U.S. Markets open in 1 hr 56 mins
  • S&P Futures

    4,293.50
    -4.75 (-0.11%)
     
  • Dow Futures

    33,859.00
    -14.00 (-0.04%)
     
  • Nasdaq Futures

    13,664.25
    -17.00 (-0.12%)
     
  • Russell 2000 Futures

    2,021.50
    -2.30 (-0.11%)
     
  • Crude Oil

    89.81
    +0.40 (+0.45%)
     
  • Gold

    1,791.60
    -6.50 (-0.36%)
     
  • Silver

    20.08
    -0.20 (-0.97%)
     
  • EUR/USD

    1.0126
    -0.0039 (-0.3848%)
     
  • 10-Yr Bond

    2.7910
    0.0000 (0.00%)
     
  • Vix

    20.06
    +0.53 (+2.71%)
     
  • GBP/USD

    1.2020
    -0.0039 (-0.3197%)
     
  • USD/JPY

    134.3780
    +1.1060 (+0.8299%)
     
  • BTC-USD

    24,057.07
    -147.55 (-0.61%)
     
  • CMC Crypto 200

    573.05
    -17.71 (-3.00%)
     
  • FTSE 100

    7,557.42
    +48.27 (+0.64%)
     
  • Nikkei 225

    28,868.91
    -2.87 (-0.01%)
     

Amkor Technology Reports Financial Results for the Second Quarter 2022

  • Oops!
    Something went wrong.
    Please try again later.
·14 min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.

TEMPE, Ariz., August 01, 2022--(BUSINESS WIRE)--Amkor Technology, Inc. (Nasdaq: AMKR), a leading provider of semiconductor packaging and test services, today announced financial results for the second quarter ended June 30, 2022.

Second Quarter 2022 Highlights

  • Net sales $1.5 billion

  • Net income $125 million, earnings per diluted share $0.51

  • EBITDA $302 million

"Amkor delivered record second quarter revenue of $1.5 billion. Demand for Advanced packaging solutions remained strong and drove our Automotive & Industrial end market to 16% year-on-year growth and a new record," said Giel Rutten, Amkor’s president and chief executive officer. "We have returned to normal output levels in Shanghai after a government mandated COVID-19 lockdown, and our global factory network is prepared to support the growth expected in the second half of the year."

Quarterly Financial Results

($ in millions, except per share data)

Q2 2022

Q1 2022

Q2 2021

Net sales

$1,505

$1,597

$1,407

Gross margin

16.6%

20.4%

19.4%

Operating income

$143

$210

$155

Operating income margin

9.5%

13.2%

11.0%

Net income attributable to Amkor

$125

$171

$126

Earnings per diluted share

$0.51

$0.69

$0.51

EBITDA (1)

$302

$363

$295

(1)

EBITDA is a non-GAAP financial measure. The reconciliation to the most directly comparable GAAP financial measure is included below under "Selected Operating Data."

At June 30, 2022, total cash and short-term investments was $1.1 billion, and total debt was $1.1 billion.

The company paid a quarterly dividend of $0.05 per share on June 27, 2022. The declaration and payment of future dividends, as well as any record and payment dates, are subject to the approval of the Board of Directors.

Business Outlook

The following information presents Amkor’s guidance for the third quarter 2022 (unless otherwise noted):

  • Net sales of $1.88 billion to $1.98 billion, a sequential increase of 25% to 32% and a year-on-year increase of 12% to 18%

  • Gross margin of 19.0% to 21.0%

  • Net income of $200 million to $250 million, or $0.82 to $1.02 per diluted share

  • Full year 2022 capital expenditures of approximately $950 million

Conference Call Information

Amkor will conduct a conference call on Monday, August 1, 2022, at 5:00 p.m. Eastern Time. This call may include material information not included in this press release. To access the live audio webcast and the accompanying slide presentation, visit the Investor Relations section of Amkor’s website, located at ir.amkor.com. The live call can also be accessed by dialing 1-877-407-4019 or 1-201-689-8337.

About Amkor Technology, Inc.

Amkor Technology, Inc. is one of the world’s largest providers of outsourced semiconductor packaging and test services. Founded in 1968, Amkor pioneered the outsourcing of IC packaging and test and is now a strategic manufacturing partner for the world’s leading semiconductor companies, foundries and electronics OEMs. Amkor’s operational base includes production facilities, product development centers, and sales and support offices located in key electronics manufacturing regions in Asia, Europe and the USA. For more information visit amkor.com.

AMKOR TECHNOLOGY, INC.

Selected Operating Data

Q2 2022

Q1 2022

Q2 2021

Net Sales Data:

Net sales (in millions):

Advanced products (1)

$

1,084

$

1,157

$

980

Mainstream products (2)

421

440

427

Total net sales

$

1,505

$

1,597

$

1,407

Packaging services

87

%

86

%

85

%

Test services

13

%

14

%

15

%

Net sales from top ten customers

65

%

64

%

61

%

End Market Data:

Communications (smart phones, tablets)

37

%

41

%

40

%

Automotive, industrial and other (ADAS, electrification, infotainment, safety)

23

%

21

%

22

%

Consumer (AR & gaming, connected home, home electronics, wearables)

22

%

19

%

22

%

Computing (data center, infrastructure, PC/laptop, storage)

18

%

19

%

16

%

Total

100

%

100

%

100

%

Gross Margin Data:

Net sales

100.0

%

100.0

%

100.0

%

Cost of sales:

Materials

49.2

%

46.7

%

44.7

%

Labor

11.8

%

11.5

%

13.1

%

Other manufacturing

22.4

%

21.4

%

22.8

%

Gross margin

16.6

%

20.4

%

19.4

%

(1)

Advanced products include flip chip, memory and wafer-level processing and related test services.

(2)

Mainstream products include all other wirebond packaging and related test services.

AMKOR TECHNOLOGY, INC.
Selected Operating Data

In this press release, we refer to EBITDA, which is not defined by U.S. GAAP. We define EBITDA as net income before interest expense, income tax expense and depreciation and amortization. We believe EBITDA to be relevant and useful information to our investors because it provides additional information in assessing our financial operating results. Our management uses EBITDA in evaluating our operating performance, and our ability to service debt, and our ability to fund capital expenditures and pay dividends. However, EBITDA has certain limitations in that it does not reflect the impact of certain expenses on our consolidated statements of income, including interest expense, which is a necessary element of our costs because we have borrowed money in order to finance our operations, income tax expense, which is a necessary element of our costs because taxes are imposed by law, and depreciation and amortization, which is a necessary element of our costs because we use capital assets to generate income. EBITDA should be considered in addition to, and not as a substitute for, or superior to, operating income, net income or other measures of financial performance prepared in accordance with U.S. GAAP. Furthermore, our definition of EBITDA may not be comparable to similarly titled measures reported by other companies. Below is our reconciliation of EBITDA to U.S. GAAP net income.

Non-GAAP Financial Measure Reconciliation:

(in millions)

Q2 2022

Q1 2022

Q2 2021

EBITDA Data:

Net income

$

125

$

171

$

126

Plus: Interest expense

15

14

13

Plus: Income tax expense

11

30

16

Plus: Depreciation & amortization

151

148

140

EBITDA

$

302

$

363

$

295

AMKOR TECHNOLOGY, INC.

CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share data)

(Unaudited)

For the Three Months
Ended June 30,

For the Six Months
Ended June 30,

2022

2021

2022

2021

Net sales

$

1,504,868

$

1,406,535

$

3,101,684

$

2,732,685

Cost of sales

1,255,713

1,133,715

2,527,199

2,194,331

Gross profit

249,155

272,820

574,485

538,354

Selling, general and administrative

68,868

74,189

145,827

150,957

Research and development

37,478

43,516

75,841

87,834

Total operating expenses

106,346

117,705

221,668

238,791

Operating income

142,809

155,115

352,817

299,563

Interest expense

14,593

12,764

28,741

25,437

Other (income) expense, net

(8,041

)

(96

)

(13,137

)

(7

)

Total other expense, net

6,552

12,668

15,604

25,430

Income before taxes

136,257

142,447

337,213

274,133

Income tax expense

10,788

15,989

40,516

27,656

Net income

125,469

126,458

296,697

246,477

Net income attributable to non-controlling interests

(691

)

(652

)

(1,256

)

(862

)

Net income attributable to Amkor

$

124,778

$

125,806

$

295,441

$

245,615

Net income attributable to Amkor per common share:

Basic

$

0.51

$

0.52

$

1.21

$

1.01

Diluted

$

0.51

$

0.51

$

1.20

$

1.00

Shares used in computing per common share amounts:

Basic

244,592

243,863

244,498

243,566

Diluted

245,855

245,551

245,938

245,372

AMKOR TECHNOLOGY, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands)

(Unaudited)

June 30, 2022

December 31, 2021

ASSETS

Current assets:

Cash and cash equivalents

$

733,922

$

826,744

Restricted cash

962

Short-term investments

375,137

251,530

Accounts receivable, net of allowances

1,169,028

1,258,767

Inventories

636,969

484,959

Other current assets

48,831

33,601

Total current assets

2,963,887

2,856,563

Property, plant and equipment, net

3,059,978

2,871,058

Operating lease right of use assets

168,618

159,742

Goodwill

20,787

24,516

Restricted cash

3,451

3,815

Other assets

173,941

122,860

Total assets

$

6,390,662

$

6,038,554

LIABILITIES AND EQUITY

Current liabilities:

Short-term borrowings and current portion of long-term debt

$

127,998

$

153,008

Trade accounts payable

859,455

828,727

Capital expenditures payable

344,301

210,875

Short-term operating lease liability

68,099

64,233

Accrued expenses

385,109

422,892

Total current liabilities

1,784,962

1,679,735

Long-term debt

981,220

984,988

Pension and severance obligations

109,924

120,472

Long-term operating lease liabilities

75,461

83,937

Other non-current liabilities

211,545

196,876

Total liabilities

3,163,112

3,066,008

Stockholders’ equity:

Preferred stock

Common stock

291

290

Additional paid-in capital

1,985,992

1,977,134

Retained earnings

1,434,906

1,163,939

Accumulated other comprehensive income (loss)

(5,747

)

19,978

Treasury stock

(219,147

)

(219,065

)

Total Amkor stockholders’ equity

3,196,295

2,942,276

Non-controlling interests in subsidiaries

31,255

30,270

Total equity

3,227,550

2,972,546

Total liabilities and equity

$

6,390,662

$

6,038,554

AMKOR TECHNOLOGY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

For the Six Months Ended
June 30,

2022

2021

Cash flows from operating activities:

Net income

$

296,697

$

246,477

Depreciation and amortization

299,341

274,991

Other operating activities and non-cash items

(10,041

)

305

Changes in assets and liabilities

(123,728

)

(65,442

)

Net cash provided by operating activities

462,269

456,331

Cash flows from investing activities:

Payments for property, plant and equipment

(340,208

)

(273,617

)

Proceeds from sale of property, plant and equipment

773

2,249

Payments for short-term investments

(298,351

)

(173,307

)

Proceeds from sale of short-term investments

14,120

45,396

Proceeds from maturities of short-term investments

155,910

103,116

Other investing activities

(58,916

)

(25,332

)

Net cash used in investing activities

(526,672

)

(321,495

)

Cash flows from financing activities:

Proceeds from short-term debt

18,112

3,679

Payments of short-term debt

(12,048

)

(10,431

)

Proceeds from issuance of long-term debt

190,000

120,992

Payments of long-term debt

(155,284

)

(184,212

)

Payments of finance lease obligations

(15,943

)

(6,633

)

Payments of dividends

(24,473

)

(29,221

)

Other financing activities

(5,089

)

8,287

Net cash used in financing activities

(4,725

)

(97,539

)

Effect of exchange rate fluctuations on cash, cash equivalents and restricted cash

(25,020

)

(10,274

)

Net increase (decrease) in cash, cash equivalents and restricted cash

(94,148

)

27,023

Cash, cash equivalents and restricted cash, beginning of period

831,521

702,197

Cash, cash equivalents and restricted cash, end of period

$

737,373

$

729,220

Forward-Looking Statement Disclaimer

This press release contains forward-looking statements within the meaning of the federal securities laws. You are cautioned not to place undue reliance on forward-looking statements, which are often characterized by terminology such as "may," "will," "should," "expects," "plans," "anticipates," "believes," "estimates," "predicts," "potential," "continue" or "intend," by the negative of these terms or other comparable terminology or by discussions of strategy, plans or intentions. All forward-looking statements in this press release are made based on our current expectations, forecasts, estimates and assumptions. Because such statements include risks and uncertainties, actual results may differ materially from those anticipated in such forward-looking statements as a result of various factors, including, but not limited to, the following:

  • health conditions or pandemics, such as COVID-19, impacting labor availability and operating capacity, capital availability, the supply chain and consumer demand for our customers’ products and services;

  • dependence on the highly cyclical, volatile semiconductor industry;

  • industry downturns and declines in global economic and financial conditions;

  • changes in costs, quality, availability and delivery times of raw materials, components and equipment, including any disruption in the supply of certain materials due to regulations and customer requirements, as well as supply constraints, production delays, fluctuations in commodity prices and wage inflation;

  • dependence on international factories and operations and risks relating to our customers’ and vendors’ international operations;

  • our substantial indebtedness and restrictive covenants in the indentures and agreements governing our current and future indebtedness;

  • fluctuations in interest rates and changes in credit risk;

  • difficulty funding our liquidity needs;

  • dependence on key customers or concentration of customers in certain end markets, such as Communications and Automotive and Industrial;

  • fluctuation in demand for semiconductors and conditions in the semiconductor industry generally, as well as by specific customers, such as inventory reductions by our customers impacting demand in key markets;

  • our substantial investments in equipment and facilities to support the demand of our customers;

  • difficulty attracting, retaining or replacing qualified personnel;

  • difficulty achieving high capacity utilization rates due to high percentage of fixed costs;

  • changes in our capacity and capacity utilization rates and fluctuations in our manufacturing yields;

  • competition with established competitors in the packaging and test business, the internal capabilities of integrated device manufacturers and new competitors, including foundries;

  • decisions by our integrated device manufacturer and foundry customers to curtail outsourcing;

  • maintaining an effective system of internal controls;

  • the absence of backlog, the short-term nature of our customers’ commitments, double bookings by customers and deterioration in customer forecasts and the impact of these factors, including the possible delay, rescheduling and cancellation of large orders, or the timing and volume of orders relative to our production capacity;

  • the development, transition and ramp to high volume manufacture of more advanced silicon nodes and evolving wafer, packaging and test services technologies, which may cause production delays, lower manufacturing yields and supply constraints for new wafers and other materials;

  • the historical downward pressure on the prices of our packaging and test services;

  • laws, rules, regulations and policies imposed by U.S. or other governments, such as tariffs, customs, duties and other restrictive trade barriers and national security, data privacy and cybersecurity, antitrust and competition, tax, currency and banking, labor, environmental, health and safety laws;

  • laws, rules, regulations and policies within China and other countries that may favor domestic companies over non-domestic companies, including customer- or government-supported efforts to promote the development and growth of local competitors;

  • fluctuations in currency exchange rates, particularly the dollar/yen exchange rate for our operations in Japan;

  • any warranty claims, product return and liability risks, and the risk of negative publicity if our products fail, as well as the risk of litigation incident to our business;

  • the possibility that we may decrease or suspend our quarterly dividend;

  • our continuing development and implementation of changes to, and maintenance and security of, our information technology systems;

  • challenges with integrating diverse operations;

  • any changes in tax laws, taxing authorities not agreeing with our interpretation of applicable tax laws, including whether we continue to qualify for tax holidays, or any requirements to establish or adjust valuation allowances on deferred tax assets;

  • our ability to develop new proprietary technology, protect our proprietary technology, operate without infringing the proprietary rights of others and implement new technologies;

  • our significant severance plan obligations associated with our manufacturing operations in Korea;

  • natural disasters and other calamities, political instability, hostilities or other disruptions; and

  • the ability of certain of our stockholders to effectively determine or substantially influence the outcome of matters requiring stockholder approval.

Other important risk factors that could affect the outcome of the events set forth in these statements and that could affect our operating results and financial condition are discussed in the company’s Annual Report on Form 10-K for the year ended December 31, 2021 (the "Form 10-K") and from time to time in our other reports filed with or furnished to the Securities and Exchange Commission ("SEC"). You should carefully consider the trends, risks and uncertainties described in this press release, the Form 10-K and other reports filed with or furnished to the SEC before making any investment decision with respect to our securities. If any of these trends, risks or uncertainties continues or occurs, our business, financial condition or operating results could be materially and adversely affected, the trading prices of our securities could decline, and you could lose part or all of your investment. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by this cautionary statement. We assume no obligation to review or update any forward-looking statements to reflect events or circumstances occurring after the date of this press release except as may be required by applicable law.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220801005625/en/

Contacts

Jennifer Jue
Senior Director, Investor Relations and Finance
480-786-7594
jennifer.jue@amkor.com