Rumor
TSMC CoWoS Constraints to Limit 2026 TPU Production; Capacity Expansion Accelerated for 2027
Friday, November 28, 2025 at 09:33 AM
Fubon Research estimates 2026 TPU production will be limited to 3.1-3.2 million units due to TSMC's CoWoS constraints, citing full load at AP8, allocation of AP7 Phase 1 to Apple, and late readiness of AP7 Phase 2. Fubon, however, upgraded its 2027 capacity forecast for TSMC's in-house CoWoS to 120k wpm by end-2026 and 140k wpm by end-2027, indicating an acceleration of expansion for anticipated strong demand.
Context
Fubon Research warns that sell-side forecasts for 2026 TPU production are overly optimistic due to advanced packaging constraints at TSMC. While some expect 4 million units, Fubon's analysis indicates a production ceiling of 3.1 to 3.2 million units. This shortfall stems from existing fabs running at full load, new capacity being reserved for Apple, and the next expansion phase not coming online until late 2026. Critically, outsourcing to firms like ASE Technology is limited to lower-end chips, with all AI accelerators remaining in-house at TSMC.
Despite the near-term bottleneck, TSMC is aggressively accelerating its CoWoS capacity expansion for 2027. The company now targets 120,000 wafers per month by the end of 2026 and 140,000 by the end of 2027, both figures being upgrades from previous estimates. This expansion is projected to enable a near-doubling of TPU production to 5 to 6 million units in 2027, signaling a strong demand outlook and a significant volume ramp-up for key customers like Google, Broadcom, and MediaTek.
Sources (6)
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