Taiwan's drive to scale artificial intelligence and robotics faces a critical setback as political deadlock in the Legislative Yuan blocks passage of the 2026 central government budget, freezing billions of New Taiwan dollars in new technology investment across multiple ministries.

Taiwan's National Science and Technology Council (NSTC) has raised concerns that prolonged delays in budget approvals could cause Taiwan to miss the critical 2026 global takeoff for silicon photonics (SiPh) and co-packaged optics (CPO), two cornerstone technologies underpinning next-generation AI servers.

As artificial intelligence (AI) moves beyond its infrastructure build-out phase, the industrial PC (IPC) sector anticipates 2026 as a key year for scaling AI from centralized cloud setups to diverse edge computing environments. This transition marks a turning point in which AI-powered edge devices become integral to real-world operations across the manufacturing, medical, transportation, defense, and public safety sectors.

The upcoming CES 2026 is set to elevate artificial intelligence (AI) from a prominent topic to the exclusive central theme, reflecting the technology's maturation toward everyday application. The Consumer Technology Association (CTA), organizer of the event, announced that all showcased products and innovations will focus on AI, indicating a shift in focus from prior years, when AI was one of several highlights.

The Consumer Technology Association (CTA) has announced that artificial intelligence (AI) will be the central theme of CES 2026, under the banner "AI Forward." The event will emphasize AI's impact on product launches and technological advancements, with keynote addresses and major announcements from leading technology companies.

As 2026 begins, DIGITIMES has conducted in-depth analyses of sectors within the electronics industry. The current landscape theme can be described as "one core, two keys, three drivers." The core, semiconductors, has two keys —the satellite industry and memory— and will be driven by three factors: AI servers, defense, and green energy. These areas will be critical to watch in 2026.

South Korea's four major conglomerates, Samsung Group, LG Group, SK Group, and Hyundai Motor Group have unanimously identified artificial intelligence transformation (AX) as a core focus in their New Year organizational restructuring and personnel deployments. South Korean conglomerates have no longer viewed AI merely as a new business but have instead embedded AI across end-to-end processes including R&D, manufacturing, finance, and operations. Representative groups such as Samsung, LG, SK, and Hyundai Motor have all carried out 2026 organizational restructuring and personnel adjustments toward the end of 2025, simultaneously deploying AX-related organizations and technical talent to accelerate their AX initiatives in the New Year.

Facing stiff competition in the domestic market, Chinese technology companies are accelerating their push into international markets, with artificial intelligence (AI) firms spearheading efforts in Singapore. According to The Straits Times, these companies plan to introduce a wide range of AI products, including robots, large language models (LLMs), and cloud solutions by 2026 to tap into Singapore's growing technology sector.

Europe's defense technology sector is experiencing rapid growth as the ongoing Russia-Ukraine war and rising geopolitical tensions drive increased investment in AI-driven defense solutions. The UK and Germany have emerged as the primary hubs for startups focused on advanced military technologies, signaling a shift in defense priorities across the continent.

As frontier AI models reach practical usability, competition is shifting from incremental improvements in model performance to a broader battle over distribution, application integration, and cost-effective deployment, according to DIGITIMES analyst Luke Lin. Developers are now racing to secure access to end users via devices and platforms, marking a new phase in AI competition that is expected to last for the next several years.

As AI adoption accelerates, global and US economies in 2025 have been increasingly driven by technology companies' investments in AI infrastructure. Analysts warn that next year's AI server demand will depend on whether deployed AI can generate revenue, distinguishing "good AI" from "bad AI" with unclear monetization.

Taiwan's aging population and declining birth rates have led to an increasingly pressing labor shortage, a major structural issue uncovered through a National Taiwan University (NTU) study commissioned by the National Development Council (NDC) on how demographic shifts impact policies. Under this backdrop, industry experts see high potential for the robotics sector, but cost reduction and improved intelligence remain key challenges for widespread adoption.

On December 30, Chinese AI company Z.ai launched a share sale to raise HK$4.35 billion (approx. US$560 million), aiming to become the first large language model (LLM) developer listed in Hong Kong amid a tech IPO surge, with a scheduled listing for January 8, 2026. Meanwhile, Z.ai has recently launched its latest open-source model, GLM-4.7, signaling a shift toward enterprise-focused AI and broader global adoption. As the company prepares for a 2026 IPO, the release highlights the growing influence of independent developers in a market increasingly shaped by hyperscale competitors and ecosystem distribution.

In 2025, rising geopolitical tensions reshaped global technology and manufacturing, boosting Southeast Asia as a key hub for data centers, advanced manufacturing, and AI. The Johor-Singapore Economic Zone enhanced cross-border integration, strengthening Singapore's "Singapore+1" strategy, while Johor emerged as a major data center cluster amid sustainability concerns.

Although AI has made tremendous progress in the digital domain, intelligence in the physical world still faces many challenges. Robots need to perceive 3D space, manipulate objects, and understand physical rules, all of which require enormous investments of manpower and resources. Dr. Jim Fan, head of Nvidia's robotics business and co-head of the GEAR lab, recently posted on X criticizing the current state of the robotics industry. Looking back at developments in robotics in the year now coming to an end, he argues that the robotics field remains in a state of chaos, and that its development direction may be wrong.

2025 proved turbulent for downstream applications and end-user devices. Tariffs and geopolitical tensions dominated the first half, while AI gained momentum later in the year. Global market unpredictability pushed many brands—particularly in China, the epicenter of geopolitical tensions—toward domestic markets and self-sufficiency.

The field of AI robots has now entered a phase of rapid development and iteration, as evidenced by optimistic predictions from Nvidia CEO Jensen Huang and Tesla CEO Elon Musk. As noted by the National Science and Technology Council (NSTC), key technologies for building advanced AI robots in the future include semantic reasoning, task decomposition, causal inference, chain-of-thought, multi-step reasoning, and cross-domain generalization capabilities.

The South Korean printed circuit board (PCB) industry is struggling as soaring gold and copper prices, up 50% and 30% respectively since early 2025, increase production costs. Despite high factory utilization due to the AI boom in semiconductors, many companies cannot raise product prices, worsening profitability.

Global 5G penetration is expected to overtake 4G in 2027 to become the dominant network technology, according to the latest Mobility Report from Ericsson. In addition to this pivotal milestone in mobile communications, the report also points to the beginning of the standardization process for 6G, which is expected to reach 180 million users by 2031, with advanced markets such as the US, China, Japan, and South Korea leading the way in terms of adoption.

Taiwan-based tech products distributor Weblink International is riding a surge in memory prices and robust demand for AI servers, positioning the company for strong growth in 2026. President Dave Lin said both segments continue to face supply constraints, but remain among Weblink's most promising growth drivers.

The rapid expansion of AI data centers is triggering unprecedented electricity demand, placing Taiwan's power grid under growing strain. Taiwan Power Company (Taipower) Chairman Wen-sheng Tseng warns that land scarcity, urban density, and climate risks are converging into a critical infrastructure challenge.

It is difficult to imagine any company exerting greater influence on the AI industry in 2025 than Nvidia. The market closely tracks CEO Jensen Huang's every move—whether he was meeting US President Donald Trump or sharing fried chicken and beer with executives from Samsung Electronics and Hyundai Motor Group in South Korea.

Tatung held an extraordinary shareholders meeting on December 30, where its board was comprehensively reshuffled with nine directors (including three independents), and non-compete restrictions on the newly elected directors were lifted.

The rise of AI sovereignty is fueling a new global competition, driving countries to invest heavily in AI infrastructure and technologies, akin to an arms race. As nations seek to secure their technological futures and maintain economic and military advantages, this trend is reshaping global dynamics and priorities.