Core Insights - Amkor Technology reported a full-year revenue of $6.7 billion, reflecting a 6% increase, with strong growth across computing, automotive, consumer, and stabilized communications markets [1][4][6] - The company achieved record revenue in computing and expects continued growth in 2026, particularly in advanced packaging and computing sectors [4][5][16] Financial Performance - For the fourth quarter, Amkor reported revenue of $1.89 billion and EPS of $0.69, exceeding guidance, with a year-over-year increase of 16% despite a sequential decline of 5% [3][6] - Gross profit for the quarter was $315 million, with a gross margin of 16.7%, including a one-time benefit of approximately $30 million from asset sales [2][6] - Full-year gross profit was $939 million, with a gross margin of 14%, and net income totaled $374 million, resulting in an EPS of $1.50 [7] 2026 Guidance and Strategy - Amkor guided Q1 2026 revenue to be between $1.6 billion and $1.7 billion, indicating a 25% year-over-year growth at the midpoint, with expected lower seasonal margins [5][12] - The company plans capital expenditures of $2.5 billion to $3.0 billion for 2026, focusing on facility expansion and advanced packaging capacity [14][15] - Strategic priorities include enhancing technology leadership, expanding geographic footprint, and investing in advanced packaging platforms critical for AI and high-performance computing [9][10][11] Market Outlook - The company anticipates strong growth in computing, expected to exceed 20%, along with continued growth in advanced automotive, while other segments are projected to grow in single digits [16][19] - Amkor is optimistic about demand in communications, particularly related to iOS, and expects a solid performance in Android markets [18] - In the automotive sector, while overall unit sales are flat, the semiconductor content per vehicle is increasing due to the shift towards hybrid and electric vehicles [19] Operational Developments - The Vietnam facility reached break-even in Q4, and construction of the Arizona campus is underway, with a focus on expanding advanced packaging capacity [8][11][20] - The company is prioritizing high-density fan-out (HDFO) and other advanced packaging technologies, with new programs expected to launch in 2026 [10][11]

Financial Data and Key Metrics Changes - Q4 2025 revenue was $1.89 billion, down 5% sequentially but up 16% year-on-year, with full year revenue growing 6% to $6.7 billion [12][14] - EPS for Q4 was $0.69, with net income of $172 million, and full year net income was $374 million, resulting in EPS of $1.50 [14][15] - Gross profit for Q4 was $315 million, with a gross margin of 16.7%, while full year gross profit was $939 million, with a gross margin of 14% [13][15] Business Line Data and Key Metrics Changes - Communications revenue grew 28% year-on-year in Q4, and 1% for the full year, driven by strong demand in iOS [12][14] - Computing revenue increased 6% year-on-year in Q4 and 16% for the full year, supported by AI-related PC devices [12][14] - Automotive and industrial revenue rose 25% year-on-year in Q4 and 8% for the full year, driven by advanced automotive content [12][14] - Consumer revenue declined 10% year-on-year in Q4 but grew 9% for the full year [12][14] Market Data and Key Metrics Changes - The computing segment is expected to grow over 20% in 2026, with strong contributions from AI and HPC [10][11] - Communications, computing, and automotive markets are projected to see strong year-on-year growth in Q1 2026 [16] - The automotive market is expected to remain flat in unit sales, but increased semiconductor content per vehicle is anticipated [40] Company Strategy and Development Direction - The company aims to elevate technology leadership, expand geographic footprint, and enhance strategic partnerships [8][10] - Focus on advanced packaging platforms, including HDFO and Flip Chip, critical for next-generation AI and HPC [9][10] - Construction of the Arizona campus is underway, with significant capital expenditures planned for facility expansion and advanced packaging capacity [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating market shifts and geopolitical challenges, emphasizing strong customer engagements [5][11] - The company anticipates a strong start to 2026, with revenue guidance for Q1 between $1.6 billion and $1.7 billion, reflecting a 25% year-on-year increase [16][17] - Management is monitoring export control and trade policies, which are factored into Q1 guidance [11] Other Important Information - Capital expenditures for 2026 are expected to increase to $2.5 billion-$3 billion, with a significant portion allocated for facility expansion [17] - The company held $2 billion in cash and short-term investments at year-end, with total liquidity of $3 billion, a 30% increase from the prior year [16] Q&A Session Summary Question: CapEx guidance and its implications - The CapEx projection includes 65%-70% for facilities, with significant spending on the Arizona project expected to peak in 2026 [19][21] - Customer commitments for HDFO projects are contributing to the high CapEx numbers [20][23] Question: Growth expectations in computing - Computing is expected to show 20% year-on-year growth, with data center HDFO programs anticipated to ramp significantly [27][29] Question: Margin outlook and impacts - Q1 margins are impacted by a one-time asset sale, but the company expects to achieve a 30% incremental flow-through for the full year [41][43] Question: Partnership with TSMC - The partnership with TSMC is ongoing, focusing on technology and manufacturing needs in the U.S., with increasing customer interest [49][51]

Financial Data and Key Metrics Changes - Q4 2025 revenue was $1.89 billion, down 5% sequentially but up 16% year-on-year, with EPS at $0.69, outperforming guidance [11][4] - Full year 2025 revenue grew 6% to $6.7 billion, with gross profit of $939 million and gross margin at 14% [14][13] - Net income for 2025 was $374 million, resulting in EPS of $1.50, with EBITDA at $1.16 billion and EBITDA margin at 17.3% [14][13] Business Line Data and Key Metrics Changes - Communications revenue grew 28% year-on-year in Q4, with a 1% increase for the full year, driven by iOS demand [11] - Computing revenue increased 6% year-on-year in Q4 and 16% for the full year, supported by AI-related PC devices [11] - Automotive and industrial revenue rose 25% year-on-year in Q4 and 8% for the full year, driven by advanced automotive content [11] - Consumer revenue declined 10% year-on-year in Q4 but grew 9% for the full year, reflecting product lifecycle impacts [12] Market Data and Key Metrics Changes - The computing segment is expected to grow over 20% in 2026, with strong contributions from AI and HPC [10] - Communications, computing, and automotive markets are projected to see strong year-on-year growth in Q1 2026 [15] - The automotive market is gradually recovering, with mainstream automotive showing three consecutive quarters of growth [11] Company Strategy and Development Direction - The company aims to elevate technology leadership, expand geographic footprint, and enhance strategic partnerships [6] - Focus on advanced packaging platforms, including HDFO and test, critical for AI and high-performance computing [6] - Construction of the Arizona campus is underway, with significant investments planned for 2026 [10][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating market shifts and geopolitical challenges, emphasizing strong execution [4] - The company anticipates continued growth in advanced packaging and computing, with a focus on margin improvement [9] - Management highlighted the importance of customer commitments and partnerships in supporting capacity investments [21][30] Other Important Information - Capital expenditures for 2025 were $905 million, with expectations for 2026 CapEx to increase to $2.5 billion-$3 billion [14][15] - The company held $2 billion in cash and short-term investments at year-end, with total liquidity at $3 billion [15] Q&A Session Summary Question: CapEx guidance and investment changes - Management clarified that the high CapEx guidance includes significant spending for facilities and equipment, with a focus on supporting advanced packaging growth [18][19] Question: Government incentives and CapEx - Management indicated that government incentives would come in on a lag, with minimal offsets in the 2026 guidance [24] Question: Computing segment growth and data center programs - Management expects data center HDFO programs to ramp significantly, contributing meaningfully to revenue [26][28] Question: Communication segment outlook - Management noted relative strength in iOS and a stable outlook for Android, with expectations for premium tier benefits [44] Question: Partnership with TSMC and CapEx impact - Management confirmed ongoing discussions with TSMC regarding U.S. manufacturing and emphasized strong customer interest in the Arizona project [45][48] Question: Balance sheet management and cash needs - Management stated that the company can operate comfortably with $500 million on the balance sheet and expects a decrease in interest expense despite potential debt increases [54]