Amkor Reports 3 Percent Q2 Revenue Gain
Key Points
- Revenue (GAAP) for Q2 2025 reached $1.51 billion, up 3.4% compared to Q2 2024, and beating estimates by $88 million.
- GAAP earnings per share came in at $0.22, exceeding the $0.16 analyst forecast for Q2 2025 but down from $0.27 a year ago.
- Gross margin for Q2 2025 fell to 12.0%, continuing year-ago margin pressure from Q1 to Q2 2025.
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Amkor Technology (NASDAQ:AMKR), a major provider of semiconductor packaging and test services, released its second quarter 2025 results on July 28, 2025. The main headline was a substantial GAAP revenue and earnings beat for Q2 2025. The company delivered $1.51 billion in GAAP revenue. Although profits and revenue both improved from the prior quarter, gross margin (GAAP) contracted from a year ago, reflecting ongoing industry cost pressures. Overall, it was a solid quarter for Amkor as it saw broad-based sequential improvements, highlighted by strong demand in advanced packaging for high-performance and AI applications.
| Metric | Q2 2025 | Q2 2025 Estimate | Q2 2024 | Y/Y Change |
|---|---|---|---|---|
| EPS (GAAP) | $0.22 | $0.16 | $0.27 | (18.5%) |
| Revenue (GAAP) | $1.51 billion | $1.42 billion | $1.46 billion | 3.4% |
| Gross Margin | 12.0 % | 14.5 % | (2.5 pp) | |
| Operating Income | $92 million | $82 million | 12.2% | |
| EBITDA | $259 million | $247 million | 4.9% |
Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in Q1 2025 earnings report.
What Amkor Technology Does and Where It's Focusing
Amkor Technology provides outsourced semiconductor assembly and testing services to chipmakers around the world. The company works with leading customers in mobile devices, computing, automotive, consumer electronics, and industrial applications. Its business centers on advanced packaging—technology that allows more powerful and energy-efficient chips to be produced by combining multiple semiconductor components in a single package.
Amkor's recent focus has been on expanding its advanced packaging capabilities, developing new facilities across the globe, and deepening customer partnerships in artificial intelligence, automotive, and high-performance computing. Key success factors include its investments in research and development, continual improvement of manufacturing processes, and its diverse geographic footprint, which allows it to offer flexibility for customers in managing supply chain risks.
A Closer Look at the Quarter: Performance Drivers and Financial Trends
This quarter, Amkor reported GAAP revenue of $1.51 billion, $88 million above consensus and up 3.4% compared to Q2 2024. Communications remained the largest market at 40% of sales, but declined from 48% a year ago, while the computing and consumer segments grew in both percentage and dollar terms.
GAAP EPS of $0.22 was $0.06 ahead of estimates, but down from $0.27 last year. Gross margin, which measures how much of each sales dollar is left after production costs, slipped to 12.0%, down from 14.5% in Q2 2024. While margins were flat compared to the first quarter, they remain below historical levels.
A one-time benefit of $32 million tied to a contingency payment from the 2017 Nanium acquisition helped boost operating income and EBITDA. The net effect on EPS was $0.07. Stripping this out, operational profitability would have grown more modestly versus the prior quarter. Operating income (GAAP) jumped to $92 million from $82 million a year ago.
In advanced products—such as flip chip packages, wafer-level processing, and 2.5D system-in-package (SiP) technologies—sales reached $1,228 million, up 15% from the prior quarter and 4% from a year ago. These technologies are critical for chips powering artificial intelligence, data centers, and automotive features like advanced driver assistance systems (ADAS). Amkor ramped new design wins in areas like redistributed layer (RDL) technology and co-packaged optics, with several more customer programs moving into qualification for later periods.
Key Strategic Priorities: Technology, Customers, and Risk Management
Amkor continues to emphasize leadership in advanced chip packaging, devoting $42 million to research and development in Q2 2025 and $87.66 million for the six months ended June 30, 2025, compared with $77.74 million for the six months ended June 30, 2024. The first phase of a new expanded chip test facility in Korea is on track to open by late 2025.
Geographic diversification is another main focus. Amkor operates major manufacturing locations in Vietnam, Korea, Portugal, and is planning a large advanced packaging plant in Arizona, set to begin construction in the back half of the year. The company points to flexibility in its supply chain as a way to manage evolving global tariffs and export controls, with management describing its manufacturing footprint as an advantage for mitigating risk and partnering with customers through disruptions. Amkor also noted that TSMC's expansion in the U.S. could be a growth opportunity, reflecting confidence in its collaborative model within the broader semiconductor supply chain.
The company's business remains heavily tied to its largest customers, with the top ten accounting for 72% of revenue. Named customers include Apple and Qualcomm. While these deep relationships anchor revenue and provide stability, they also mean Amkor is sensitive to the timing and scale of new product launches or changes in customer procurement patterns. Management cited strong, ongoing communication with these accounts to handle any supply chain changes or cost shifts prompted by trade policy or shifting production needs.
Gross margin and inventory trends remain important areas to watch. Inventory increased to $375 million from $311 million at year end. Total debt (GAAP) rose to $1.57 billion at June 30, 2025, up from $1.16 billion at December 31, 2024. The company's cost structure, which involves a high ratio of fixed manufacturing costs, makes profitability especially sensitive to swings in end demand.
Looking Forward: Guidance and Upcoming Catalysts
Management provided guidance for Q3 2025, expecting net sales in the range of $1.88 billion to $1.98 billion. The midpoint points to around 27% sequential growth from Q2 to Q3 2025. Gross margin is forecast to rebound slightly, returning to a range of 13.0% to 14.5%. Net income (GAAP) guidance is $85 million to $120 million, with EPS projected between $0.34 and $0.48. Planned capital expenditures (CapEx) remain at $850 million for FY2025, with 5% to 10% estimated for the new advanced packaging facility in Arizona.
The company cited new customer programs in communications and compute as likely drivers for the second half. Amkor remains cautious about macroeconomic and trade risks, but anticipates some margin recovery as utilization improves. Key watch areas for future quarters include margin progression, inventory management, project execution at new sites, and ongoing developments in global trade policy. The quarterly dividend was held steady at $0.08269 per share, paid on June 25, 2025.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
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