Nvidia's demand for advanced packaging technology remains robust, but the type of technology the U.S.-based AI chip giant requires is evolving, CEO Jensen Huang said Thursday. His remarks came in response to questions about whether the company was scaling back orders.
Nvidia's latest AI chip, Blackwell, utilizes a sophisticated "chip-on-wafer-on-substrate" (CoWoS) advanced packaging technology provided by Taiwan Semiconductor Manufacturing Co. (TSMC), Nvidia's primary contract chipmaker.
A Shift from CoWoS-S to CoWoS-L
“As we transition to Blackwell, we’ll primarily use CoWoS-L. While we continue manufacturing Hopper—which relies on CoWoS-S—we’re reallocating CoWoS-S capacity to CoWoS-L,” Huang explained during an event hosted by chip supplier Siliconware Precision Industries in Taichung.
This transition represents a shift in focus rather than a reduction in capacity. According to Huang, Nvidia is increasing its reliance on CoWoS-L to meet the growing demands for Blackwell chips.
Hopper, Nvidia’s previous GPU architecture, preceded the Blackwell platform, which was announced in March 2024.
Impact on Suppliers and TSMC
Nvidia has historically relied on CoWoS-S technology to assemble its AI chips. However, industry analysts and media have noted the impact of its pivot to CoWoS-L.
Ming-Chi Kuo, an analyst at TF International Securities, stated that Nvidia’s shift to CoWoS-L would affect suppliers. Local Taiwanese reports also suggested that Nvidia was reducing CoWoS-S orders, potentially impacting TSMC’s revenue.
Despite these concerns, Huang emphasized that advanced packaging capacity has increased significantly. “Today, we have about four times the advanced packaging capacity compared to less than two years ago,” he said.
Export Restrictions and Local Enthusiasm
When asked about new U.S. export restrictions limiting AI chip exports to most countries outside close U.S. allies, including Taiwan, Huang declined to comment.
Huang remains a prominent figure in Taiwan, where he is widely celebrated. Born in Tainan, Taiwan’s historic capital, he emigrated to the United States at age nine. He is expected to attend Nvidia Taiwan’s annual New Year celebration in Taipei this week, an event that has drawn significant local media attention.
Nvidia’s continued innovation and demand for advanced packaging signal its commitment to staying at the forefront of AI chip technology, even as it navigates supply chain shifts and geopolitical challenges.
