SMT (surface-mount technology) smart factory specialist YJ Link secured a record-high order backlog on the back of expanding global data center investment. YJ Link said on the 25th that it is maintaining its growth momentum, with an order backlog of about 34 billion won as of June.
The expansion of YJ Link's orders is being attributed directly to increased data center investment by global big-tech corporations. The company recently won about $4.8 million (7.4 billion won) in orders for equipment to build data centers from Google and AMD. In semiconductors, it also secured an equipment supply contract worth about $1 million from a domestic company identified as H, expanding its business portfolio.
YJ Link previously signed a supply contract for PCB (printed circuit board) transfer equipment with Foxconn, the No. 1 global EMS (electronics manufacturing services) corporation, following its existing clients Tesla, SpaceX and Harman. By adding Google and AMD as new clients, it further strengthened its global big-tech references.
Industry watchers say expanded data center investment will serve as a growth driver for YJ Link. Global big-tech corporations such as Google, Amazon and MS are making large-scale capital expenditures to build AI infrastructure and data centers.
Servers and power/communication equipment used in data centers are all produced based on precision PCBs. YJ Link's SMT equipment is core machinery used in PCB manufacturing processes, and it is expected to benefit directly from increased data center investment. The company is being viewed as having secured a favorable position to win additional global clients, spurred by the latest orders from Google and AMD.
It is also strengthening production competitiveness. YJ Link boosted responsiveness to North American clients through its Mexico production plant, which began operations in August last year. By building a local production system, it significantly improved delivery lead times as well as the speed of technical support and after-sales service (AS).
Results are improving quickly as well. YJ Link's first-quarter revenue this year was 14.7 billion won, roughly doubling from a year earlier, and operating profit reached 1.1 billion won, returning to the black. Considering the current order book and global equipment demand, the market expects second-quarter results to also be strong.
YJ Link will also make a full-fledged entry into the EMS business through its Thailand production subsidiary. Its existing Vietnam and Mexico subsidiaries will handle SMT equipment production, while the Thailand subsidiary is set to operate as an EMS-dedicated production base responsible for electronics such as ECUs (electronic control units), power modules and communication boards. Through this, the company plans to move beyond its equipment manufacturing-centered business structure and foster the EMS business as a new growth pillar.
Chief Executive Park Sun-il of YJ Link said, "Securing a record order backlog reflects global clients' high evaluation of YJ Link's technological prowess and quality competitiveness," adding, "As the secured orders are sequentially recognized as revenue, we expect this year to be a turning point for earnings growth."
Meanwhile, YJ Link recently decided to buy back 2 billion won worth of its own shares to enhance shareholder value. The company plans to use the repurchased shares as an incentive fund for employee performance rewards and to attract key talent. Through this, it expects to secure top talent, strengthen corporate competitiveness and enhance mid- to long-term corporate value.