NVIDIA CEO Jensen Huang Responds to CoWoS Order Cut Speculations; Explains Decrease in Orders is Due to Transition to CoWoS-L

NVIDIA’s CEO, Jensen Huang, has addressed recent concerns regarding potential cuts to CoWoS packaging orders. He clarified that no such reductions are occurring; the adjustments in figures stem from the transition to the new Blackwell architecture.

NVIDIA Maintains CoWoS Orders Amid Transition to CoWoS-L Technology

The semiconductor industry has been buzzing with speculation about TSMC’s CoWoS performance, particularly amid rumors suggesting a downturn in NVIDIA’s orders due to diminished demand within the AI sector. These speculations not only led to fluctuations in NVIDIA’s stock prices but also fostered a wave of uncertainty in Taiwanese markets. However, Huang has set the record straight regarding CoWoS production. As reported by The AI Investor, the shift to the Blackwell architecture involves the adoption of CoWoS-L, indicating a transition towards newer production methodologies that have contributed to a decrease in output figures.

Jensen Huang on CoWoS capacity cut rumor.$NVDA pic.twitter.com/58EYBUX7wX

— The AI Investor (@The_AI_Investor) March 3, 2025

NVIDIA’s previous generation, Hopper, relied on the more established CoWoS-S technology, known for its impressive yield rates nearing 99%.With the new Blackwell architecture, the company has shifted to utilizing CoWoS-L. While this updated packaging technology promises enhanced performance, achieving ideal yield rates has been a struggle, resulting in comparatively lower production outputs compared to its predecessor. Nonetheless, Huang has assured that NVIDIA is collaborating with partners to improve this situation.

A report from Taiwan Economic Daily indicates that TSMC is actively expanding its CoWoS-L production capabilities, driven by high demand for this packaging technology. It is projected that TSMC will fully transition to CoWoS-L by the second half of 2025, particularly as the upcoming Blackwell Ultra GB300 series will adopt this newer standard. However, with Hopper reaching the end of its lifecycle, and NVIDIA having previously maximized demand for that architecture, it is expected that CoWoS production figures will decline temporarily.

While the current CoWoS output does not wholly encapsulate the demand dynamics from the AI sector, it suggests that NVIDIA faces significant challenges in recapturing the level of excitement experienced during the Hopper generation. Given the somewhat uneven performance of Blackwell, there is hope that the forthcoming Ultra lineup will perform better and reinvigorate market confidence.

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