TSMC is planning to more than double its CoWoS advanced packaging capacity by 2028 to address the surging demand for AI and high-performance computing chips. The company is currently facing significant delivery bottlenecks, as existing capacity is largely reserved by major clients like Nvidia.
Data indicates that Nvidia alone accounts for approximately 60% of TSMC's total CoWoS capacity, with the top three customers consuming over 85% of the output. This high demand has extended lead times to between 52 and 78 weeks, with availability for 2026 and 2027 already fully booked.
To mitigate the supply gap, TSMC is accelerating capital expenditure and equipment installation across its advanced packaging facilities. Despite these efforts, the long wait times have triggered an industry-wide order spillover, forcing major chip designers to seek alternative packaging solutions.
Companies such as AMD are diversifying their supply chains by shifting orders to competitors. Intel is leveraging its EMIB and EMIB-T technologies to capture this overflow, aiming to become the world's second-largest advanced packaging provider, while OSAT firms like ASE, SPIL, Powertech, and KYEC are also seeing increased demand.
