Amkor Technology (AMKR) Morgan Stanley Technology, Media & Telecom Conference summary

Market trends and outlook

• Second-half revenue expected to be stronger due to recovery in key sockets and support from other markets.

• Communications and consumer markets remain stable, while compute shows improved strength, especially with AI-related demand.

• Automotive market is mixed, with advanced segments like ADAS showing growth, but mainstream products facing inventory corrections.

• Advanced automotive segment (ADAS, infotainment, connected car) is projected to outpace mainstream MCU growth.

• AI and data center demand, including CPUs, GPUs, and switches, are expected to drive multi-year growth.

Technology and customer dynamics

• Ongoing transition to next-generation GPU and RDL technologies, with new product launches in advanced packaging.

• Strong pipeline with primary and secondary customers, with industry roadmaps pointing to more advanced packaging.

• Strategic partnership with TSMC, positioning as a fast follower in advanced packaging technologies like CoWoS-S and SWIFT.

• Advanced packaging for automotive includes flip chip BGA, MCMs, and SIP, not just TSMC-style CoWoS.

• Interest in silicon photonics and co-packaged optics is growing, with AI accelerating adoption.

Capital investment and manufacturing strategy

• U.S. facility in Arizona aims to align packaging with regional front-end fabs, balancing higher costs with automation and utilization.

• CapEx for 2024 is $850 million, with 5-10% allocated to the U.S. facility; spend expected to rise in 2026-2027.

• Vietnam facility ramping well, with high yields and significant future revenue potential.

• Customers weigh supply chain certainty against cost, often blending U.S. and offshore production.

• Scale and utilization are key to managing cost structure and capital intensity.