KYEC expands testing capacity to meet rising AI demand
Defective chips need to be caught before they become part of an expensive AI package. Finished processors must also be checked for reliable performance under heavy workloads. Taiwan semiconductor testing specialist KYEC does both, and growing AI demand is prompting it to invest in more capacity.
KYEC tests chips on wafers, checks finished devices, and exposes components to demanding operating conditions to identify potential failures. As AI processors become more complex and consume more power, that work requires increasingly capable equipment and careful temperature control.
In April, KYEC raised its 2026 capital-expenditure budget to a record NT$50 billion (about US$1.53 billion) to expand capacity for AI and high-performance computing. Customer financing is also supporting its expansion overseas. Nvidia announced in October that a US$1.1 billion capacity-reservation advance to KYEC would fund new US testing facilities and equipment, with high-volume production targeted for April 2027. The arrangement helps KYEC finance the expansion while securing future testing capacity for Nvidia.
Demand is already lifting sales. Third-quarter 2026 revenue reached NT$12.14 billion (US$371 million), up 30.7% from a year earlier and 9% from the previous quarter. Net profit attributable to shareholders increased 14.9% year on year to NT$2.64 billion (US$81 million), while operating profit rose 25.7% to NT$3.13 billion (US$96 million). Gross margin fell to 37.6% from 39.5% in the second quarter, with analysts pointing to higher electricity, depreciation, and staff costs as the key factors.
Growth continued into October, when revenue reached NT$4.43 billion (about US$135 million), up 29.5% year on year. That brought sales for the first ten months to NT$37.90 billion (US$1.16 billion). Nvidia’s financial backing shows how securing reliable testing capacity has become a strategic priority in the AI supply chain.
US$ conversions use an illustrative rate of NT$32.7 per US$1.