Rising Demand for CoWoS Drives Core and Glass Fiber Shortages in Advanced Packaging
CoWoS can be broken down into "CoW" and "WoS.""CoW" stands for "Chip-on-Wafer," referring to chip stacking; "WoS" stands for "Wafer-on-Substrate," which means stacking chips on a substrate. Simply put, CoWoS involves stacking chips and then packaging them onto a substrate, which reduces the space required for chips and also lowers power consumption and cost.
With the development of CoWoS, the substrate size is increasing, from 60mm x 60mm in the past to over 100mm x 100mm in the future. This also increases substrate warpage. One current solution to address substrate warpage is to use a thicker core.
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In the CoWoS process, the cores currently used are supplied by Resonac, primarily because Resonac can produce thicker products (1.2mm, 1.4mm, 1.6mm, etc.). A thicker core has greater strength to reduce warpage.
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We can see the structure of the substrate in the cross-sectional diagram below: from top to bottom, it consists of a build-up film, core, and another build-up film, forming a sandwich-like structure. The core has layers of glass fiber in between!
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Source: Shang Y. Hou
A thicker core requires more glass fiber, and the glass fiber used for advanced packaging needs low CTE and high tensile elasticity, currently supplied mainly by Nittobo. Due to the surge in demand for advanced CoWoS packaging driven by AI applications, as CoWoS production capacity rapidly expands, Nittobo’s capacity is expected to fall short of demand, leading to a shortage of T-glass next year. This shortage may result in substrate manufacturers being unable to acquire Resonac’s core.
Reportedly, some substrate manufacturers have even rented offices near Resonac’s factory to closely monitor material availability. It means having Resonac’s core means an opportunity to secure orders in the future!
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Main questions and answers at Nittobo Financial Results Briefing held on Nov. 1, 2024)
- Q1: Please update the plans for expanding production capacity for special glass Fiber (T-glass, NE-glass, NER-glass) in and beyond 2025 and 2026.
A1: Due to AI application, demand for special glass fiber is currently strong, and we are planning increases in production capacity beyond 2025. For T-glass in particular customers have strong forecasts going forward, and we need to expand production capacity further. We plan to put in place sufficient capacity to deal with all demand by 2026/2027.
- Q2: what areas will Nittobo expand the production of special glass fiber?
A2: Primarily in Taiwan but also in Japan. We are moving to increase capacity at our factory in Taiwan because there is space for expansion. In Japan we will expand capacity through such measures as making more efficient use of limited space.
- Q3: In the Medium-Term Management Plan (fiscal 2024-2027) it was announced that Nittobo will commit 80 billion yen to capital investments over four years. What is the outlook for investments aimed at raising production capacity for special glass fiber next fiscal year?
A3: We intend to take a key projet investments at an early stage of the period of the Medium-Term Management Plan. The forecasts that we have received from customers for special glass fiber are very strong, and we plan to steadily raise output next year and the year after that.