Nvidia GB200 Supply Shortage – Got Many Customers, Demand Exceeds Supply

• The packaging and testing plant is chasing orders
• Taiwan chains ASE and KYEC expect Q4 related orders to double

Nvidia’s GB200 and B-series AI chips, built on the new Blackwell architecture, have attracted a large number of customers, with demand exceeding supply. Nvidia previously aggressively increased production through TSMC’s advanced processes, before spreading the order-chasing effect to the backend. The final packaging and testing plant saw an explosion in operations at ASE Investment Holdings and KYEC, with related orders doubling in the fourth quarter.

ASE Investment Holdings never mentions individual customer and order trends. KYEC said capacity utilization is actually quite high at this stage, but it didn’t mention a single customer. KYEC is full of new orders from Nvidia and is mobilizing internally to welcome large orders, sources said. They could be transferred for this purpose. More production capacity could meet Nvidia’s needs.

An industry insider has previously reported that Nvidia will invest in additional wafers in TSMC. It analyzes that TSMC’s production has increased significantly in terms of supply chain upstream and downstream relationships, and demand for backend packaging and testing will also increase. If it increases at the same rate, TSMC will first reflect relevant information, and packaging and testing plants will be acquired.

Research firm TrendForce recently published a report showing that the supply chain is optimistic that shipments of Nvidia’s GB200 Super AI chip, which is based on the Blackwell architecture, could exceed 1 million in 2025. The industry is optimistic that TSMC is the exclusive foundry for Nvidia chips. For large orders, ASE Investment Holdings and KYEC are the winners in backend packaging and testing.

Industry analysis shows that the testing process for GB200 and B-series AI chips, built on Nvidia’s Blackwell architecture, is much longer than the previous generation H-series and requires four consecutive procedures, including terminal testing (final testing) and burn-in. After FT testing, the final SLT system-level testing was conducted, which resulted in a significant increase in testing time, which had a positive impact on average unit price (ASP) and gross margin. It helped related third parties and helped improve earnings performance for ASE Investment Holdings and KYEC.

ASE’s subsidiary ASE Silicon Products has a close relationship with Nvidia. In addition to performing TSMC’s CoWoS advanced packaging OS segment process, it also deploys test production capabilities in the Zhongke Factory to meet Nvidia’s one-stop production service in wafer bags.

ASE Investment Holdings expects business opportunities to explode in AI and high-speed computing (HPC), which will drive huge demand for advanced packaging. Related growth trends are expected to continue until 2025. The group’s AI advancement is expected to double its packaging performance this year.

KYEC actively welcomed Nvidia’s order-tracking effectiveness and was fully “in action,” sources said. KYEC’s Nvidia orders have surged, and the company will be very busy in the fourth quarter as product complexity increases and testing times drag on. Production capacity is severely low, and most of the Tongluo 3 plant is planned to be used to test Nvidia chips. This should contribute significantly to KYEC from the fourth quarter to next year.

KYEC’s current revenue stream accounts for 70-80% primarily from testing, with the rest being packaging. Thanks to Nvidia’s order-tracking effect, utilization of KYEC-related test production lines has reached a high level.