TSMC Considers 10% to 20% Price Hike for Advanced CoWoS Packaging
TSMC is reportedly planning to increase the prices of its advanced CoWoS packaging services by 10% to 20% due to surging artificial intelligence demand and ongoing supply constraints. This decision follows a broadening of market demand from traditional GPUs to CPUs and custom application-specific integrated circuits (ASICs). This potential price increase highlights the intense pressure on semiconductor supply chains as artificial intelligence hardware demand continues to outpace manufacturing capacity. Higher packaging costs will likely cascade down to hardware manufacturers, potentially driving up end-user prices for advanced AI accelerators and high-performance computing systems. Equipment delivery lead times have lengthened from 3 to 6 months to 6 to 8 months as suppliers struggle to scale production quickly. Meanwhile, analyst projections indicate that TSMC's monthly CoWoS wafer capacity is expected to surpass 130,000 wafers by 2026 and reach 200,000 wafers by 2027.
## BACKGROUND
CoWoS (Chip on Wafer on Substrate) is an advanced 2.5D packaging technology developed by TSMC that integrates multiple processors and high-bandwidth memory stacks onto a single substrate. It provides the essential high-performance computing foundation and memory bandwidth required by modern artificial intelligence and high-performance computing products.