China's OSAT providers are trying to move deeper into advanced packaging as artificial intelligence (AI) demand strains global chip packaging supply, creating an opening for companies that have long played a lower-profile role in the semiconductor value chain.

Lianyou Metals reported record first-quarter results in 2026, as tightening global supplies of tungsten and cobalt and stronger demand from semiconductor, defense and automotive markets pushed both prices and shipment volumes higher.

Nan Ya PCB, one of Taiwan's leading IC substrate manufacturers, said it expects capital spending to rebound sharply in 2026, potentially reaching a record high, as demand from advanced chip packaging customers accelerates alongside the rapid growth of artificial intelligence (AI) computing.

AI server demand is pushing semiconductor packaging into a new growth cycle, but the market remains heavily concentrated among a small group of global outsourced semiconductor assembly and test leaders and Taiwanese and Chinese companies, sharpening the challenge for South Korea's back-end chip industry.

Taiwan Chinsan Electronic Industrial said strong demand from cloud and server customers pushed related revenue contribution to 35% in the first quarter of 2026, with high-margin AI server applications accounting for roughly half of the segment.