China's Chip Packaging Giants Invest Billions in AI-Driven Expansion

China's top firms in semiconductor packaging and testing are embarking on a significant capacity expansion worth billions, driven by rising demand for AI, robust profit increases, and Beijing's initiative for technological independence. In the first half of the year, Jiangsu Changjiang Electronics Technology (JCET), Tongfu Microelectronics, and Huatian Technology collectively announced investments surpassing 15 billion yuan (US$2.2 billion). These companies are enhancing advanced packaging for AI accelerators, a vital stage in chip production. JCET, the largest packaging entity in China, noted a remarkable 79.4% year-on-year net profit increase to 845 million yuan, with record revenues of 19.5 billion yuan. In June, JCET revealed plans for a 7.8 billion yuan advanced packaging facility in Shanghai's Lingang, expected to be completed by late 2028. Tongfu Microelectronics anticipates a profit increase of up to 337% for the first half, partly due to its collaboration with Advanced Micro Devices, and has secured approval for a 4.2 billion yuan private share placement to boost memory chip capacity.