ASE Technology Weighs US Expansion in Advanced Chip Packaging Amid Tariff Uncertainty

ASE Technology Holding Inc., the world’s largest semiconductor packaging and testing provider, said on June 25 it is carefully evaluating advanced chip packaging capacity expansion in the United States, amid customer demand and uncertainty over US tariff policies.

Unlike some peers, ASE has been cautious about building new capacity in the US. However, its global expansion strategy is being reassessed after President Donald Trump proposed “reciprocal” tariffs in April, including new import duties on semiconductors and other critical tech products.

ASE subsidiary Siliconware Precision Industries Co. (SPIL) is already involved in Nvidia’s $500 billion AI infrastructure project in Arizona, announced in April. SPIL is a key supplier of chip-on-wafer-on-substrate (CoWoS) packaging technology for Nvidia’s AI chips.

“We will proactively plan for capacity expansions in line with the Nvidia project,” said ASE COO Tien Wu. “Beyond that, we’ve received more customer requests to build ‘Made-in-America’ packaging capacity, which we’re currently evaluating.”

Wu noted that the US tariff landscape is a key factor in ASE’s manufacturing decisions, and the company is monitoring developments closely. Taiwan is currently seeking to reduce the proposed 32% tariff before the 90-day grace period ends early next month.

“US production is feasible, but it depends on customer support and skilled local labor,” Wu said, adding that replicating complex manufacturing processes in a new environment is challenging.

Despite these uncertainties, ASE remains cautiously optimistic about the second half of 2025, citing rising demand for edge AI devices, ASICs, and high-performance computing used in servers and data centers.

The company will maintain its $2.5 billion capital spending plan for 2025, up 32% from last year. A large share will support advanced chip packaging and testing capacity.

Wu emphasized that AI-driven demand for advanced packaging is just beginning, and ASE expects more waves of growth to come. The company forecasts a 10% year-over-year revenue increase in this segment, according to its annual report.

At its latest shareholder meeting, ASE approved the election of Danielle Chang, daughter of Chairman Jason Chang, to the board, replacing Rutherford Chang.