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Thermal stress in a semiconductor package is one of the major causes of delamination during stress testing. The influence of epoxy molding compound (EMC) properties on package interfacial stress was studied in this paper. Stress index was calculated based on the tested EMC properties. It was found that there is optimized filler content to get the lowest stress. Type of stress modifier is another important raw material in EMC formulations for stress reduction purpose. With certain types of stress modifier, the stress index can be reduced 2 times. The adhesion to lead frame finishing was also measured to understand the effect of stress on interface adhesion strength. All the finished material was molded on a SOIC 20L test vehicle and soaked with a Jedec MSL 3 condition. Delamination was checked after soaking and reflows. It was found delamination to lead frame is strongly related to stress index.