Amkor Technology

Management guided that Amkor's AI advanced packaging revenue will triple in 2026, with new compute programs ramping in the second half of the year. First quarter revenue grew 27 percent year over year to a record 1.68 billion dollars. The communications segment was up 42 percent, computing up 19 percent, and gross margin expanded to 14.2 percent as the mix shifts toward higher-value packaging.

Amkor is the only major non-Chinese packaging company building a US facility at scale, backed by 407 million dollars in CHIPS Act funding plus a 25 percent investment tax credit on qualifying spend. Apple and Nvidia are already locked in as anchor customers for the Arizona facility. Competitors like ASE would need years to replicate the US footprint, which creates a structural moat.

Apple alone is around 30 percent of revenue, and the top two customers together are nearly 40 percent of the business. If Apple ever shifts packaging strategy to a different provider or in-house, the impact would be severe. The Nvidia relationship is still just a memorandum of understanding, not a binding contract, so there's execution risk on that conversion too.

Amkor generated 308 million dollars in free cash flow last year, but capex guidance for this year is 2.5 to 3 billion dollars. That gap is massive and the company is betting that customer prepayments, the CHIPS grant, and operating cash flow will bridge it. If any one of those pieces stumbles, the company could face dilutive financing at the wrong time.