Morgan Stanley Raises CoWoS Demand Forecast to 2.69 Million Wafers by 2027, Citing CPUs and ASICs as New Drivers

June 28, 2026

Industry Analysis / Moomoo Unknown

Overview

Morgan Stanley has significantly raised its demand forecast for TSMC’s CoWoS packaging, projecting it to reach 2.69 million wafers annually by 2027. CPUs and ASICs are emerging as new key drivers for CoWoS demand, in addition to traditional GPUs. Non-TSMC OSAT vendors such as ASE/SPIL, Amkor, and Powertech are expected to capture a larger share of packaging for high-end PC CPUs and gaming GPUs, indicating a diversifying AI server market.

In Depth

Key Findings

Morgan Stanley has substantially increased its demand forecast for TSMC’s CoWoS (Chip-on-Wafer-on-Substrate) packaging, projecting it to reach 2.69 million wafers annually by 2027. This surge in demand is attributed to the emergence of CPUs and ASICs (Application-Specific Integrated Circuits) as new primary drivers, complementing the traditional role of GPUs.

Technical Details

CoWoS is an advanced packaging technology essential for AI, High-Performance Computing (HPC), and data center chips, enabling high bandwidth and low latency by integrating multiple chip dies (such as GPUs, HBM, CPUs, and ASICs) onto a silicon interposer. Morgan Stanley’s latest analysis indicates a growing trend where advanced packaging like CoWoS is becoming mandatory for high-performance CPUs and custom ASICs, driven by the rapid evolution and adoption of AI chips. Concurrently, HBM (High Bandwidth Memory) demand is also projected to grow significantly, closely linked to AI chips, with HBM capacity per AI chip increasing substantially in 2026 and HBM module demand growing exponentially by 2027.

Background & Context

As semiconductor scaling approaches its physical limits, advanced packaging has become a crucial means of enhancing chip performance. While TSMC remains the pioneer and market leader in CoWoS technology, the explosive growth in demand is driving diversification within the supply chain. The new forecast anticipates that non-TSMC Outsourced Semiconductor Assembly and Test (OSAT) vendors, including ASE/SPIL, Amkor, and Powertech, will secure a larger share in packaging high-end PC CPUs and gaming GPUs. This reflects the diversification of the AI server market, moving beyond NVIDIA’s historical dominance to include the rise of Intel, AMD, and custom ASIC vendors.

Strategic Significance & Outlook

Morgan Stanley’s upward revision of CoWoS demand forecasts clearly demonstrates the robust growth of the advanced packaging market and the increasing centrality of CoWoS within the AI ecosystem. The diversification of suppliers could mitigate the risk of over-reliance on a single vendor like TSMC, thereby improving overall supply chain resilience. Furthermore, with CPUs and ASICs becoming new demand drivers for CoWoS, the application scope for advanced packaging technologies will broaden, accelerating innovation across the entire semiconductor industry. Coupled with the surge in HBM demand, the advanced packaging sector is expected to remain a highly attractive area for investors and engineers alike.

Source: https://news.futunn.com/en/post/75096132/morgan-stanley-raises-cowos-demand-forecast-to-reach-2-69

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