Apple AAPL and Qualcomm QCOM stocks were down about 1% on Wednesday morning after a report said both companies are facing potential supply constraints tied to a shortage of high-end Japanese glass cloth used in advanced chip substrates.

The specialised material, produced largely by Japan’s Nitto Boseki, is a key input for printed circuit boards and chip substrates used in smartphones and AI servers, according to a Nikkei Asia report.

The surge in artificial-intelligence hardware demand has intensified competition for the glass cloth, with Nvidia NVDA, Amazon AMZN, Alphabet (GOOG) and Advanced Micro Devices AMD also seeking the same supplies, the report said.

Industry sources cited concerns that limited capacity and strict quality requirements could create a bottleneck for electronics and AI hardware production into 2026.

Apple and Qualcomm did not immediately comment on the report.