2025-12-02 02:08Summary of TSMC CoWoS Capacity and AI Semiconductor Market Insights Industry Overview - The report focuses on the Asia-Pacific Technology sector, specifically the AI semiconductor market and TSMC's CoWoS (Chip on Wafer on Substrate) capacity expansion for 2026 [1][2]. Key Insights on TSMC and CoWoS Capacity - TSMC is expected to increase its CoWoS capacity by 79% to 125k wafers per month (kwpm) by 2026, up from an estimated 70k kwpm at the end of 2025 [3][12]. - The additional capacity will primarily support NVIDIA and Broadcom, with some allocation to MediaTek [3][12]. - NVIDIA's CoWoS-L capacity is revised upward to 700k wafers, aligning with its forecast of US$500 billion in AI GPU revenue through the end of 2026 [4][12]. AI Semiconductor Demand Dynamics - NVIDIA is experiencing strong AI demand, but production of the B40 chip has been cut from an expected 1.5-2 million units in the second half of 2025 to 900k units, indicating potential pricing issues in the Chinese market [4]. - Google's TPU is identified as a significant growth driver in the ASIC market, with Broadcom's CoWoS bookings increasing to 230k units [5][13]. - The competition for AWS's Trainium ASIC involves Broadcom and Marvell, with expectations of increased production capacity for AWS [6]. Market Trends and Projections - The report highlights key players in the AI semiconductor space, including TSMC, MediaTek, KYEC, Aspeed, Alchip, GUC, SMIC, Naura, AMEC, and ASMPT [7]. - The demand for CoWoS capacity is projected to grow significantly, with NVIDIA, Broadcom, and AMD leading the charge [23][24]. - The overall demand for CoWoS is expected to reach 1,329k wafers in 2026, up from 680k wafers in 2025, indicating a robust growth trajectory [24]. Financial Implications - The report notes that AMD anticipates an 18% CAGR in data center CPU demand from 2025 to 2030, with AI contributing an additional US$30 billion in revenue by 2030 [14]. - The AI semiconductor market is projected to see quarterly revenue increases, with significant contributions from both NVIDIA and AMD [42][44]. Additional Considerations - TSMC's capacity expansion may face challenges due to clean room space limitations, potentially impacting its ability to meet rising demand [33]. - The report emphasizes the importance of understanding the supply chain dynamics and the implications of power deployment plans on CoWoS demand [36][38]. Conclusion - The AI semiconductor market is poised for substantial growth, driven by increasing demand for advanced chips from major players like NVIDIA and Google. TSMC's strategic capacity expansion will be crucial in meeting this demand, although operational challenges may arise. Investors should closely monitor these developments for potential investment opportunities in the sector [1][2][3][4][5][6][7][12][14][23][24][36][38].