Kyber/Backplane PCB Delays May Lower 2027-2028 AI PCB/CCL Market Size Expectations

Overview

This report focuses on the potential impact of delayed Kyber/backplane PCB delivery in NVIDIA's Rubin Ultra servers on the AI PCB, CCL, and copper cable supply chains. Jefferies' channel checks show that Kyber, an orthogonal backplane PCB solution used for intra-rack connections, is relatively complex technically, and visibility for a 2027 ramp has declined materially. Rubin Ultra is highly likely to continue using the Oberon architecture in 2027.

Core views

The core view is that a Kyber delay is negative for incremental AI PCB/CCL demand and market sentiment, but it does not change the long-term trend of rising PCB content in AI infrastructure. If Kyber is delayed, 2027 AI PCB/CCL TAM would be revised down by 5%/8% versus the original forecast; if Kyber is delayed further or canceled, 2028 would be revised down by another 11%/16%. At the supply-chain level, upstream materials companies may continue to outperform downstream PCB manufacturers in the near term thanks to stronger pricing and cost pass-through, while copper cable vendors benefit from the extension of the Oberon lifecycle.

Analysis framework

The report analyzes the issue mainly based on supply-chain channel checks, changes in the AI server architecture roadmap, the upgrade cycle of PCB/CCL materials, and TAM scenario forecasts, while comparing the Kyber delay scenario with the original market size estimates.

Methodology notes

• Market size estimationTAM scenario analysis

  Estimate the degree of downward revision under Kyber delay or cancellation scenarios based on the original AI PCB/CCL TAM forecast.

  The report includes AI servers, high-speed switches, and high-speed optical modules in AI PCB/CCL TAM, and separately evaluates the impact of the 2027 delay scenario and the 2028 cancellation scenario.

• Supply chain analysisUpstream-downstream relative return analysis

  Compare the degree of benefit or harm to upstream materials makers, downstream PCB manufacturers, and copper cable vendors under architecture changes.

  Upstream glass fiber fabric and CCL benefit from supply tightness and price increases, so their short-term earnings leverage is stronger than that of PCB manufacturers; copper cables benefit from the continuation of the Oberon architecture.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• NVIDIA Corporation (NVDA)

  The core company tied to changes in the Rubin Ultra, Kyber, and Oberon architectures

  Strengths

  Upgrades to the AI server platform continue to drive demand for high-value interconnects, PCBs, and materials; the report discloses a Buy rating and a $300 target price.

  Weaknesses

  If Kyber is delayed, the pace of some supply-chain upgrades and market expectations may slow.

  Comparison

  Compared with downstream PCB manufacturers, the impact on NVIDIA is more about platform architecture pathways and supply-chain timing than the material earnings leverage emphasized in the report.

  Risks

  Competition from INTC, AMD, and hyperscalers' in-house ASICs; slower data center capex; vehicle platform progress below expectations.

• AI PCB manufacturers

  The segment directly affected by a Kyber/backplane PCB delay

  Strengths

  They continue to benefit long term from AI infrastructure interconnect upgrades and higher PCB content.

  Weaknesses

  A Kyber delay would lower 2027-2028 TAM expectations and may trigger EPS downgrades.

  Comparison

  They may underperform upstream glass fiber fabric and CCL materials companies in the near term.

  Risks

  Project delays, cancellations, weaker demand expectations, and softer market sentiment.

• Upstream material makers such as CCL and glass fiber fabric companies

  Upstream of the PCB supply chain, driven by material upgrades and price increases

  Strengths

  Tight supply, ongoing price increases, and strong cost pass-through make near-term earnings leverage relatively attractive.

  Weaknesses

  A downward revision in end-market TAM may still affect medium- to long-term demand growth.

  Comparison

  The report expects upstream materials makers to continue outperforming downstream PCB manufacturers in the near term.

  Risks

  Easing supply-demand tightness, price declines, and a slower materials upgrade cycle if Kyber is canceled.

• Copper cable vendors

  Potential beneficiaries of the extended Oberon architecture

  Strengths

  An extended Oberon lifecycle reduces the risk of copper cables being displaced by backplane PCBs.

  Weaknesses

  If Kyber is ultimately adopted successfully, replacement pressure on copper cables within rack interconnects could rise again.

  Comparison

  Compared with PCB backplane solutions, copper cables have a more favorable relative-benefit profile in a Kyber delay scenario.

  Risks

  Maturing of new PCB interconnect solutions, accelerated customer architecture shifts, and price competition.

Key data

• Original 2025 AI PCB/CCL TAM forecastAI PCB: $6-7 billion; AI CCL: $2-3 billionIncludes AI servers, high-speed switches, and high-speed optical modules.
• Original 2026 AI PCB/CCL TAM forecastAI PCB: $12 billion; AI CCL: $5 billionGrowth is driven by specification upgrades and material upgrades.
• Original 2027 AI PCB/CCL TAM forecastAI PCB: $25 billion; AI CCL: $12 billionIf Kyber/backplane PCB is delayed, these are expected to be revised down by 5% and 8%, respectively.
• Original 2028 AI PCB/CCL TAM forecastAI PCB: $41 billion; AI CCL: $21 billionIf Kyber is ultimately not implemented, these are expected to be revised down by another 11% and 16%, respectively.
• NVDA rating and target priceBuy, target price $300, current price $210.69The target price corresponds to 21x Jefferies' CY28E EPS estimate of $14.14.

Impact & implications

The short-term impact mainly shows up in lower AI PCB/CCL market expectations, potential EPS revisions for PCB companies, and weaker market sentiment. The structural impact is not unidirectionally negative: upstream materials companies may still benefit from tight supply and price increases, and copper cable vendors also face a lower risk of being displaced by backplane PCBs as the Oberon solution continues. In the long run, upgrades in specifications and materials such as M9/10, PTFE, and CoWoP are still progressing, and the demand trend for high-value interconnect solutions in AI infrastructure has not been fundamentally disrupted.

Risks

• Kyber is ultimately canceled or delayed further, leading to another downward revision in AI PCB/CCL TAM.
• EPS expectations for PCB supply-chain companies are cut, creating share price pressure.
• Supply-chain visibility into Kyber's implementation path is low, and even a simplified two-container design still poses technical challenges.
• Competition from INTC, AMD, and hyperscalers' in-house ASICs may affect NVIDIA's share and ASP.
• Corporate and hyperscaler data center capex slows.
• Vehicle platform development slows more than expected.

What to watch

• Whether Rubin Ultra in 2027 is confirmed to continue using the Oberon architecture.
• Whether the new Rubin Ultra in 2028 can implement the Kyber architecture, or whether Kyber is canceled.
• The actual adoption pace of materials and process upgrades such as M9/10, PTFE, and CoWoP.
• Whether prices for glass fiber fabric, CCL, and other upstream materials continue to rise.
• Whether PCB manufacturers' earnings forecasts are revised down.
• Whether copper cable vendors' orders and earnings benefit from the extended Oberon lifecycle.