As mentioned in the previous part, with the requirements of small size, high performance, and low power consumption of high-end chips, packaging technology is also developing in the direction of high packaging efficiency, high pin density, and efficient heat dissipation. Winsoul Capital proposes that the essence of advanced packaging is the expansion of interconnection area and the improvement of interconnection efficiency.
According to Winsoul Capital, advanced packaging can be extended to different solutions according to different needs, which fit the characteristics of different scenarios. For example, system-in-package can assemble multiple chips and other components with different functions and processes into a single package to form a system or subsystem. It is suitable for highly integrated, low-power, and miniaturized products such as consumer electronics such as smartphones, tablets, and wearables, as well as IoT devices.
3D packaging can be integrated vertically by stacking chips or chip components, improving performance and reducing power consumption. It is suitable for fields with high requirements for computing density and energy efficiency, such as high-performance computing, data centers, artificial intelligence accelerators, etc.
Fan-out wafer-level packaging allows the area around the chip to also be used for interconnects, allowing for larger chip sizes or more I/O interfaces. Suitable for high-end mobile processors, high-performance GPUs, FPGAs, etc.
2.5D/3D ICs integrate the use of silicon mid-level or TSV technology to interconnect multiple chips in 2D or 3D space, suitable for high-end server CPUs, GPUs, network processors, etc., these applications require extremely high data processing power and low power consumption.
Figure: The essence of advanced packaging is the improvement of interconnection area and interconnection efficiency
Benefiting from the strong downstream demand for high-computing power chips, the advanced packaging market has maintained rapid growth
According to Winsoul Capital, in the post-Moore era, advanced packaging technologies such as chips will deeply benefit from the strong demand for high-performance computing chips such as supercomputing, and are expected to achieve rapid growth. In 2023, driven by AIGC represented by ChatGPT, the demand for GPUs and CPUs from NVIDIA and AMD will increase significantly. At present, mainstream computing chip manufacturers in the field of AI chips have introduced chips or advanced packaging solutions, NVIDIA's main products A100/H100 are all packaged with TSMC CoWos 2.5, and the MI300 AI accelerator card released in AMD2023 has 13 chiplets, and is also equipped with a total of 8 HBM3 chips with a total of 128GB.
Figure: Chiplet Processor Chip Market Size (USD 100 million)
Advanced packaging accounts for an increasing proportion of the semiconductor packaging and testing market
According to Yole's forecast, the global advanced packaging revenue in 2023 will be $37.8 billion, accounting for 44% of the semiconductor packaging market. It is expected to grow 13% to $42.5 billion in 2024 and $69.5 billion in 2029, with a CAGR of 11%. China's advanced packaging market has grown from 42 billion yuan in 2019 to 79 billion yuan in 2023, an increase of more than 85%, and the market size has maintained a rapid growth trend. According to the calculation of the Prospective Industry Research Institute, it is expected that the scale of China's advanced packaging market will reach 134 billion yuan in 2029, with a compound average growth rate of 9%.
Figure: Global semiconductor packaging and testing market structure
The continuous construction of domestic production lines for advanced packaging is an independent way to make up for the lack of advanced processes
According to Winsoul Capital, the manufacturing link in Chinese mainland is weak, and there is still some way to go before the advanced process can achieve a breakthrough under Western sanctions. However, advanced packaging technology can make up for the lack of advanced manufacturing processes to a certain extent. Since the beginning of this year, JECT Technology, Tongfu Microelectronics, Huatian Technology and other large-scale investment in advanced packaging projects have ushered in the latest progress. Including the second phase of the Nanjing Integrated Circuit Advanced Packaging and Testing Industrial Base project with Huatian's investment of 10 billion yuan, the foundation stone was laid in Pukou District, Nanjing; Tongfu Tongda invested 7.5 billion yuan in the advanced packaging and testing base project started.
Figure: Top 10 global advanced packaging manufacturers in 2022 (million US dollars)
At present, the domestic mass production line of advanced packaging is dominated by FC/WLCSP/Bumping and other terminal production capacity, and the high-end 2.5D/3D packaging capacity is still under construction. China has a high localization rate in degumming, cleaning, and etching equipment, and has made significant breakthroughs in CMP, heat treatment, and thin film deposition in recent years. The proportion of China's semiconductor equipment localization has increased significantly in the past two years, from 21% in 2021 to 35% in 2023.
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Outlook and Analysis of China Semiconductor Industry 2024 (2)
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Outlook and Analysis of China Semiconductor Industry 2024 (5)
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Outlook and Analysis of China Semiconductor Industry 2024 (9)
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