TSMC's CoWoS advanced chip packaging revenue grows at 80% CAGR as Nvidia reserves capacity

Taiwan Semiconductor Manufacturing Company (TSMC) announced that revenue from its most advanced chip packaging technology, CoWoS, is growing at an 80% compound annual growth rate as the company ramps up production capacity to meet surging demand for artificial intelligence chips. The chip-on-wafer-on-substrate (CoWoS) technology has emerged as a critical bottleneck in AI semiconductor production. Nvidia has reportedly reserved most of TSMC's CoWoS capacity, underscoring the technology's importance for training and running large AI models. Underappreciated chip packaging is poised to become the next bottleneck for artificial intelligence, the company noted. The advanced packaging process places multiple chips closer together than traditional methods, improving data transfer speeds and energy efficiency. TSMC's comments come as competitors including Intel and Amkor seek to expand their own advanced packaging capabilities to challenge the Taiwanese foundry's dominance. The 80% growth rate reflects the rapid scaling of AI infrastructure worldwide, with hyperscale data center operators investing billions in GPU clusters that rely on TSMC's packaging technology.