July 31, 2025 /SemiMedia/ — Global demand for CoWoS (Chip-on-Wafer-on-Substrate) packaging wafers is forecast to reach 1 million units by 2026, with Nvidia expected to secure 60% of the total capacity, according to a new research note from Morgan Stanley.

The report projects that Nvidia will require approximately 595,000 CoWoS wafers in 2026, with around 510,000 wafers to be manufactured by TSMC, primarily for its next-generation Rubin AI chips. Total shipments of Nvidia chips could reach 5.4 million units that year, including 2.4 million Rubin-based chips.

To support demand across multiple product lines including the Vera CPU and automotive chips, Nvidia has also tapped Amkor and ASE for approximately 80,000 wafers.

Separately, TSMC is advancing plans to build an advanced packaging facility in Arizona. Construction on the first site is expected to begin next year and complete before 2029. According to industry sources, the Arizona facility will focus on SoIC and CoW technologies, while downstream on-substrate packaging is likely to be handled by Amkor. Contractors have reportedly begun hiring CoWoS equipment engineers to be stationed in the U.S.

The developments underscore the growing importance of advanced packaging amid the AI boom, and highlight the deepening ties between TSMC and Nvidia as supply chains extend into the U.S.