TSMC: Silicon Photonics to Go Mainstream in 2027

TSMC's projection marks a significant milestone for silicon photonics, a technology that uses light to transmit data, promising higher speeds and lower power consumption than traditional electrical interconnects. The prediction of over 50% market share by 2027 suggests that SiPh will move from niche to standard in data center optical interconnects. The growth is tied to AI scale-out, where large AI models demand massive data transfer between chips and servers. This could accelerate investment in SiPh manufacturing and packaging, areas where TSMC is already strong. However, the timeline depends on continued AI infrastructure buildout and the industry's ability to scale production efficiently.