Taiwan’s substrate makers rarely make headlines outside semiconductor trade press, but Kinsus Interconnect Technology Corp (Taiwan stock code 3189.TW) is becoming an exception. The company, a longtime maker of ABF (Ajinomoto Build-up Film) and BT substrates, has approved a three-year capital-expenditure program worth NT$23.5 billion, with roughly NT$7 to 8 billion earmarked for 2026 alone. The money is going almost entirely toward one goal: keeping pace with the substrate demand created by the AI chip boom.
For readers outside the chip-packaging world, a substrate is the unglamorous layer that sits beneath a processor package, wiring the silicon die to the circuit board. It sounds like plumbing, and in a sense it is. But as AI accelerators have grown larger, denser, and hungrier for board-level interconnects, the substrate has quietly become one of the tightest bottlenecks in the entire AI hardware supply chain, a story Tom’s Hardware detailed in its 2026 review of the ABF supply crunch. Kinsus’s expansion plan is the clearest sign yet of how far that bottleneck is reshaping a company that, until recently, drew a fifth of its revenue from a side business making contact lenses.
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What Kinsus Just Announced About Its AI Chip Substrate Push
Kinsus has confirmed that its board-approved capital spending program now totals NT$23.5 billion spread across three years, with 2026 spending alone projected at NT$7 to 8 billion. Nearly all of that capital is aimed at ABF substrate capacity, the material category most tightly linked to high-end AI accelerators, server CPUs, and advanced packaging formats like CoWoS.
The centerpiece of the buildout is the K6 plant in Yangmei, Taoyuan, which Kinsus is expanding in phases. Phase 2 of the K6 expansion is scheduled to come online in 2027, and when it does, monthly ABF capacity at the site is expected to rise by roughly 25%, pushing output toward approximately 50 million units a month. Kinsus has said its planning horizon for AI-related substrate demand now extends into 2028 and 2029, a timeline that suggests management does not see the current AI capex cycle as a short-term spike.
That confidence shows up in pricing, too. Kinsus has said ABF substrate prices rose roughly 5% in the first half of 2026, and it expects increases of up to 7% in the second half. In a component category that has historically competed on thin margins and long depreciation cycles, sustained double-digit annualized price gains are a signal that demand is outstripping supply, not simply that costs are rising.
Who Is Kinsus Interconnect Technology Corp?
Kinsus Interconnect Technology Corp, listed on the Taiwan Stock Exchange under ticker 3189.TW, has built its business on two parallel product lines: ABF substrates, used primarily in CPUs, GPUs, and other high-performance logic, and BT substrates, a lower-cost laminate category used in memory, NAND flash, power management ICs, and optical communication products. The company’s president and CEO is Chen Ho-hsu (éģæēģæ), who has overseen the pivot toward AI-linked capacity over the past two years.
What makes Kinsus’s current moment notable is the shape of its revenue. According to 2026 reporting, Kinsus’s business mix currently breaks down to roughly 30% ABF substrates, 40% BT substrates, and 20% contact lenses, with the rest spread across smaller product lines. The contact lens business is a legacy diversification that has nothing to do with semiconductors, a reminder that Kinsus spent years as a mid-sized, diversified components supplier rather than a pure AI-infrastructure play. That is changing: AI-related revenue currently sits at roughly 5 to 10% of the total, and Kinsus expects that share to climb to 10 to 15% by the end of 2026.
Kinsus has also said its ABF substrate business has now surpassed its 2022 peak, the previous high-water mark set during the last major semiconductor upcycle. That detail matters because it establishes that the current AI-driven demand is not simply recovering lost ground, it is pushing the company into genuinely new territory.
Inside the NT$23.5 Billion Capital Expenditure Plan
Capital spending plans of this size are rare for a company Kinsus’s size, and the phased structure of the rollout reflects a deliberate, risk-managed approach rather than an all-at-once bet. Taiwan News, in coverage of the expansion, quoted CEO Chen Ho-hsu describing the company’s reasoning directly:
“We will not build all the plants at once.”
Chen Ho-hsu, President and CEO, Kinsus Interconnect Technology, via Taiwan News
That phased posture is consistent with how Kinsus has sequenced the K6 plant, bringing initial ABF capacity online first and reserving Phase 2 for 2027 rather than committing the full NT$23.5 billion to a single build cycle. It is a hedge against the possibility that AI accelerator demand cools before the capacity is needed, while still giving Kinsus a credible answer when customers ask about long-term supply commitments.
Earlier reporting from the trade outlet IC&PCB Union had pegged an earlier phase of Kinsus’s expansion closer to NT$19.6 billion, before the fuller three-year, NT$23.5 billion program was confirmed. The gap between those two figures is itself a useful data point: it shows how quickly Kinsus’s own investment planning has scaled up as 2026 AI chip orders have come in stronger than initially budgeted.
Why AI Chips Need So Much More Substrate Than Before
To understand why a substrate maker is suddenly central to the AI hardware story, it helps to understand what has changed about the chips themselves. Modern AI accelerators, the CPUs, ASICs, and LPUs that Kinsus has identified as its target product categories, are no longer single dies dropped onto a board. They are increasingly built from multiple chiplets, high-bandwidth memory stacks, and interposers assembled using advanced packaging techniques such as CoWoS, all of which sit on top of a substrate that has to route far more signal and power than earlier generations required.
That growth in complexity pushes substrate requirements in two directions at once: substrates need to be physically larger to fit more silicon, and they need finer, more precise circuitry to handle the increased signal density. Both of those shifts favor ABF over older, cheaper laminates, which is why Kinsus’s ABF line, rather than its BT business, is absorbing almost the entirety of the new capital spending. The dynamic lines up with what Tom’s Hardware called a “material wall beneath every AI accelerator” in its 2026 analysis of the sector-wide ABF supply crunch, a framing that treats substrate availability as a genuine ceiling on how fast AI chip output can scale, not merely a cost line item.
ABF Substrates: The High-End Layer
ABF substrates are the material of choice for the chips that sit at the center of the AI boom: CPUs, GPUs, and the custom ASICs and LPUs that hyperscalers are increasingly designing in-house. Kinsus has specifically flagged these three categories, CPUs, ASICs, and LPUs, as the product lines driving its AI-related ABF demand. The appeal of ABF lies in its ability to support finer circuit lines and better electrical performance at larger panel sizes, both of which are needed as AI chip packages grow.
BT Substrates: The Volume Business Diversifies Into AI’s Edges
Kinsus’s BT substrate line, the larger of its two semiconductor businesses by revenue share, is not sitting still either. The company has said BT substrates will focus on memory, NAND flash, power management ICs, and optical communication products, all of which are adjacent to the AI buildout without being the AI accelerator itself. High-bandwidth memory packages, in particular, depend on substrates and interposers that are closely related to the BT category, linking Kinsus’s legacy memory-substrate business to the same AI demand curve lifting its ABF line, even if the connection is less direct than the CPU and ASIC story.
The Glass Core Question: What Is Actually Confirmed
Glass core substrates have become one of the most talked-about next-generation packaging materials in the semiconductor press, promising better flatness and signal performance than organic ABF laminates at the panel sizes advanced AI packages now require. It would be natural to assume Kinsus, given its ABF leadership position, has a named glass core program underway. That assumption is not something the available reporting on this story actually supports.
There is no confirmation in the current round of reporting of a specific Kinsus product officially branded “glass core,” nor confirmation of commercial glass-core manufacturing at Kinsus today. What is confirmed is that Kinsus’s cited technology roadmap spans the 3nm, 2nm, and 1nm logic nodes and ties into CoWoS advanced packaging, the same frontier where glass core material research is concentrated industry-wide. Readers should treat glass core as a technology Kinsus is positioned near, given its node roadmap and packaging ties, rather than one it has announced a specific product for. The same caution applies to the phrases “2026 Impact” and “AI Chip Substrate Revolution”: neither is confirmed as an official Kinsus publication title, program name, or company designation in the current reporting, and should be read as descriptive framing rather than Kinsus’s own branding.
Kinsus’s Revenue Mix and AI Exposure: By the Numbers
The following table summarizes the confirmed capital spending, capacity, and pricing data Kinsus and trade outlets have reported for the current expansion cycle.
| Metric | Figure | Timeframe |
|---|---|---|
| Total capital expenditure program | NT$23.5 billion | Three-year program |
| Planned 2026 capex | NT$7â8 billion | Full year 2026 |
| K6 Phase 2 capacity increase | ~25%, to ~5,000 units/month | Begins operations 2027 |
| ABF price increase, 1H26 | ~5% | First half 2026 |
| ABF price increase, 2H26 | Up to 7% | Second half 2026 |
| AI-related substrate demand planning horizon | Extends into 2028â2029 | Forward guidance |
A second data set, covering how Kinsus’s revenue is currently split and where AI fits into that mix, shows just how much room the AI segment has left to grow even as it becomes more central to the company’s story.
| Revenue Category | Current Share | Notes |
|---|---|---|
| ABF substrates | ~30% | Primary AI chip substrate product line |
| BT substrates | ~40% | Memory, NAND flash, power ICs, optical comms |
| Contact lenses | ~20% | Legacy diversified business line |
| AI-related revenue share (current) | ~5â10% | Across ABF and BT lines combined |
| AI-related revenue share (expected, end of 2026) | ~10â15% | Company guidance |
| Overall 2026 revenue growth expectation | Double-digit | Company guidance |
Read together, the two tables tell a consistent story: AI is still a minority of Kinsus’s current revenue, but it is the fastest-growing slice, and it is the slice receiving essentially all of the new capital spending. That is a familiar pattern across the AI hardware supply chain in 2026, visible elsewhere in how TSMC’s profit jumped as its AI-linked advanced packaging business expanded and in how Samsung has leaned on TSMC’s 3nm process for Nvidia-bound memory chips rather than spreading investment evenly across legacy product lines.
Advanced Packaging and the CoWoS Connection
Kinsus’s roadmap explicitly ties its substrate business to CoWoS (Chip-on-Wafer-on-Substrate), TSMC’s advanced packaging platform that has become the default assembly method for the largest AI accelerators on the market. CoWoS packages stack multiple compute dies and high-bandwidth memory on an interposer, then mount the entire assembly on a substrate that has to be large, flat, and precise enough to keep everything electrically connected without warping under thermal stress. That is exactly the kind of substrate Kinsus’s ABF expansion is built to supply.
The packaging side of this story has been shifting quickly elsewhere in the industry too. TechTimes reported in mid-2026 that TSMC had begun pursuing an EMIB-like packaging approach, borrowing a technique Intel pioneered, in a move the outlet described as shaking up the AI packaging race in ways that directly involve Kinsus. The detail underscores that substrate suppliers like Kinsus are not passive component vendors in this cycle; they are being pulled into packaging-level decisions that used to sit entirely with the foundries and OSAT (outsourced semiconductor assembly and test) providers.
Competitive Landscape: Where Kinsus Sits in the ABF Substrate Market
Kinsus is not the only Taiwanese substrate maker racing to expand ABF capacity. The broader ABF market has historically included a handful of major suppliers across Taiwan, Japan, and South Korea, competing for allocation from a small set of chip designers that need the highest-end substrates for their flagship accelerators. Reports describing this wider supply crunch, including the Tom’s Hardware analysis cited above, have framed ABF capacity constraints as an industry-wide phenomenon rather than a Kinsus-specific one, meaning rivals are almost certainly running similarly aggressive expansion programs of their own.
What distinguishes Kinsus in this field is less about raw scale and more about the speed of its pivot. A company that built a meaningful share of its revenue on contact lenses just a few years ago is now guiding to double-digit AI-driven revenue growth and committing nearly a quarter of its three-year capex budget to a single material category. That is a sharper strategic turn than most of its larger, more AI-focused competitors have had to make, since many of them were already substrate specialists before the AI boom began.
Historical Context: From 2022 Peak to a New AI Cycle
Kinsus’s ABF substrate business previously peaked in 2022, during the last major semiconductor upcycle driven by pandemic-era demand for PCs, servers, and consumer electronics. That cycle cooled in 2023 as inventory gluts worked through the system, and substrate makers across the industry pulled back on expansion plans. Kinsus’s confirmation that its ABF business has now surpassed that 2022 high is therefore a meaningful marker: it signals that the current AI-driven cycle is not simply replaying the last upswing but building past it, on the back of demand from a different category of customer (AI accelerator designers rather than general-purpose PC and server OEMs).
That history also explains why Kinsus’s capex plan is phased rather than front-loaded. Having been through one boom-bust substrate cycle within the past five years, Kinsus’s leadership appears to be deliberately avoiding the overbuild risk that hit the sector after 2022, choosing instead to let Phase 2 of the K6 expansion ride on confirmed 2027 order visibility rather than speculative demand projections.
Market Impact: What This Means for the Broader AI Hardware Chain
Substrate capacity is one of the least visible, and least substitutable, links in the AI chip supply chain. Unlike GPU or memory shortages, which occasionally make headlines when products go out of stock, as happened with DDR5 memory pricing climbing on AI-driven shortages earlier in 2026, substrate constraints tend to show up quietly, as longer lead times quoted to chip designers rather than empty retail shelves. Kinsus’s willingness to accept 5 to 7% price increases through 2026 while still guiding to double-digit revenue growth suggests its customers have little choice but to absorb the higher cost, which in turn puts upward pressure on the bill of materials for every AI accelerator built on Kinsus substrates.
That cost pressure compounds other AI infrastructure spending already flagged elsewhere this year, including the capital intensity behind Nvidia’s roughly $500 billion in AI-related financing commitments and the memory-side pressure documented in coverage of Micron’s HBM4 sales climbing more than 331% ahead of its October webinar. Substrates are a smaller line item than GPUs or HBM stacks in absolute dollar terms, but a sustained shortage in this one layer can still slow the pace at which finished AI accelerators reach customers, regardless of how much silicon capacity exists upstream.
What Kinsus Leadership Is Saying About Demand and AI-Driven Manufacturing
CEO Chen Ho-hsu has been direct about his read on demand durability, telling Taiwan News in comments tied to the expansion announcement:
“I’m not too worried about demand slowing or bursting. AI is real and still has enormous potential ahead.”
Chen Ho-hsu, President and CEO, Kinsus Interconnect Technology, via Taiwan News
Chen has also pointed to a less obvious way AI is reshaping Kinsus from the inside, beyond its role as a product category the company sells into. In the same Taiwan News coverage, he described how AI and data analysis tools are becoming necessary for Kinsus to hit the yield levels its AI chip customers demand:
“An engineer could help improve the production yield rate to 80%, but if we want the yield to reach more than 95%, we need AI and big data analysis.”
Chen Ho-hsu, President and CEO, Kinsus Interconnect Technology, via Taiwan News
That comment is a useful reminder that the AI boom is reshaping substrate manufacturing on two levels at once: Kinsus is both selling into AI chip demand and leaning on AI tooling internally to hit the tighter yield tolerances that same demand requires. It’s a dynamic playing out across the chip supply chain this year, echoed in how other hardware suppliers have described using AI and automation to manage the kind of pricing and output pressure detailed in coverage of Intel’s repeated 2026 CPU price increases.
Predictions: Where the Substrate Race Goes From Here
- Expect more phased capex announcements, not single mega-plants. Kinsus’s “not all at once” approach to K6 is likely to become the template other substrate makers follow, reducing overbuild risk after the painful 2022â2023 downcycle.
- ABF price increases will likely continue into 2027. If 2026’s 5â7% increases hold while AI chip demand keeps climbing toward Kinsus’s 2028â2029 planning horizon, further price hikes are a reasonable expectation rather than a one-off adjustment.
- AI’s share of Kinsus revenue should keep climbing past the 10â15% guided for year-end 2026, given that Phase 2 capacity at K6 does not even come online until 2027, meaning the current guidance likely understates AI’s eventual weight in the business.
- Glass core and next-generation substrate materials will remain a watch item rather than a near-term Kinsus product launch, since no commercial glass-core manufacturing has been confirmed at the company as of this reporting.
- Substrate supply will stay a quieter, but real, constraint on AI accelerator shipment timelines through at least 2027, running in parallel with the better-known GPU and HBM memory bottlenecks already shaping 2026 AI hardware headlines.
Why This Matters Beyond Taiwan’s Stock Market
Kinsus is a mid-cap component supplier, not a household name like Nvidia or TSMC, which is exactly why its capex decisions are a useful barometer. Large chip designers and foundries have every incentive to talk up AI demand; a substrate maker putting NT$23.5 billion of real capital behind that demand, while still hedging with a phased rollout, is a more grounded signal of how deep the current AI buildout actually runs through the supply chain. The PCB and materials supply crunch extends well beyond any single company, as TVBS World Taiwan’s reporting on AI’s hidden bottleneck in PCB and materials supply has also documented, framing substrate and materials availability as a sector-wide constraint rather than an isolated Kinsus story.
For investors and supply chain planners watching the AI hardware buildout, Kinsus’s 2026 numbers offer a smaller-scale, easier-to-verify complement to the headline-grabbing figures coming out of Nvidia, TSMC, and the hyperscalers. The company’s own guidance, double-digit revenue growth, AI revenue share climbing from single digits toward 15% within a year, and a multi-year capex commitment extending planning into 2029, suggests the AI chip substrate squeeze is not close to resolving anytime soon.
Frequently Asked Questions
What does Kinsus Interconnect Technology Corp actually make?
Kinsus manufactures ABF and BT substrates, the circuit layers that connect semiconductor dies to circuit boards, along with a separate contact lens product line. Its ABF substrates are used in CPUs, GPUs, and AI accelerators, while its BT substrates serve memory, NAND flash, power management ICs, and optical communication products.
How much is Kinsus spending on its AI chip substrate expansion?
Kinsus has approved a three-year capital expenditure program totaling NT$23.5 billion, with planned 2026 spending of NT$7 to 8 billion. Most of that spending is directed at ABF substrate capacity at its K6 plant in Yangmei, Taoyuan.
When will the K6 plant’s new capacity come online?
Phase 2 of the K6 expansion is scheduled to begin operations in 2027, when monthly ABF capacity at the site is expected to rise by about 25%, to roughly 5,000 units.
Is Kinsus making glass core substrates?
Current reporting does not confirm a specific Kinsus product officially named “glass core” or confirm commercial glass-core manufacturing at the company. Kinsus’s confirmed technology roadmap covers the 3nm, 2nm, and 1nm nodes and ties into CoWoS advanced packaging, adjacent to where glass core research is concentrated industry-wide, but that is not the same as a confirmed glass core product.
How much of Kinsus’s revenue currently comes from AI chips?
Kinsus’s AI-related revenue share is currently estimated at roughly 5 to 10% of total revenue, with the company expecting that to rise to 10 to 15% by the end of 2026.
Why did ABF substrate prices increase in 2026?
Kinsus has said ABF substrate prices rose approximately 5% in the first half of 2026 and are expected to rise up to 7% in the second half, reflecting demand for high-end substrates outstripping available capacity across the industry.
What is CoWoS and why does it matter to Kinsus?
CoWoS (Chip-on-Wafer-on-Substrate) is TSMC’s advanced packaging platform used to assemble the largest AI accelerators by stacking compute dies and high-bandwidth memory on an interposer before mounting the assembly on a substrate. Kinsus has cited CoWoS as a key advanced packaging technology tied to its ABF substrate roadmap.
Has Kinsus’s substrate business recovered from the 2022-2023 downcycle?
Yes. Kinsus has said its ABF substrate business has surpassed its 2022 peak, the previous high point set during the last major semiconductor demand cycle, indicating the current AI-driven cycle has pushed the business beyond its prior ceiling rather than merely recovering to it.
