Summary of Key Points
In the first half of 2026, the domestic PCB (Printed Circuit Board) industry, commonly referred to as the “circuit framework” within electronic products, experienced a period of rapid growth: leading companies saw substantial increases in performance, and there was a surge in demand for high-end products, driven by the strong demand for AI computing infrastructure. However, the industry also faced challenges such as rising costs of upstream materials and accelerated capacity expansion, as well as bottlenecks in the supply of high-end materials.
1. Collective Performance Boost from Leading Companies, with High-End Products Driving Growth
As a leading PCB company, Shanghai Electric Co., Ltd. reported revenue of 13.689 billion yuan (a year-on-year increase of 61%) and net profit of 2.923 billion yuan (a year-on-year increase of 73%) in the first half of the year, with net profit in the second quarter increasing by 35% month-on-month. More notably, the revenue from high-end PCBs (32 layers and above) grew by 190% year-on-year, and the gross margin rose to 40.5% (an increase of 4 percentage points), indicating that not only were more high-end products sold, but they also generated higher profits.
Other top companies also performed well: Dongshan Precision’s net profit soared by 290% year-on-year, exceeding the entire profit of the previous year; Pengding Holdings saw a 181% increase in revenue from automotive and server boards, with the AI server business generating nearly 1 billion yuan. These figures point to one conclusion: high-end PCBs related to AI have become the “engine” driving performance growth.
2. AI Computing Power Demand as the Core Driver of Industry Prosperity
Why has the PCB industry suddenly become so popular? The answer lies in AI. Large AI models and data centers require a large number of servers, and the demand for the core circuit boards within these servers, especially high-layer, high-speed high-end PCBs, has exploded.
Industry data supports this trend:
- Domestic PCB exports increased by 27.6% from January to June, with exports of high-end boards (4 layers and above) increasing by 47.7%;
- Global PCB production value grew by 26.3% in the first quarter, the strongest growth rate in recent years.
In simple terms, for AI to process data quickly, more computing facilities are needed, and these facilities rely on high-quality PCB boards, which has directly boosted the entire industry.
3. Rising Prices of Upstream Materials and Short-Term Supply Tightness
The prices of upstream PCB materials (such as copper foil and electronic fabric) have been increasing recently, and this trend is spreading from high-end products to mid- and low-end products. Jingwang Electronics management explained that the concentrated demand for AI computing infrastructure construction has led to a supply shortage, and this tight situation is unlikely to change in the short term.
This is a double-edged sword for companies: on one hand, rising material costs may squeeze profits; on the other hand, with the industry experiencing both increased volume and prices, leading companies with scale and technical advantages can offset these pressures by raising prices or optimizing costs.
4. Accelerated Capacity Expansion, but the Risk of Overbuilding Needs to Be Watched
Seeing the industry’s profitability, many companies have started to expand their capacity: from January to June, there were 76 new PCB investment projects in China (a year-on-year increase of 105%), with investment amounts reaching 169.1 billion yuan (several times that of last year).
However, industry associations warn that too rapid investment in popular areas such as optical communications and high-speed PCBs may lead to overbuilding. For example, if multiple companies build similar capacity, it could result in excess supply and subsequent price declines and losses for businesses. Therefore, capacity expansion should be approached rationally and not blindly follow the trend.
5. Structural Challenges in the Industry: Bottlenecks in High-End Materials and Overinvestment
Despite the industry’s prosperity, there are two underlying concerns:
1. Bottlenecks in High-End Materials: The special materials required for high-end PCBs (such as high-speed, high-frequency substrates) have long certification cycles and slow capacity ramp-up times, and domestic companies still rely on imports, making them vulnerable to supply disruptions;
2. Risk of Overbuilding: Excessive investment in popular areas may lead to waste of resources.
If these issues are not addressed, they could affect the industry’s long-term healthy development. After all, the demand for AI is long-term, but if there is overcapacity or a reliance on imported materials, the industry’s growth may lack sustainability.
Conclusion
The surge in the PCB industry in the first half of 2026 is essentially due to the benefits of AI technology in computing infrastructure. Leading companies have seized the opportunity in high-end products, resulting in impressive performance. However, the industry must also be cautious of rising material costs, overbuilding, and bottlenecks in high-end materials. For ordinary investors and professionals, it is a prudent strategy to focus on companies with leading high-end PCB technologies while being aware of the industry’s risks.