Core Viewpoint - The article discusses the groundbreaking ceremony for ASE Technology Holding's third park in Nanzih, which has a total investment of NT$ 17.8 billion, focusing on "smart operations" and "advanced packaging testing" to meet the growing demand driven by AI, high-speed computing, and high-speed communication applications [2]. Group 1: Investment and Development Plans - The third park is expected to start construction in 2026 and be completed by the second quarter of 2028, creating approximately 1,470 job opportunities, with an estimated annual output value of NT$ 4.63 billion per hectare upon completion [2]. - The park will integrate smart, digital, and sustainable building concepts, enhancing supply chain efficiency and advanced packaging testing capabilities [3]. Group 2: Infrastructure and Technology - The development includes two buildings: a smart operations center and an advanced process testing building, designed with ecological, energy-saving, health, and waste reduction principles [3]. - The smart operations center will feature an automated warehouse for material handling, inventory management, and production distribution, improving operational efficiency and supply chain resilience [3]. Group 3: Market Demand and Product Testing - The third park will support various types of packaging and module product testing, including socket products, BGA products, high-frequency modules, and power management modules [4]. - As AI chips and high-speed interconnect applications increase product complexity, testing technologies are evolving towards high frequency, high power, and high parallelism to support more complex advanced packaging types [4]. Group 4: Acquisition and Expansion Strategy - ASE Technology is reportedly in discussions to acquire two factories from Innolux in Tainan, indicating a strategic move to expand its production capacity in response to the urgent demand for semiconductor testing [5][6]. - The semiconductor industry is experiencing a strong demand for testing capacity, prompting ASE Technology to consider significant investments in existing facilities to expedite its expansion plans [6].

Summary of Conference Call Records Industry Overview - The BT substrate industry is nearing full production capacity with utilization rates exceeding 90% as of 2026, driven primarily by demand from automotive electronics, power chips, and AI server applications [1][2] - The supply-demand balance for ABF substrates is improving, but a structural gap remains for high-end products, particularly those with over 20 layers [1][2] Key Insights and Arguments - **Demand Drivers**: The main growth drivers for BT substrates in 2026 are automotive electronics and power-related chips, with AI-related demands also contributing, especially in power management and auxiliary chip segments [3] - **High-End Product Shortages**: High-end ABF substrates, particularly for FPGA and AI servers, are still in short supply due to yield bottlenecks, with domestic manufacturers facing cost disadvantages [1][4] - **Market Dynamics**: The market for BT substrates is relatively stable with many participants, while ABF substrates have seen more volatility in utilization rates, particularly in 2022 and 2023 [2] - **Production Capacity**: Key equipment delivery times for exposure machines have decreased from 2-3 years during peak demand to about 1 year, alleviating constraints on capacity release for 2025-2026 [1][5] Additional Important Points - **Material Dependency**: Core materials such as ABF films and solder mask materials are still heavily reliant on Japanese suppliers, with domestic manufacturers facing technical bottlenecks in fine line adhesion and reliability verification [1][17] - **New Market Entrants**: The barriers to entry for BT substrates are lower compared to ABF substrates, primarily due to the similarity in materials and processes to PCB manufacturing. However, gaining market acceptance remains a significant challenge [6] - **Technological Advancements**: The industry is observing a shift towards glass substrates as a potential replacement for organic substrates due to their advantages in warpage control, although mass production remains a challenge [1][14] - **Power Management Modules**: The integration of power management modules into AI servers is becoming critical, with domestic manufacturers capturing a significant market share in this area [1][8][11] Supply Chain and Material Procurement - **Supplier Relationships**: The supply chain is characterized by strong relationships between major customers and large substrate manufacturers, with overseas suppliers dominating the market due to their superior technology and yield performance [11][18] - **Price Dynamics**: Price changes for ABF and BT substrates are primarily driven by fluctuations in raw material costs rather than supply-demand dynamics, as customer relationships tend to be stable [18][20] Future Outlook - **Market Growth**: The demand for storage-related BT substrates is expected to improve, driven by AI applications, leading to increased pricing and profit margins in this segment [19][20] - **Technological Challenges**: The industry faces challenges in achieving higher density and integration levels, particularly with the transition to vertical power delivery systems and embedded capacitors [15][16]