A method for manufacturing an integrated circuit package system includes: forming a first device unit, having first external interconnects arranged along a perimeter of the first device unit, and a second device unit, having second external interconnects arranged along a perimeter of the second device unit, in an array configuration; mounting an integrated circuit die over the first device unit; connecting the integrated circuit die and the first external interconnects; encapsulating with an encapsulation covering the integrated circuit die, the first device unit, and the second device unit with both the first external interconnects and the second external interconnects partially exposed; and forming a partial encapsulation cut in the encapsulation electrically isolating the first external interconnects and the second electrical interconnects.