As a key means to improve chip performance, advanced packaging technology is becoming the focus of competition in the global semiconductor industry. Entering 2025, especially driven by emerging technologies such as artificial intelligence, 5G communications, automotive electronics and high-performance computing, the market has put forward higher requirements for chip performance, power consumption and integration, prompting global semiconductor manufacturers to increase investment in advanced packaging technology research and development and capacity expansion. In the recent period of time, giants such as GF and TSMC have increased their layout, and the landing of U.S. subsidy policies marks the beginning of a global competition around advanced packaging.
The expansion plans of the two major foundry giants
Gf is spending $575 million to build an Advanced Packaging and Photonics Center
On January 17, GlobalFoundries announced the construction of an Advanced Packaging and Photonics Center at its wafer fab in Malta, New York. The center will focus on providing advanced packaging and testing capabilities for areas such as artificial intelligence, automotive, aerospace, defense and communications. The total investment is expected to be $575 million, with an additional $186 million for research and development over the next decade. The state of New York will provide $20 million in funding, and the U.S. Department of Commerce will provide $75 million in direct funding through the Chip Act.
With a total investment of more than NT $200 billion, TSMC increased its production to CoWoS
According to Taiwan media reports, contract manufacturing giant TSMC plans to build two CoWoS advanced packaging plants in the South Science Park Phase 3 (Nanke Phase 3) in Taiwan, China, with a total investment of more than NT $200 billion (about 44.4 billion yuan). The new plant, with a total area of 25 hectares, is expected to start construction in March 2025 and be completed and installed in April 2026. The expansion is designed to meet the demand for advanced packaging driven by artificial intelligence. At present, the Southern Taiwan Science Park Administration has confirmed that TSMC submitted a land lease application.
Advanced packaging market potential is huge, manufacturers 2025 to accelerate the layout
According to Yole Group's forecast, the global advanced packaging market size is about $37.8 billion in 2023, and by 2025, this figure is expected to reach about $46 billion to $48 billion. From 2023 to 2029, the compound annual growth rate (CAGR) of the advanced packaging market is expected to be 10.7% to 12.9%, which means that the market growth rate will remain at a high level in 2025.
The proportion of advanced packaging in the overall packaging market is gradually increasing. In 2023, advanced packaging will account for 48.8% of the overall packaging market, nearly half of the market. This proportion is expected to increase further by 2025.
High Performance Computing (HPC) and Generative Artificial Intelligence (AIGC) are the major factors driving the growth of the advanced packaging market. The rapid development of these fields is increasing the demand for high-performance, low-power chips, thus driving the application of advanced packaging technologies. In addition, the popularity of emerging technologies such as 5G communication, Internet of Things, and automotive electronics has also brought new growth opportunities to the advanced packaging market.
According to incomplete statistics, in addition to GF and TSMC, many companies have an important layout in the field of advanced packaging in 2025:
ASE Technology: ASE's SPIL Precision division plans to expand production to three advanced packaging facilities in 2025 to meet the needs of the high-performance computing and AI sectors.
Huatian Technology (HTC) : Jiangsu Pangu Semiconductor Advanced sealed test Project, a subsidiary of Huatian Technology, plans a total investment of 3 billion yuan, and is expected to be partially put into production in 2025.
JCET: JCET's wafer-level microsystem integration high-end manufacturing project has a total investment of 10 billion yuan, and is expected to achieve an annual production capacity of 6 billion high-end advanced packaging chips by 2025.
Samsung Electronics: Samsung plans to mass-produce 12-layer HBM4 stacked memory in the second half of 2025 and set up a dedicated HBM4 production line.
SK Hynix: SK Hynix plans to mass-produce 16-layer stacked HBM4 memory in 2025 and introduce hybrid bonding technology.
Brief summary
In 2025, the field of advanced packaging ushered in the outbreak of capacity demand, and the global semiconductor industry entered a new round of technology competition. The expansion plans of GF and TSMC, as well as the huge subsidies of the US government, show the important position of advanced packaging technology in the global semiconductor industry chain. At the same time, ASE, Huatian Technology, Changdian Technology and other enterprises are also actively promoting the construction and mass production of advanced packaging projects. This competition will not only promote the development of high-performance computing and artificial intelligence chips, but also inject strong momentum into the continued growth of the global digital economy. As more enterprises increase their investment in advanced packaging, technological innovation and applications will be more extensive, and advanced packaging will become a key support for the development of the global semiconductor industry.
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