At a glance. A wet-process equipment house running 100–120% utilisation, naming 2.5D CoWoS as an end market, and telling the TPEx briefing it needs about 50% more capacity each year in 2027 and 2028. Q1 sales NT$1.596bn were the third-highest quarter on record; gross margin 33.8% was the weakest in 55 quarters on mix and Tainan depreciation. Grand Process does not run CoWoS. The briefing never said 800 V.
What changed this quarter
Demand outran the new fab. Phase 2 is licensed and in production, which doubled capacity on paper. CEO Chang Hung-tai said orders still exceeded that, headcount is already up about 100 this year, and the company is looking at leased space and M&A because the current footprint is not enough.
Mix hit the margin, not the year. Q1 gross margin 33.8% (from 42.1% in Q4) because more of the quarter's acceptances were lower-margin clean / rework tools, Tainan depreciation stepped up, and the chemicals subsidiary booked fixed costs around selling 65% of Shanghai Tienhong. That disposal is also why net income still rose. Full-year average gross margin is not expected to follow Q1 down.
3D was dated as this year's volume start. 2.5D remains the main shipment. 3D hybrid bonding is "a larger demand source from this year," with mix — and a higher margin than 2.5D — lifting in 2027–28.
The numbers
| Q1 2026 | Value | Change |
|---|---|---|
| Revenue | NT$1.596bn (~US$50.7m) | −25.7% QoQ, +28.7% YoY |
| Gross margin | 33.8% | vs 42.1% in Q4; 55-quarter low |
| Operating margin | 13.15% | 55-quarter low |
| Non-operating | about NT$370m (~US$11.7m) | disposal-related, a high |
| Net income (parent) | NT$462m (~US$14.7m) | −17.7% QoQ, +81.3% YoY |
| EPS | NT$16.11 (~US$0.51) | second-highest quarter |
2025 was a record year, up nearly 60%. First four months of 2026 were up more than 10%. 2025 earnings distribution: NT$46 cash dividend, payout above 100%. Outsourcing of tool build is down from nearly 50% before Phase 2 to about 25–30%, and is meant to keep falling as in-house capacity opens.
NVIDIA 800V read-through
Grand Process is not on NVIDIA's 800 VDC list and this briefing never said 800 V. The read-through is tools into the line that builds the GPU package.
What the briefing actually adds:
- 2.5D CoWoS is on the application list, next to 3D SoIC, HBM, CPO, fan-out and copper-pillar. That is a wet-bench vendor naming TSMC's process as a customer end market. It is not CoWoS foundry revenue and not an NVIDIA vendor assignment.
- Utilisation 100–120% for two years. Through 2028, 2.5D and 3D advanced packaging are the fastest demand; panel-level is second.
- Capacity +~50% a year in 2027 and 2028 is what management says it needs to keep up. Phase 2 at ~200 tools of annual capacity in 2026, then more toward 2028, is the expansion math discussed around the same briefing; the company number to hold from the podium is the 50% a year.
- 3D tools carry more margin than 2.5D. 2026 is the first volume year; 2027–28 is when 3D mix is expected to lift group margin. Do not read 2026 as a 3D P&L.
HBM, CPO and compound (SiC / GaN / InP) tools are on the same deck. They are not dual-tagged onto those other hubs from this briefing.
Segments that moved
2.5D advanced packaging is still the shipment. Multi-step etch and strip is the high-margin process; simple clean is the low-margin process that weighed on Q1.
3D / hybrid bonding / SoIC — "this year is the first year of 3D volume." Customers are already adding production lines. Mix is guided to matter in 2027–28.
Panel-level — high share on 310 / 510 / 600 mm lines; three customers shipping in 2026; most revenue in 2027. Some Q4 2025 shipments are still being accepted.
Memory / HBM tool shipments "almost double" in 2026. Silicon-photonics tools remain joint development.
Outsourcing 25–30% this year; new capacity is meant to be in-house.
Guidance
- 2026: continued growth to a new high. Q1 average gross margin is not the year. First-four-months revenue already +10%+.
- 2027–28: about 50% more capacity each year. 3D mix up; panel-level revenue more visible. Demand CAGR around the same briefing was discussed near 45% through 2028 — hold that as management's demand comment, not as a sales guide.
- Outsourcing: hold ~25–30% in 2026, then down.
- No numbered full-year revenue or margin guide was given.
Management Q&A
Q: How tight is capacity, and how fast will you add?
A: Utilisation has been 100–120% for two years. Phase 2 doubled capacity and is still not enough; the company needs about 50% more capacity each year in 2027 and 2028 to meet customers. Leased plants and M&A are on the table because the current site and headcount — already +100 people this year — are short.
Q: What is actually shipping — 2.5D CoWoS, 3D, or panel-level?
A: 2.5D advanced packaging is still the main shipment. 3D hybrid bonding becomes a larger demand source from this year, and 3D is the fastest grower over the next several years, with mix lifting in 2027–28. Panel-level has three customers shipping in 2026; most of that revenue is recognised next year. Memory-related tool shipments are almost double this year.
Q: Why did Q1 gross margin fall to 33.8%?
A: Product mix in the quarter's acceptances was heavier in lower-margin clean tools; Tainan new-fab depreciation stepped up; and the chemicals subsidiary carried fixed costs around selling 65% of Shanghai Tienhong. Multi-step etch and strip remain the high-margin processes. Full-year average gross margin is not expected to follow one weak mix quarter.
Q: Will 3D help margin?
A: 2026 is the first 3D volume year. 3D equipment margin is materially higher than 2.5D. As 3D mix rises in 2027–28, that is expected to lift group gross margin.
Q: How much work is still outsourced?
A: Before Phase 2, outsourcing was close to half. It is now about 25–30%, and should stay in that band this year. New capacity is meant to be in-house, so the outsourced share should keep falling as 2027–28 plants open.
Q: Who is buying panel-level tools?
A: Grand Process is a main supplier on 310, 510 and 600 mm panel-level lines that have actually entered production. Three customers are in; all three see 2026 shipments; revenue recognition is back-end loaded into 2027. Some Q4 2025 shipments are still being accepted.
Disclaimer
English notes on Grand Process Technology's TPEx results briefing of 26 May 2026, covering Q1 2026, from contemporaneous quotes of management. Figures and statements are as presented by management, are unaudited, and have not been independently verified. USD equivalents are approximate at about NT$31.5 to the dollar. For reference only; not investment advice.