KLA Corp. expects 15-19% annual revenue growth in advanced packaging equipment through calendar 2026, CEO Michael E. Hurlston told investors. The projection exceeds broader semiconductor equipment industry growth and underscores packaging's role as a competitive battleground across Asia, Europe, and North America.
Advanced packaging stacks chips vertically or arranges them horizontally to solve bandwidth and latency bottlenecks that single-chip designs cannot address. TSMC's CoWoS technology dominates high-end AI chips in Taiwan, while Samsung's X-Cube and Intel's Foveros represent South Korea's and America's competing approaches. Each requires specialized inspection equipment to detect nanometer-scale defects across multi-layer structures.
Indium phosphide production capacity surged over 20% in Q4 2024 alone, Hurlston reported. The material enables electro-absorption modulated lasers used in most initial 1.6 terabit-per-second optical transceivers. These interconnects move data between AI chips in data centers worldwide, with 200-gigabit lane speeds exceeding performance expectations.
Nvidia's latest GPUs use TSMC's CoWoS-L to integrate HBM3E memory from SK Hynix and Micron. AMD's MI300 series employs 3D chip stacking. Both designs prioritize packaging innovation over traditional transistor scaling—a shift that benefits equipment suppliers like KLA, Applied Materials, and Tokyo Electron.
The 2026 forecast suggests packaging equipment demand will track AI infrastructure buildout rather than consumer electronics cycles. Hyperscalers including Amazon, Microsoft, Google, and China's ByteDance continue data center expansion despite potential slowdowns in smartphones and PCs. Advanced packaging revenue as a share of total fab spending should rise measurably through 2026, making it a key metric for identifying which suppliers capture AI-driven growth across global markets.
Sources:
1 Globe Newswire, "Willis partners with Circle Asia to launch Asia’s first insurance facility for collectors and galler" (March 23, 2026)
2 Yahoo Finance, "CNOOC Names Huang Yongzhang as Chief Executive Officer" (March 23, 2026)
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5 Nasdaq, "2 Artificial Intelligence (AI) Stocks That Are Quietly Outperforming Micron Technology in 2026 With " (March 21, 2026)