Advanced Packaging Market Size & Share Analysis - Growth Trends & Forecasts (2025-2030)

Global Advanced Packaging Market Trends and Insights

Rising demand for heterogeneous integration for AI and HPC

AI workloads require compute density and memory bandwidth unattainable with legacy packaging. TSMC’s CoWoS platform integrates chiplets and high-bandwidth memory in a single structure, gaining rapid adoption among leading AI accelerator vendors.^{[1]Taiwan Semiconductor Manufacturing Company Limited, “TSMC Intends to Expand Its Investment in the United States to US USD165 Billion to Power the Future of AI,” pr.tsmc.com} Samsung’s SAINT technology achieved similar objectives using hybrid bonding that supports forthcoming HBM4 stacks, underscoring the strategic value of in-house advanced packaging. Thermal interface materials, specialized substrates, and active interposers raised package cost to 15–20% of the total semiconductor build-to-materials, up from 5–8% for mainstream CPUs. As a result, advanced packaging capacity became as critical as leading-edge fabs in determining time-to-market for AI systems. The advanced packaging market, therefore, grew in tandem with, rather than lagging, front-end process migrations.

Miniaturization of consumer devices boosting WLP adoption

Smartphones, wearables, and hearables consistently demand thinner profiles and higher functional density. Fan-out wafer-level packaging (FOWLP) enables multiple dies to be embedded in ultra-thin packages below 0.5 mm, supporting flagship mobile processors without compromising thermal performance. The shift from fan-in WLP to FOWLP reduced overall system cost by up to 25% because under-fill, wire-bonding, and laminate substrates were eliminated. Miniaturization also moved into implantable medical electronics, where dimensions are life-critical; leadless pacemakers benefited from WLP to cut device size by 93% while meeting stringent reliability targets. Consequently, consumer and medical demand created a recurring baseline that insulated the advanced packaging market from cyclical swings in PC end-markets.

Government semiconductor subsidies accelerating infrastructure development

Legislation such as the United States CHIPS and Science Act allocated USD 52.7 billion for domestic capability, with USD 1.6 billion reserved for advanced packaging. Amkor secured USD 407 million to build a USD 2 billion facility in Arizona, the largest OSAT investment on U.S. soil. Europe followed with a EUR 43 billion (~USD 48.6 billion) Chips Act, catalyzing onsemi’s USD 2 billion vertically integrated silicon-carbide packaging site in the Czech Republic. Singapore approved substantial incentives for Micron’s USD 7 billion high-bandwidth memory packaging plant, creating 3,000 jobs by 2027. Subsidies shifted comparative advantage away from the traditional low-cost hubs toward politically prioritized geographies, reshaping site-selection decisions for new lines in the advanced packaging market.

EV power-electronics reliability transforming packaging requirements

The migration to 800-volt vehicle architectures forced radical improvements in thermal, voltage, and mechanical robustness. JCET committed RMB 4.4 billion (USD 621 million) to build an automotive-grade packaging campus in Shanghai dedicated to silicon-carbide and high-temperature components. Packages designed for EV inverters must withstand −40 °C to +150 °C thermal cycling over 20 years, a requirement that dictates advanced materials, void-free sintering, and double-sided cooling topologies. Automotive silicon-carbide modules now carry package value three to four times that of traditional silicon devices, elevating packaging from commodity to differentiation. Tier-1 suppliers consequently entered co-development agreements with OSATs to secure proprietary designs, supporting sustained double-digit revenue growth for automotive lines within the advanced packaging market.

High capital intensity constraining market entry

Tooling for 2.5D and 3D processes can cost USD 10–15 million per chamber, vastly exceeding the USD 3 million typical for legacy lines. TSMC budgeted USD 42 billion in 2025 capital outlays, of which a material share targeted advanced packaging expansions. Smaller OSATs, therefore, struggled to amortize investments across rapidly shrinking product life cycles, prompting niche specialization or defensive mergers. The elevated hurdle rate widened the technological gap between tier-one providers and regional followers, dampening fresh capacity in the advanced packaging market during 2024–2026.

BT-resin substrate bottlenecks limiting production capacity

High-density build-up substrates used in 2.5D interposers depend on BT resin supplied by a limited group of Japanese and Taiwanese firms. Lead times doubled to 24 weeks for the most advanced substrates, forcing package redesigns that sacrificed input/output density or increased bill-of-materials expense. To secure supply, leading OSATs structured multi-year purchase agreements and explored backward integration with substrate partners. Until new fabs reach volume in 2026, substrate scarcity remains a gating factor that tempers the otherwise robust growth trajectory of the advanced packaging market.

Segment Analysis

By Packaging Platform: AI workloads accelerate 2.5D/3D adoption

Flip-chip packages retained leadership with 49.0% revenue in 2024, anchored by high-volume consumer and industrial applications. Yet 2.5D/3D configurations delivered the fastest gains, achieving a 13.2% CAGR outlook as AI accelerators demanded logic-to-memory proximity beyond flip-chip limits. The advanced packaging market size for 2.5D/3D solutions is forecast to reach USD 34.1 billion by 2030, equal to 38% of total platform revenue.  

Samsung’s SAINT platform attained sub-10 µm hybrid bonds, reducing signal latency by 30% and extending thermal headroom by 40% relative to wire-bonded stacks.^{[2]SEMI VISION, “Geopolitical Disruption to the Semiconductor Industry Ecosystem,” tspasemiconductor.substack.com} TSMC’s CoWoS ramped three additional lines in 2025 to clear a 12-month backlog. Embedded-die and fan-out WLP progressed as complementary options: embedded packages suited space-constrained automotive domains, while fan-out WLP captured 5G base-station and mmWave radar designs. Collectively, these dynamics embedded 2.5D/3D packaging at the center of next-generation device roadmaps, guaranteeing its role as the prime value driver inside the advanced packaging market.

Note: Segment shares of all individual segments available upon report purchase

By End-User Industry: Vehicle electrification widens demand profile

Consumer electronics absorbed 40.0% of 2024 shipments, but its growth plateaued at single digits. In contrast, automotive and EV demand is projected to expand at a 12.4% CAGR, lifting its share of the advanced packaging market to 18% by 2030. The advanced packaging market size for automotive electronics is estimated to surpass USD 16 billion by the end of the forecast period.  

EV traction inverters, on-board chargers, and domain controllers now specify automotive-grade fan-out, double-side cooled power modules, and over-molded system-in-package (SiP) assemblies. Data-center infrastructure provided another high-growth niche: AI servers utilize advanced packages with power densities reaching 1,000 W/cm², dictating innovative thermal lid and under-fill chemistries. Healthcare, meanwhile, requires biocompatible coatings and hermetic enclosures, attributes that carry premium average selling prices and stable replacement demand. Cumulatively, these segment trends diversified revenue streams and reduced dependence on cyclical smartphone refresh cycles within the advanced packaging market.

By Device Architecture: Vertical integration extends scaling

Two-dimensional ICs still comprised 56.0% of units in 2024, yet their share is projected to decline as 3D ICs scale at a 15.1% CAGR. The advanced packaging market share for 3D ICs is expected to reach 28% by 2030 as through-silicon-via (TSV) and hybrid-bonded stacks move into mainstream AI and networking devices.  

Samsung demonstrated logic-to-memory hybrid cubes that achieved sub-10 µm TSV pitch, improving bandwidth and energy efficiency against 2.5D interposer solutions. At the same time, 2.5D interposers formed a transitional architecture for designers seeking higher performance without full TSV complexity. Foundries and OSATs collaborated on active-interposer programs that embed voltage regulation and photonic layers, signaling a gradual convergence of advanced packaging and system-on-substrate concepts. These architectural shifts ensure vertical integration remains the central lever for sustaining Moore-like progress, cementing its importance to the advanced packaging market.

Note: Segment shares of all individual segments available upon report purchase

By Interconnect Technology: Hybrid bonding overtakes pitch limits

Solder bumps held 62.0% revenue in 2024, reflecting their cost competitiveness for legacy nodes. Copper pillars gained share in performance-driven flip-chip devices, but the fastest acceleration came from hybrid bonds projected at a 17.5% CAGR. The advanced packaging market size attributable to hybrid bonding is expected to reach USD 18.2 billion by 2030, up from USD 6.6 billion in 2024.  

Hybrid bonding enables direct metal-to-metal contacts below 10 µm, eliminating under-bump metallization and enhancing thermal paths. Samsung deployed the technique in HBM4 production, cutting signal latency by 40% and doubling bandwidth. Yield learning curves improved significantly in 2025, approaching mature flip-chip levels, which removed a key adoption barrier. As logic-to-memory and die-to-die interfaces climb into multiple terabits per second, hybrid bonding’s scalability positions it as the default choice for next-generation integration across the advanced packaging market.

Geography Analysis

Asia-Pacific generated 75.0% of 2024 revenue because Taiwan, South Korea, and mainland China house the bulk of front-end fabs and substrate suppliers. TSMC announced a USD 165 billion U.S. investment, reflecting a diversification strategy rather than the displacement of its Taiwan base, ensuring Asia retains leadership in the medium term. China’s domestic OSATs delivered double-digit sales gains and expanded into automotive packaging, but tight controls on extreme-ultraviolet (EUV) tools limited their move into leading-edge wafer-fab processes.

North America emerged as the fastest-growing region at a 12.5% CAGR thanks to the CHIPS Act incentives. Amkor’s USD 2 billion Arizona site will combine bump, wafer-level, and panel-level lines once fully ramped in 2027, providing the first large-scale outsourced option near U.S. system integrators. Intel, Apple, and NVIDIA pre-booked a portion of this capacity to de-risk geopolitical supply interruptions, redirecting meaningful volumes that historically flowed to East Asian OSATs. Consequently, the advanced packaging market now includes a credible North American supply node capable of high-volume AI product support.

Europe pursued specialization rather than volume leadership. onsemi’s Czech facility addressed silicon-carbide devices for automotive power, aligning with local OEM electrification targets. Germany’s Fraunhofer institutes led panel-level research, but manufacturers stayed cautious on green-field megasite commitments. Meanwhile, Singapore strengthened its hub role; Micron’s HBM plant and KLA’s process-control expansion created a vertically coherent ecosystem that supports AI memory and metrology under one jurisdiction.^{[3]Micron Technology, “Micron Breaks Ground on New HBM Advanced Packaging Facility in Singapore,” investors.micron.com} India introduced a 50% capital cost-sharing scheme, attracting proposals for advanced packaging pilots that promise medium-term upside yet remain contingent on talent availability.

Collectively, these developments diversified geographic risk for system OEMs and rebalanced the advanced packaging market. Even so, Asia-Pacific is forecast to maintain more than 60% share in 2030 because existing infrastructure, supply clusters, and economies of scale still surpass new regional entrants.