The Interconnect Baton — The Week AMAT Named the Next HBM and TSMC Put H2 2026 on the Clock

Four countries, one handoff

Across four countries this week, the semiconductor headlines looked like separate stories. An Applied Materials (AMAT) executive in Seoul said "after HBM, interconnect is next." At a Taipei SEMI Forum, TSMC's Advanced Packaging VP Hsu Kuo-chin fixed silicon photonics penetration above 50% by 2027 and co-packaged optics (CPO) mass production in H2 2026. In Tokyo, Advantest's (6857) August print put a 1-trillion-yen operating-profit trajectory in the tape, and Kioxia entered the global semiconductor top 8. In Hsinchu, compound-semi PA foundry Win Semiconductors (3105) jumped 17.7% in a week as its AI optical-communications mix overtook mobile for the first time.

Four headlines, four languages, one baton being handed off.

The company that named the baton

For two years the semiconductor narrative has orbited HBM. This week, multiple signals converged that the axis is shifting to the next bottleneck: on-package optical interconnect — CPO and silicon photonics.

Applied Materials said it most clearly. On August 31 in Seoul, AMAT publicly identified "advanced interconnect technology as the next growth axis after HBM," and in the same session unveiled a 3D-scaling roadmap with new materials and HBM/CPO process efficiency work. When an equipment company names "next," it is signaling CAPEX direction. Why AMAT delivered this message in Seoul — not Tokyo, not Hsinchu — matters: Korea's memory trio (000660, 005930) sets the wafer-order direction of the cycle.

TSMC put a clock on it

The same day in Taipei, TSMC's Advanced Packaging VP said silicon photonics would cross 50% penetration by 2027 and CPO mass production would start in H2 2026. That is a clock attached to AMAT's Seoul statement. It is not a coincidence that TSMC and Samsung are reportedly hiking foundry prices 10–15% across nodes this week, or that AI memory (HBM) unit prices have already surpassed top-tier SoC cost — a structural inversion Taiwanese outlets flagged on August 30. Advanced foundry is reclaiming pricing power on the promise of optical-interconnect integration.

Wafer orders run ahead

SK Hynix's (000660) Q2 wafer purchases hit KRW 670.6B, up 104% QoQ — more than 10x its production growth of 10.5% and materially above Samsung's (005930) wafer-order lift. Wafer buys running at roughly ten times production growth mean that not just HBM capacity but the advanced-packaging layer on top of it, CPO included, is being pre-booked. Bloomberg's report the same day that SK Hynix is evaluating a Japan joint venture with candidate sites across Hokkaido and Kyushu belongs in the same picture: physical proximity to the compound-semiconductor and back-end equipment clusters that the optical layer will require.

Tokyo confirms the test complexity

Advantest's (6857) August tape confirms it from a different angle. The market is now pricing a 1-trillion-yen operating profit trajectory because CPO and silicon-photonics-integrated dies require dramatically more test channels than pure HBM stacks. Kioxia entering the Q2 global semi top 8, with Renesas cracking the top 20, is a downstream effect — when the memory cycle extends into optical, NAND-scale suppliers reclaim a scale premium. Nikkei's sharp decline this week, dragged by Advantest and Tokyo Electron (8035), was a short-term reaction to US rate concerns, not a repudiation of the structure.

Taiwan already has an answer

Win Semiconductors (3105) breaking NT$500 on a 17.7% weekly gain has a specific cause: its AI optical-communications GaAs/GaN power-amplifier revenue mix overtook mobile for the first time. As CPO adoption spreads through the data center, PA-foundry demand steps up. TSMC's (2330) Q2 employee bonus pool of NT$36B (~USD 1.1B), up 50.6% YoY — outrunning revenue growth — and this week's brokerage NT$2,120 price target on an unnamed major memory name with orders booked into 2028 are both artifacts of the capital piling into whoever holds this baton and the value chain beneath them.

Korea's export data confirms the scale

Korea's semiconductor exports posted $32.7B in July (+166.29% YoY), $33.6B in June (+173.87%), and $29.4B in May (+154.3%) — three straight months on an all-time-high trajectory. DDR5 16Gb spot sat at $53.933 on August 31. Two things simultaneously: the HBM cycle itself has not peaked, and the next baton — optical-interconnect CAPEX — layers on top of it. CXMT's H1 revenue surge of 873% with a claim to lead Samsung and SK Hynix on LPDDR6 is not a low-end substitution story; it is the negative proof of why Korea's memory trio must move early into interconnect. If China takes the commodity LPDDR/DRAM rung, defensibility upstream lies in what China cannot copy: the photonic packaging stack that AMAT, TSMC, Advantest, and TEL are already tooling.

Implications

• Investor lens: AMAT — the equipment company whose stack extends from HBM into interconnect — is the US anchor for this baton. TSMC (2330) and Win Semi (3105) are the Taiwan anchor. Advantest (6857) is Japan. SK Hynix's (000660) pre-loaded wafer orders and Japan JV evaluation are Korea.
• Risk: CPO mass production slipping from H2 2026 into 2027; silicon-photonics yield. Now that TSMC has publicly committed to a timeline, these two metrics dictate name-level valuations over the next 4–6 months.
• Watch: Micron's (MU) fiscal Q4 print on September 30 — likely the first quarter in which memory-cycle earnings and optical-interconnect CAPEX intent appear on the same document.

Key Sources: - After HBM, Interconnect Next: Applied Materials Eyes Korean Semiconductors' Future (Ajunews, 2026-08-31) - TSMC Exec: Silicon Photonics to Hit 50% Penetration by 2027; CPO Mass Production Set for H2 2026 (cnyes, 2026-08-31) - SK Hynix Accelerates Wafer Purchases Amid HBM Surge, Outpaces Samsung (thelec, 2026-08-31) - SK Hynix Considers Semiconductor Joint Venture in Japan (Bloomberg, 2026-08-31) - Win Semi (3105) Surges 17.7% as Foreign Buyers Return and AI Optical Comms Mix Tops Mobile (cnyes, 2026-08-30) - August Earnings Reveal AI Chip Stock Winners; Advantest Eyes 1-Trillion-Yen Profit (Minkabu, 2026-08-30) - TSMC and Samsung Raise Foundry Prices 10-15% as AI Demand Tightens Advanced Nodes (cnyes, 2026-08-30) - plus 8 more