Unpacked: Advanced Packaging

My uncle's viral chicken recipe

My uncle Nelson Huang ran Golden Wok for over a decade. He could skin a chicken in under a minute, and he knew which regulars wanted extra chili oil without asking. Until recently, he believed the hardest part of running a restaurant was promoting his food.

Then a delivery app put Golden Wok on its front page when a food influencer filmed herself cracking open his Beggar’s chicken — a whole bird stuffed with mushrooms and seasoned rice, then wrapped in lotus leaves and sealed in clay. To prepare the dish, he had to bake the entire thing for six hours until the shell was hard enough to be broken at the table with a small mallet. “Wow! This is Amazing!” she told four million people. Orders quadrupled in a month, and everyone wanted the chicken.

After going viral, my uncle did everything he could to keep up with all the eager foodies reserving a spot to try his chicken. He raised prices, he hired, he prepped more, and stayed open later. And that’s when he learned the real lesson of running his restaurant: You can ramp up your own kitchen however you want. You cannot ramp up your suppliers. Over the next year and a half, that one dish failed him three times, and never once because of the chicken.

The Lotus Leaf

The Beggar’s chicken has a maximum size, and it isn’t set in the kitchen. The lotus sets it. A leaf grows as big as a leaf grows, and it needs to wrap the chicken perfectly. If too big, all the aromatics escape, and the chicken bakes dry; if too small, the stuffing leaks out and the mushrooms burn. If no vendors at the farmer’s market sell lotus leaves with the right size, Uncle Nelson still has to find a way to serve the dish. So at banquets, when big-spending regulars request extra chicken, he wraps two together in an oversized leaf, and serves them side by side as one platter. To keep the seams from tearing under the extra weight, Uncle Nelson has to enlist his Taiwanese cousins, who run a catering crew across town and know the double-fold that holds. His own line is already maxed out just keeping up with the singles; customers who just wanted soup dumplings were turned away.

Three thousand miles away, a man in a leather jacket has the same problem. Nvidia’s lotus leaf is the reticle, which limits the largest pattern a lithography machine can print onto a wafer. So Nvidia cannot design a GPU die exceeding the 26 mm × 33 mm exposure field. To get past the limit, Blackwell combines two maximum-size dies in one package, tightly linked so they behave as a single chip.

To manufacture Blackwell, TSMC’s advanced packaging lines hit the same capacity ceiling as the lines at Golden Wok. Only so many double-die packages can be bonded through CoWoS each month. To keep all the AI customers happy, TSMC keeps the high-margin chip-to-wafer bonding in-house, and offloads overflow work to fellow Taiwanese assembly houses, ASE, PTI, and U.S.-based AMKR 0.00%↑ for testing, and legacy-packaging steps. But gamers who only want an RTX 50-series card for their new PC have to wait. While GeForce dies are monolithic and don’t need any advanced packaging, they still compete for TSMC’s 5nm-class wafer capacity as Nvidia’s enterprise AI silicon. With datacenter parts generating an order-of-magnitude more revenue per die, Nvidia allocates the shared upstream capacity to AI accelerators first.

From here, the kitchen lines and the packaging lines fail in parallel, layer by layer:

The Seasoning

Then came the first call. My uncle’s distributor said the MSG in the stuffing was being rationed. Some new-age diet fad had turned sodium into the enemy, and every company in the West now needed MSG to promote its low-sodium wellness branding. The MSG producers said their expansion would not be complete for another two years. Without any alternatives, Uncle Nelson bought what he could and reformulated around the rest.

Ajinomoto, the company famous for creating MSG, makes the insulating film laminated between every sheet of copper wiring, seasoning every layer of the substrate since the Pentium III. The substrate is the miniature circuit board inside every processor, built one layer at a time — copper then film, then copper again — stacked on both sides of a rigid core woven with glass cloth. Before Intel’s Pentium III, processors used messy liquid insulating inks that had to be screen-printed, dried, and polished one coat at a time. Ajinomoto handed factories a ready-made sheet of film instead, clean enough for lasers to drill the microscopic holes that connect one layer of wiring to the next. This substitution made it possible to build substrates through a stack-and-repeat process.

Like Scotch™ tape, the Ajinomoto Build-up Film™ (ABF) became the name for an entire category. It is the foundation of semiconductor chip packages, and today the entire AI build-out funnels through it. Blackwell, AMD’s MI400, and every hyperscaler’s custom ASIC all stand on the same layers of insulation film. No one has found a qualified substitute yet. Neither, for what it’s worth, has my uncle Nelson. The two Huangs share the same supplier, and Ajinomoto seasons both the stuffing and the substrate.

The Clay

The second failure was the clay shortage. The food-safe blend comes from exactly three regional suppliers, and every restaurant chasing the same viral dish was calling all three. So Uncle Nelson did something ten years of thin margins taught him to never do: he prepaid. After maxing out six credit cards and enrolling in seven buy-now-pay-later plans, he advanced his clay suppliers money to produce more clay to guarantee his allocation.

Jensen’s “clay” is the build-up itself, pliable sheets pressed and cured over a rigid fiberglass core to form the substrate. Copper traces run through the whole stack, wiring the chiplets down to the motherboard. For most of the chip industry’s history, the substrate was invisible plumbing; a 2015 CPU needed just a few ABF layers in a ~40mm package that cost about $50. These packages shipped within weeks from suppliers nobody has heard of. Blackwell blew up that package. It wires together two huge dies and eight memory stacks on a single giant substrate, consuming three to four times as much material as a typical CPU. To secure enough packaging capacity, Nvidia reportedly fronted roughly half the cost of expansion at Ibiden and Unimicron. But volume is only half the challenge. Each ABF substrate must also be tailored to the electrical and mechanical demands of a specific chip module to run AI workloads at scale. Chip and substrate makers now co-design each generation of AI packages, and must coordinate their capacity and R&D roadmaps in lockstep. The result is a high-end substrate market concentrated around a handful of incumbents.

The Rice Straws

The third call was about the rice straw delays, and there was no arrival date in sight. Of all things, this delay was the straw that nearly broke my uncle’s back. Uncle always said the secret to a good Beggar’s chicken was a sturdy pack of straws. He followed the tradition his grandfather taught him, where the straws tied the lotus-wrapped bird while he packed mud all over to make a smooth grey egg. The hidden fiber kept the clay from cracking as it shrank in the heat.

Blackwell’s architecture relies on the same principle. Inside the substrate beneath each chip, woven glass fiber, specifically T-glass, holds the brittle laminate together through the heat of assembly and the stress of thermal cycling. The cloth sits at the core, reinforcing the very material that encases it.

The most advanced cloth comes almost exclusively from a single Japanese textile mill, Nitto Boseki. When AI demand surged, there wasn’t enough fabric to go around. Prices jumped, and orders backed up for over a year. Procurement teams from billion-dollar firms all flew to Japan to plead for allocation.

The Bullwhip Effect

After running the restaurant for over ten years, my uncle had to close down Golden Wok. The viral rush worked its way backward through the supply chain. Suppliers raised their bulk minimums to justify investments needed for new production, and by the time the order reached the straw weaver, a month of viral demand looked like the new normal. Uncle Nelson prepaid at the top of that curve. Then the video cycled out of everyone’s feed, and the delivery app’s orders shrank to a quarter of the peak. But the clay and straws my uncle had preordered kept arriving on schedule, and he was unable to repurpose the materials for another dish. Only then did the other half of the bullwhip show up, the half nobody warned him about. Investors see the same risk in the capital pouring into AI infrastructure and do not want to be caught on the back half of the bullwhip. Every quarter, critics trace how many Blackwells were bought with Nvidia’s own money. Asking “where are the profits to justify the spending?”

On the suppliers’ end of the whip, Nvidia sees a different problem. When the AI boom took off, it first had to convince its suppliers to scale up so there would be a build-out at all. For more chips to be built, Ajinomoto, Ibiden, Nittobo, and others must all expand capacity, adjusting to a wave of AI demand they cannot forecast. The demand signals reaching them are distorted by the bullwhip effect, making it difficult to know how much capacity to build.

Nvidia’s prepayments and investments absorb the unpredictable swings in demand so suppliers can confidently invest in expansion. The signal reaching the suppliers has to be smoother than the demand that produced it, or nothing gets built at all. But the concern over profitability is legitimate. If AI demand fizzles out like the reservations and delivery orders for the Beggar’s chicken, then every prepayment becomes the straw and clay my uncle had bought.

The lesson at Golden Wok was that the bullwhip cannot be survived alone. The other Huang wants artificial intelligence in everyone's lives, and he's willing to stack up all five layers of the AI cake to get there. Every prepayment and financing check makes someone else sign onto the bet, from the chatbot all the way down to the glass yarn. Money flowing upstream commits Ibiden to pour concrete; money flowing downstream gives a startup the balance sheet to sign for compute. The spending is what keeps every layer committed and building long enough to outlast the whip.