According to a research report from Gf Securities Co.,Ltd., the rise of semiconductor manufacturing is being shaped by Tao's Law v2. This framework shifts the performance improvement pathway from a sole reliance on advanced process nodes to a holistic co-optimization across devices, circuits, chips, and systems. This shift is expected to elevate the importance of advanced packaging, 3D integration, hybrid bonding, memory fusion, and system-level interconnects.

Approaches such as LogicFolding and 3DFolding are projected to boost demand for hybrid bonding, Through-Silicon Vias (TSV), 2.5D/3D packaging, and related inspection equipment. System-level interconnect solutions like Unified Bus and Hi-ONE are anticipated to enhance the significance of optical interconnects, advanced packaging, and system-level testing. Furthermore, complex heterogeneous integration will increase the importance of testing, metrology, yield management, and key materials.

Core Analytical Insights

Tao's Law redefines the performance enhancement framework for the post-Moore's Law era by using time constant (τ) as a unified optimization target. The traditional Moore's Law primarily relied on geometric scaling to increase transistor density, but advanced processes now face physical, cost, and interconnect bottlenecks. The marginal benefits of relying solely on node progression for performance gains are diminishing. Tao's Law incorporates challenges like device switching, interconnect propagation, memory access, and system communication into a single temporal dimension for measurement. Consequently, semiconductor competition is expanding from the race for advanced nodes to compressing time overhead across the entire chain of devices, circuits, chips, and systems.

From Theory to Practical Implementation

Tao's Law v2 advances time scaling from a theoretical concept to practical applications in chip folding and AI system restructuring. On the chip side, v2 strengthens the LogicFolding approach. By vertically folding critical paths, shortening interconnect distances, and reducing RC delay and clock skew, it achieves synergistic improvements in density, frequency, and power consumption at a fixed process node. For instance, the Kirin 2026 demonstrates a normalized power reduction from 1 to 0.59 under equivalent performance conditions, highlighting the direct contribution of 3D structural reorganization to chip energy efficiency.

On the system side, v2 extends τ optimization from individual chips to AI clusters. Technologies like Unified Bus, Hi-ONE, and 3DFolding compress system-level data movement time from three dimensions: communication protocols, near-package optical I/O, and packaging topology. This evolution transforms Tao's Law from a chip-level optimization tool into a comprehensive, full-stack co-optimization framework.

Value Enhancement Across the Supply Chain

The principles of Tao's Law elevate the value of the 3D integration industry chain, benefiting packaging & testing, equipment, materials, and wafer manufacturing collectively. LogicFolding and 3DFolding depend on high-density vertical interconnects, hybrid bonding, TSV, 2.5D/3D packaging, and wafer-level 3D integration. This dependency promotes advanced packaging from a traditional back-end process to a core determinant of performance, power consumption, bandwidth, and system integration efficiency.

Simultaneously, hybrid bonding requires support from front-end-level processes such as etching, copper filling, Chemical Mechanical Planarization (CMP), precision alignment, annealing, surface treatment, and metrology inspection. The boundary between manufacturing and packaging is becoming increasingly blurred, leading to a concurrent rise in the importance of semiconductor equipment, key materials, packaging & testing, wafer manufacturing, and yield management segments.

The industrial significance of Tao's Law v2 is not to diminish the value of manufacturing but to expand it from planar processes further into the realms of 3D integration and system-level interconnects.

Associated Investment Risks

Investors should consider risks including cyclical fluctuations in the semiconductor industry and market, potential delays in the industrialization of new semiconductor manufacturing technologies and processes, and intensified competition within the semiconductor equipment sector.