The global semiconductor supply chain is preparing for the artificial intelligence (AI) era at an unprecedented pace. From upstream lithography equipment, midstream wafer foundry and advanced packaging, to downstream application-specific integrated circuit (ASIC) design services, every segment is being strongly propelled by AI demand. The latest industry developments show that Global Unichip Corp. (GUC, 3443) has seen its revenue repeatedly hit new highs, benefiting from mass production shipments of AI ASICs for US cloud clients. Meanwhile, the world’s leading wafer foundry TSMC (2330.TW) and lithography equipment champion ASML have also delivered impressive results. Market reports further suggest that TSMC plans to acquire facilities from panel maker AU Optoelectronics (2409) to expand next-generation advanced packaging capacity.
GUC’s recent operations have experienced explosive growth. According to its latest financial report, the company’s July consolidated revenue reached NT$5.77 billion (approximately $179.0 million), up 17.06% month-over-month and a staggering 158.38% year-over-year, marking the second consecutive month of record monthly highs. Cumulative revenue for the first seven months of this year totaled NT$31.11 billion (approximately $965.4 million), up 102.55% year-over-year. This leap in operational scale primarily stems from the mass production of CPU and AI inference chips for two US-based cloud service providers (CSPs), as well as next-generation projects transitioning to tape-out from late this year to early next year.
Institutional investors note that GUC’s mass production momentum is highly concentrated in cloud-related applications. In the second-quarter revenue mix, cloud computing, AI training, and cloud connectivity collectively accounted for nearly 80%, with the remaining roughly 20% coming from consumer electronics, cryptocurrency, memory, and other applications. Notably, while the product mix will not change significantly in the second half of the year, an internal application shift is underway, with automotive electronics gradually taking over the share previously held by cryptocurrency. The current-generation products for North American clients have already been taped out by GUC, and a chip adopting a “cockpit-driving integration” architecture for a Chinese client has also completed tape-out, with volume production expected next year.
To ensure uninterrupted future supply, GUC has been highly proactive in securing resources for advanced processes and packaging. The company has recently completed resource allocation for CoWoS, high-bandwidth memory (HBM), and packaging substrates, while deepening its R&D, process, manufacturing, and engineering collaboration with TSMC to strengthen its Design Technology Co-Optimization (DTCO) capabilities. This is also reflected in the financial figures: GUC’s contract liabilities surged to NT$13.21 billion (approximately $410.0 million) in the second quarter, a 62.55% quarterly increase, indicating that clients have made substantial advance payments to secure tape-out and material preparation schedules.
In terms of advanced technology deployment, GUC has extended its reach into emerging fields such as co-packaged optics (CPO) and Compute Die. It is understood that GUC has collaborated with a startup to demonstrate a CPO module and has initiated cooperation with large clients, with engagement models covering IP licensing and advanced process services. Furthermore, GUC’s collaboration with silicon photonics startup Lightmatter has entered the actual tape-out phase, utilizing TSMC’s N3P process and COUPE platform for production, demonstrating its ambitions in the heterogeneous integration space. GUC’s net profit after tax for the first half of 2026 reached NT$3.2 billion (approximately $99.3 million), up 84% year-over-year, with earnings per share (EPS) of NT$23.89.
At the very upstream of the supply chain, the AI arms race is similarly generating enormous business opportunities for equipment manufacturers. Reports indicate that US depositary receipts (ADRs) of lithography leader ASML recently rose about 1.7% intraday, reflecting market recognition of its pivotal position. Since AI chips require the most advanced manufacturing capabilities, which are nearly impossible to achieve without ASML’s extreme ultraviolet (EUV) lithography equipment, the company’s management has raised its 2026 revenue outlook to between $43 billion and $45 billion (approximately NT$1.5 trillion), representing about 16% growth from the midpoint of its previous forecast range. ASML’s second-quarter revenue reached $9.33 billion (approximately NT$300 billion), with a net profit of $2.92 billion (approximately NT$94 billion).
To meet the strong demand from major wafer foundry clients like TSMC, ASML plans to increase its annual EUV production capacity by approximately 30% each in 2027 and 2028. To date, most of the newly added EUV capacity for 2027 has already been fully booked by customers.
As one of ASML’s most important customers, TSMC’s operations are equally robust. TSMC reported July consolidated revenue of NT$467.58 billion (approximately $14.5 billion), up 5.6% month-over-month and 44.7% year-over-year, setting a new record high for the same period. Cumulative revenue for the first seven months of this year reached NT$2.87 trillion (approximately $89.1 billion), a significant 37% increase compared to the same period last year. Based on TSMC’s third-quarter guidance, with a median US dollar revenue forecast of $45.2 billion (approximately NT$1.5 trillion), representing about 12% quarterly growth, the company still needs to generate approximately NT$978.82 billion (approximately $30.4 billion) in combined revenue for August and September to meet its target, following the July results.
In advanced process technology, TSMC’s 5nm products accounted for the highest share of wafer sales revenue at 33% in the second quarter, followed by 3nm at 30% and 7nm at 11%. Notably, the 2nm process also entered mass production and began contributing revenue for the first time, accounting for 3% of the total. In aggregate, 7nm and more advanced processes accounted for 77% of total quarterly wafer sales revenue. Benefiting from the continued expansion of AI infrastructure by cloud service providers, TSMC has raised its full-year 2026 US dollar revenue growth forecast for the second time, from the previously expected “over 30%” to “slightly above 40%.”
As advanced process chips ramp up in volume, back-end advanced packaging capacity has become a critical battleground. Market reports suggest that TSMC intends to purchase AU Optronics’ L7 (Gen 7.5) and L5C (Gen 5) facilities adjacent to its Central Taiwan Science Park campus, with the transaction value potentially exceeding NT$30 billion (approximately $930.9 million). The two parties may collaborate on developing advanced packaging technology in the future, similar to the previous model with Innolux. In response, TSMC stated it does not comment on market rumors, while AU Optronics said it does not comment on speculative reports.
Industry analysts note that the market’s focus is primarily on Fan-Out Panel-Level Packaging (FOPLP) and CoPoS (Chip-on-Panel-on-Substrate) technology. CoPoS is viewed as TSMC’s next-generation platform that extends its existing CoWoS technology while incorporating the advantages of panel-level packaging, improving area utilization efficiency for large AI chip packages by “turning circles into squares.” If TSMC ultimately collaborates with AU Optronics, AUO’s technology and mass production experience in large glass substrates and panel production lines would serve as a critical foundation for the partnership. The entire semiconductor supply chain, from design services and equipment to manufacturing, has fully entered a high-growth phase driven by AI.