An Overlooked AI Server Supplier Reports Thursday Morning

Record sales, a 1.49 book-to-bill, and a stock cut by more than half from its June high.

October 19, 2026

Here's a setup worth your attention.

A company that set records last quarter for sales and earnings, with orders running well ahead of shipments, just saw its stock lose more than half its value from its June high.

Part of that is the AI selloff. Part of it is a spending plan the market didn't like. Results land Thursday before the open.

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This stock had a brutal stretch. It ran to a June high near $220, then fell back below $95 by mid-October as AI hardware sold off, and investors balked at a big new spending plan.

The business didn't follow it down. Last quarter set records, and orders are still running well ahead of shipments.

The name I've been watching sits deeper in the AI stack than you might realize. Not a chip designer. Not a networking player. The company that actually makes the complex printed circuit boards those chips and switches ride on.

The stock is TTM Technologies (NASDAQ: TTMI), and it reports third-quarter results before the market opens on Thursday, Oct. 22.

Action: If you want exposure, keep it to a starter position ahead of Thursday's report. Shares sit near $94, well below the 50-day moving average near $122, so let the print and guidance tell you whether to add.

Operational Overview and Recent Earnings

TTMI makes the boards that everything else bolts onto. Think fighter jet radar systems, hyperscale AI server racks, 5G base stations, satellite payloads. If a modern electronic system matters, odds are a TTMI board is inside it.

AI server complexity has made PCBs a real bottleneck. Layer counts jumped from 20 to 40-plus, signal-integrity tolerances are brutal, and only a handful of fabs can hit the specs. TTMI is one of them. That scarcity is the thesis you are buying.

Last quarter was a statement print you should anchor to. Net sales hit a record $1.0 billion, up 37% year over year, and non-GAAP EPS of $0.99 was also a record and beat the Street. Book-to-bill came in at 1.49, so orders ran well ahead of shipments.

Data center and networking was 40% of sales on AI demand, and aerospace and defense was 37%, with program backlog above $1.7 billion. That's a mix shift, not a one-quarter sugar high, so track backlog commentary on the next call before you decide anything.

Action: Before Thursday's open, write down what you need to see: data center growth holding up, defense backlog still building, and a fourth-quarter outlook that doesn't walk anything back.

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Data Center PCBs are a Long-Term Growth Catalyst

AI rack systems need boards most fabs in the world simply can't make. TTMI already supplies leading networking OEMs, and that's lifting dollar content per server and showing up in the revenue mix quarter by quarter.

The defense side is cooking too. With U.S. defense spending at record levels and next-gen fighter and missile programs ramping, the aerospace and defense book is running hot.

TTMI closed its purchase of Epiq Solutions, a maker of software-defined radio and RF sensing gear, on Sept. 30 to deepen that business.

Then there's the valuation reset, and the reason for it. On Oct. 12, TTMI announced a $400 million plan to rapidly add AI capacity at four facilities in China, and the stock fell about 10% that day on worries about capital intensity and China exposure.

The broader AI hardware selloff did the rest. Shares are still up about a third this year, but they now trade around 20 times forward earnings, a much cheaper entry than you had in June. Truist kept its Buy rating and raised its target to $231 on Oct. 13.

Action: Listen on Thursday's call for how the $400 million China build gets funded, when it starts producing, and any named hyperscaler programs. Those are the pieces that could push your estimates up.

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Bear Case

TTMI is no longer the stock that nearly doubled into June. It has already been cut in half once, which tells you how fast sentiment can swing, and Thursday's print has to deliver or your stock takes another hit.

A handful of networking and defense primes drive the majority of revenue. If one major program slips, or a defense budget decision gets delayed, it shows up in results fast.

If hyperscaler capex timelines slip even a quarter, the growth narrative dims. Last week's selloff was the market pricing in some of that risk already.

Management is adding fab capacity in China to meet AI demand. That brings spending, execution, and geopolitical risk. If utilization lags or startup costs run hot, margins compress right when your expectations are highest.

Street targets sit far above the share price. Truist's $231 is more than double where shares trade today. That gap reflects skepticism about whether the AI mix shift and the China build pay off, and it means a cautious fourth-quarter outlook could still hit the stock.

Action: Size your position accordingly. Keep it to a starter before the print, add only if guidance confirms the AI and defense demand, and reassess on a close below $80 or if the AI board story shows cracks in Thursday's commentary.

AI Server Buildout Positions TTMI as a Scarce Supplier

A record Q2 2026, with 37% revenue growth, a 1.49 book-to-bill and a mix tilted toward AI and defense, underscores TTMI's position as one of the few fabs that can actually build what the hyperscalers need.

Defense backlog above $1.7 billion gives you visibility, and the data center business is still early in the content story.

With a multi-quarter mix shift playing out and a selloff that has cut the stock in half from its high, TTMI is worth a close look before the crowd decides the AI buildout needs more than chips and switches.

Thursday morning's print is the next test. Size it carefully and let the numbers tell you whether to add.

Setup Scorecard

Entry Zone: Starter position near $90 to $95 ahead of Thursday's print; add only if guidance confirms demand.

Target: $130 over six to 12 months, a recovery toward the 50-day and summer trading range (Truist's target is $231).

Stop Loss: Reassess on a close below $80.

Catalyst Timeline: Q3 results Thursday, Oct. 22 before the open (call at 8:30 a.m. ET). Fourth-quarter guidance, China capacity timing, and hyperscaler commentary are the key tells.

Confidence Level: Medium-High. The business is executing, but the gap between current price and analyst targets tells you the market needs more proof.

That's our coverage for today; thanks for reading! Reply to this email with feedback or any tech stocks you want me to check out.

Best Regards,
—Noah Zelvis
Tech Stock Insider