AI data centers are running hotter. Taiwan's power-hardware suppliers are racing to keep up.

Delta Electronics and Lite-On Technology are pumping capital expenditure toward roughly 9% of revenue, the highest in years, to keep up with AI data centers whose power and cooling appetites are redrawing the rack. Both Taiwanese suppliers closed Q2 2026 with record results, and both are now converting that cash into plants, equipment, and engineering headcount rather than waiting for the next chip cycle to tell them what to build.

The two companies make the unglamorous middle layer of the AI buildout. Delta builds the power-conversion units, uninterruptible power supplies, and rack-level thermal gear that sit between the grid and a server's processor. Lite-On supplies power supplies, cooling components, and increasingly higher-density server enclosures for the same customers. Neither company makes the chips. Both decide, well before any GPU ships, whether a hyperscaler can physically turn it on.

That decision point is where the AI buildout is now constrained. Chipmakers such as Nvidia and AMD have moved to refreshing their AI platforms on roughly an annual cadence, with each generation stepping up rack-level power density and thermal load. The shift is forcing a parallel rebuild of the power and cooling layer underneath: 800-volt rack power distribution, higher-capacity liquid cooling, and denser power-conversion hardware that the old 12-volt architectures cannot deliver.

Lite-On's Q2 2026 numbers show what the demand looks like on the supplier side. Revenue hit a record NT$52.7 billion (about US$1.65 billion at roughly 32 NT$ per US dollar) in the quarter, up 38% year over year, and the share of revenue tied to AI workloads surpassed 25% for the first time, according to the company's earnings release. The transcript published by Investing.com shows management crediting AI demand for lifting gross margin, not just top line.

Delta is on the same arc, with a different quarter. The company's Q1 2026 release showed gross margin reaching a record 37% and earnings per share doubling year over year to NT$7.91. Management has guided full-year capex toward NT$70 billion (around US$2.2 billion at roughly 32 NT$ per US dollar) for global expansion, according to a Biggo Finance report on Delta's commentary, with the bulk going into power and thermal capacity for data center customers. The independent preview from 01.co ahead of Delta's Q2 release flagged 800-volt power architecture ramp and the margin trajectory as the swing factors for a quarter that was already expected to set a revenue record.

The market read on this is the 9% capex-to-revenue ratio itself. Industrial-electronics suppliers typically run capex in the mid-single digits as a share of sales. Pushing toward 9% is a balance-sheet signal that the supplier expects demand to outrun its current footprint for at least the next two to three years, and is willing to absorb the depreciation hit to stay in the build. Digitimes Research framed both companies' spending in that range on August 14, 2026, treating it as a tell that the AI buildout is now power- and thermal-constrained, not chip-constrained.

That frame is also where the risk lives. If AI capex cools faster than the supplier build assumes, both companies carry new fixed cost on plants that were sized for a faster ramp. Hyperscalers buying from the same two vendors across multiple generations create customer concentration that becomes a margin lever on the next pricing round. And a competitor, whether Foxconn's power-electronics arm or a Chinese power-supply vendor cleared for hyperscaler work, only needs one design win to reset the price floor.

For now, neither company is slowing. Lite-On told analysts the AI demand shows no signs of cooling. Delta's Q2 release is due in the next reporting window; the 800-volt ramp and the capex absorption rate will be the two numbers to watch.