Advanced IC substrates: Taiwanese companies lead the market
Increasing capacity expansion by substrate manufacturers to accommodate the growth of application processors in the AI age.
- The advanced IC substrate market is expected to grow at an 11% CAGR from 2022 and 2028 to nearly US$34 billion at the end of the period.
- Advanced substrate innovation persists with the incorporation of glass material.
- Unimicron, Ibiden, Nan Ya PCB… Asian companies dominate IC substrate revenue with 93% of the market, especially the Taiwanese players.
- New players entered advanced substrates to supply AI market leaders.
The IC substrate market is poised for significant growth, with its value projected to increase from US$15.1 billion in 2022 to nearly US$29 billion by 2028. This growth is primarily attributed to the surging demands in the AI, 5G, and automotive sectors. New entrants are joining the market to meet the rising needs of AI customers, leading to a substantial demand for substrates. All market participants are making significant investments to meet these requirements and accommodate the escalating demand, announces Yole Intelligence in its new semiconductor packaging report, Status of the Advanced IC Substrate Industry 2023 report.
In this advanced IC substrate market, Yole Intelligence, part of Yole Group, forecasts the SLP market to climb from US$2.9 billion in 2022 to US$3.6 billion by 2028. This market is primarily rooted in high-end smartphones. ED , an emerging laminate substrate technology, is anticipated to surpass 1.2 billion units in production by 2028, with its revenue increasing to US$900 million.
In this dynamic context, Yole Intelligence has developed a comprehensive advanced packaging technology & market report with metrics and forecasts for the IC industry. In its new Status of the Advanced IC Substrate Industry 2023 report., the company, part of Yole Group, delivers an overview of the industry, ecosystem and technology for each substrate platform.
Bilal Hachemi, Ph.D., Technology and Market Analyst, Packaging within the Semiconductor, Memory, and Computing Division at Yole Intelligence, part of Yole Group“In this new analysis, we point out and deeply analyze the potential of a novel substrate core material, Glass Core. This solution, part of the advanced IC substrate market, heralds a new era for advanced substrates, particularly with its innovative applications in AI and servers. The materials and equipment segments within the advanced IC substrate industry are keeping pace with the evolving demands, the increasing complexity of the market, and the needs of end customers.”
The center of advanced IC substrate manufacturing is in East Asia, specifically three countries: Taiwan, South Korea, and Japan. It’s worth highlighting that Taiwan plays a pivotal role in this landscape. It is also notable that China is making substantial strides with unprecedented investments, positioning itself for future market dominance.
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Japanese players like Meiko and Ibiden hold considerable market shares and serve as key SLP suppliers to Samsung. Meanwhile, Chinese players are gradually entering the market to cater to domestic demand from Huawei, Xiaomi, and Oppo. Notable entrants include AKM Meadville and KinWong, who have announced substantial investments in SLP technology. It is important to note that SLP adoption primarily pertains to high-end applications. Widespread adoption is hindered by the higher price associated with SLP, making it less accessible for mass-market products. Consequently, the SLP market is projected to experience gradual growth over the next five years, primarily driven by the increasing demand for 5G smartphones and potential adoption in the medical and automotive sectors.
Vishal Saroha, Technology and Market Analyst Packaging at Yole Intelligence“The SLP market is dominated by Taiwanese companies, such as ZD Tech, Compeq, and Unimicron, with Austria-based AT&S also making a significant mark. Among these, Taiwanese firms, in particular, have been making substantial investments in capacity expansion, commanding almost 60% of the total SLP revenue in 2022.”
AT&S is the solitary contender in Europe, with aspirations to break into the top three soon, while no substrate supplier in the United States currently ranks among the top twenty. Therefore, the production of advanced substrates will remain highly concentrated in Asia. To diversify supply chains and bolster local resilience in Europe and the US, more companies are contemplating investments in the advanced substrate industry. Local government incentives may further stimulate this trend, particularly in the US and Europe. New entrants have joined the advanced substrate sector to cater to the needs of AI market leaders.
Yole Intelligence’s semiconductor packaging team invites you to follow the technologies, related devices, applications, and markets on www.yolegroup.com.
In this regard, do not miss Yik Yee Tan, Senior Technology and Market Analyst at Yole Intelligence’s presentation: Global vehicle electrification trends and BEV opportunities in the developing world, on November 8 during ISES SOUTHEAST ASIA, in Penang, Malaysia. More information here.
Come and meet Yole Group’s analyst, Yik Yee Tan, and look at the latest market, technology, reverse engineering and reverse costing analyses. Send us your request for an onsite meeting at firstname.lastname@example.org.
- IC : Integrated Circuit
- CAGR : Compound Annual Growth Rate
- AI : Artificial Intelligence
- SLP : Substrate-Like PCB
- ED : Embedded Die