News

Compal increases 2024 CapEx to 18 billion TWD to expand AI server manufacturing and infrastructure

Tuesday, March 3, 2026 at 03:26 AM

Compal Electronics plans to increase its 2024 capital expenditure to 18 billion TWD, a 125% increase year-over-year, to expand server production capacity in Taiwan, the United States, and Vietnam. The company expects server shipments to surge in Q1, with AI servers projected to account for 80% of total server revenue by 2026. The firm is expanding its AI strategy from motherboards to L10/L11 rack-level solutions, collaborating with AMD and pursuing Vera Rubin certification. Q1 server shipments include HGX B300 and RTX platforms.

Context

Compal is aggressively pivoting into the AI infrastructure market, boosting its 2024 capital expenditure by 125% to 18 billion TWD. This surge in spending targets expanded production capacity in Taiwan, Vietnam, and the United States, alongside the establishment of a new AI laboratory. The investment facilitates a strategic shift from component manufacturing toward high-value L10 and L11 rack-level solutions, supporting HGX B300 and RTX platforms. By expanding its manufacturing footprint, Compal aims to capture surging demand for hyperscale AI deployments. Partnering with AMD on rack-level solutions and pursuing Vera Rubin certification, Compal expects server revenue to reach 10% of total sales by 2026 and 20% by 2027. Management anticipates AI servers will constitute 80% of this segment’s revenue. While moving toward full-system integration may initially squeeze gross margins, the company projects that economies of scale will drive higher operating profits, helping offset current volatility and seasonal inventory adjustments in its core notebook business.

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