Can AI Packaging Demand Boost ASE Technology's Long-Term Growth? - The Globe and Mail

ASE Technology Holding ASX is benefiting from the growing demand for AI chip packaging. In the first quarter of 2026, ASX's Assembly, Testing and Materials (ATM) business performed better than expecte... Read original →

The surging demand for AI chips is transforming semiconductor packaging from a back-end process into a front-line technological battleground. ASE Technology’s resilient Q1 2026 performance—defying seasonal norms—signals that advanced packaging has become a critical bottleneck in the AI compute supply chain. Upstream foundries like TSMC are racing to expand CoWoS capacity, while downstream GPU clients demand faster turnaround, compelling OSATs to adopt hybrid bonding and silicon interposers at scale. Geopolitically, U.S. CHIPS Act subsidies aim to reshore packaging, yet export controls inflate compliance costs for firms in Taiwan, China. With Amkor and JCET aggressively advancing Fan-Out and chiplet solutions, ASE must push R&D spending beyond 8% of revenue to sustain its tech lead. Over the next 18 months, AI server ramp-ups will drive 2.5D/3D packaging adoption past 35%, but without co-engineering labs with top-tier clients, ASE’s scale advantage risks erosion by rapid architectural shifts.