To enhance artificial intelligence (AI) performance, Meta and Nvidia are advancing plans to embed GPU compute cores directly into the base die of high-bandwidth memory (HBM). This innovation blurs the lines between memory and system semiconductors, presenting new opportunities and challenges for South Korea's semiconductor industry.
Competing with leading players, Cheng Mei Instrument Technology recently delivered the first CoPoS measurement and inspection equipment to the ASE Group, aiming to break KLA Corporation's near-monopoly in the equipment market. Cheng Mei Chairman Tony Tsai stated that in recent years, the company has been aggressively entering the advanced packaging field. He estimates that in 2025, measurement and inspection equipment in the semiconductor sector will account for roughly 60–70% of revenue, with 2026 expected to exceed 70%.
Rapidus plans to begin construction on a second fabrication plant in Chitose, Hokkaido, in fiscal 2027 to produce 1.4nm and eventually 1nm chips, according to reports from Nikkei and Yomiuri Shimbun. The move underscores Japan's push to return to the front of advanced logic manufacturing, even as Rapidus works to complete its 2nm process and secure the funding required to sustain its roadmap. However, the company has since denied this reported timeline.
Google's expanding Tensor Processing Unit (TPU) strategy is emerging as a serious challenge to Nvidia's long-running dominance in AI accelerators, particularly after a report from The Information revealed that Meta is in talks to begin using Google TPUs in its data centers in 2027 under a potential multibillion-dollar agreement.
Topco Scientific (TSC) expects semiconductor material demand to remain robust through 2026, driven by AI-led advanced process capacity utilization and strong memory market momentum. The company is optimistic about next year's performance in key product lines, including photoresist, silicon wafers, and quartz, with photoresist showing the strongest growth potential amid booming advanced node requirements.
Recent market rumors indicate that Meta is negotiating to deploy Google's seventh-generation TPU "Ironwood" in its data centers by 2027, with procurement potentially reaching tens of billions of US dollars. This move signals confidence that Google will become a leading ASIC chip supplier, challenging Nvidia's dominance and securing the second spot in the AI accelerator market.
Taiwan's IC design sector has rapidly expanded in the application-specific integrated circuit (ASIC) market, driven by growing demand for AI applications. MediaTek has entered Google's TPU supply chain, Alchip Technologies has secured new Amazon Web Services programs, and Global Unichip (GUC) continues to win additional projects. Market chatter indicates GUC has landed the full back-end turnkey order for Tesla's AI5 chip, expected to contribute revenue starting in 2027.
Explosive AI demand is accelerating a historic global memory chip shortage, with major cloud service providers (CSPs) securing multi-year long-term agreements (LTAs) to guarantee supply through 2027 and 2028. Industry sources reveal that nearly all memory production capacity for 2026 has been pre-booked, confirming an unrelenting shortage throughout the year.
In the competitive realm of artificial intelligence computing power, Nvidia currently leads the market, but Google is emerging as a formidable contender with its self-developed TPUs. According to CNBC, Google has collaborated extensively with Broadcom since 2016 to design and manufacture its AI chips. This partnership has progressed into the seventh generation of TPUs, which power Google's internal AI infrastructure and rival Nvidia's GPUs in AI workloads.
China's AI chip startup Zhonghao Xinying has introduced its own tensor processing unit (TPU), a major step in the country's "de-Americanisation" drive as US export curbs continue to block access to Nvidia's high-end GPUs.
TSMC announced in mid-2025 that it will fully exit the gallium nitride (GaN) foundry business within two years. The strategic move refocuses resources on advanced silicon manufacturing and packaging, reshaping the global supply chain for power semiconductors. The withdrawal has triggered a succession contest among contract chipmakers. The competition quickly centered on a US-Taiwan rivalry after GlobalFoundries secured a critical technology licensing deal with the departing industry leader.
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