Taiwan's AI chip role grows as HCLTech spotlights ecosystem

HCLTech has published research on Taiwan's role in global AI semiconductor infrastructure.

The study, prepared by Omdia, positions Taiwan at the centre of manufacturing and system integration for the next phase of AI build-out.

The white paper argues that competition in AI semiconductors is shifting away from standalone chip speed towards integrated platforms that combine compute, memory, connectivity, packaging and software. This, it says, is increasing the importance of regions that can pair chip production with assembly, testing and server manufacturing.

Taiwan features heavily in that assessment. Taiwan-headquartered foundries account for more than half of the global foundry services market, while Taiwanese original design manufacturers produce about 90% of the world's server motherboards and 80% of server systems, according to the research.

Omdia says TSMC accounts for more than 90% of the world's leading-edge semiconductor production, underlining how concentrated advanced manufacturing remains on the island. The report links that position to Taiwan's growing relevance in building large-scale AI systems, not just producing individual chips.

Platform shift

The study describes a semiconductor market being reshaped by the demands of AI models and data centre infrastructure. As architectures grow more complex, performance increasingly depends on how multiple elements work together across a system.

That includes not just silicon design, but memory integration, advanced packaging, interconnects, power delivery and software. In that context, the paper identifies system-level coordination as an increasingly important driver of commercial success in AI hardware.

“AI semiconductor competition is no longer about who builds the fastest chip, but who delivers the best workload outcome. Performance now depends on compute, memory, packaging, connectivity and software being designed together from the start. That makes execution the real differentiator - the leaders will be those who can turn complex silicon ambition into scalable, production-ready platforms,” said Ameer Saithu, executive vice president and global head of semiconductor business, HCLTech.

Packaging focus

Advanced packaging is identified as one of the most significant parts of that shift. The white paper highlights TSMC's CoWoS technology as an example of how high-performance logic and high-bandwidth memory can be combined within more complex AI systems.

Taiwan's position in packaging extends beyond TSMC. The report notes that ASE Technology Holding, a Taiwan-based outsourced semiconductor assembly and test provider, holds roughly 40% of the global OSAT market.

This matters because AI infrastructure is no longer confined to chips in isolation. Large deployments increasingly require close coordination between processors, memory, networking, thermal design and physical system assembly.

As an illustration of that trend, the white paper cites NVIDIA's GB200 NVL72, which integrates 72 GPUs and 36 CPUs in a single liquid-cooled rack. The example is intended to show the scale of current AI systems and the engineering demands involved in bringing them together.

Regional spread

While the report presents Taiwan as the principal hub, it also describes a broader Asian semiconductor network that is becoming more distributed. Singapore, Malaysia, Vietnam and China are all identified as contributors across manufacturing, packaging, testing and equipment production.

That regional spread is helping add capacity and resilience to semiconductor supply chains, the study says. Even so, it argues that Taiwan remains the main link between advanced manufacturing, integration and the industrialisation of AI infrastructure.

HCLTech's Taiwan leadership echoed that point in comments accompanying the publication. “Taiwan's role in AI goes well beyond making chips. Its depth, from wafers to racks, spanning leading-edge manufacturing, advanced packaging and server production, is very hard to replicate. Even as capacity spreads across Asia, Taiwan remains the centre that connects it all, and the opportunity now is to turn that strength into faster, more resilient AI deployment,” said Terry Tai, country head of Taiwan, HCLTech.

The paper also points to growing investment by hyperscale companies in custom AI silicon, a trend that could deepen reliance on Taiwan's ecosystem. The combination of foundry scale, packaging expertise and server production gives the market a role in both design and deployment.

“As hyperscalers accelerate investment in custom AI silicon, Taiwan's semiconductor ecosystem is becoming even more important to the global AI infrastructure value chain. HCLTech combines its global silicon engineering experience with a deep understanding of Taiwan's semiconductor ecosystem to help customers turn increasingly complex AI chip designs into scalable, manufacturable products. Working closely alongside customers' engineering teams gives us a practical view of what it takes to move from design intent to volume production,” said Hong Ming Chang, senior director, Taiwan, HCLTech.