Advanced Packaging Market Set to Double by 2034
OTTAWA – The advanced packaging market is poised for explosive growth over the next five years, driven by AI, high-performance computing and the insatiable demand for smaller, faster electronics, a new report asserts.
According to new research from Towards Packaging, the global advanced packaging sector will climb to $78.8 billion by 2034 from $40.3 billion in 2025 – a compound annual growth rate of 7.6%.
And with the growth will come a fundamental shift in how semiconductors are assembled and interconnected, the firm says.
The growth drivers are familiar to anyone tracking the industry: AI accelerators need enormous bandwidth and power efficiency. Data centers are proliferating. Automotive electronics keep getting more complex. And consumer devices? They’re demanding performance that can only be delivered through advanced heterogeneous integration.
Fan-out wafer-level packaging is leading the charge, offering superior thermal performance and smaller footprints critical for mobile and wearable applications. But it’s the chiplet revolution that’s really changing the game. By disaggregating monolithic designs into smaller, specialized dies, manufacturers can mix and match components, boost yields and dramatically reduce costs.
2.5D and 3D packaging technologies continue to mature, with through-silicon vias (TSVs) and interposers enabling the high-bandwidth, low-latency connections that AI and HPC applications require. Meanwhile, system-in-package (SiP) solutions are carving out territory in IoT, wearables and 5G infrastructure by integrating multiple functions into compact modules.
Use of panel-level packaging (PLP), which involves larger panel substrates instead of individual wafers, is rising, which can lower per-unit cost and improve throughput.
North America remains the dominant region, thanks in large part to its strong semiconductor ecosystem, rapid adoption of AI and 5G technologies, and continuous R&D investments.
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