TSMC is reportedly seeing the demand for advanced packaging shoot up, leading to capacity constraints.
- TSMC plans to raise prices for its Chip on Wafer on Substrate process, an advanced packaging technique that integrates AI chips and high-bandwidth memory.
- The move could raise costs for Nvidia, AMD, and other chip and gadget makers.
- TSMC stock hit a record high on Oct. 5 but has since gotten caught up in the selloff in AI-linked stocks.
Taiwan Semiconductor Manufacturing Co. (TSM) is preparing to raise prices for its advanced packaging process by 10%-20% as surging demand for AI chips strains production capacity, Taiwan’s China Times reported on Tuesday, citing supply-chain sources.
If it goes through with the plan, it would raise costs for several chip firms, including Nvidia Corp (NVDA) and Advanced Micro Devices (AMD). The move could also put further pressure on the prices of Apple’s (AAPL) iPhones and MacBooks, which have already seen price increases amid rising memory chip costs.
TSMC’s CoWoS Plan
TSMC is considering raising prices for CoWoS (Chip on Wafer on Substrate), its advanced packaging technology that integrates chips and high-bandwidth memory (HBM) into a single package.
The report says the potential hike is being considered as demand for advanced packaging expands beyond GPUs to server CPUs and custom AI chips or ASICs, leading to capacity constraints.
TSMC is continuing to ramp up its advanced packaging operations to meet demand, with monthly CoWoS capacity expected to exceed 130,000 units in 2026 and 200,000 units next year, China Times reported.
TSMC is the world’s largest contract chipmaker, making advanced chips that power everything from AI data centers to smartphones. Its major customers also include Broadcom, Qualcomm and MediaTek.
TSM, NVDA: Retail View, Stock Move
On Stocktwits, the retail sentiment was ‘bullish’ for NVDA and AMD, and ‘bearish’ for TSM.
TSM stock hit a record high on Oct. 5 but has since been caught up in the selloff in AI-linked stocks amid renewed concerns about the sustainability and returns of massive AI investments. Shares remain 40.5% up year to date.
NVDA has declined about 11% from its record close on Oct. 6, but it has been up 16% year-to-date.
“$CRWV $NVDA $TSM Ignore the noise from Musk. He’s scared,” said a trader, referring to the SpaceX CEO’s bearish comments on the neocloud sector, which pressured several cloud and AI-linked stocks on Monday.
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