Morgan Stanley has recognized an important sector inside synthetic intelligence that’s being underestimated by the market: superior packaging in semiconductors. This course of, which is positioned in the final stage of semiconductor manufacturing after design and manufacturing, not solely protects the manufactured chips by permitting their reference to exterior units, but additionally will increase their performance and efficiency, laying the muse for chips of More highly effective and environment friendly AI.
Innovation and Capacity of AI Chips
According to Morgan Stanley, packaging is a necessary means of accelerating processing capability in an surroundings the place synthetic intelligence turns into more and more frequent. Today’s AI programs, in contrast to conventional digital packaging, require graphics processing items, CPUs, high-bandwidth reminiscence, I/O controllers and different parts that transmit data at unbelievable speeds and with most vitality effectivity.
The Value of Packaging in Semiconductor Production
The financial institution highlights that packaging, beforehand seen as a ultimate stage and value middle, is now seen as the primary method to enhance efficiency. That’s as a result of engineers have found out easy methods to use all components of a chip, together with packaging, to extend efficiency. The superior packaging market is projected to achieve $116 billion by 2027, pushed by insatiable demand for computing energy, reminiscence, and new chip architectures.
Projections and Potential Winners
Morgan Stanley suggests the market is underestimating each the tempo of innovation and the implications for progress. Notable winners are recognized in Japan, South Korea and the European Union. Additionally, the agency has categorized shares to capitalize on the superior packaging pattern into two teams: expertise corporations on the forefront of AI computing and people benefiting from packaging provide chains.
Featured Examples in the Sector
USA:
- Amkor: You are uniquely positioned to profit from the Outsourced Semiconductor Assembly and Testing (OSAT) Services trade. Morgan Stanley notes that Amkor plans to construct a complicated packaging and testing facility in Arizona, which is able to serve to package deal and check chips produced for Apple on the close by TSMC facility.
- ACM Research: SK Hynix, the world’s second-largest reminiscence chip maker, is a key buyer. There is upside potential for ACM’s enterprise if it manages to ship superior packaging merchandise and copper plates for SK Hynix’s high-bandwidth reminiscence manufacturing line.
Taiwan:
- TSMC: A serious CoWoS expertise supplier, with its superior packaging and testing income forecast to exceed 10% in 2024.
Japan:
- Disk and Advantest: They are probably the most favored corporations by Morgan Stanley in Japan, as a result of their means to supply cost-effective options and their doubtless profit from progress in the superior package deal tester market.
An AI-Driven Improvement Cycle
In abstract, superior semiconductor packaging represents a big alternative that’s being underestimated by the market. With its rising significance in growing the efficiency of AI chips, this sector is about to endure a substantial enchancment cycle, pushed by the fixed demand for better computing energy and vitality effectivity.
