Goldman Sachs: AI is igniting a major cycle in PCBs

Goldman Sachs points out that the construction of artificial intelligence infrastructure is driving the PCB (Printed Circuit Board) and CCL (Copper Clad Laminate) industries into a super-cycle. The bank believes that, as AI server specifications continue to upgrade, the industry is experiencing a dual momentum of “higher speed” and “larger scale,” which will significantly increase the value and market space of related components.

According to Chasewind Trading Desk, Goldman Sachs predicted in a report released on January 20 that the global AI server PCB market size will increase by 113% year-on-year in 2026 and continue to grow by 117% in 2027. As the upstream core material, the AI server CCL market will see even more astonishing growth, with projected year-on-year increases of 142% in 2026 and 222% in 2027. This explosive growth is driven by the improvement in computing density, the surging demand for high-speed connections (such as 800G/1.6T), and the trend of PCBs gradually replacing copper cable connections inside AI servers.

Goldman Sachs refutes market concerns that “AI infrastructure has passed its initial stage and competition will intensify.” The bank believes that rapid technological iteration (such as migration to M9-grade materials and higher-layer boards) has built extremely high barriers in R&D and capital expenditure, enabling leading firms to maintain a relatively healthy competitive environment and to continue securing major customer orders. For the first time, Goldman Sachs rated Shenghong Technology, Shudian Co., and Shengyi Technology as “Buy” in its report.

Dual Drivers: Speed Upgrades and Scale Expansion

The core logic of the Goldman Sachs report is based on two major trends. First is the value increase brought by speed upgrades. With AI server specifications advancing, the computing density per cabinet is significantly increasing, driving demand for high-speed connection technologies such as 800G and 1.6T. This has directly led to a substantial increase in the dollar content of PCBs and CCLs.

Second is the scale effect. The sustained rollout of AI servers is expanding the total addressable market (TAM), with suppliers’ capacity expanding accordingly. Goldman Sachs specifically points out that PCB applications in AI servers are increasing. For example, in rack-level servers, PCB backplanes and midplanes are replacing traditional copper cable connections, since the PCB solution is easier to assemble, bringing additional incremental space to the industry.

Market Forecast: CCL Growth Leads the Supply Chain

According to Goldman Sachs’ modeling, growth rates for PCBs and CCLs in all aspects of AI data centers will be extremely eye-catching. The report shows that the global AI server PCB market is expected to grow from about $3.1 billion in 2024 to $27.1 billion in 2027.

In contrast, upstream material CCL shows even greater elasticity. Goldman Sachs expects the global AI server CCL market to surge from $1.5 billion in 2024 to $18.7 billion in 2027. In terms of growth rates, CCL market growth (142%/222% in 2026 and 2027) even surpasses that of optical modules (107%/48%) and AI training servers (57%/37%) during the same period.

Investment View: Technology Barriers Safeguard, Competitive Landscape Better Than Expected

Responding to common investor concerns about “market growth slowing” and “heightened competition” risk, Goldman Sachs presents a distinctly opposing view in their report. The analyst team led by Allen Chang believes that, as AI server specifications rapidly migrate, customers are more inclined to rely on technology leaders to ensure product quality and timely delivery of the latest architectures.

The report points out that the development and production of the latest generation of AI server PCBs and CCLs require not only extremely high R&D investment, but also face enormous capital expenditure burdens. This effectively limits the number of new entrants. Therefore, under the backdrop of rapid technological iteration, the competitive market environment will be milder than investors expect, with leading firms continuing to benefit.

For the first time, Goldman Sachs rated Shenghong Technology, Shudian Co., and Shengyi Technology as “Buy” in its report.

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