IN Brief:
- EU-headquartered companies capture 6% of European data-centre semiconductor spending and 7% of server manufacturing and assembly.
- European companies account for 8% of cloud infrastructure value while EU server demand has risen 36% annually since 2021.
- The research connects planned data-centre expansion with semiconductor, PCB, server, and systems manufacturing capacity.
Global Electronics Association has published research showing a substantial gap between European demand for AI and data-centre infrastructure and the share of the associated electronics value captured by companies headquartered in the European Union.
The study, produced with DECISION Études & Conseil, estimates that EU-headquartered companies account for 6 per cent of semiconductor spending for data centres in the European market, 7 per cent of server manufacturing and assembly, and 8 per cent of cloud infrastructure value. European production of printed circuit boards for data-centre applications is described as negligible.
Demand is rising much faster. The research puts annual growth in EU server-system demand at 36 per cent since 2021, compared with about 20 per cent for domestic manufacturing. DECISION expects servers to become the largest electronics market segment before 2030, overtaking smartphones and automotive electronics as AI workloads expand.
Those figures place the physical hardware behind AI alongside model development and cloud services in Europe’s industrial debate. Data centres require accelerators and CPUs, memory, networking silicon, optical components, PCBs, power conversion, cooling controls, connectors, racks, and complete server assemblies before software workloads can run.
Additional European data-centre capacity will not automatically create a proportionate domestic hardware industry if the servers and their component content continue to be designed, fabricated, or assembled elsewhere. The rate at which compute infrastructure expands can therefore diverge significantly from the growth of the electronics manufacturing base supplying it.
Sanjay Huprikar, Chief Global Officer at the Global Electronics Association, said Europe is “only capturing a small fraction of the value” being created by the data-centre market. The Association argues that semiconductor policy, server manufacturing, and cloud infrastructure need to be considered across the same supply chain rather than developed as isolated industrial programmes.
The report follows the European Commission’s proposed Cloud and AI Development Act, published in June. The Commission wants to at least triple EU data-centre capacity over the next five to seven years while simplifying deployment and addressing access to energy, land, water, and financing. It is also proposing an EU-wide framework for assessing cloud and AI sovereignty.
A tripling of data-centre capacity would create substantial demand for electronics, but the regional value captured by that investment will depend on the origin of the hardware. If the current manufacturing mix remains broadly unchanged, European spending on imported or externally designed server and semiconductor technology would rise alongside domestic compute capacity.
The Commission is also pursuing Chips Act 2.0, proposing further support for semiconductor design and production within the EU. The proposal acknowledges continued dependencies in advanced manufacturing and semiconductor design while seeking to retain European strengths in other device categories and develop capacity around AI and cloud infrastructure.
The hardware chain extends well beyond leading-edge processors. AI servers combine devices built on multiple process nodes and depend on high-bandwidth memory, substrates, advanced packaging, networking silicon, power delivery, optical connectivity, and board-level manufacturing. Domestic final assembly can therefore remain exposed to external supply even when the server chassis is completed within Europe.
Printed circuit boards illustrate the problem at a less visible layer. High-performance servers and switches require boards capable of handling dense interconnect, high-speed signalling, demanding power distribution, and increasingly complex thermal constraints. The report’s assessment that European PCB production for data-centre applications barely exists points to a weakness below the headline semiconductor layer.
Europe nevertheless retains substantial capability in semiconductor equipment, power electronics, photonics, industrial automation, and specialist parts of the component supply chain. Converting those strengths into a larger share of AI infrastructure manufacturing would require investment across several layers simultaneously rather than concentrating policy support on a single device category.
Supply-chain depth will also affect resilience. A locally assembled server still depends on external production if its processors, memory, optical interfaces, PCBs, or substrates have no practical regional source. Increasing European value capture therefore involves both high-profile semiconductor capacity and the less visible manufacturing infrastructure needed to connect, package, power, and assemble those devices.
The research provides a numerical baseline before the next phase of European AI infrastructure investment. Server demand is already outpacing domestic production, while semiconductor, assembly, PCB, and cloud shares remain low. Planned data-centre expansion will show whether that gap narrows or whether Europe’s compute capacity grows faster than the electronics industry supplying it.
