Four Major MLCC Leaders Confirm: AI-Driven Shortage Wave Set to Surpass the 2018 Super Cycle
Taylor Wilson
Yageo, Walsin, Holystone and Coretech all confirmed at their shareholder meetings that the AI-driven MLCC shortage will outlast the 2018 passive-component super-cycle. This means the industry is entering a structurally supported long-cycle upcycle, not a short-term spike.
How long will this shortage actually last?
All four makers reached the same conclusion: this shortage will be the longest supply-demand imbalance on record, surpassing the 2018 passive-component super-cycle.
Walsin GM Tseng Ming-tsan explicitly extended the timeline to beyond 2027; Holystone expects the supply gap to widen further next year.
This means → the market's framing needs to shift from "when does the shortage end" to "who benefits most from a prolonged deficit."
Two demand waves — which one is bigger?
Wave one comes from AI server and data-center infrastructure spending, already running for over a year.
Wave two comes from AI PCs and edge devices — potential shipments reach 200 million units, dwarfing the server market's few-million-unit scale.
In plain terms = servers are the vanguard; AI PCs are the main force. Once the memory-supply bottleneck clears, the MLCC shortage deepens — it does not ease.
How hot are orders? What does Yageo's data tell us?
Yageo's book-to-bill ratio — new orders divided by shipments — has climbed above 1.3, reportedly surpassing Japan's Murata.
Market sources say Yageo chairman Pierre Chen has ordered full production ramp-up, maximizing utilization rates, building buffer inventory and clearing capacity bottlenecks — but Yageo has not officially confirmed these reports.
This means → a B/B ratio persistently above 1 signals demand is growing faster than shipments; inventory is being drawn down, not built up.
Why is capacity expansion so difficult?
Lead times for high-end passive-component equipment have stretched to 1–1.5 years; the machines Holystone plans to install in H2 were actually ordered two years ago.
Walsin holds a favorable position in equipment vendors' order queues, yet Japanese vendors still quote 6–12 months and Taiwanese vendors 3–6 months.
In plain terms = even if a maker places a big equipment order today, the new capacity won't come online for one to two years — supply inherently lags demand.
Can the expansion pace keep up with demand?
Holystone expects capacity to grow 20%–30% year-on-year this year, with equipment arriving in phases in Q3 and Q1 next year; a further 30%–40% uplift is targeted by 2027.
Walsin has tripled this year's capex versus prior levels and will sustain expansion for two consecutive years — yet the pace still falls short of full demand.
This reflects a core tension: makers are already expanding flat-out, but equipment lead times mean capacity release consistently trails the demand surge.
After the trading-restriction lift, what's next for the sector?
Last week's lifting of trading restrictions on passive-component stocks saw Yageo, Nippon Denshi Boeki, Holystone and Coretech all hit limit-up on the first unrestricted trading day.
Walsin, under restrictions the longest, is next in line — the sector looks set to emerge from the shadow of segregated trading.
This means → whether supply-side catch-up can meaningfully narrow the gap before 2027 is the key variable that will prove or disprove the "super-cycle" thesis.
Content is for reference only, not financial advice.