NVIDIA Corporation (NVDA.US) and Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR (TSM.US) both deny the rumors of cutting orders for CoWoS, with Huang Renxun saying that the demand for advanced packaging is shifting.

NVIDIA Corporation CEO Huang Renxun, when asked whether the company will cut orders for Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR CoWoS, stated that despite the changing technology requirements, the company's demand for Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR advanced packaging remains strong. In addition, Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR Chairman Wei Zhejia also responded during the earnings call today, stating that the rumors of being cut off are false, and reiterated that the company has been working hard to increase production capacity in collaboration with customers. The industry also stated that overall demand for Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR CoWoS is still exceeding supply, and even if customers switch from CoWoS-S to CoWoS-L, it does not mean that orders are being cut, as overall CoWoS-L production capacity still cannot meet the increasing demand from customers. Recently, there have been rumors circulating in the market about NVIDIA Corporation cutting orders for Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR advanced packaging CoWoS, but related industry sources have stated "they haven't heard anything about it." Nomura Securities analysts, including Aaron Jeng, confirmed in a research report released on January 13 that based on industry surveys, NVIDIA Corporation has significantly reduced its CoWoS-S orders with Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR and United Microelectronics Corp. Sponsored ADR, with a production capacity cut of up to 80%. Tianfeng analyst Guo Mingchi stated that due to NVIDIA Corporation redefining its production line in the latest Blackwell architecture blueprint, its demand for CoWoS-S will significantly decrease for at least the next year. He explained that the 200 series will use a dual-chip design (manufactured using CoWoS-L); the 300 series will use both dual-chip (CoWoS-L) and single-chip (CoWoS-S) designs. Guo Mingchi also noted that due to the new roadmap, there are rumors that NVIDIA Corporation is cutting CoWoS-S production capacity, indicating that at least in the next year or so, NVIDIA Corporation's demand for CoWoS-S will decrease significantly. He pointed out that starting from the first quarter of this year, NVIDIA Corporation will focus on the 200 series and reduce the supply of the Hopper series (CoWoS-S), further decreasing the demand for CoWoS-S; however, the demand for CoWoS-L is more urgent. Guo Mingchi pointed out that the changes in the product roadmap will have varying impacts on the performance of NVIDIA Corporation and its supply chain partners. However, from NVIDIA Corporation's perspective, the reduction in CoWoS-S is mainly due to changes in the product roadmap and not a decrease in demand. This change also aligns well with Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR's strategic plan to make its CoWoS-L technology the mainstream solution. Morgan Stanley analysts Charlie Chan and others stated in their report that considering the better performance of CoWoS-L, NVIDIA Corporation has requested Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR to use CoWoS-L technology for part of the production of GB300A. Morgan Stanley also expects that despite the reduction in NVIDIA Corporation's order, the overall demand for Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR CoWoS will remain unchanged, and they predict a slight increase in the production volume of GB300A this year.