China's fast-rising AI models are running into a compute supply bottleneck as demand for advanced packaging substrates surges, with ByteDance reportedly preparing to spend CNY100 billion (US$14.9 billion) a year on large-scale chip substrate purchases by 2030. Supply chain sources say the scramble for packaging substrate capacity is intensifying across Huawei HiSilicon, Hygon Information Technology, ByteDance, and major outsourced semiconductor assembly and test (OSAT) players, even as the industry races to expand output.
Samsung Electronics is considering expanding its 4nm foundry capacity as rising HBM4 base-die demand pushes existing capacity to full utilization, South Korea's Money Today reported on September 21. The company is also reviewing whether to build a new 2nm production line for base dies in future HBM5 products.
Rising demand for advanced packaging tied to AI and high-performance computing (HPC) is driving development at Baipu Industrial Park in Kaohsiung, where construction has formally begun on what is billed as Taiwan's first advanced packaging supply-chain cluster. Led by TSMC, the park's first phase has already been fully allocated, and a groundbreaking ceremony on September 21 drew more than 20 semiconductor companies, including TSMC, Foxconn, and ASE.
China's silicon carbide (SiC) end-market demand is expanding rapidly, driven by high-voltage charging infrastructure and AI servers. The surge in orders has tightened SiC wafer capacity in China, and some offshore companies seeking foundry partners there have reportedly been turned away, pushing spillover business toward Taiwan, where Episil, HYS, and Diodes are among the names cited as potential beneficiaries.
MediaTek has introduced a new chip aimed at premium, ultra-portable Googlebook devices, underscoring how next-generation AI, battery life, and wireless performance could shape consumer computing worldwide. The Dimensity CX C10 Max is built for thinner systems, faster multitasking, and privacy-focused Gemini features in markets beyond Asia.
Demand from high-tech companies for new research and manufacturing sites remains strong, prompting Taiwan to advance plans to expand Longtan Science Park by 104 hectares as the government seeks to accommodate continued growth in AI and semiconductor industries.
China's FD-SOI supply chain is taking shape through a new round of investment. Changcun Capital, the investment platform backed by YMTC, participated in a strategic investment in FD-SOI developer Ruili Pingxin Microelectronics in August, drawing attention to whether Chinese semiconductor capital is expanding beyond memory manufacturing into specialty logic and wafer foundry technologies.
Global memory shortages remain severe, with AI and cloud applications intensifying demand for scarce supply. Prices for both DRAM and NAND flash have risen sharply, while China's two flagship memory makers, CXMT and YMTC, are preparing to break from their long-standing division of the market.
Advanced packaging remains one of the semiconductor industry's hottest technology areas in 2026. In Taiwan, terms such as co-packaged optics (CPO), chiplets, and glass substrates are increasingly common as packaging moves deeper into system-level design.
