Xintec, TSMC's packaging and testing unit, is preparing for a broader testing-led expansion that could affect global chip supply chains. The company said capacity gains, new equipment spending, and strategic-partner orders may support growth in 2026, even as it continues a gradual shift in its product mix and packaging portfolio.
Capacity on the rise
The company said it is cautiously optimistic about 2026, with wafer testing, or CP, orders from strategic partners expected to become a key growth driver. Chairman CH Chen said total testing capacity is projected to rise 50% in the third quarter of 2026.
At its annual shareholders' meeting, Xintec said its board had approved a new capital spending plan of US$22.21 million, from the second quarter of 2026 to the third quarter of 2027, for equipment tied to 12-inch back-side copper process services. It also earmarked US$910,000 in recurring capital spending to upgrade facilities and production-line equipment by the end of 2026.
Zhongli plant takes shape
Chen said installation at Xintec's new Zhongli plant started in the second quarter of 2026 and is now about 60% complete. New capacity is expected to begin coming online in the third quarter of 2026, and once production lines are fully installed in the fourth quarter of 2026, combined wafer testing and final testing capacity should increase by more than 50%.
That expansion is expected to lift testing revenue quarter by quarter and become a major growth engine in 2026. Sources familiar with the matter said testing accounted for about 60% of revenue in the first quarter of 2026 and is likely to remain in the 60% to 70% range for the rest of the year, potentially pushing Xintec's operating mix further toward testing than toward its CSP packaging business.
Testing leads, packaging follows
Xintec said about 75% of revenue currently comes from TSMC, though the business remains focused mainly on testing services, with only a small amount of CSP packaging. Its products cover 20 to 30 applications, including smartphones and ASICs.
To support the next phase of expansion, Xintec said the necessary testing tools will be installed primarily under a consignment model with strategic partners. That approach is intended to help the company avoid the longer equipment lead times affecting parts of the industry as peers rush to place orders.
CSP packaging widens its scope
Xintec also said its 8-inch CSP packaging line will take on several new projects in the second half of 2026 and move into volume production, helping utilization and offsetting earlier losses from 3D sensor orders. In addition, 12-inch CSP packaging capacity is set to increase to 2,000 wafers per month in the third quarter of 2026, with a focus on automotive CMOS image sensors and wearable devices, such as AR and VR smart glasses.
The company said its CSP packaging business targets niche markets, while new products scheduled for mass production in the second half of 2026 remain in more price-competitive mainstream segments. Customized CSP packaging under development is not expected to ship until 2028, due to unresolved technical challenges in the backend supply chain.
Article translated by Jingyue Hsiao and edited by Jerry Chen
