Friday's (June 5th) market action can be summarized in one phrase: AI chip woes, robotics frenzy.
Overnight, the U.S. AI chip giant Broadcom plummeted due to guidance that fell short of explosive expectations, accelerating a global wave of sentiment-driven selling in tech stocks. Yet, amidst this widespread chip sector downturn, the glass substrate segment managed to carve out a remarkably independent and positive trajectory!
This indicates that savvy capital has not exited the market but is instead clustering more tightly around the absolute core theme of "AI computing power + advanced packaging."
As AI chips grow larger and their power consumption approaches physical limits, traditional organic "foundations" are struggling to cope. On the eve of this foundational material revolution shifting from "silicon stacking" to "glass substrates," why are industry giants fiercely jockeying for position?
With 2026 viewed as the first year of commercialization, how much industrial explosive potential does the glass substrate technology truly hold? Today, we will dissect this high-tech industry chain map and explore which Electronic ETFs could allow investors to participate in this advanced packaging feast.
Understanding Glass Substrates: Characteristics and Advantages
At its core, a glass substrate involves using specialized glass to replace traditional plastic organic substrates or silicon interposers, serving as the chip's "foundation." Its importance stems from the fact that traditional organic substrates can no longer withstand the "breakneck speed" of AI chip development.
Traditional organic substrates, such as ABF, have non-uniform microstructures, are prone to warping under heat, suffer from significant signal loss, and cannot meet high-density wiring requirements. In contrast, glass substrates possess four overwhelming physical advantages.
1. Its Coefficient of Thermal Expansion (CTE) is an extremely close match to silicon chips. This fundamentally solves issues of warping and solder joint cracking in large-size chips caused by thermal cycling, leading to a substantial improvement in yield rates.
2. It boasts exceptional electrical properties. With extremely low dielectric constant and loss, signal transmission speeds can increase by over 3.5 times while loss is reduced by 50%. This makes it the only viable solution for achieving next-generation 224Gbps high-speed interconnects.
3. Its surface flatness rivals that of a mirror. With roughness below 0.1μm, circuits hundreds of times finer than a human hair can be drawn within a minuscule area, directly boosting interconnect density by 10 times and supporting the goal of single-package trillion-transistor integration.
4. It is a natural platform for photonic integration. Being transparent, glass is an ideal substrate for Co-Packaged Optics (CPO), perfectly integrating electrical and optical interconnects. In simple terms, as AI chip power consumption and area approach physical limits, the glass substrate is the only material that can still provide incremental benefits at the physical level, making it a "mandatory option" for advanced packaging in the post-Moore's Law era.
Global Giants' Positioning Battle: Diverging Paths and Production Timelines
While industry giants have reached a consensus on the "silicon to glass" technological shift, their specific technical paths have diverged, and their mass production schedules vary significantly.
A recent key catalyst was MediaTek's announcement that its next-generation chips will abandon TSMC's CoWoS in favor of Intel's EMIB-T glass substrate solution, with plans for mass production in 2027.
This marks the transition of the glass substrate ecosystem competition from the technology R&D phase into a direct battle for customers, directly challenging TSMC's dominance in high-end packaging.
Industry Chain Overview: Raw Glass is the "Crown," TGV is the "Bottleneck"
Value distribution within the glass substrate industry chain is highly uneven, with core segments possessing extremely high barriers to entry.
Upstream – Raw Glass and Materials: This is the most lucrative segment. The formulation for glass substrate raw materials involves high-purity quartz sand, boron oxide, etc., with production technology long monopolized by oligopolies like U.S.-based Corning and Japan's AGC, which together hold nearly 90% of the global display substrate market share.
Glass raw materials for semiconductor packaging demand even higher purity and thermal stability, creating a deep technological moat. This is a key reason many analysts see the clearest space for domestic substitution in the upstream segment within China. Domestic players like Gobi Glass (ASX: GOB), Kaisheng Technology (ASX: KST), and Qibin Group (ASX: QBG) are accelerating their catch-up efforts, but a gap remains.
Midstream – TGV (Through-Glass Via) Formation and Metallization: This is the most critical and challenging process. The core process involves four steps: via formation, metallization filling (copper filling), surface wiring, and back-end testing.
The mainstream via formation technique is converging on "femtosecond laser-induced + wet etching." However, consistency issues in copper filling, such as void rates and aspect ratios, remain unresolved, directly impacting yield rates. Currently, only a few manufacturers like Woge Photoelectric (ASX: WGP) and Yuntian Semiconductor (ASX: YTS) have mastered some core processes, but they are still some distance from large-scale mass production.
Downstream – Packaging and Application: Ecosystem dominated by giants. This final stage involves integration by companies like Intel and TSMC into advanced packaging solutions such as CoWoS and EMIB, for use in high-end applications like AI server CPUs/GPUs, HBM memory, and CPO.
Market Outlook: 2026 as the Commercialization Starting Point, But a Long Road Ahead
According to Yole Group data, advanced packaging has become a major driver of packaging market expansion, with the market reaching $46 billion in 2024 and projected to exceed $79.4 billion by 2030.
Driven by demand from AI, high-performance computing, and data centers, the 2.5D/3D advanced packaging market is expected to continue expanding, potentially nearing $35 billion by 2030, with a compound annual growth rate (CAGR) of approximately 19% from 2024 to 2030.
Market consensus points to 2026 as the "first year of commercialization" for glass substrates. A SEMI report forecasts that, under the most optimistic scenario, the glass core substrate market could achieve a CAGR of 67.2% from 2028 to 2040.
Short-term market size is projected to grow from $1.48 billion in 2024 to $2.33 billion in 2034, driven by strong tailwinds from AI computing investment and the advanced packaging capacity gap.
Changjiang Securities estimates that if TGV packaging penetration reaches 50% and its cost share is 25% by 2030, the global glass substrate market could expand to approximately $4.4 billion. Companies like TSMC, Intel, Samsung Electro-Mechanics, and BOE are actively progressing with pilot and mass production verification, with 2026 being a critical validation window.
Dongwu Securities notes that glass substrates, with their tunable CTE, low dielectric loss, high surface flatness, and potential for panel-level large-size processing, are becoming an important alternative direction for advanced packaging. Three technical paths—TSMC's CoPoS, Intel's Glass-Core, and CPO—are all expected to benefit from this underlying material restructuring.
However, it is crucial to acknowledge that the path to industrialization is not smooth. Beyond the aforementioned TGV metallization and yield bottlenecks, comprehensive industry standards are still lacking, and supply of high-end equipment, such as electroplating machines and PVD systems, remains insufficient.
Industry insiders offer a sobering forecast, suggesting large-scale mass production is unlikely to materialize until at least 2028 or even after 2030.
Which ETFs are Related to Glass Substrates?
Based on the above analysis, 2026 is expected to be a key node for the commercial introduction of glass substrates, with accelerated penetration potentially occurring around 2028. The following ETFs have some thematic connection to the glass substrate trend.
For instance, the Electronic ETF (HuaBao) tracks the Electronic 50 Index, heavily weighted in the semiconductor and consumer electronics sectors. It covers hot industries like AI chips, automotive electronics, 5G, and printed circuit boards (PCBs). Its top holdings include companies like Luxshare Precision (ASX: LXP), Cambricon (ASX: CBN), Industrial Fulian (ASX: IFL), and SMIC (ASX: SMC).
In the past month, this Electronic ETF has seen significant inflows of 190 million units, with its size growing noticeably to a latest figure of 805 million units, making it the largest fund tracking its underlying index, with decent liquidity.
Note: The above data is for reference only and does not constitute any investment advice.
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