industry theme is therefore not simply that AI increases demand for circuit boards. Rather, faster transmission requirements are prompting a shift in materials, structures, and production methods across the supply chain. M10 CCL, quartz-based materials, RCC/ZRCC, HLC-plus-HDI architectures, mSAP processes, and glass-core substrates are examples of this broader hybridization. The key constraint is the combination of specialized material availability and the ability to manufacture complex structures at reliable yields. Companies that can qualify products, scale production, and maintain process consistency may be better positioned, although industry demand and investment outcomes remain uncertain.

The source presents periods of significant share-price pullback as possible opportunities to consider companies with technical advantages in materials and manufacturing. That is an investment opinion, not a guarantee of performance. The article also invites readers to follow analyst Chen Chih-Lin’s app and live broadcasts for market updates. Investors should make independent judgments, evaluate their own risk tolerance, and recognize that past performance does not guarantee future returns.

Key Insights Table

Afterwards...

The next phase of PCB and substrate development will depend on whether new materials can move from qualification into stable, scalable manufacturing. As AI infrastructure and high-speed networking evolve, suppliers will need to balance signal performance, mechanical stability, cost, availability, and yield. A hybrid mix of materials and processes may become increasingly common, but no single approach is likely to solve every design challenge. For industry observers and investors, the most useful indicators will include customer adoption, production consistency, capacity availability, and the ability to sustain returns through the technology transition.

For market information, the source provides the analyst app link: https://lihi.cc/zwrii. It also lists the contact number 02-2653-8299 and attributes the article to analyst Chen Chih-Lin and Kaixu Investment Advisory (凱旭投顧). The source states that recommended securities have no improper financial-interest relationship, that past performance does not guarantee future profits, and that investors should make independent judgments, carefully assess investments, and bear their own investment risks.