After years of offshoring, Europe’s printed circuit board industry is entering a new phase. Demand is rising, fueled by AI and defense, but supply is not following. The result is a growing imbalance in a €10 billion global market. European PCB manufacturing accounts for roughly €2 billion of that total, yet the industry underpins modern electronics.

“The first element of any defense system is the PCB, yet it is missing from most European defense policy discussions.” That omission, according to Aspocomp CEO Manu Skyttä, says a lot about Europe’s industrial blind spots.

For decades, those blind spots were masked by globalization. Production of printed circuit boards steadily moved to Asia, particularly to China, in search of lower costs and scale. Found in everything from defense systems and data centers to cars and medical devices, PCBs underpin modern electronics.

“China today accounts for roughly 65 percent of global PCB manufacturing,” Skyttä says. But the shift came with trade-offs. As manufacturing consolidated around volume, Europe’s capability in complex, high-specification boards weakened. Now, that dynamic is beginning to reverse.

“2025 is the first year since 2000 that the value of European PCB manufacturing has increased,” he says. After years of decline, demand is returning. But the recovery is uneven, and capacity is struggling to keep up.

Manu Skyttä, an aeronautical engineer by training, became the CEO of Aspocomp in 2024.

From survival to surge

The change is recent, and for Aspocomp, abrupt.

“When I joined, the order book was empty. The first priority was survival,” Skyttä says.

That was early 2024, when Skyttä, an aeronautical engineer by training, stepped into the role after a career in operations-heavy industries, including defense group Patria, aviation at Finnair, and industrial services at Wärtsilä.

Within 18 months, the company moved from weak demand to full utilization. Net sales rose 38 percent in 2025 to €38.2 million, and the operating result turned positive at €0.9 million, compared to a €4.0 million loss the year before.

The turnaround was driven by two core segments: semiconductors and defense.

AI and defense reshape demand

Aspocomp’s largest segment is now semiconductors, specifically boards used in chip testing equipment. In 2025, net sales in this segment more than doubled to €17.5 million from €8.5 million the year before.

The shift is not company-specific. The rise of AI is driving a surge in semiconductor demand, fueled by rapid data center expansion and new computing needs, McKinsey recently pointed out.

“The demand is increasingly coming from AI-related development. Data centers are growing rapidly, and chip testing requires more complex boards,” Skyttä says. He points to a deeper technical shift.

“Chip development now requires more and more testing, and that increases the requirements for the testers themselves.”

As chips become more advanced, testing infrastructure must follow. That pushes demand toward high-density interconnect boards, an area where European manufacturers still compete. “These testers require highly complex HDI boards, and we have a strong position in that segment.”

Alongside semiconductors, defense has become a second growth engine. The Security, Defense, and Aerospace segment generated €9.3 million in 2025, up 44 percent year-on-year. While smaller in absolute terms, its role is different.

“This segment provides important stability for the company alongside the semiconductor industry,” Skyttä says. Unlike semiconductors, defense demand is less cyclical and increasingly shaped by geopolitics.

“What we see now is mainly stockpiling,” he says. “For us, this is only the beginning. The real increase in demand will come in the 2030s.”

In that sense, geopolitics is no longer a backdrop, but a direct driver of demand and investment decisions.

Demand rises, capacity does not

The broader European PCB market remains fragmented and constrained.

The scale gap is significant: Aspocomp’s €38 million in revenue is less than one percent of that of the global PCB leader, Taiwan’s Zhen Ding Technology.

“Out of around 170 manufacturers in Europe, about 140 have revenue below €10 million,” Skyttä says. Most companies lack the financial capacity to invest in new equipment or expand production. As a result, supply is tightening even as demand grows.

Europe remains structurally dependent on external electronics supply chains, with capacity still concentrated in Asia despite growing strategic demand, as recent European policy debates have highlighted.

“European capacity is actually decreasing at the same time,” Skyttä says. “That creates a void in Europe.” That void is already visible in customer behavior.

“We see customers being more proactive. They are already asking how to secure capacity in the future.” 

For Aspocomp, the imbalance is immediate. “Our factory has been running at full capacity since early 2025,” Skyttä says. “We could increase capacity by 50 percent immediately if we had it.”

In this environment, operational performance becomes decisive. “Maintenance people are effectively defining our net sales,” he says. “And now the focus is quality, quality, and quality.”

A strategic shift away from China

The company has adjusted its supply strategy in response.

Historically, Aspocomp complemented its own production by sourcing lower-cost boards from China. That approach no longer fits its positioning.

“Trading from China is a volume game, and we don’t have that scale,” Skyttä says. Instead, the company is expanding partnerships in Europe and Southeast Asia.

“We have shifted our strategy to increase partnerships outside China,” Skyttä says, adding that Apsocomp is not competing in high volumes like in China. “Our strength is in highly complex boards.”