Amkor's Q2 2025 Earnings Call: Navigating Contradictions in Automotive Growth, Trade Effects, and Margin Outlook

Automotive market growth expectations, effect of trade restrictions on 2.5D program, customer conversation and market growth expectations, 2.5D production and capacity expansion, and gross margin flow-through and strategic investments are the key contradictions discussed in Amkor Technology's latest 2025Q2 earnings call.



Revenue Growth and Market Diversification:
- Amkor Technology reported second quarter revenue of $1.51 billion, an increase of 14% sequentially and 3% year-on-year.
- Growth was driven by strong demand across all end markets, including communications, computing, automotive, and industrial markets.

Strategic Investments and Capacity Expansion:
- The company's computing revenue increased by 16% from the first quarter, with an 18% year-over-year growth in the first half of 2025.
- This growth is attributed to investments in advanced packaging and test solutions, supporting the expanding AI and high-performance computing demand.

Rationalization of Manufacturing Footprint:
- Amkor is planning to optimize its manufacturing footprint by considering the rationalization of 7 factories in Japan to align capacity with market conditions.
- This action is aimed at improving profitability by addressing underutilized assets and streamlining operations.

Expansion Into Edge Devices and AI Integration:
- In response to AI expanding into edge devices, Amkor is working closely with lead customers to assess future device needs and develop advanced packaging solutions.
- This strategy places Amkor as a trusted partner to the world's largest semiconductor companies, positioning it for growth in the AI domain.