While the whole world watches the successes of chip manufacturers, the true beneficiaries of artificial intelligence are sometimes hidden in the most unexpected niches. A striking example is 85-year-old Lin Tsung-chi, founder of Taiwan's King Slide Works. His company, historically specializing in the production of furniture hinges and drawer slides, unexpectedly turned out to be a critically important link in the supply chain for AI infrastructure. Since the start of the year, the company's market capitalization has soared by nearly 280%, allowing Lin to take the top spot on the island's list of richest people.
The secret to this success lies in diversification. King Slide produces rail mechanisms for server racks—components that hold heavy computing equipment and allow it to slide out for maintenance without disrupting the fragile cooling system. Based on industry data, I estimate the company controls about 80% of the global market for these high-tech slides for high-performance servers. This is effectively a monopoly in its micro-niche.
Margins that giants dream of
King Slide's financial performance is staggering. In the latest quarter, gross margin reached 87%—higher than Nvidia (around 75%) and TSMC (68%). For comparison, just a few years ago this figure was approximately 50%. The company's executive vice president, Jay C. Wang, attributes this profitability to two decades of engineering development that enabled the creation of highly specialized mechanisms.
The economics here are simple: when an AI server rack costs millions of dollars, the client does not haggle over the price of the slides—they demand flawless quality. A mechanism failure could lead to downtime of equipment worth a fortune. According to Forbes, the founder's wealth is now estimated at approximately $20.3 billion, allowing him to surpass even Foxconn's chairman Terry Gou.
The future lies in customization and density
Even more interesting times lie ahead. Hyperscalers are actively transitioning to their own AI accelerators, which is breaking standardization. Each new chip differs in dimensions, heat dissipation, and connectors, requiring a unique rack and, accordingly, unique slides. This opens up new growth horizons for King Slide.
An additional driver will be the growing density of data centers. The declared capacity of gas power plants in the U.S. being built for direct power supply to data centers has doubled—from 97 GW at the end of 2025 to more than 189 GW by mid-2026. The company is already expanding production in Houston to serve North American clients.
However, the future will not be entirely cloudless. According to Daiwa Securities estimates, King Slide's share of supplies for Nvidia systems could drop to 75% as early as next year, as the chip manufacturer diversifies its suppliers. This will give data center operators leverage to pressure prices. Nevertheless, the business's fundamental dependence on global investments in AI infrastructure will remain unchanged.
My view: the King Slide story is a classic example of how, in the era of technological revolutions, not only the creators of the "brains" win, but also the manufacturers of the "skeleton." Investors should take a closer look at companies holding a dominant position in narrow but critically important segments of the supply chain—that is where the greatest added value is currently being generated.