Apple (AAPL) and Qualcomm (QCOM) are concerned about the strained supplies of Japan’s high-end glass cloth fiber, Nikkei Asia reported.
Glass cloth is a vital part in chip substrates and printed circuit boards, or PCBs, which themselves are the building blocks of electronic devices, and the most advanced types of this cloth are made almost exclusively by one Japanese firm, Nitto Boseki, or Nittobo for short, the report added.
Apple and Qualcomm did not immediately respond to a request for comment from Seeking Alpha.
Apple was an early adopter of Nittobo’s glass cloth for iPhones. Initially, there was little issue with supply. The AI boom has increased the demand for high-performance PCBs manufactured with premium glass cloth, meaning that even AI companies now want Nittobo’s products, putting not just Apple but also mobile chip maker Qualcomm (QCOM) at risk of supply shortages, the report noted.
Short supplies of the glass cloth fiber have Apple scrambling against the likes of Nvidia (NVDA), Alphabet’s (GOOG) (GOOGL) Google and Amazon (AMZN) to secure the same scarce resource, the report added.
The short supply of glass fiber and the resulting crunch in PCB supplies are creating what one industry insider calls “one of the biggest bottlenecks for the electronics-making and AI industry for 2026,” according to the report.
Amid growing concerns, Apple dispatched staff to Japan last autumn, and stationing them at Mitsubishi Gas Chemical, or MGC, to try to secure more supplies of materials used in bismaleimide triazine, or BT, substrates, to report added.
Several types of chips require BT substrates as their base, including those used in iPhones and other mobile devices. And to make its BT substrate materials, MGC requires Nittobo’s glass cloth.
Apple even asked the Japanese government officials if they could help secure more supplies from Nittobo to meet its 2026 product roadmap, the report noted.
MGC told the news outlet that the company’s “related business division is closely discussing with important customers including direct and indirect ones to search out the solution of current materials supply issues,” but declined to comment further.
Earlier, Nikkei had reported that Nvidia and Advanced Micro Devices (AMD) also sent staff to visit Nittobo in hopes of getting supplies needed for AI chips, the report noted.
Nvidia and AMD did not immediately respond to a request for comment from Seeking Alpha.
“No additional capacity is no additional capacity, even if you pressure Nittobo,” said an executive with a substrate supplier serving AMD, Nvidia and Apple, the report noted. “The way we see it, the situation will only truly improve meaningfully when Nittobo’s new capacity goes online in the second half of 2027.”
Apple is also working to find alternative sources, including sending staff to a small Chinese glass fiber maker known as Grace Fabric Technology, or GFT, and asking MGC to help oversee the Chinese material supplier’s quality improvement, the report noted.
Meanwhile, Qualcomm has visited another, smaller Japanese glass cloth supplier, Unitika, to see if it could help ease the supply. However, the quantity that Unitika makes is far less than that of Nittobo, as per the report.
“This is one of the biggest bottlenecks for the electronics-making and AI industry for 2026,” an executive from a supplier to Nvidia and Apple told the news outlet.
The special type of glass they are seeking is formally known as low-coefficient-of-thermal-expansion, or CTE, glass but is commonly called T-glass. The product is valued for its dimensional stability, rigidity and ability to facilitate high-speed data transmission, which is vital in AI computing and other premium processor chips, the report noted.
Many new entrants are hoping to capitalize on the constrained supply, such as Taiwan Glass, a traditional glass manufacturer based in Taipei, and China’s Taishan Fiberglass, Grace Fabric and Kingboard Laminates Group, as per the report.
However, the technological barriers to entry are high — every glass fiber is thinner than a human hair and must be perfectly round and free of any bubbles — and new entrants are struggling to achieve adequate capacity and consistent quality, the report noted. No tech giant is willing to risk mounting their high-end chips on substrates which could compromise the quality of their final products, industry executives told the news outlet.
“The stability of T-glass cloth is a decisive factor for substrate quality,” said a source with a substrate equipment maker, while a PCB making executive noted that the product’s location deep inside a device’s substrate means it cannot be taken out and fixed later, the report added.
Apple pioneered the use of high-end glass fiber in its smartphones, well before AI chip leaders started deploying such materials at scale in their products. However, even Apple has been caught off guard by buyers like Nvidia, Amazon and Google entering the fray, the report noted.
Apple has talked to suppliers about using less-advanced types of glass cloth, but it would take time to test and verify alternative materials, doing little to immediately improve the situation, the report added.
T-glass is not the only product facing issues in the tech supply chain. AI-driven investments have already impacted the memory chip market, with consumer electronics, PC and smartphone makers racing to secure vital DRAM and NAND flash components for 2026, the report noted.
Several other components and materials related to chip substrates and printed circuit boards also face potential shortages this year. One example that some industry insiders pointed to is drill bits and drilling machines, used to drill layers of printed circuit boards for servers. In the past, one drill bit could be used many times . However, AI server boards have become thicker, harder and more expensive, which means drill bits must be much more advanced and replaced more frequently, the report added.
Recently, Nittobo told Nikkei Asia that it would continue to prioritize quality over quantity, and not become a maker of commoditized components.
“It’s inevitable that we’ll lose some market share,” said Nittobo CEO Hiroyuki Tada. While he acknowledges the pressure to expand capacity, he says there is a limit to the risks that a small supplier like his can take on, the report noted.
Chris Lin, chairman and president of Aspeed Technology, a top developer of chips for server board management controllers, said constraints in chip substrates and other supply chain bottlenecks have held back some AI demand potential for 2026.
“We do see very strong demand and good growth momentum for 2026 but we do have to adjust down our forecast because of the constraints in material supplies,” said Lin, the report noted.