TF International Securities analyst Ming-Chi Kuo previously predicted Himax Technologies, Inc (NASDAQ:HIMX) as a potential supplier for Taiwan Semiconductor Manufacturing Co (NYSE:TSM).

Kuo’s latest supply chain survey indicates that Taiwan Semiconductor’s Compact Universal Photonic Engine (silicon photonics) development and ecosystem visibility have improved markedly. Furthermore, the analyst confirmed that Himax is the exclusive supplier of micro-lens arrays for the first and second generations of COUPE FAUs.

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Thanks to COUPE, Himax is poised for robust expansion over the next few years. Kuo estimates Himax revenue to reach $1.16 billion in 2026, $1.42 billion in 2027, and $2.4 billion in 2028 (versus the consensus of $1.11 billion for 2026), and EPS of $1.00, $1.60, and $3.40 (versus the consensus of $0.80 for 2026).

Kuo noted that the first COUPE generation is fully developed and undergoing mass production validation. Second-generation mass production validation should begin in the first half of 2026.

The analyst said that Taiwan Semiconductor’s earnings call and Nvidia Corp (NASDAQ:NVDA) CEO Jensen Huang’s statements may seem contradictory, but both are fundamentally positive about COUPE.

Himax is the exclusive micro-lens array supplier for the first and second COUPE generations. Kuo said a second supplier would likely emerge before the third generation.

According to the analyst, several events in the next six months could further boost market visibility for COUPE and silicon photonics.

Among Taiwan Semiconductor’s developing technologies, COUPE receives the highest priority, providing multi-year visibility.

On January 16, Taiwan Semiconductor mentioned silicon photonics could move to mass production in about 1–1.5 years. On January 17, during a visit to Taiwan, Nvidia chief Jensen Huang told local media about the Nvidia and Taiwan Semiconductor collaboration on silicon photonics, which will take several years.

Among Taiwan Semiconductor’s clients, Advanced Micro Devices, Inc (NASDAQ:AMD) is likely the first to adopt COUPE, continuing its aggressive trend of using Taiwan Semiconductor’s advanced technologies.

If mass production is on time (late 2027), Rubin Ultra could be the first Nvidia product to use COUPE.

Based on Kuo’s recent supply chain checks, if there are no big production problems, FOCI will be the sole FAU (ReLFACon) provider for both Gen 1 and Gen 2 COUPE, and Himax is the exclusive supplier of the micro-lens array. The earliest a second supplier might enter the market would be for the Gen 3.

Price Actions: At last check on Wednesday, HIMX stock was up 5.91% to $10.13. TSM is up 2.99%.

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