Amkor Q3 Earnings Miss: Will Dim Q4 Guidance Pull Down the Stock?

Core Viewpoint - Amkor Technology (AMKR) reported lower-than-expected earnings for Q3 2024, with a decline in net income and a dismal outlook for Q4 2024, which may negatively impact its stock price [1][5]. Financial Performance - Q3 earnings per share were 49 cents, a 9.3% decline year over year, missing the Zacks Consensus Estimate by one cent [1]. - Revenues for the quarter reached $1.86 billion, exceeding the consensus estimate of $1.83 billion, and reflecting a 2.2% year-over-year increase driven by demand for Advanced SiP technology [2]. - Operating income margin for Q3 was 8%, up 240 basis points sequentially but down 110 basis points from the previous year [8]. - EBITDA for Q3 was $309 million, a 25% increase sequentially but a 7% decline year over year [8]. Market Segmentation - Advanced products accounted for 84.2% of total Q3 revenues, while mainstream products made up 15.8% [6]. - The Communications sector contributed 52% of Q3 revenues, while Automotive and Industrial markets accounted for 16% [7]. - Consumer and Computing markets each generated 16% of revenues [8]. Guidance and Outlook - For Q4 2024, Amkor anticipates revenues between $1.60 billion and $1.70 billion, lower than the Zacks Consensus Estimate of $1.85 billion [10]. - Gross margin for Q4 is expected to be between 13.5% and 15.5%, with net income projected between $70 million and $110 million [11]. Balance Sheet and Cash Flow - As of September 30, 2024, total cash and short-term investments were $1.47 billion, down from $1.55 billion at the end of Q2 [9]. - Long-term debt decreased to $894 million from $949.3 million at the end of Q2 [9]. - Operating cash flow for Q3 was $164.2 million, totaling $551.3 million for the first three quarters of 2024 [9].