Amkor Technology Inc at JPMorgan Global Technology, Media and Communications Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Peter Peng - JPMorgan - Analyst : Okay. Maybe just to start with some of the near-term stuff because that's been pretty topical on top of investor inline. So your first half revenue is better than expected, and you talked about some of the cyclical recovery, but some would argue that the uptake could be some pull-in of demand ahead of the expiration of the 90-day reciprocal tariff brief. Notably, one of your major wireless customer talked about pulling in component inventories near term to mitigate some of this near-term tariff-related challenges. Could you just walk us through the process of how you differentiate between pull-ins and just general and cyclical order improvements?

Question: Peter Peng - JPMorgan - Analyst : Your lead times and your order is relatively short, yet you receive 6, 9, 12 months customers rolling forecast. Have these long-term forecasts evolved since Liberation Day in early April?

Question: Peter Peng - JPMorgan - Analyst : As we look into the second half of the year, I think the company has indicated that the fundamentals remain intact, and you have some company-specific ramp expected. The street is modeling a relatively flat year-over-year revenue profile for the second half of the year. Maybe you can outline some of the potential factors that might lead to upside or downside in the literature.

Question: Peter Peng - JPMorgan - Analyst : Got it. We've been in this prolonged down cycle for quite a while. Maybe you can talk about some of the environment you're seeing? And how has that evolved? . REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 13, 2025 / 5:50PM, AMKR.OQ - Amkor Technology Inc at JPMorgan Global Technology, Media and Communications Conference

Question: Peter Peng - JPMorgan - Analyst : Okay. All right. Let's kind of move to your end market. So starting with the communications segment, and you mentioned about the socket loss. And regarding that, we estimate the revenue headwind from this socket loss in the current generation was approximately 2% to 3% of your total revenues. One is like our estimate is close. And then as we look at the next-generation phones, how should we assess the content gain and share opportunities there?

Question: Peter Peng - JPMorgan - Analyst : Okay. Maybe just longer term, especially with this customer, our revenue exposure for this customer has grown significantly, almost 2.7 times over the past five years, and it's almost a third of your total revenue mix. I guess how are you thinking about share gains and content expansion opportunity with this customer?

Question: Peter Peng - JPMorgan - Analyst : Got it. Okay. Let me stop here and see if there's any questions. Unidentified Participant Yeah. So we talk a little bit about your 2.5D (inaudible) REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 13, 2025 / 5:50PM, AMKR.OQ - Amkor Technology Inc at JPMorgan Global Technology, Media and Communications Conference

Question: Peter Peng - JPMorgan - Analyst : Okay, that's a good segue into the computing market. So you have several growth drivers. Your RDL based technology, the aforementioned 2.5D package solutions, co-package optics, among others, maybe you can rank order these growth drivers in order of significance and discuss how impactful these opportunities are for your business?

Question: Peter Peng - JPMorgan - Analyst : Beyond the H20 head when, one of the that one is your, that marquis customer transition to the CoWoS-R architecture, we estimate that, you guys almost generating close to $200 million revenues for this customer in in 2024. I know you guys, working on the CoWoS-R equivalent technology which should begin to ramp in 2026. So maybe if you can discuss the partnership there and the longer term revenue opportunities with this customer. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 13, 2025 / 5:50PM, AMKR.OQ - Amkor Technology Inc at JPMorgan Global Technology, Media and Communications Conference

Question: Peter Peng - JPMorgan - Analyst : Beyond the merchant GPU market, there's been strong deployments of custom AI accelerators by the cloud and hyperscale providers. Maybe we can discuss some of these engagements and when should we expect your customer base to kind of broaden outside, this customer?

Question: Peter Peng - JPMorgan - Analyst : Another growth driver in the compute space is the ARM-based CPUs and that's gaining traction among the cloud hyperscalers for the data center builds as well as in PCs, just driven by the power efficiency and the adoption of AI. And additionally, these are using some of these more advanced packing solution. You mentioned the RDL based technology. Maybe if you can just kind of discuss your design line pipeline here and help us how to understand the revenue opportunity in this area? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 13, 2025 / 5:50PM, AMKR.OQ - Amkor Technology Inc at JPMorgan Global Technology, Media and Communications Conference

Question: Peter Peng - JPMorgan - Analyst : Okay. Maybe moving towards the automotive and industrial market. That's starting to show some positive inflection, right? And the team indicated that this market has reached its trough. And maybe just kind of comment on what you're seeing there. And then maybe we can then talk about the different trends within that business.

Question: Peter Peng - JPMorgan - Analyst : So we talked about those diverging trends between your advanced product, which is 40% sales and then the mainstream product, which is 60% of sales. Maybe you can provide some context on the growth characteristics of these two segments over the past few years? And then how should we think about that going forward?

Question: Peter Peng - JPMorgan - Analyst : So kind of just summing all up in general, do you think you this segment is something that grow in line with the SARs? Or is this something that's going to be at a growth premium to the auto SARs.

Question: Peter Peng - JPMorgan - Analyst : Just units, auto units.

Question: Peter Peng - JPMorgan - Analyst : Okay. On the -- maybe kind of moving on to testing business. You guys have announced some expansion plans for turnkey solutions and you're starting to prioritize some of this investment in test solutions. It's about 10% to 15% of your business mix. Maybe just kind of elaborate on what opportunities are you pursuing in this testing sector. And then additionally, how are you guys approaching opportunities in the AI testing market?

Question: Peter Peng - JPMorgan - Analyst : Maybe just kind of switching to the financials. You have achieved a 20% gross margin in the past. Currently, there's some head cost wins from ramping up your Vietnam factory and then also just underutilization. Maybe just talk about the key drivers that could help you return to the 20% gross margin level?

Question: Peter Peng - JPMorgan - Analyst : Maybe just on that point on Vietnam. Just given this tariff uncertainty, has that kind of forced you to reevaluate on how you're thinking about your geographic footprint and expansion strategy?

Question: Peter Peng - JPMorgan - Analyst : And then on the Arizona fab, how are you -- what's the timing on that? I think you guys are planning on some constructions in the second half of the year. Maybe just update on timing on how you the Arizona fab and when that goes online?

Question: Peter Peng - JPMorgan - Analyst : How important is the Chips Act to this project. And if the team doesn't receive funding from it, what alternative strategies are there to fund this operation?

Question: Peter Peng - JPMorgan - Analyst : Okay, any questions? Unidentified Participant I just want to revisit your early comment earlier comment on the recovery and you said something about MCUs and auto. So how particularly these legacy chips overall, some of your customers have publicly said that seeing some improvement in the market. How do you -- do you see that playing out? Because you said that there is still some inventory in MCUs, but how has it played out in autos as well?

Question: Peter Peng - JPMorgan - Analyst : We have a few minutes left. If you have any closing remarks?