TTM Technologies Just Printed the Largest Quarter in Its History — and the Market Sold the Stock 28%

TTM Technologies printed the largest quarter in its history: net sales of $1.2039 billion, up 60% year over year, with data center and networking revenue of $493.6 million (+115%) now 41% of sales. Adjusted EBITDA of $242.3 million was 20.1% of revenue, and management guided 2027 to $6.5–6.75 billion of revenue and $8.10–8.90 of non-GAAP EPS on 108.1 million diluted shares. The stock still fell 27.7% to $73.89 on Oct. 22. The reaction, not the print, is what the next two quarters have to answer.

Three things in the release mattered more than the beat. Guidance of $1.42–1.44 billion for the fourth quarter puts the midpoint at $1.43 billion, just under the $1.44 billion consensus, so a record quarter still ended with a slightly disappointing near-term number. Management also flagged material lead times stretching from about 12 weeks to as much as 24 weeks, which the market read as demand arriving later rather than sooner. And the balance sheet absorbed two large cash commitments at once: the $650 million all-cash purchase of the Ophir Optics business from MKS Inc announced Oct. 19 and expected to close in the second quarter of 2027, alongside $400 million of new AI capacity.

The most useful read in this print is not the revenue line but the split between what boards earn and what boards pay for. TTM's non-GAAP gross margin reached 24.8%, up 330 basis points from 21.5% a year earlier. One tier up, Kingboard Laminates — the largest laminate supplier behind the AI build — reported first-half 2026 revenue of HK$14.90 billion (+55%), gross profit of HK$4.58 billion, gross margin near 30.7% against 18.4% a year earlier, and net profit of HK$2.89 billion (+209%), all on shipment volume up just 14%. A 55% revenue gain on 14% more volume is a price cycle, and the price is being set above the board layer.

Goldman's own forecast makes the point brutally: blended AI server PCB pricing per square meter is projected to rise from $5,833 in 2025 to $18,549 in 2028 while shipment area grows from 0.9 million to 4.5 million square meters. Roughly half of the revenue line in this cycle is price, not boards. TTM captures the pass-through and carries the working capital and the capital spending; Kingboard Laminates and Ajinomoto capture the increment.

The 2028 date is not a metaphor. TTM's $400 million brownfield expansion across four plants in China and its Penang, Malaysia site is explicitly aimed at 2028 revenue, on top of a previously disclosed $1.2 billion commitment running through 2029 and total committed capacity expansion of over $1.3 billion. Kingboard Laminates is adding specialty yarn kilns toward 13 and enough fabric for 100 million meters of AI-grade glass cloth by 2028. Samsung Electro-Mechanics has volume production from a $1.2 billion ABF expansion arriving in Q3 2027, and Ibiden is running the largest single substrate expansion on record toward 2.8 times its 2024 capacity by 2028. Into that same window, the film constraint is expected to peak: an ABF supply shortfall of roughly 10% in the second half of 2026, about 21% in 2027, and potentially more than 40% by 2028, with Ajinomoto already at full load near 2.0 million square meters a month.

The cash math is the part of this print that does not improve with revenue. TTM generated $154.7 million of operating cash flow in the third quarter against $79.9 million of net capital spending, but the first half of 2026 went the other way: $118.2 million of operating cash flow against $169.2 million of capital spending. Depreciation of roughly $120 million over the first nine months against $249 million of capital spending means spending is running at about twice the depreciation rate. Cash of $876.3 million at Sept. 28 is comfortable, but $650 million of it is committed to Ophir and $400 million to new AI lines before 2028, with roughly $20 million a quarter of interest expense against an adjusted EBITDA run rate near $970 million.

Near term the debate is arithmetic: TTM must hold the $1.43 billion fourth-quarter midpoint and then convert a 49% data center mix into the $6.5–6.75 billion 2027 guide, with N+M moving from about 30% of data center and networking activity to roughly 50%. Further out, the question is whether the 2028 capacity wave lands into demand that is still inelastic, or into a substrate bottleneck that finally breaks.

The investment question is not whether AI server boards are growing — this print settles that. It is who keeps the dollars as material inflation, capacity and the substrate bottleneck cycle through 2028. On the evidence in this quarter, the money is being made in film and laminate, TTM is the vehicle that converts that inflation into revenue and capital spending, and 2028 is the year the bill comes due.