We make the organic build-up substrate that carries the accelerator die onto the board - the piece directly beneath the chip. On the leading-edge AI-server substrate our share is estimated to be around 70-80%, and near 100% at the launch of each new generation, though that comes down 20 to 30% over roughly three to six months as others qualify. Demand continues to exceed our capacity, and we are spending to close the gap - around 500 billion yen across the Ono and Gama plants through FY2028, largely funded by customer advances. In the same breath as that spending, two concessions: we are not optimistic about product prices, because competitors may also expand capacity; and the same year our AI substrate surged, the legacy PC-substrate line took a 10.6 billion yen impairment. We name no customer - only a major CPU customer, a major GPU customer, hyperscalers.
We note that the Electronics segment that surged also contains the legacy PC‑substrate line in the Philippines, which recorded a 10.6 billion‑yen impairment as its competitive environment is expected to intensify. Accordingly, the non‑AI half is in retreat even as the AI half compounds.
For the year ended March 2026, net sales rose 12.7% to 416.2 billion yen and operating profit rose 30.3% to 62.0 billion yen. All gain came from Electronics — IC substrate sales up 23.4%, segment profit up 68.6% at 18.6% margin. Net income rose 89% to 63.7 billion yen, however, we flag this as flattered by a one-time extraordinary gain offsetting a 16.4 billion yen impairment. The tell: next year's guidance has operating profit up ~45% to 90 billion yen while net income falls 9% to 58 billion yen. Operating profit, not net income, is the metric we point to.
We plan roughly 500 billion yen of capital investment across FY2026-2028 — about 280 billion at the Ono Plant, where AI-server substrate mass production started October 2025, and about 220 billion at the Gama Plant, driven by a major CPU customer's requests for earlier ramp. This lifts SAP capacity to more than double by FY2027 and just under three times the H1-FY2024 level by end-FY2028, which management says is needed or "
Our Electronics segment surges, yet the legacy PC-substrate line in the Philippines took a 10.6 billion yen impairment as competition intensifies — the non-AI half retreats while the AI half compounds. Roughly 22% of sales sit in an uncharacterized "Others" segment; its AI relevance is unresolved. Our substrates depend on ABF build-up film, and material supply remains a constraint: we are qualifying alternatives but have not secured volumes for potential upside.
We estimate our share on leading-edge AI-server substrate at around 70-80%. At each new-generation launch it typically reaches close to 100%, then declines 20-30% over roughly three to six months as rivals qualify. The near-monopoly sits at the frontier and erodes as the node matures. For the next-generation silicon-bridge substrate, the backside-interconnect difficulty is high enough that we expect to hold our technological advantage at least through FY2030.
We hold a roughly 70-80% AI-server substrate share, yet we are not optimistic about product prices. While supply and demand are tight, competitors may also be expanding capacity, so we factor price-decline risk into our medium-term forecast. For PC and general-purpose server we conservatively assume declines; for AI server, where suppliers are limited, there may be positive factors, but our overall stance remains cautious. Long-term customer relationships keep negotiations reasonable, and material-cost increases have been passed on with agreement.
