Chang Wah Electromaterials (CWE), a Taiwanese supplier of semiconductor and electronics materials and equipment, is transitioning from 12-inch wafer-level packaging to panel-level fan-out packaging (FOPLP), anticipating promising prospects despite current yield rate challenges.
To meet the growing customer demand for encapsulating resins, CWE has partnered with Sumitomo Bakelite to establish a new factory in Kaohsiung, southern Taiwan. This manufacturing facility is slated to deliver sample products for customer validation later in the third quarter and is expected to start contributing to revenue in 2025.
CWE has commenced shipments of panel-level packaging materials since the beginning of the second half of 2024. Strong demand for advanced packaging technologies such as InFO, CoWoS, and high-bandwidth memory (HBM) packaging solutions is generating robust order momentum for CWE's wafer-level lamination equipment, with order visibility extending through 2026.
Additionally, the company is collaborating with its subsidiary JMC Electronics to develop new packaging substrates, which are combined with the rollable substrate materials it distributes to support emerging application fields like Micro LED, with mass production starting in the third quarter.
MiniLED solutions and market expansion
Meanwhile, Chang Wah Technology (CWTC), another CWE subsidiary dedicated to supplying packaging lead frames, reported revenue of NT$2.953 billion for the second quarter, up 8% from the previous quarter. Its gross margin and operating profit rates for the quarter rose 23% and 29% sequentially, thanks to significant improvements in its product portfolio.
Both CWE and CWTC are optimistic that miniLED solutions will offer the highest gross margins, focusing more on such solutions in 2024-2025.
CWTC has entered mass production of lead frames for packaging 1616/1515 LED chips for automotive applications. It has also developed new sizes of products for gaming screens and TV applications, securing a place in the supply chains of South Korean TV brands.
Furthermore, CWTC has developed a PMMS solution that offers high heat dissipation, reflectivity, airtightness, and high-temperature resistance. This solution has been adopted by leading international automakers, with usage volume increasing significantly quarter by quarter. It has also garnered interest from high-end consumer electronics clients for TV applications and is expected to enter mass production between the second half of 2024 and 2025.
In the second quarter of 2024, CWE's revenue rose 6% sequentially to NT$4.255 billion (US$129.45 million), with net profits soaring 55% quarter-on-quarter to NT$497 million, reflecting the company's successful growth strategies in advanced packaging and miniLED solutions.
