Recently, Fenghua Advanced Technology has suspended some new orders due to a surge in RC/RS series 0402 and 0603 chip resistor orders.

Although they are just surface-mount resistors, this is important—it's a signal of supply and demand imbalance for high-end, small-size, high-consistency passive components.
0402 / 0603 are package sizes. They can be MLCCs, surface-mount resistors, inductors, or EMI filters.
What AI servers truly need are components that can maintain high frequency, high consistency, and long-term reliability in a small size.
The complexity of AI VRMs is increasing, and PDNs are becoming more complex.
As a result, systems are consuming large quantities of: high-frequency MLCCs, small-size resistors, high-frequency inductors, tantalum capacitors, and HSCs.
These components are not expensive individually, but they are "must-have" items—if one is missing, the entire machine cannot be shipped.
The demand within AI servers is inherently layered.
At the most critical points, such as GPU core power supply, near HBM, and around ASIC substrates, there is still a heavy reliance on: Murata Manufacturing, TDK Corporation, Taiyo Yuden.
Because these areas require extremely low ESL, extremely low ESR, high-frequency response, and long-term reliability.
But AI servers are not only about the core.
PSUs, BBU, NICs, SSDs, optical modules, and switches also consume massive amounts of 0402/0603 components.
Importantly, AI is first tightening the capacity of top-tier MLCCs, then the pressure begins to spread to mid-to-high-end 0402/0603 components.
Recently popular MLCCs and 0402 resistors may seem like different devices, but they share a common foundation: "small-size precision manufacturing capability."
This includes precision printing, sintering, AOI inspection, high-frequency testing, ultra-small size yield control, and precise material processing.
This is very similar to the HBM industry chain.
Initially, the shortage was HBM, then CoWoS, ABF, substrates, power supplies, cooling, and testing all started to become tight.
MLCCs are now beginning to show similar phenomena.
The components most likely to be out of stock are often not the top-tier models, but mid-to-high-end specifications that can be mass-produced, pass validation, and be partially substituted.
The super cycle of passive components in 2018 is a typical example.
At that time, automotive-grade MLCCs were in short supply, high-frequency small-size specifications surged first, followed by a comprehensive price increase for 0402/0603.
Because once high-end specifications start to run out, customers stockpile in advance, lock in long-term orders, seek alternative sources, and place excess orders, causing the entire industry chain to tighten.
Currently, the AI industry may be repeating this process.
More importantly, this shortage propagates to second-tier suppliers.
After Murata Manufacturing, TDK Corporation, and Taiyo Yuden prioritize AI server and automotive customers, orders begin to overflow to: Vishay Intertechnology, Yageo Corporation, Bel Fuse Inc., Fenghua Advanced Technology.
AI data centers are pulling the entire electronics industry back into an "industrial product logic."
From GPUs, HBM, optical modules, power supplies, to 0402 resistors, the entire supply chain is tightening simultaneously.
This could mean that the passive component industry is entering a new cycle of volume and price, or even a super cycle.
Disclaimer: I hold the assets mentioned in this article. The views are biased and do not constitute investment advice. Do your own research.