A maker of outsourced semiconductor assembly and test services, Amkor packages and tests the chips that power smartphones, tablets, cars, and computers for customers like Apple and Qualcomm. Founded in 1968 by Joo-Jin (James) Kim in Pennsylvania, the company began as a bridge between U.S. chip design and his father's Korean manufacturing operations. Its name blends "America" and "Korea," reflecting that two-country origin story.
Amkor Q2 revenue rose 25.6% to $1.9B and gross margin widened to 16.8% as all end markets grew, but free cash flow turned deeply negative on rising capex.
Communications returned to growth and every end market expanded, lifting . rose 25.6% to $1.9 billion and widened 4.8 points to 16.8%, the highest in over two years, as higher volume absorbed overhead costs that had compressed margins in prior quarters. The recovery in profitability is overshadowed by a $2.5–$3.0 billion capital expenditure plan that pushed to negative $269.9 million for the first half.
Key takeaways
widened 4.8 points to 16.8%, driven by higher as rose 25.6% to $1.9 billion, with growth across all end markets.
Communications rose 32% , a clear inflection after two quarters of double-digit declines in early 2025, while automotive and industrial rose 35% and computing rose 23%.
expense rose 64.7% to $78.9 million, largely because the prior-year period included a $32.4 million net cash receipt from the Nanium Insolvency Receipt, partially offset by a $21 million gain on asset disposal in the current quarter.
Section summaries
Management's Discussion and Analysis
Q2 FY2026 revenue rose 25.6% to $1.9B with gross margin up 480 bps to 16.8%, driven by growth across all end markets and higher factory utilization.
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increased 25.6% to $1,898.0 million, with communications up 32%, automotive/industrial up 35%, and computing up 23%.
expanded to 16.8% from 12.0%, primarily due to higher factory utilization from the increase.
for the first half of 2026 reached $688.4 million, more than triple the $226.1 million spent in the first half of 2025, focused on advanced packaging equipment and the Arizona facility.
for the first half was negative $269.9 million, compared to positive $63.1 million a year ago, as the elevated capital expenditure plan consumed .
The company issued $1.15 billion in 2031 Notes in May 2026, adding to the $1.28 billion in already on the balance sheet, to fund the Arizona facility build-out.
What changed
The Q1 2026 watch item on whether 42% communications growth would sustain into Q2 is answered: communications rose 32% in Q2, confirming a durable premium smartphone cycle rather than a single-quarter order pattern.
The Q1 2026 watch item on trajectory is answered: gross margin widened to 16.8% in Q2 from 14.2% in Q1, as higher volume drove enough absorption to lift margins despite the overhead and compensation costs added in 2025.
The FY 2025 watch item on whether the $2.5–$3.0 billion 2026 plan would be funded through additional debt is partially answered: the company issued $1.15 billion in 2031 Notes in May 2026, and turned deeply negative at -$269.9 million for the first half.
The Q1 2026 watch item on whether the $300 million in expected customer advance payments materializes on schedule is not yet resolved; the filing does not report receipt of these payments in Q2.
What to watch
Whether the $1.15 billion in 2031 Notes issued in May 2026 is sufficient to fund the Arizona facility through its construction phase, or whether additional debt or equity raises will be needed given the $2.5–$3.0 billion full-year plan.
The trajectory of in the second half of 2026, to see whether seasonal releases and the expected $300 million in customer advance payments can narrow the negative $269.9 million first-half result.
Whether the up to $407 million in CHIPS Act direct funding for the Arizona facility is finalized and disbursed, or faces reduction or clawback amid the evolving tariff and trade environment flagged in the risk factors.
Whether the 16.8% in Q2 is sustainable into Q3 and Q4, or whether the mix shift toward higher-material-content products and rising overhead costs from the Arizona ramp begin to compress margins again.
rose 64.7% to $78.9 million, largely because the prior-year period included a $32.4 million Nanium Insolvency Receipt, partially offset by a $21 million gain on asset disposal.
surged to $688.4 million for H1 2026 (vs. $226.1 million in H1 2025), focused on advanced packaging/test equipment and the Arizona Facility.
The company issued $1.15 billion in 2031 Notes in May 2026 and expects full-year 2026 of $2.5–$3.0 billion, mainly for the Arizona Facility.
turned negative at -$269.9 million for H1 2026, compared to $63.1 million in H1 2025, due to higher .
Quantitative and Qualitative Disclosures About Market Risk
Primary market risks are foreign currency and interest rate fluctuations, managed via hedging and natural offsets.
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A 10% appreciation of all foreign currencies against the USD would lower pre-tax income by ~$18M due to of monetary assets/liabilities.
A 10% appreciation of all foreign currencies against the USD would lower by ~$84M, as cost impacts outweigh sales benefits.
Approximately 90% of are USD-denominated, while ~40% of costs are in Asian currencies, mainly labor, creating a net expense exposure to a weaker dollar.
The company uses foreign currency forward contracts and natural hedging to mitigate FX risk, and began hedging net investments in foreign subsidiaries in April 2024.
Interest rate risk on the investment portfolio is limited by short maturities; fixed-rate debt ($2.0B) has fair value sensitivity, while variable-rate debt ($494M) impacts .
Information about legal proceedings is set forth in Note 15 to our Consolidated Financial Statements in Part I, Item 1 of this Form 10-Q and in Note 17 to the 2025 Form 10-K.
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Information about legal proceedings is set forth in Note 15 to our Consolidated Financial Statements in Part I, Item 1 of this Form 10-Q and in Note 17 to the 2025 Form 10-K.
Amkor faces material risks from semiconductor cyclicality, AI demand uncertainty, geopolitical trade restrictions, and customer concentration.
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A downturn in the cyclical semiconductor industry or a slowdown in AI/HPC-driven demand could lead to excess capacity, reduced utilization, and lower selling prices, materially harming results.
Evolving U.S. trade policies, including tariffs and export controls like the BIS Regulations, create significant uncertainty and could restrict Amkor's access to customers and suppliers, particularly in China.
The loss of a key customer or reduced orders poses a material risk, as the top ten customers accounted for 72% of 2025 , with significant concentration in mobile and automotive end markets.
Amkor's substantial debt of $2.49 billion and the terms of its 2031 Notes could restrict operating flexibility, increase vulnerability to adverse conditions, and dilute or depress the stock price upon conversion.
The company's high fixed costs and lack of material make it difficult to maintain satisfactory gross margins if rates decline due to demand shortfalls.
Newly emphasized risks include the potential adverse impact of the 2025 OBBBA tax legislation and the OECD's 2026 Side-by-Side framework on Amkor's future tax obligations and .