Hon Precision Industry Inc (鴻勁精密), a supplier of chip test handlers used in advanced chip-on-wafer-on-substrate (CoWoS) packaging equipment, yesterday said it plans to expand production capacity by about 40 percent to meet surging demand from artificial intelligence (AI) and high-performance computing chipmakers.
The company counts Taiwan Semiconductor Manufacturing Co (台積電), US chip giant Nvidia Corp, and ASE Technology Holding Co (日月光投控) — the world’s largest chip packager and tester — among its major clients.
Hon also supplies active thermal control (ATC) equipment and cold plates that are used in advanced chip testing equipment.
Photo: CNA
The company plans to break ground on a new factory in Taiwan this quarter. Once operations begin in 2028, the facility is expected to raise the firm’s quarterly shipments to 750 units, up from the current 550 units, the company said.
“We have been doing our best to increase capacity, but customers’ demand still outpaces our capacity,” Hon Precision vice president Collin Weng (翁德奎) said at a media briefing in Taipei.
“The visibility for the first half of next year is also very clear. We do not see any shift at all,” he said.
The company’s production capacity is fully booked for the next two quarters, which is rarely seen for the semiconductor industry, where visibility typically extends only about three months, Weng said.
Equipment delivery lead times have stretched to four to five months, compared with the usual three to four months, he said.
Hon’s upbeat outlook echoed TSMC’s recent comments on sustained AI chip demand, which have eased market concerns over a potential “AI bubble.”
TSMC said earlier this month that it is also expanding its CoWoS capacity to close the widening supply-demand gap.
Hon expects a significant revenue growth next year, driven by strong customer demand, Weng said.
Key customers are upgrading test handlers and ATC equipment with higher price tags after new-generation chips enter production, using more complex technologies generating more heat, he said.
Revenue in the first nine months of this year more than doubled to NT$21 billion (US$683.6 million) from NT$9.03 billion a year earlier, the company said.
The US market contributed about 52 percent of its total revenue in the first half of this year, it said.
Net profit for the first half surged to NT$5.03 billion from NT$2.14 billion a year earlier, while earnings per share rose to NT$31.15 from NT$13.38, company data showed.
Shares rallied 8.07 percent to NT$2,235 on the Taipei Exchange’s Emerging Stock Board yesterday, making it the most expensive stock on the preparatory board. The company plans to debut its shares on the Taiwan Stock Exchange next month.
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