Monday, October 21st 2024
TSMC CoWoS Capacity Doubles for Two Years, Still Insufficient: TrendForce
At TSMC's earnings call on the 17th, the company revealed that its CoWoS (Chip-on-Wafer-on-Substrate) capacity will double each year in 2024 and 2025, but demand will continue to outpace supply. According to a report from Money DJ, the CoWoS expansion wave is expected to extend into 2026, promising strong growth for equipment suppliers for at least the next two to three years.
TSMC stated that advanced packaging currently accounts for approximately 7-9% of its revenue, and growth in this segment is expected to outpace the company's average over the next five years. While the gross margin for advanced packaging is slightly below the company average, it is steadily approaching it. Regarding CoWoS capacity, customer demand significantly exceeds TSMC's ability to supply, even with production capacity doubling year-on-year in both 2024 and 2025.
According to Money DJ, citing supply chain sources, TSMC has already provided equipment manufacturers with its machine requirements for 2026 and placed orders. Delivery schedules for next year are essentially fully booked, and TSMC is currently working with equipment suppliers to finalize shipment and installation plans for 2026.
The report noted that TSMC's CoWoS monthly production capacity is expected to reach 35,000 to 40,000 wafers this year, and surge to 80,000 wafers per month next year. Originally, the expansion wave was anticipated to slow somewhat by 2026, with monthly capacity reaching around 100,000 to 120,000 wafers. However, strong and urgent demand from major AI customers continues to drive capacity needs, and with the addition of more equipment, TSMC's CoWoS capacity could still see significant expansion, potentially reaching 140,000 to 150,000 wafers per month by 2026.
In addition, the report provided an overview of TSMC's advanced packaging supply chain. Key suppliers for wet process equipment include GPTC and Scientech, which provide automated wet benches and single wafer spin processors. Scientech holds a significant share of CoWoS equipment orders, while GPTC remains a key global supplier for major packaging and testing companies like ASE, Micron, Amkor, and Chinese packaging firms.
TSMC stated that advanced packaging currently accounts for approximately 7-9% of its revenue, and growth in this segment is expected to outpace the company's average over the next five years. While the gross margin for advanced packaging is slightly below the company average, it is steadily approaching it. Regarding CoWoS capacity, customer demand significantly exceeds TSMC's ability to supply, even with production capacity doubling year-on-year in both 2024 and 2025.
The report noted that TSMC's CoWoS monthly production capacity is expected to reach 35,000 to 40,000 wafers this year, and surge to 80,000 wafers per month next year. Originally, the expansion wave was anticipated to slow somewhat by 2026, with monthly capacity reaching around 100,000 to 120,000 wafers. However, strong and urgent demand from major AI customers continues to drive capacity needs, and with the addition of more equipment, TSMC's CoWoS capacity could still see significant expansion, potentially reaching 140,000 to 150,000 wafers per month by 2026.
In addition, the report provided an overview of TSMC's advanced packaging supply chain. Key suppliers for wet process equipment include GPTC and Scientech, which provide automated wet benches and single wafer spin processors. Scientech holds a significant share of CoWoS equipment orders, while GPTC remains a key global supplier for major packaging and testing companies like ASE, Micron, Amkor, and Chinese packaging firms.
9 Comments on TSMC CoWoS Capacity Doubles for Two Years, Still Insufficient: TrendForce
Already seeing weekly price cuts pretty much from AMD.
It would make low yields not matter as much either
New TSMC factories with cutting-edge technology on american soil are needed yesterday!
Yes, greed is the main drive for all those mega corporations.
For us, the low end user, the only thing we can do is to vote with our wallets, but since the offer is scarce, there are always suckers willing to buy the overpriced junk, just because...