MediaTek to use Intel packaging for AI chips

TSMC Taiwan Semiconductor Manufacturing Company Limited ↘ 1.20% is ramping up outsourcing of the chip-on-wafer step in its advanced CoWoS packaging process to partners including ASE Technology ↘ 2.81% and Amkor Technology ↘ 2.33%, as persistent capacity constraints continue to limit the supply of AI chips. Separately, MediaTek confirmed during its Q2 2026 earnings call that it will use both TSMC's CoWoS and Intel's ↘ 1.02% EMIB-T advanced packaging for its data center AI ASICs.

TSMC's Outsourcing Push

TSMC's CoWoS packaging — used to connect multiple chiplets and high-bandwidth memory in AI processors from Nvidia ↘ 1.47% and others — has been the tightest bottleneck in the AI chip supply chain throughout 2026. The company's own monthly capacity is projected to reach 120,000 to 140,000 wafers by end of 2026, according to TrendForce. But demand still outstrips supply, with a gap expected to narrow from roughly 20% to 10% by year-end.oplexa+2

To bridge the shortfall, TSMC has been expanding outsourced production of the CoW (chip-on-wafer) front-end step to OSAT partners, with a major increase planned for the second half of 2026. DigiTimes reported earlier this year that TSMC transferred advanced packaging orders to ASE and Amkor rather than let customers seek alternatives. OSAT partners could collectively add up to 50,000–60,000 wafers per month in new capacity, pushing total industry output toward 200,000 wafers monthly.trendforce+2

ASE's subsidiary SPIL has taken a leading role in the outsourced production, with the group expanding capital expenditure by 50% in 2026 and investing over NT$11 billion in new equipment.linkedin+1

MediaTek Confirms Intel EMIB-T for AI ASICs

During its latest earnings call, MediaTek disclosed that its first-generation data center ASIC will enter volume production in Q4 2026 and is expected to generate $2 billion in revenue. The company said it will use Intel's EMIB-T advanced packaging alongside TSMC's CoWoS to meet the varied design requirements of different AI chip customers.sammyfans+1

EMIB-T uses small silicon bridges rather than a large silicon interposer to connect chiplets, reducing packaging costs while maintaining fast data transfer speeds. The dual-sourcing strategy gives MediaTek flexibility and reduces dependence on a single supplier as it targets 15%–20% of the custom AI chip market by 2027.memorymarket+1

A Shifting Landscape

The developments reflect a broader industry reconfiguration as advanced packaging — not transistor fabrication — has become the primary constraint on AI chip supply. TSMC's willingness to share its most advanced packaging workflows with outside assemblers marks a departure from its historically guarded approach to front-end processes.trendforce+1