Amkor Technology NASDAQ: AMKR reported third-quarter 2026 revenue of $1.99 billion, up 5% sequentially, as record sales in its computing and automotive and industrial markets helped lift profitability. The company said gross margin rose to 18.3%, while operating margin reached 11.3%, reflecting a greater contribution from high-value advanced packaging products.
Net income for the quarter was $191 million, or $0.76 per share. EBITDA was $435 million, representing an EBITDA margin of 21.8%. CFO Megan Faust said gross profit totaled $364 million.
Computing and Automotive Set Records
CEO Kevin Engel said computing and automotive and industrial each posted record revenue for a second consecutive quarter. On a year-over-year basis, revenue in both end markets increased 37%, according to Engel.
Computing revenue rose 25% sequentially in the third quarter, driven by the continued ramp of Amkor’s flagship high-density fan-out, or HDFO, CPU program and growth in other data-center programs. The company expects computing revenue to rise by a low-double-digit percentage sequentially in the fourth quarter, which it said would translate to more than 50% year-over-year growth.
Engel said the HDFO manufacturing process involves more than 300 steps and that building work-in-process through the production chain took somewhat longer than anticipated. He said the issue was not related to supply constraints.
The company also said an additional HDFO CPU program for a hyperscale customer began ramping during the third quarter. Two new 2.5D programs in networking and data-center applications are expected to begin production in the fourth quarter.
Automotive and industrial revenue increased 7% sequentially to a record, supported by demand for advanced driver-assistance systems, in-car computing, infotainment and industrial products. Amkor expects low-single-digit sequential growth in the segment during the fourth quarter.
Engel said semiconductor content per vehicle continues to rise, while mainstream legacy automotive packages are also recovering. He added that customers have indicated their inventories are under control after a multiyear adjustment period.
Communications and Consumer Face Component Constraints
Communications revenue declined 8% sequentially in the third quarter. Faust attributed the decline to the strategic migration of system-in-package, or SiP, technology to Vietnam, memory supply constraints and changes in customer build patterns. Component shortages affecting premium smartphones and internet-of-things wearable devices also weighed on communications and consumer demand.
For the fourth quarter, Amkor expects communications revenue to decline by a high-single-digit percentage sequentially. Consumer revenue, which increased 10% in the third quarter on demand for IoT and home electronics, is expected to decline by a mid-teens percentage sequentially in the fourth quarter as component shortages persist.
Engel said both Android and iOS-related communications demand is expected to decline sequentially in the fourth quarter. He said memory pricing and availability have affected smartphone and PC markets, with lower-tier phones facing greater difficulty absorbing higher component costs. In PCs, he said the company continues to see a migration toward ARM-based products helping offset some market challenges.
Margins Expand Despite FX and Japan Disruption
Third-quarter gross margin increased 150 basis points from the previous quarter and 400 basis points from a year earlier. Faust said the improvement was primarily driven by a richer mix of advanced packaging products in computing and automotive.
Foreign-exchange headwinds and the impact of a July earthquake at Amkor’s Kumamoto, Japan, facility reduced gross margin by about 60 basis points sequentially, according to Faust. The Japan facility returned to full operations during the quarter.
For the fourth quarter, Amkor forecast revenue of $1.9 billion to $2 billion and gross margin of 18% to 19%. The company expects approximately $140 million in operating expenses, net income of $160 million to $185 million, and earnings per share of $0.65 to $0.75.
Faust said modest fourth-quarter margin expansion should be driven primarily by favorable product mix from further computing growth, partly offset by lower SiP volumes and continued unfavorable foreign exchange.
Capacity Expansion Supported by Customer Commitments
Amkor is expanding advanced packaging capacity in the U.S. and Asia as customers make longer-term commitments and provide advance payments tied to future capacity needs. Faust said the company has entered advance-payment arrangements with a dozen customers since 2025, primarily for advanced packaging capacity in Korea and Arizona, and has additional agreements under discussion.
The company narrowed its 2026 capital-expenditure forecast to about $2.5 billion, primarily due to the timing of construction payments for its Arizona campus. Phase I of that project remains scheduled for completion by the end of 2027.
Amkor announced Phase II of its Arizona advanced packaging and test campus in September. Combined, the two phases are planned to include more than 90,000 square meters of clean-room space and represent an estimated $12 billion investment. When fully ramped, the campus is expected to employ more than 3,500 people.
In Korea, Amkor recently broke ground on two buildings at its Gwangju campus to support HDFO production for data-center customers. A new assembly and test building at the Songdo campus remains on schedule for completion by year-end. The company expects its Korea footprint to be 40% larger in 2028 than it was in 2025.
Amkor is also expanding in Vietnam, where it is moving SiP production from Korea. Engel said that transition will free clean-room capacity in Korea for advanced packaging programs. The company expects capital spending to increase in 2027, with Arizona, Korea and Vietnam facility investments accounting for more than $2 billion based on figures discussed during the call.
As of Sept. 30, Amkor held $2.4 billion in cash and short-term investments, with total liquidity of $3.4 billion. Total debt was $2.5 billion, and its debt-to-EBITDA ratio was 1.7 times.
About Amkor Technology (NASDAQ:AMKR)
Amkor Technology, Inc is a provider of outsourced semiconductor packaging and test services. The company helps semiconductor manufacturers and electronics companies assemble, package and test integrated circuits before they are incorporated into finished electronic products.
Amkor's services include wafer bumping, wafer-level packaging, flip-chip packaging, system-in-package solutions, fan-out packaging, leadframe and laminate-based packaging, and semiconductor testing. Its products and services support applications including mobile and consumer electronics, communications, automotive, computing, industrial equipment, and memory devices.
Founded in 1968, Amkor has grown into a global semiconductor supply-chain partner with manufacturing and testing operations across regions including Asia, Europe and the United States.
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