The US midterm elections delivered a Democratic "blue wave," moving Wall Street tech stocks and adding uncertainty to AI data center expansion. Citing Goldman Sachs estimates, Reuters reported that about 45% of planned US data center expansion capacity could be affected by local governments pausing new construction projects and tightening oversight. Hon Hai (2317), Quanta (2382), Wistron (3231), Wiwynn (6669) and other Taiwan makers have actively taken AI server orders from US cloud service providers (CSPs) in recent years, and the market worries that slower construction could hit shipments and expansion plans.
Texas Shift Sparks Regulatory Concerns, Clouding Taiwan Makers' Plans
Reuters noted Democrats won key races in Texas, Georgia and elsewhere, with Texas Governor-elect Gina Hinojosa calling for a pause on approvals for new data centers and a review of power, water and tax incentive policies. As AI data centers expand rapidly, local residents worry about higher electricity bills from heavy power use, crowded-out water resources and impacts on living conditions. According to an October University of Houston poll, about 79% of likely Texas voters support limiting the number of data centers.
Texas is not only a hub for US AI infrastructure, but also a key US investment base for Taiwan server contract manufacturers. Research firm GLJ Research estimates the state accounts for about one-quarter of new US data center capacity expected before 2030; separately, Dallas Fed research shows Hon Hai, Wistron, Inventec and Pegatron (4938) have all announced AI server manufacturing plans in Texas, with Taiwan companies' announced local investment plans in 2025 estimated at 5.3 billion US dollars. If new construction projects are delayed by approvals or grid-connection issues, server equipment procurement, deployment and delivery schedules could be affected. Still, slower construction does not mean AI computing demand has disappeared, nor that existing orders have been canceled, and the actual impact will depend on major CSPs' subsequent capital spending and procurement plans.
Cooling Pair Hits Limit-Down as Selling Spreads Across Assembly and Components
Taiwan AI server supply chains came under expanding intraday selling pressure on the 5th. As of 12:18 p.m., Wiwynn plunged 6.44% to 1,670; Pegatron fell 3.15%, Wistron fell 2.84%, and Inventec turned from flat to down 1.06% at 55.8; Quanta, at an earlier quote of 306, bucked the trend with a gain of about 1.2%. Component names fell harder, with cooling makers Auras (3324) and Jentech (3653) both hitting limit-down, AVC (3017) plunging 8.3% and Sunonwealth (2421) down 6.7%; power management leader Delta Electronics (2308) fell 7.38% and Lite-On Technology (2301) fell 5.1%; server chassis makers Chenbro (8210) and Shengming Electric (3013) fell 3.6% and 4.3% respectively, while rail maker King Slide (2059) fell 5.2%. In connectors and mechanical parts, Lotes (3533) plunged 9.62%, Fositek (6805) fell 9.86%, and JPC (6197) and Wellwinning (6290) fell 7.29% and 9.34% respectively, showing selling spreading from server assembly to cooling, power, chassis and connector supply chains.
PCB and Substrate Names Hardest Hit, Several Touch Limit-Down
PCB, copper-clad laminate (CCL) and IC substrate stocks also faced heavy selling. Based on midday quotes, Nan Ya PCB (8046) plunged 10% to 972; Kinsus (3189) fell 9.98% to 740; EMC (2383) fell 9.99% to 4,100, ITEQ (6213) fell 9.97% to 551, Topoint (8021) fell 9.92% to 340.5, and Taiwan Line Tek (6274) fell 9.87% to 1,005, all touching or approaching limit-down levels. Elsewhere, Gold Circuit Electronics (2368) fell 9.34%, Unimicron (3037) fell 9.68%, and Tripod (3044) fell 9.19%; Compeq (2313) and Zhen Ding-KY (4958) fell 8.49% and 7.74% respectively. From high-end CCL and PCB to IC substrates, related groups weakened almost across the board, reflecting broadening adjustment pressure across AI hardware supply chains.