Storage capacity negotiations scheduled until 2030! Winbond Electronics initiates expansion plans ahead of schedule

AI-driven storage demand continues to expand, prompting Winbond Electronics to make early preparations—clients are already rushing to reserve production capacity for three years from now.

Winbond Electronics, the world's leading niche storage IDM company, announced that it will accelerate expansion plans at its Lujhu plant in Kaohsiung, Taiwan, consolidating the originally scheduled Phase II and Phase III projects into simultaneous development of the Module B factory. According to Taiwan’s Industrial & Commercial Times, the plant is expected to begin construction of a cleanroom in 2027, with equipment installation possibly starting as early as the beginning of 2029.

Industry insiders point out that Agentic AI is driving ongoing increases in storage capacity and advanced packaging demand, stating “this growth trend is expected to continue for quite some time,” which is the direct reason Winbond Electronics has decided to initiate the Module B plan ahead of schedule. Some clients have already started advance negotiations for capacity allocations in 2029 and 2030.

Quarterly Performance: Rising Volume and Prices, Record Gross Margin

Winbond Electronics’ consolidated revenue for the second quarter was NT$59.843 billion, up 56.4% quarter-on-quarter and 184.7% year-on-year.

Price hikes were the core driving force: DRAM prices surged about 100% in a single quarter, while Flash prices rose about 43%. As a result, the gross margin increased to 66.2%, with earnings per share (EPS) of NT$5.40.

Moving into the third quarter, the upward trend continues. The Taiwan Industrial & Commercial Times, citing industry sources, forecasts that demand for niche DRAM and SLC NAND remains higher than supply, with prices expected to rise about 50% quarter-on-quarter; NOR Flash prices are forecasted to rise about 30% as cloud service provider (CSP) clients actively build up their inventories.

The price increase is expected to narrow to 2% to 5% in the fourth quarter, but industry insiders believe that with increased DRAM capacity and output, Winbond Electronics should still see quarter-on-quarter growth in both revenue and profit.

Module B: Comprehensive Product Line Targeting AI

The product roadmap for Winbond Electronics’ Kaohsiung Module B covers Standard DRAM, CUBE DRAM, Wafer-on-Wafer (WoW), and silicon capacitors (Si-Cap), and will support 14nm and future 12nm DRAM processes, with plans to introduce EUV equipment later on.

The logic behind this strategy is clear: AI is driving storage to evolve toward higher density and more advanced packaging, so Winbond Electronics must secure processes and capacity in advance in order not to fall behind the market when customer demand materializes.

Equipment installation will proceed in phases based on customer forecasts and long-term agreements (LTA), rather than a one-time ramp-up to full capacity, allowing better control of capital expenditure.

Si-Cap: The Third Growth Curve

Silicon capacitors (Si-Cap) warrant particular attention in this expansion plan.

Industry insiders view them as Winbond Electronics’ “third potential growth driver” outside of logic and memory. The company has already invested around NT$4 billion to build a dedicated Si-Cap production line.

Currently, mass-produced products offer capacitance densities of about 3,300 nF/mm², with the latest samples reaching about 5,400 nF/mm², primarily aimed at advanced AI packaging and AI power management applications. Reports estimate they may enter mass production as early as the end of the first quarter of 2027.

The logic behind Si-Cap is that AI chips require extremely high power stability, and silicon capacitors can deliver higher-density power decoupling at the packaging level, making them indispensable for advanced packaging. Winbond Electronics has positioned itself early to capture this emerging demand.