AMKR
Amkor Technology, INC
NASDAQ
10-K: Amkor Technology Reports Mixed Results in 2024, Focuses on Strategic Investments
Sentiment:
Annual Results
21 February 2025 4:00 PM
Amkor Technology's 2024 results show a slight revenue decrease but strategic investments in Vietnam and Arizona signal future growth.
Worse than expected
Net sales decreased by 2.9% to $6.318 billion in 2024.
Operating income margin decreased to 6.9% due to increased employee compensation costs and start-up costs at the Vietnam Facility.
Net cash provided by operating activities was $1.089 billion, a decrease from the previous year due to changes in working capital and lower operating profits.
Summary
- Amkor Technology's net sales decreased by 2.9% to $6.318 billion in 2024, primarily due to lower sales in the automotive and industrial and communications end markets.
- Gross margin increased slightly to 14.8% due to the extension of the estimated useful life of test equipment and favorable foreign currency exchange rates.
- Operating income margin decreased to 6.9% due to increased employee compensation costs and start-up costs at the Vietnam Facility.
- Capital expenditures totaled $743.8 million, focused on advanced packaging and test equipment.
- Net cash provided by operating activities was $1.089 billion, a decrease from the previous year due to changes in working capital and lower operating profits.
- The company paid total cash dividends of $178.6 million in 2024.
- Amkor plans capital expenditures of approximately $850 million in 2025, including investments in the Arizona Facility.
Sentiment
Score: 6
Explanation: The document presents a mixed picture. While revenue and operating income declined, the company is making strategic investments and remains a leader in advanced packaging. The sentiment is neutral to slightly positive.
Positives
- Gross margin increased to 14.8% due to the extension of the estimated useful life of test equipment and favorable foreign currency exchange rates.
- The company was awarded up to $407 million in direct funding by Commerce pursuant to the CHIPS Act to support the Arizona Facility.
- The company is focused on leveraging its leadership position in services for advanced technologies.
Negatives
- Net sales decreased by 2.9% to $6.318 billion in 2024.
- Operating income margin decreased to 6.9% due to increased employee compensation costs and start-up costs at the Vietnam Facility.
- Net cash provided by operating activities decreased due to changes in working capital and lower operating profits.
Risks
- The semiconductor industry is cyclical and impacted by broad economic factors.
- The company faces competition from established competitors and new entrants.
- The company is dependent on key customers and concentration of customers in certain end markets.
- The company faces challenges integrating diverse operations.
- The company is exposed to risks arising from international trade restrictions and regional conflict.
- The company faces risks in connection with the continuing development and implementation of changes to, and maintenance and security of, its information technology systems.
- The company's substantial indebtedness could have a material adverse effect on its financial condition.
- The company may decrease or suspend its quarterly dividend.
Future Outlook
Amkor expects 2025 capital expenditures to be approximately $850 million, with 5% to 10% allocated to the Arizona Facility. The company anticipates continuing to pay quarterly cash dividends.
Industry Context
The report acknowledges the cyclical nature of the semiconductor industry and the increasing competition, including from Chinese firms. It highlights the importance of advanced packaging in driving growth in key markets like high-performance computing, automotive, IoT, and mobile communications.
Comparison to Industry Standards
- The document mentions key competitors such as ASE Technology, JCET Group and Powertech Technology.
- It also acknowledges competition from contract foundries like TSMC and Samsung, and electronic manufacturing service providers like Universal Scientific Industrial and Luxshare.
- The report positions Amkor as the world's largest U.S. headquartered OSAT service provider, emphasizing its leadership in advanced packaging technology.
Stakeholder Impact
- Shareholders may be impacted by the company's performance and dividend policy.
- Employees may be impacted by changes in compensation and benefits.
- Customers may be impacted by the company's ability to provide packaging and test services.
- Suppliers may be impacted by the company's purchasing decisions.
- Creditors may be impacted by the company's ability to repay debt.
Next Steps
- Begin construction of the Arizona Facility in the second half of 2025.
- Continue to make prudent investments and manage capacity expansion.
- Closely manage costs in response to changes in market conditions.
Key Dates
- 1968: Amkor founded.
- March 15, 2019: Date of Indenture for 6.625% Senior Notes due 2027.
- March 28, 2022: Date of Secured Facility Agreement for Singapore Revolver.
- May 18, 2021: Stockholders approved the Amkor Technology, Inc. 2021 Equity Incentive Plan.
- March 2022: ATSH entered into the 2022 Singapore Revolver.
- December 31, 2024: End of fiscal year.
- February 14, 2025: Number of shares outstanding of each of the issuers classes of common equity.
- February 20, 2025: The Board of Directors amended and restated the Restated Bylaws of the Company.
Keywords
semiconductor packaging, outsourced assembly, test services, advanced packaging, Amkor Technology, financial results, capital expenditures, CHIPS Act, Vietnam Facility, Arizona Facility
AMKR
Amkor Technology, INC
NASDAQ
Sector: TBD
Filings with Classifications
Worse than expected
29 April 2025 3:45 PM
Quarterly Report
- Net sales decreased year-over-year.
- Gross margin decreased year-over-year.
- Operating income margin decreased year-over-year.
- Net cash from operating activities decreased year-over-year.
Worse than expected
21 February 2025 4:00 PM
Annual Results
- Net sales decreased by 2.9% to $6.318 billion in 2024.
- Operating income margin decreased to 6.9% due to increased employee compensation costs and start-up costs at the Vietnam Facility.
- Net cash provided by operating activities was $1.089 billion, a decrease from the previous year due to changes in working capital and lower operating profits.
Worse than expected
10 February 2025 4:09 PM
Earnings Release
- The full year net sales decreased from $6.503 billion in 2023 to $6.318 billion in 2024.
- The full year operating income decreased from $470 million in 2023 to $438 million in 2024.
- The full year net income attributable to Amkor decreased from $359.813 million in 2023 to $354.012 million in 2024.
Worse than expected
29 October 2024 3:43 PM
Quarterly Report
- The company's gross margin decreased to 14.6% in Q3 2024 from 15.5% in Q3 2023.
- Operating income margin also declined to 8.0% in Q3 2024 from 9.1% in Q3 2023.
- Net income attributable to Amkor was $122.6 million, or $0.49 per diluted share, in Q3 2024, compared to $132.6 million, or $0.54 per diluted share, in Q3 2023.
Better than expected
28 October 2024 4:09 PM
Quarterly Report
- The company's Q3 2024 revenue of $1.86 billion exceeded expectations, showing a 27% sequential increase.
- The company's net income of $123 million and earnings per diluted share of $0.49 were better than expected.
Worse than expected
1 May 2024 3:29 PM
Quarterly Report
- The company's net sales decreased by 7.2% year-over-year, indicating worse than expected results.
Worse than expected
16 February 2024 3:59 PM
Annual Results
- Net sales decreased by 8.3% due to lower sales in the consumer and computing end markets.
- Gross margin decreased to 14.5% due to product mix and lower factory utilization.
- Operating income margin decreased to 7.2% due to lower gross margin and increased R&D expenses.
Worse than expected
5 February 2024 4:09 PM
Quarterly Report
- The company's full year net sales decreased by 8% year-on-year, indicating a decline in overall revenue.
- The company's full year net income decreased significantly from $766 million in 2022 to $360 million in 2023.
- First quarter 2024 guidance anticipates a more than seasonal decline in Communications and weakness in the Automotive & Industrial end market.
Disclaimer: This summary was generated by artificial intelligence and its accuracy is not guaranteed. The information provided here is for general informational purposes only and does not constitute financial advice, recommendation, or endorsement of any kind. It may contain errors or omissions. You should not rely on this information to make financial decisions. Always seek the advice of a qualified financial professional before making any investment or financial decisions. Use of this information is at your own risk.