20 of China's OSATs push into advanced packaging amid EUV curbs

Advanced packaging emerges as a critical lever for China's semiconductor industry to circumvent EUV equipment restrictions. As fabrication nodes shrink under technological constraints, OSATs are accelerating investments in 2.5D/3D integration and silicon interposers, strengthening vertical collaboration between foundries and AI chip designers. This shift not only alleviates pressure from process scaling but also reshapes global packaging dynamics. Rising compliance costs and supply chain disruptions are forcing companies to invest heavily in domestic alternatives, creating short-term financial strain. International competitors may respond with intensified IP controls and technical barriers, pushing China toward self-reliant ecosystems. Over the next 12 months, consolidation in packaging will intensify, with local firms poised to gain market share in HPC and AI chip segments.