compute
Where AI chips are made, and what limits how many.
An AI chip is several chips in one package: a processor made on the newest manufacturing process, stacks of high-bandwidth memory beside it, and links that carry data between packages by wire or by light. Each step depends on a small number of factories and tool makers. The open question is no longer whether these chips work, but whether enough of them can be made, at good yield, quickly.
- Packaging sets the pace.
- Each AI processor must be joined to its memory in an advanced package, and that step has limited supply since 2023. Estimated capacity rose from about 13,000 wafers a month at end-2023 to about 130,000 targeted for end-2026, and supply is still reported short.
- Memory is the scarcest input.
- Three companies make nearly all high-bandwidth memory. SK hynix says more than half of its 2027 and 2028 capacity is covered by long-term agreements, and 2027 prices are projected to more than double.
- Tools and cleanrooms are the next limit.
- The sole maker of EUV lithography machines says its planned 2027 and 2028 supply will not fully meet demand. Equipment makers cite cleanroom space and component shortages, and tool lead times have lengthened.
- Watch slack, not announcements.
- The test of this view is whether new capacity stays full. In mid-2025 packaging utilization was reported near 60% before demand caught up; falling utilization or packaging prices would be the first sign of a cycle peak.
what would change the view
- Packaging prices fall, or reported CoWoS-class utilization drops below about 80%, for two consecutive quarters while capacity is still being added.
- Memory makers renegotiate long-term HBM agreements lower, or the projected 2027 HBM price increase reverses.
- 2027 wafer fab equipment spending comes in below 2026, or ASML order intake falls for two consecutive quarters.
map
scoreboard Advanced-packaging capacity: how many wafers a month the industry can turn into finished AI chip packages, each joining a processor to its high-bandwidth memory. TSMC does not publish this figure, so the map shows the range of published supply-chain estimates. Revenue and capital spending are inflated by price increases and do not measure volume.
TSMC's CoWoS-class capacity at year-end: a line through the middle of published estimates, the shaded band their range, dashed where projected. Hollow points are other estimates of capacity outside TSMC. The strip below marks dated evidence on whether the capacity is being used; the accent marks signs of tight supply.
| step | suppliers at volume | who | ramping or sampling |
|---|---|---|---|
| EUV lithography | 1 | ASML | none outside ASML |
| 2.5D and 3D packaging (CoWoS-class) | 2 | TSMC; Intel (EMIB) | ASE/SPIL and Amkor (partner capacity) |
| Co-packaged optics switches | 2 | Nvidia (with TSMC); Broadcom | Lightmatter; Ayar Labs; Marvell |
| High-bandwidth memory | 3 | SK hynix; Samsung; Micron | CXMT (limited production, low reported yields) |
| Leading-edge logic (2 to 3 nm class) | 3 | TSMC; Samsung; Intel (18A) | Rapidus (pilot line); SMIC (5 nm-class, without EUV) |
Steps in the chain by number of suppliers shipping at volume, from public disclosures. Counts are editorial judgment. Advanced organic substrates are also reported short, but no public supplier count was found.
players
Listed companies whose value depends mainly on adding or using scarce leading-edge capacity. Private companies are included if they ship production silicon to outside customers, or run a government-backed fab with a working pilot line and a dated start for mass production. Others that pass the test include SambaNova, FuriosaAI and Rebellions. Funding amounts are not shown for anyone.
- TSMClisted, NYSE: TSM
- leading-edge logic; advanced packaging · CoWoS about 130,000 wafers a month targeted for end-2026 (estimate); 2 nm 8% of 3Q26 sales. Makes most AI accelerators and packages them; 2026 capital spending guided at $60 to 64 billion.
- ASMLlisted, Nasdaq: ASML
- EUV and DUV lithography · 113 new lithography systems sold in 3Q26. Sole EUV supplier; says planned 2027 and 2028 supply will not fully meet demand.
- SK hynixlisted, KRX: 000660
- high-bandwidth memory · About 50% of HBM in 2Q26 (one research firm, by revenue). More than half of 2027 and 2028 capacity under long-term agreements; expects the memory shortage to last through 2030.
- Samsung Electronicslisted, KRX: 005930
- high-bandwidth memory; foundry · About 33% of HBM in 2Q26 (same firm). Supplying HBM4 for Nvidia's next platform.
- Micronlisted, Nasdaq: MU
- high-bandwidth memory; DRAM · About 18% of HBM in 2Q26 (same firm). US-based memory maker; fiscal 4Q26 revenue $54.2 billion against $11.3 billion a year earlier, mostly on price.
- Intellisted, Nasdaq: INTC
- foundry (18A, 14A); EMIB packaging · 18A in volume production in Arizona (Oct 2026). Says a shortage of advanced organic substrates limits its packaging output, and expects the industry to stay supply constrained through 2027 and into 2028.
- Nvidialisted, Nasdaq: NVDA
- GPUs, systems, networking · Data center revenue $89.0 billion in fiscal 2Q27. Reported to use over half of CoWoS capacity; shipping co-packaged optics switches since June 2026.
- Broadcomlisted, Nasdaq: AVGO
- custom AI chips; Ethernet switch silicon · Buyer of foundry and packaging capacity. Designs accelerators for cloud companies and the switch chips that link them.
- AMDlisted, Nasdaq: AMD
- GPUs and CPUs · Buyer of foundry and packaging capacity. Second merchant GPU supplier; rack-scale systems ramping in 2026.
- Lam Researchlisted, Nasdaq: LRCX
- etch and deposition tools · Sees 2027 wafer fab equipment spending above $200 billion (Oct 2026). Flags cleanroom space and component supply as limits for 2027.
- Amkorlisted, Nasdaq: AMKR
- outsourced advanced packaging and test · Arizona campus phase 1 due by end-2027. Multi-year packaging agreements with Nvidia in Arizona and Korea; customer ramp late 2028.
- Lumentumlisted, Nasdaq: LITE
- lasers and optical components · Laser supply reported as a constraint on optical links. Marvell agreed on 2 November 2026 to acquire it in an all-stock deal expected to close in the first half of 2028.
- Marvelllisted, Nasdaq: MRVL
- custom silicon; electro-optics · Completed its Celestial AI acquisition (photonic interconnect), Feb 2026. Agreed to acquire Lumentum (2 Nov 2026).
- Cerebraslisted, Nasdaq: CBRS
- wafer-scale processors and systems · Listed May 2026. Builds one processor per whole wafer instead of packaging small chips.
- Rapidusprivate
- 2 nm foundry (Japan) · Pilot line running since Apr 2025; mass production targeted 2H FY2027. Government-backed program in Hokkaido.
- CXMTlisted, Shanghai STAR Market: 688825
- DRAM and HBM (China) · Limited HBM3E production planned at reported 20 to 30% yields (Oct 2026). China's main DRAM maker, listed in July 2026; works without EUV access.
- Etchedprivate
- inference chip specialized for transformers · First production rack delivered to a customer (Jul 2026). Chip made at TSMC; sells rack-scale systems.
- d-Matrixprivate
- memory-centric inference accelerator · Corsair in full production (Jun 2026). Air-cooled systems aimed at existing data centers.
- Tenstorrentprivate
- RISC-V processors and AI accelerators · Blackhole and Galaxy systems shipping (Oct 2026). Sells hardware and licenses designs to other chipmakers.
- Lightmatterprivate
- photonic interposers and optical engines · Near-packaged optics in manufacturing; volume ramp early 2027. Says lasers and fiber, not chips, limit optical scale-up.
- Axelera AIprivate
- edge inference chips · Metis shipped to more than 500 customers (Feb 2026). Netherlands-based; second-generation Europa chip launched and shipping in September 2026.
resources
- Epoch AI, machine learning hardware
- Independent, free dataset of more than 180 AI accelerators with performance, memory and release data.
- TrendForce News
- Daily semiconductor supply-chain news, including the capacity and price reports used here.
- Chips and Cheese
- Free technical deep dives on processor and memory architecture.
- SIA and BCG, Emerging Resilience in the Semiconductor Supply Chain
- Where each manufacturing step is located and how that is shifting.
notes
As of 3 November 2026. Supplier counts and placements reflect editorial judgment. TSMC does not disclose CoWoS capacity; figures are supply-chain and analyst estimates, shown as ranges, and describe nameplate capacity, not output. HBM shares come from a single research firm and are revenue-based; other trackers differ. Revenue figures are inflated by price increases and should not be read as volume. Not investment advice.