As chip performance hits the limits of single-die scaling, the industry is turning to advanced packaging — chiplets, 2.5D interposers, fan-out, hybrid bonding, and system-in-package — to keep performance improving. This theme tracks the companies that build, package, and assemble the complex multi-die systems that AI and high-performance computing demand, along with the specialty foundries and EMS partners that manufacture them.
Why it matters
- Packaging is the new scaling. When you cannot shrink the transistor fast enough, you stack, tile, and interconnect multiple dies. That makes the packaging layer a growing share of total chip cost and complexity.
- HBM drives packaging demand. High-bandwidth memory requires precision die stacking (TSV, micro-bump, hybrid bond), and every AI GPU ships with multiple HBM stacks attached — directly benefiting OSAT and substrate suppliers.
- EMS and substrate complexity is rising. AI servers, networking switches, and defense electronics need more layers, finer pitch, and higher reliability from their PCBs, substrates, and assemblies.
Roster
- TSEM — Tower Semiconductor — specialty analog foundry with strength in power management, RF, and sensors. Capacity in Israel, the U.S., and Japan.
- AMKR — Amkor Technology — leading OSAT (outsourced semiconductor assembly and test) with advanced packaging for AI, mobile, and automotive.
- TTMI — TTM Technologies — advanced PCBs, backplanes, and RF components for data center switching, aerospace, and defense electronics.
- JBL — Jabil — electronics manufacturing services with growing mix in intelligent infrastructure, cloud hardware, and data center programs.
- STM — STMicroelectronics — broad industrial and automotive semiconductor franchise with vertical fab ownership in power (SiC), analog, and embedded processing.
What to watch
- HBM packaging ramp — AMKR and others are building new capacity for HBM3E and HBM4 assembly. Watch for yield and volume milestones.
- Chiplet ecosystem maturation — UCIe and other interconnect standards are expanding the addressable market for advanced packaging houses.
- Substrate pricing and lead times — tight substrate supply for advanced SiP and flip-chip can be a margin tailwind for TTMI and peers.
- TSEM capacity utilization — specialty foundries run lean; utilization above 80% typically signals pricing power.
- JBL mix shift — Intelligent Infrastructure as a share of total revenue is the key metric for whether Jabil is re-rating structurally.