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Substrate supplier for AMD, Intel and others warns of capacity overload until 2027

Taiwanese ABF wafer manufacturer Unimicron Technology said the demand for high-performance electronic components is so high that the company’s production capacity will be overloaded over the next five years.

Unimicron specializes in the production of ABF (Ajinomoto Build-up Film) substrates required for chips used in consumer computers, servers and game consoles, and many other devices. The company’s clients include Intel, Apple, AMD and NVIDIA. Speaking with analysts after the earnings report, Unimicron President Michael Shen said the company’s capacity is full until at least 2027. The manufacturer’s shares are up 4.6% today to a record high. “Customers are currently discussing orders with us for 2027, 2028, 2029 and 2030. Delivery time for new equipment can be two to three years ,” said Mr. Shen.

Major players in the processor market, including Intel, AMD and NVIDIA are completely dependent on the supply of ABF substrates. This means that even with all the efforts of governments and multibillion-dollar investments in increasing production, the absence of this component can slow down production volumes for years. According to the President of Unimicron, the company’s existing customers have occupied its production facilities for several years in advance, and new players may have problems with the supply of material.

Manufacturers of ABF substrates have long been reluctant to invest in plant expansion due to past periods of market volatility resulting in product shortages. Over the past three years, Unimicron shares have risen more than tenfold.

source: Bloomberg




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