Otto Pukk on INCAP’s 2026 Playbook From Acquisition Integration To Organic Growth

AI is boosting demand and breaking planning models at the same time, and that tension shows up everywhere in electronics manufacturing services right now. From my home to yours, I sit down with Otto Pukk, President and CEO of INCAP, to take stock after Q1 and get specific about what a stronger 2026 actually depends on: execution, supply resilience, and a footprint that can serve customers where they need to build. 

We talk through INCAP’s recent acquisition of Lacon and what “integration” really looks like in a lean, decentralized EMS organization. Otto shares why cultural fit matters more than slide decks, how cross-selling becomes a practical organic growth engine, and why customer concentration risk looks very different today than it did years ago. We also dig into the structural shifts required to scale, including a new regional approach that adds just enough governance to protect leadership time without taking ownership away from factory teams. 

From there, we zoom out to geographic strategy and market forces. India plays a central role, not as a simple low-cost bet but as a capability and engineering hub, while the US market still feels like early innings. We also get into automation, early AI use in manufacturing, and the real-world headaches of component availability as AI data centers pull on semiconductor supply. Tariffs come up too, framed as a “new normal” that EMS partners have to navigate calmly. Finally, we tackle the defense boom with a balanced lens, including how startups and drones are reshaping defense electronics and manufacturing expectations. 

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Transcript

Welcome And 2026 Outlook

Philip Stoten, Journalist and Podcast Host 0:05

Okay. Hello from my house to yours. Welcome to EMS at sea level. I am joined by Otto Puck, who is the president and CEO of INCAP. Otto, great to have you back on the show. Always an absolute joy to chat to you. Trust your wealth.

Otto Pukk, President & CEO, InCap 0:20

Yeah, always a pleasure. Uh to you as well, Philip. So we're looking forward to our conversation today.

Philip Stoten, Journalist and Podcast Host 0:27

Very good. Q1's always a really interesting moment to take stock. Gives you a chance to um see if the year started how how you how you wanted it to. Before we get into the numbers, how does it look from where you're sitting? How does 2026 look right now?

Otto Pukk, President & CEO, InCap 0:45

No, we uh still believe that uh 2026 is is will be stronger than than last year. Of course, we did uh quite substantial acquisition in in the end of the year, so so that speak for themselves. So so overall, I think think uh it looks good for for 2026. That said, of course, uh where we see growth on the market currently is uh around AI and AI data centers, and of course, uh around defense uh as well. And and and that's the major uh growth drivers currently on the market. And the rest is a little bit uh uh flattish, I would say, but but overall we we look at at uh a growth.

Philip Stoten, Journalist and Podcast Host 1:23

Yeah, well we'll we'll get into those a little bit later, but they are absolutely, you know, there is a defense boom, and there is that hyperscalar um infrastructure being put in for AI, which I think is fascinating.

Lacon Integration And Customer Mix

Philip Stoten, Journalist and Podcast Host 1:35

Let's just touch on some of the things that that we saw in in your recent results that I think formed uh an important part of it. The um the integration of Lacon um with that acquisition closing in February. How's that process been going in practice? What surprised you most positively or otherwise?

Otto Pukk, President & CEO, InCap 1:56

No, I think it has gone very well, and and and we are or uh uh having a good uh fit when it comes to culture. Of course, that is a big thing for us when we look at acquisition targets, that that it fits in into the way we work and and and and uh our culture. Uh so so overall I think it has gone very well. That said, of course, running a decentralized organization, we are not doing that heavy integration now than perhaps some others are doing. So it's more getting them into our different corporation streams and into our ecosystem and and and uh start working with them in the in the big picture. But overall, I'm very happy on on how uh the progress have have been, and and I see a lot of opportunities in this uh now moving forward as well, with cross-selling and so uh to to uh ours and and uh and theirs uh customers and yeah, and in your results you mentioned um a commentary around customer concentration and the risk that has that's a meaningful shift uh uh in cap.

Philip Stoten, Journalist and Podcast Host 2:57

You've avoided that over concentration in the past. Is that a new strategic goal and how does the picture look now compared to say 18 months ago before that acquisition?

Otto Pukk, President & CEO, InCap 3:10

No, I think I think if you look at that now with the latest acquisition, then then uh clearly the customer concentration that we have is is uh uh I would say uh a problem in the past. That that of course uh some uh people have followed us for years, then they remember when we had uh concentration you know over 80%, and and and now we are well well uh below uh or in the 20s in that sense. And I think that uh it's hard to find an EMS company that doesn't doesn't have a uh uh customer that that is is uh somewhere there uh in in in 20-30 percent of the business. But so I think that that is in the past, and we wanted to a little bit emphasize on on that because uh uh I think uh people who have uh followed us over time, they they remember when that risk realized some years ago, and and now it's a different company. That said, of course, we are looking at driving and running business and and uh a healthy business, and I'm not that worried in the immense industry of having customer concentration. So if I would have an opportunity to end up in a similar situation again, I would probably take it if the business is sound because customers are sticky and it's not so you know, we have close corporations and and and they have outsourced a big part of our uh their their uh uh services around manufacturer to us, and and it's not so that you know in some other industries, you know, the customer come and go in the EMS this long-term partnership. But but uh yeah, if that answers your question.

Philip Stoten, Journalist and Podcast Host 4:42

Yeah, no, it absolutely does. And I think what you say is fascinating because I think customer relationships are sticky, they're particularly sticky when you're doing a really good job. Uh the EMS industry is way more sophisticated than it was in the past. So shifting is uh is more challenging for uh from an OEM point of view. So um I think it I think it does make perfect sense to grow with your customer when the opportunity is there, and then you know, regularly look at it and then and figure out how you balance it and not by taking less from that customer, but by winning more from others, I guess is the bottom line.

Scaling Decentralization With Regional Oversight

Philip Stoten, Journalist and Podcast Host 5:18

When you were talking about in-cap strategy and organization, I think that's a very fundamental part to how we think of in-cap. You you've got this very lean, decentralized model. You don't want to lose that, but you talk about a new larger in-cap. How do you how do you match those two things? Uh are they are they in conflict? And what do you see as the as the the new larger in-cap going forward structurally and organizationally?

Otto Pukk, President & CEO, InCap 5:48

Yeah, we we came out here just uh yesterday, I think it was with with the that we are uh re-arranging a little bit. We have now a regional approach to to to how we manage it on the day-to-day. But in principle, that means that now we do having 11 factories all over the world, and then we have added a small small level of of governance in between me and and and uh and and and the factory managers. So so uh and that is more to protect my time because I can't. I I visited all of our 11 factories during Q1, it was exhausting. So so so so uh uh having that uh regional approach. But but in the essence it's the same. We we have the same decentralized approach. We have have uh the the business is done out in the units, the managing directors and the teams out in the units are the ones running and owning the business. And and and in that sense, I think I think nothing uh has changed. And I think we can continue with this regional approach now. We can we can continue uh over the years to add on the units and and and so on and and keep our flexible model model in the future as well. So I think now we have yeah, done done a step in that that direction and and that we're quite happy with uh what we see for so far.

Philip Stoten, Journalist and Podcast Host 7:05

Yeah, it makes sense, doesn't it? Alto, you can't spend all your time in the uh flying around the world. It's super impressive that you've visited all those facilities in Q1. But if you roll forward a couple of years and there are double the number of facilities, that would be a very uh very time-consuming task.

India And The Global Footprint Plan

Philip Stoten, Journalist and Podcast Host 7:22

It kind of brings me to the next topic I wanted to talk to you about, which is geographic uh strategy, and particularly with um some of the opportunities and some of the mega trends we see in the market. The growth of India is a great example. You've invested in more technology there and you're building up that um the um capability and capacity of the facility there. Um but we're also seeing all kinds of geopolitical impacts around tariffs and other things that affect how you think about the long-term strategy in terms of a global footprint. What's your current feeling? Where do you think you perhaps still need to strengthen in terms of geographical presence? Um, and do you see India as maybe a key low-cost cornerstone to that long-term ambition?

Otto Pukk, President & CEO, InCap 8:13

No, of course, uh India is uh and and will remain for in-cap a very important market and a very important place. I wouldn't call it low-cost though, because our capabilities in the uh in some cases out there, or far larger than than we have in some of the other sites, but but but and and the service offering there is very strong when it comes to engineering and and so, but of course it's important. It's a growing market and and uh India is a democracy, and and I think uh that that is something that that little bit uh uh makes them special in the in the Asian uh Asian uh marketplace. And and and so, in the end of the day, that even if there can be some low-level corruption or whatnot, if you go to court and eventually, if you have not done anything wrong, you will win in court. And uh that is the comfort that you perhaps don't get in some other other states. But when it comes to uh geographical, then then I think um in that sense we uh in the long run could have uh some other presence in in Asia as well, a little bit to balance out that the country risk that that we have our three factories in Asia in in all in India. But so so I think that could be and then of course uh the US market where I think we are only scratching the surface on there's a lot to to uh do there. So over time, I think also in North America that that that we will would uh could increase our presence. That said, now I think I think uh key currently uh for uh our focus in in in cap and with me and the management it's it's on the organic growth. Uh we have quite nice footprint already, and and and uh we we don't want to do any any uh big MA moves and so, especially with our share price, clearly trading with the with with uh um uh discounts compared to to our peers. And and and so the key for us is to focus on the organic growth and and and and so and then over time. If if the how to say the signs are better, then we can look at at the more aggressive MA path uh as well. But currently I think we are quite happy with the latest acquisition. We have a lot of uh nice presence in Europe, we have strong presence in India and in Asia, and also so uh have presence on the US market. And already already with that we have a lot of how to say playing chords to play around with to create value for our shareholders.

Philip Stoten, Journalist and Podcast Host 10:36

Yeah, and to create value for your customers as well. I think it's uh I think it's a very good footprint you've got. And when I look at MA, I think sometimes that can overshadow what's going on with organic growth. And I think for shareholders, for customers, for for the well-being of a business, you have to have that organic growth engine operating properly.

Otto Pukk, President & CEO, InCap 10:57

So there's about Noel and I I would say that if you look at many campuses, it's a little bit of a smoke screen as well, you know. If you do a lot of acquisitions, it's hard to see what is actually the organic growth and what is the the growth in general. And of course, there are both instruments to grow, but but uh yeah, key uh key here is organic uh as I see it the moving forward for in-cap, at least for for technical.

Automation AI Supply Risks And Tariffs

Philip Stoten, Journalist and Podcast Host 11:20

Yeah, and I think when you look at those those different environments, those different locations in terms of manufacturing, you have to balance future consideration, not just with where labor, labor costs are at certain levels, but you also have to consider how much of our work is being automated now? What's the long-term strategy with uh with automation within the business? And that impacts again uh where you manufacture and how you build agility to be able to move stuff from one facility to to another. That agility really trumps footprint. You've got to be able to move from one to the other. Is that something you think a lot about when you're looking at operating systems in all the different internal businesses?

Otto Pukk, President & CEO, InCap 12:05

Of course, there it is in the background. That said, that they if you look at practically uh very often the customer shows us where the manufacturing should be, and and that is for for uh reasons, their internal reasons, logistically, if it's close to their end customer or end market or or or RD or whatever it can be. So so in practice, we don't have that many cases where we actually need are moving around production and in that. But of course, I think that is is uh always something we look at that that that uh uh our systems and and and so are in power and and and so but another thing of course that is very interesting currently and and the is is AI and and and uh uh we haven't we I'll say I think we are only scratching the surface on on on now when AI comes into manufacturing and and uh and there is not very many practical uh applications yet, but but I'm quite sure there will be in in the future, and and this is very interesting. Uh development. Myself, I I I use Copilot, for example, a lot in my work, and and it's amazing, you know. It it suddenly uh all my emails have got much more politer and so that than it was before. So so uh clearly it it it is a powerful thing if if uh this kind of AI tools uh already in the office environment, and I'm sure we're gonna see more and more in in production as well.

Philip Stoten, Journalist and Podcast Host 13:32

Yeah, you have to program it out to make sure it doesn't lose your charm and humor whilst being um being more polite. We need to we need to have both of those. It's really interesting you mention AI. When I look at marketing market conditions, AI is having a huge impact in terms of um driving driving demand for you, but it's also having a big impact downstream on sucking a lot of the oxygen out of the supply chain, particularly when we when we look at semiconductors. Component availability was clearly a headache in Q1, not just for you, for a lot of people, shipments were affected by availability of components. How are your customers experiencing that and how are you managing your way through that those those component challenges?

Otto Pukk, President & CEO, InCap 14:18

Yeah, no, the real the there is, and then in Q1 we we we uh a little bit looked at uh uh like it from our perspective that it was isolated to some some projects. Now we see, and and we have of course you know the community EMS community small, we are talking to our peers and and and so as well. So so so so uh we hear a lot of of uh problems now with component availability, even if we haven't felt very much in in-cap. What we see is many customers we are are uh in discussion of increasing buffer stocks and and and and a little bit how to say uh securing more long uh long term uh with increasing in forecasts and this kind of thing. So there is some some action being made, but but so far, yes, uh I would say that we have have uh uh not felt like like a huge impact of it of it uh yet. But but yeah, you need to be well prepared and and on top of things.

Philip Stoten, Journalist and Podcast Host 15:14

Yeah, and that preparation comes with having that data available, and again, that's somewhere uh somewhere that you can be using AI to interrogate what's going on in the market and see what's what's happening specific to the bill of materials that you're operating in. We mentioned tariffs. It felt like we were talking about nothing but tariffs a year ago. It feels like it's just become a a reality and part of our lives, and we just get on with what we do well um with that in the background. Is that how you see the the tariff issue at the moment?

Otto Pukk, President & CEO, InCap 15:46

Yeah, no, I think I think so so uh uh that that uh of course uh you know change and and and some kind of turmoil seems to be the new normal. So so so so that of course is our job to to handle. But but you know, uh in that sense we are back to a new normal. And it was interesting to see as well, you know, that during the the uh this crisis, for example, we had uh or working with several big uh multinational US companies. And then and and and there you could see that some you know were were concerned and and and we were working on you know rerouting shipments from different areas to others or production and and so and others they were quite cool about it and said that yeah, they you know uh politicians come and go and and and yeah and they they are in uh how to say they have survived several um administrations and and looked at it more long term. And I I think that that uh uh is perhaps a healthy way to look at it. That yeah, we always need to deal with short-term crises and and and so for our customers, whatever it is, and if it's tariffs or supply uh difficulties or or or something else. But uh in long term, I think think and you know you learn to live uh and and to to uh play with the uh whatever rules there in that sense and and and it's business as usual in the in the bigger picture.

Philip Stoten, Journalist and Podcast Host 17:09

Yeah, that makes sense, doesn't it? And I think adaptability is a key superpower of EMS, and it's something that maybe as a standalone EMS OEM with a factory of your own, it's very difficult to do. So having a partner that's aware of that and has that in its skill set, I think is is hugely valuable.

Defense Demand Without Overcommitting

Philip Stoten, Journalist and Podcast Host 17:26

Um, you talked about the inflection points in markets, you described key ones order take in the defence industry as a record high, significant new orders in Germany and Romania, uh, and in CAP have joined the INCAP Slovakia have joined the Slovak Security and Defence Industry Association. Is that a market that you're really doubling down on? Is it a deliberate part of your playbook, embedding impact structurally into the the defense network across multiple countries?

Otto Pukk, President & CEO, InCap 18:01

Uh we are not doubling down on the defence. So even now with our lock on acquisition and that is uh uh more active in defense than perhaps the old old in cap was, uh then I don't expect our the defense in total in the group uh uh surpass somewhere 15% or something like that, uh, even after the projects that we are rampant. For us, it's important that we are balanced, you know. That that I strongly hope that our politicians uh continue to to invest in our defense and and so, even if we would have this current konflicts in Iran and in Ukraine and so resolved in one way or another. But you never know, you know, when when money is needed somewhere else then then it can go. And and and we have taken very cautious or more much more cautious approach there, and not run into um and this race that that I think many of our in our industry have are like really aiming to become defense, uh solar defense players. But but I think that that uh yeah, it's better to be balanced and and and and prepared for other andra days as well. But that said, of course, we we are uh as you said in different defense associations. We we do very important defense work with with big multinational partners, but also with the new kind of how to say defense uh companies with with uh that that are younger and and in uh innovative in in different kinds of applications that are or are used um in different conflicts around the world. And so so so so I think I think uh of course it's an interesting part, and we'll we'll take our share in that sense, but yeah, we are not doubling down. We're in the long run. We're balance is key.

Philip Stoten, Journalist and Podcast Host 19:41

Focused on bad focused on balance. And it's really fascinating what you say when you look at those classic principles in the uh defense market that you're clearly dealing with, the multinationals, they have very different requirements for these fast-moving, um fast-moving startups and smaller, innovative, younger companies that you mentioned. It's a nice challenge to have to be able to provide an operating environment for manufacturing for both of those companies. Uh, and it's something that's very important within INCAP generally, or within any MS generally, to be able to really take great care of a startup which could be a potential tier one customer in the future, but also look at those legacy um principles. That must be quite a challenge. Is it just opening your mind to new ideas, or is there a these are startup projects, these fit these kind of people, and these are legacy projects, these fit these kind of people?

Otto Pukk, President & CEO, InCap 20:39

Yeah, no, if you look at that um the in InCAP, we have been working with startups uh for a long time. And and uh many of our largest customers today, they used to be startup when when we started working with them. Uh so so so working in that uh ecosystem is nothing new. Uh, of course, it it it has its own challenges, and you need to be careful so you don't get burned in that sense. But but but uh I think we have good systems for for that. And then now if you look at at the defense startup, it's the it's the same thing in that sense. What is interesting, of course, is that it's a totally different kind of industry than the classical defense, and and and many of the applications when we talk about drones and and and this kind of countermeasures in them, and and so we are talking about uh more into how to say consumer or or or in that uh yeah consumer industry rather than klassic defense in that sense. I think it will be interesting to see because if we have now situations where you can take out uh you know 30 million tank with uh 300 uh uh euro drone in that sense, then then that of course shakes the industry around. And and I think this more klassiska players we we see also now they are moving in in to try to I'll say defend their ground a little bit. So so so uh I don't think that we uh uh the I'll say the the the race or the game is over. We I think we will see development in in the defense now due to this uh here in the coming years uh as well. And it's very exciting, of course, because we we cater to to both parties. So uh for us it's it's opportunity all the way.

Philip Stoten, Journalist and Podcast Host 22:23

Yeah, and it's fascinating to see the way conflicts have changed just in the last just in the last five years, just in the period of the uh Ukraine war in particular, but you're seeing that that play out in uh Iran as well. It's a completely different dynamic. And as you say, there's a there's an asymmetry where a 300 euro uh drone can take out a multi a multi-million dollar um uh tank or or even bring down a multi a multi-million dollar missile. So yeah, it's uh it's a really it's a really curious market now, and it'll be interesting to see

Top Priorities For The Year Ahead

Philip Stoten, Journalist and Podcast Host 22:58

how it goes. Also, just to wrap up, you've got increased um enhanced engineering capabilities, you've got a stronger order book, you've got a clear strategic direction with everything you've brought together. As you look at the rest of 2026, what's the one thing you're most focused on getting right?

Otto Pukk, President & CEO, InCap 23:15

Well, I think I think uh as I mentioned before, we we believe in growth and and and uh uh but of course it is always uh so that we need to see that we have the different inputs. And and uh what we are monitoring very closely now is the material availability and working closely with our customers to to counter and balance balance any uh challenges that there might be there. Uh, we continue to to work with integration, of course, and and and uh so with our uh latest acquisition and and uh uh try to harvest cross-selling opportunities there. I think we have a great customer portfolio and balanced uh customer portfolio, and and uh uh this this uh is giving us opportunities, and I'm quite sure we will see those more and more here in the in the coming years.

Philip Stoten, Journalist and Podcast Host 24:03

Yeah, I I absolutely agree with you. And uh looking at that cross-polonization, that um cross-selling gives you um opportunities for that organic growth you you spoke of, and having those two layers in there. The bottom line with EMS is you've got to get everything right. There isn't anything you can uh you can leave to charge, and you've also got to be ready for the next disruption, which no matter how many we list, it'll be one outside that list that comes up comes along in the coming months. Otto, always an absolute joy to chat, absolute pleasure. Look forward to talking to you again soon and meeting up somewhere in the world in the uh not too distant future. Thanks for your time.

Otto Pukk, President & CEO, InCap 24:40

Thank you very much.