Amkor Technologies reported Q2 advanced packaging revenue growth as AI-driven demand for chiplet and HBM assembly accelerated.
Semiconductor packaging and testing company Amkor Technology delivered better-than-expected second quarter results, demonstrating strong momentum in advanced packaging even as management's cautious forward guidance tempered investor enthusiasm.
For Q2 2026, Amkor posted revenue of $1.90 billion, up 25.6% year-over-year and beating analyst estimates of $1.82 billion by 4.5%. Adjusted earnings per share reached $0.70, significantly exceeding consensus estimates of $0.48—a 45.4% beat. Adjusted EBITDA totaled $400 million against expectations of $330.8 million, representing a 21.1% margin and a 20.9% beat. Operating margin expanded to 10.5%, up from 6.1% in the prior year quarter. However, third quarter revenue guidance of $2 billion came in 4.1% below analyst estimates of $2.09 billion, signaling a more cautious outlook.
The strong quarter reflected broad-based growth across all major end markets, driven by high factory utilization rates now reaching the upper 70% range across multiple technology platforms. CEO Kevin Engel highlighted accelerating momentum, stating, "Both Advanced and Mainstream revenue increased year-on-year, with Mainstream achieving its fifth consecutive quarter of year-on-year growth." Computing and automotive industrial markets emerged as standouts, with strength also supported by iOS ecosystem demand and improving consumer sentiment. Two-thirds of gross margin expansion came from higher utilization rates, with the remaining third attributable to favorable product mix shifts toward higher-margin advanced packaging.
Management attributed second quarter performance to several strategic and operational drivers. Advanced packaging technologies, particularly 2.5D and high-density fan-out (HDFO) solutions for AI and high-performance computing applications, saw accelerated adoption as customer programs ramped in data centers and next-generation CPU projects. Two major partnerships were announced: an agreement with TSMC to integrate wafer fabrication with packaging and test, and a deal with NVIDIA to support next-generation AI infrastructure with long-term technology and capacity alignment commitments. Amkor's geographic expansion also advanced, with construction progress in Arizona, Songdo (Korea), and planned cleanroom capacity additions in Vietnam, Portugal, and Taiwan.
Forward guidance, however, reflected operational transitions and market headwinds. CFO Megan Faust noted, "Communications revenue is expected to decline in the high single digits sequentially, which is a departure from the typical seasonal patterns," citing the ongoing migration of System-in-Package (SiP) production to Vietnam, memory supply constraints, and shifting build patterns. The SiP transition to Vietnam is intended to free up capacity for advanced computing products but will create near-term disruption, with timing impacts expected to extend into early next year. Despite this, management projected nearly 30% sequential growth in computing revenue for Q3, driven by accelerating AI data center demand and HDFO CPU ramp programs. Automotive and industrial markets are expected to contribute mid-single-digit sequential growth, partially offsetting communications weakness.
Management emphasized that success in the coming quarters will depend on execution of the SiP transition, profitability momentum in the computing segment as AI and data center demand scales, and customer uptake of advanced packaging solutions through new TSMC and NVIDIA partnerships. Inventory days outstanding increased to 32 from 31 in the previous quarter, reflecting supply chain positioning. The stock has declined to $55.85, down from $60.91 before earnings, reflecting investor concerns about the sustainability of growth momentum amid near-term guidance caution.