TAIPEI -- Taiwanese PCB manufacturers produced a global output value of NT$217.5 billion in the fourth quarter, up 2.8% year-on-year.

For the year, the domestic industry's total annual output value reached NT$817 billion, up 6.1% growth from 2023, the Taiwan Printed Circuit Association (TPCA) said today.

Looking ahead to 2025, the sector is poised for further expansion, driven by increasing AI-related demand for servers and edge computing, as well as growing applications in satellite communications. The forecasted industry output is expected to reach NT$854 billion, or 4.6% growth.

The PCB sector maintained steady growth in 2024, with AI servers and satellite communications emerging as key drivers. High-end HDI board demand surged, making it the fastest-growing product category. The automotive electronics market also continued its upward trajectory, while a moderate recovery in the smartphone and memory sectors contributed to the industry's positive performance.

By market, communications was the largest sector, at 34.2%, followed by computers (22.5%), semiconductors (15.5%), automotive (12.9%), consumer electronics (9.9%) and others (5%).

Mobile PCBs remained a dominant segment, while the shift toward electric and autonomous vehicles sustained robust demand for automotive electronics. Notably, although AI servers and satellite communications accounted for a smaller portion of overall PCB applications, their growth trajectory remained strong. In 2024, Taiwan's server PCB production value surged 49% to NT$50.9 billion, while the satellite PCB sector skyrocketed by 83% YoY to NT$19.3 billion.

Multilayer PCBs (30.5%) and HDI boards (20.1%) experienced rising demand, driven by AI servers, automotive electronics and satellite applications. Flexible PCBs (24.4%) saw a declining market share due to stagnant smartphone growth and weaker AI-driven demand. IC substrates (15.5%) faced growth slowdowns due to market fluctuations but are expected to rebound with the increasing adoption of AI and high-performance computing chips.

The outlook for 2025 remains cautiously optimistic, TPCA said. Global cloud service providers are ramping up capital expenditures, and sovereign AI development efforts are gaining momentum worldwide. AI server demand is projected to continue its upward trend, while advancements in knowledge distillation technology could accelerate AI edge computing adoption, further fueling HDI and multilayer PCB demand. The expanding low-earth orbit (LEO) satellite market, driven by decreasing launch costs, is also expected to boost demand for satellite PCBs.

Policy uncertainties in the US, however, remain a critical factor for 2025. Potential tariff adjustments could impact global inflation trends, while shifts in EV policies, such as relaxed environmental regulations or subsidy reductions, may introduce volatility in the electric vehicle sector. Additionally, China’s ongoing deflationary risks could weaken consumer market recovery.

Another notable industry development is the increasing production capacity of Taiwanese and Chinese PCB manufacturers in Thailand, starting in 2025. While the initial scale is limited, long-term capacity expansion could intensify market price competition. Furthermore, rising international gold prices and expected electricity price hikes pose additional cost challenges for manufacturers.

Despite the seasonal slowdown in Q1 2025, AI servers and satellite communications are anticipated to sustain industry momentum. The Taiwanese PCB sector is forecasted to grow by 2.6% in Q1 2025, reaching NT$186.2 billion, with full-year growth expected at 4.6%, bringing the total industry value to NT$854.1 billion.