Huaxi: Advanced packaging upgrades, continuous progress in the glass substrate industry.

Huaxi released a research report stating that in 2026, industrial changes in glass substrates will begin to appear simultaneously on both the demand and supply sides. NVIDIA is evaluating glass substrates, upstream commercial progress is also increasing, and industry demand is extending from technological exploration toward customer projects and line construction investment. The value of glass substrates is first reflected in dimensional stability and fine-line patterning. The bank is bullish on the introduction value of glass cores in high-end large packaging, while upgrades to organic substrates will also advance in parallel. Based on existing progress, the bank judges that 2027-2028 is an important observation window for the first batch of customer introductions, and 2028-2030 is expected to enter a revenue growth phase. Huaxi's main views are as follows: Leading customer evaluations and upstream equipment procurement jointly accelerate the industrialization of glass substrates In 2026, industrial changes in glass substrates will begin to appear simultaneously on both the demand and supply sides. On September 24, The Seoul Economic Daily reported that NVIDIA is evaluating glass substrates; according to the transcript of SCHMID's August earnings call, management stated that it is conducting Glass Core technology and equipment cooperation with companies within the supply chains of Intel, NVIDIA, and AMD. Upstream commercial progress is also increasing: LPKF obtained LIDE equipment orders in the second quarter, and in September received a letter of intent for expanded line procurement from an Asian advanced packaging customer; SCHMID delivered large-size panel-level packaging equipment in March, and domestic companies Wuhan DR Laser Technology Corp., and Kunshan Dongwei Technology have also successively disclosed TGV-related orders and deliveries. The above progress indicates that industry demand is extending from technological exploration toward customer projects and line construction investment. Core advantages: stability and fine-line patterning, adapting to large-size packaging demand As AI accelerators integrate more compute dies, chiplets, and HBM, packaging size and interconnect density increase simultaneously, and carriers need to maintain flatness, line alignment, and assembly reliability over larger areas. The value of glass substrates is first reflected in dimensional stability: research on glass core samples published by Shinko shows that compared with traditional organic core substrates, the positional accuracy fluctuation of the outermost alignment marks is reduced by about 35%, and warpage is reduced to less than half; in terms of fine-line patterning, DNP has demonstrated RDL samples with 1/1 micron line width/spacing. Glass Core replaces the core layer, while ABF continues to handle build-up insulation and fine-line circuit formation, and the two can be combined in the same substrate. Therefore, the bank is bullish on the introduction value of glass cores in high-end large packaging, while upgrades to organic substrates will also advance in parallel. Implementation difficulties: multiple process coordination including TGV, metallization, and build-up layers TGV via formation requires controlling via shape, cracks, and processing consistency among a large number of dense through holes; metallization and copper filling require forming a continuous seed layer, reducing voids inside vias, and withstanding interfacial stress caused by the difference in thermal expansion between copper and glass; build-up layers require maintaining alignment accuracy through repeated lamination, curing, and patterning, while controlling warpage, delamination, and dicing breakage. Failure in any back-end process step will lose the processing investment accumulated previously. Therefore, mass production breakthroughs depend on full-line yield, manufacturing takt time, unit good-product cost, and customer reliability certification. A single process reaching targets still needs to be further translated into stable output across continuous batches. Industry progress: leading manufacturers have entered customer verification and supply construction, and scaled revenue will form in stages Intel has demonstrated Glass Core and EMIB integrated samples and continues to advance assembly and reliability verification; Absolics' embedded products have entered reliability evaluation, while the non-embedded route is advancing supplier selection and proof-of-concept preparation. Samsung Electro-Mechanics plans to fill in glass core manufacturing capability through the proposed establishment of GlaSSEM, and its partner proposed establishing a supply system from October 2027 to March 2028; LG Innotek aims for Glass Core mass production in 2028; DNP's Kuki pilot line has already supplied samples, plans to complete line construction in 2028, and uses mass production in fiscal 2030 (2030.04-2031.03) as the latest investment premise. Domestically, BOE has produced 24-layer samples exceeding 100100 mm and sent them to customers for verification, while Tcl Corporation is advancing key process research and pilot R&D layout. Lens Technology has jointly developed and verified Glass Core with chip customers and is conducting advanced packaging process cooperation with Intel; WG Tech (JiangXi) Group is advancing TGV product prototyping and customer verification, and some products have already been delivered in small batches. Risk warnings Technology and reliability verification fall short of expectations; cost and yield improvement fall short of expectations; customer certification and capacity construction are delayed; organic substrates and other packaging technologies continue to upgrade; AI demand fluctuates.