Amkor Technology just printed a quarter that looks like a different company than the one analysts had on the watchlist a year ago. Q2 revenue rose 25.6% year over year to $1.90 billion, a record; gross margin expanded roughly 480 basis points to 16.8%; operating income more than doubled to $200 million; and diluted earnings per share of $0.70 was a triple - and a more-than-triple - of the $0.22 reported a year earlier. The first half of 2026 was even more striking: revenue up 26.5% to $3.58 billion, operating income up 143% to $300 million, and operating cash flow of $382 million. The story the company tells is that AI-linked packaging - advanced SiP, 2.5D, HDFO, copper hybrid bonding - has shifted the demand mix toward higher-ASP work, and that the Arizona advanced-packaging plant plus the Vietnam ramp are exactly the capacity that mix needs. Management used the earnings call to call out record revenue in Computing and Automotive & Industrial, expansion of strategic partnerships across the semiconductor ecosystem, and continued advancement of key customer programs in AI and HPC.
The other story is the one that does not show up cleanly in the income statement: the capex bill. Amkor spent $688.4 million on property, plant and equipment in the first six months of 2026, more than three times the $226.1 million spent in the first half of 2025, and management raised its full-year 2026 capex guide to a range of $2.5 billion to $3.0 billion. The funding mechanism is now on the balance sheet: in May 2026, the company issued $1.15 billion of 0.00% convertible senior notes due 2031, simultaneously entered into capped-call transactions with a $106.37 strike and a $139.50 cap covering approximately 10.8 million underlying shares, and finished the quarter with $1.55 billion of cash and $960 million of short-term investments against $2.52 billion of total debt. Net of cash and short-term investments, the company is essentially debt-neutral - but the embedded capex program implies that, by year-end, the cash pile will be substantially drawn down and the operating leverage from the next two years of the build is the entire investment case.
The cleanest read of the quarter: the customer pipeline is real, the mix shift is real, and the margin recovery is real, but the company is now in a build cycle whose return depends on volume and utilization holding up through 2027 and 2028. At a $58.21 close on August 13, 2026, Amkor trades at roughly 26x trailing earnings, 22x forward, 10.5x trailing EV/EBITDA, and 1.9x sales, after a roughly 40% pullback from a 52-week high of $96.68 set in mid-June. The pullback is not a thesis break - it is a valuation reset as the market recalibrates how much of the next two years' revenue is already priced in.