Morgan Stanley: SEMICON Taiwan 2026 Key Takeaways - We Need More
Summaries are public. PDF access requires an active membership; all members have the same access. Sign in
Morgan Stanley's Greater China semiconductor team concludes from SEMICON Taiwan 2026 that Taiwan AI semiconductor capex should stay strong through 2027 to resolve supply-chain bottlenecks, maintaining Overweight ratings on TSMC, MediaTek, Hon Precision, Allring, MPI, and Winway, with the Greater China tech view at Attractive. CEO-forum messages underscored that Taiwan remains a bottleneck for AI infrastructure: TSMC deputy co-COO Hou said demand over the past six months has grown and shifted with unprecedented frequency while WFE partners' tool deliveries remain insufficient, and MediaTek CEO Tsai asked ASE, TSMC, and Unimicron for more capacity. Three technical themes stand out. First, silicon photonics/CPO: inter-rack CPO links remain Nvidia's preferred direction, and NV576 Rubin Ultra may use CPO switch trays in 2027 to connect eight NVL72 racks. Second, memory optimization: supply-chain checks suggest Rubin Ultra CPUs will very likely adopt 8-Hi HBM4, about one-third less than Rubin's 12-Hi, with sufficient total bandwidth via added HBM4 base-die units, HBM4e migration, and software optimization. Third, More-than-Moore panel-level packaging and Intel EMIB-T: MediaTek's AI TPU v9 (HumuFish) should secure sufficient EMIB-T substrate supply by 2028. On-site equipment evidence included GMT hexapod stages, Toyo optical-alignment modules, and Toray's panel-level packaging tools, including a UC5000 bonder possibly linked to EMIB-T production. The overarching goal, the team argues, is lowering cost per token.