Amkor Technology, Inc. (AMKR) drops on deep earnings miss
Amkor Technology, Inc. (AMKR) drops after missing third-quarter EPS and revenue estimates, but the real story is deeper than the headline. Advanced packaging and computing strength lifted margins, while communications weakness and a softer fourth-quarter guide kept investors cautious despite record pockets of growth.
Amkor Technology (NASDAQ: AMKR) fell after reporting third-quarter 2026 results that missed both EPS and revenue estimates, even as gross margin improved on stronger advanced packaging mix. Investors are focusing on the weaker communications outlook and a softer fourth-quarter guide, which outweighed record computing and automotive revenue growth.
Amkor Technology, Inc. (AMKR) drops 6.34% to $36.81 after its third-quarter 2026 earnings missed both EPS and revenue estimates. AMKR posted $0.76 EPS on $1.99B revenue, below $0.783 and $2.04B consensus, while trading volume reached 21.3M shares against a 4.63M average. The mixed signal is stark: advanced packaging lifted margins, but weaker communications and a softer fourth-quarter guide kept the market skeptical.
Amkor Technology, Inc. (AMKR) drops after earnings miss
Key Takeaways
AMKR earnings missed consensus: EPS was $0.76 versus $0.783 expected, while revenue was $1.99B versus $2.04B.
Computing revenue rose 25% sequentially to a record, while Automotive and Industrial revenue increased 7% sequentially to another record.
Communications revenue fell 8% sequentially, and management expects another high-single-digit decline in the fourth quarter.
Fourth-quarter guidance calls for $1.9B to $2B in revenue and $0.65 to $0.75 in EPS, with gross margin of 18% to 19%.
CEO Kevin Engel tied the long-term growth story to advanced packaging, customer commitments, HDFO, 2.5D programs, and capacity expansion in Arizona and Asia.
The initial after-hours move was a 5.98% gain to $39.05, but the latest regular-session price was $36.81. B. Riley Securities cut its price target to $46 from $65 while keeping a Neutral rating.
AMKR Earnings Financial Performance: Computing Drives the Mix
Amkor generated $1.99B of third-quarter revenue, up 5% sequentially from $1.90B in the second quarter. Revenue matched the $1.99B reported in the third quarter of 2025, but the earnings profile improved sharply. Net income reached $191M, compared with $170M in the second quarter, $80M in the first quarter, and $130M in the year-earlier quarter.
The end-market split explains the result. Computing revenue rose 25% sequentially, supported by the ramp of Amkor's flagship HDFO CPU program and additional data-center programs. Automotive and Industrial revenue increased 7% sequentially, driven by ADAS and industrial products across multiple customers. Both markets reached record revenue.
The pressure came from Communications, which declined 8% sequentially. Component shortages affected premium smartphones and IoT wearables. Consumer revenue still increased 10% sequentially, helped by IoT and home electronics, but smartphone component shortages remain a direct drag on the product mix.
Gross margin expanded to 18.3%, up 150 basis points sequentially and 400 basis points year over year. Gross profit was $364M. Operating expenses totaled $139M, producing $225M of operating income and an 11.3% operating margin. EBITDA reached $435M, equal to a 21.8% EBITDA margin.
The margin improvement reflects a richer mix of advanced packaging in Computing and Automotive. Foreign exchange and the July earthquake at the Kumamoto, Japan facility reduced gross margin by about 60 basis points sequentially. The Japan facility returned to full operations during the quarter.
EPS also shows a sharp recovery across the recent earnings history. The $0.76 result compares with $0.70 in the second quarter, $0.34 in the first quarter, $0.69 in the fourth quarter of 2025, and $0.51 in the third quarter of 2025. Still, the quarter missed the $0.783 consensus estimate, so improved profitability did not fully clear the market's bar.
The fourth-quarter outlook adds a second concern. Amkor expects revenue of $1.9B to $2B, gross margin of 18% to 19%, operating expenses near $140M, net income of $160M to $185M, and EPS of $0.65 to $0.75. Computing revenue is expected to rise at a low-double-digit sequential rate, while Automotive and Industrial revenue is expected to increase at a low-single-digit rate. Communications is expected to decline at a high-single-digit rate, and Consumer revenue is expected to fall into the mid-teens sequentially.
Amkor also narrowed its 2026 capital spending estimate to around $2.5B. The company expects a step-up in capital spending during 2027 as Arizona, Korea, and Vietnam capacity expands. Customer advance payments from arrangements with a dozen customers since 2025 provide funding support for those investments.
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AMKR's initial after-hours reaction was positive despite the double miss. The stock rose about 5.98% to $39.05 after the results. The latest regular-session quote then showed a 6.34% decline to $36.81, with 21,275,218 shares traded versus an average volume of 4,627,728 shares. That reversal points to a market weighing the long-term advanced-packaging story against near-term guidance.
The clearest target action around the earnings window came from B. Riley Securities on October 20, 2026. The firm lowered its AMKR price target to $46 from $65 and kept a Neutral rating. Its setup emphasized HDFO compute strength alongside Communications risk, which matches the central tension in the reported quarter.
The broader analyst distribution remains constructive but hardly unanimous. AMKR has seven Buy ratings, six Holds, and one Sell, producing a consensus rating of Buy. That split fits the numbers: Computing and Automotive are accelerating, while handset exposure and heavy capacity spending create near-term execution risk.
Management Commentary: Advanced Packaging Takes Center Stage
CEO Kevin Engel framed the quarter as proof that Amkor's business mix is changing. He pointed to earlier customer engagement, longer-term capacity commitments, and advanced packaging demand tied to AI and high-performance computing.
“Advanced packaging is on the critical path of system performance.” - Kevin Engel, CEO, AMKR earnings call
Engel also highlighted the scale of the geographic build-out. Phase 2 of the Arizona campus is planned to bring the total campus to more than 90,000 square meters of clean-room space, with an estimated $12B investment and a workforce of more than 3,500 employees when fully ramped. In Korea, new buildings at Gwangju and Songdo will support HDFO, test capacity, and data-center demand. Vietnam will become Amkor's SiP center of excellence as production shifts from Korea.
CFO Megan Faust focused on the financial effect of the mix shift and the discipline behind the investment plan.
Faust's guidance puts the trade-off in plain English. Compute growth supports margins, but Communications and Consumer weakness limits total revenue growth. The balance sheet gives Amkor $2.4B in cash and short-term investments, $3.4B in total liquidity, and $2.5B in debt. Debt to EBITDA stood at 1.7x.
Bank of America analyst Ruplu Bhattacharya pressed management on the quality of the planned fourth-quarter margin improvement. His question linked the 20-basis-point sequential margin expansion to the SiP move to Vietnam, Android weakness, foreign exchange, and Japan.
“You're guiding to about 20 bps of sequential gross margin improvement for the fourth quarter. How should we think about the impact of the SiP migration to Vietnam as well as weakness in the Android smartphone market?” - Ruplu Bhattacharya, Bank of America, AMKR earnings call
“That's primarily due to favorable product mix as it relates to further growth in our compute. And then I would say, lower SiP.” - Megan Faust, CFO, AMKR earnings call
Faust then conceded that foreign exchange remains unfavorable and that both major smartphone ecosystems face pressure. She said Android revenue would decline in the fourth quarter versus the third quarter, while iOS revenue would also decline. That answer reinforces the margin thesis: advanced compute mix, rather than a handset rebound, is carrying the improvement.
Bhattacharya's follow-up shifted from quarterly margins to customer concentration and capital allocation. He referenced the NVIDIA (NVDA) agreement and asked how roughly $3B of total prepayments would divide between South Korea and Arizona. He also asked whether margins, capital returns, and equipment flexibility would differ between the sites.
“With this new announced agreement with NVIDIA, it looks like total prepayments are now about $3 billion. Kevin, how should we think about the division of programs between South Korea and Arizona?” - Ruplu Bhattacharya, Bank of America, AMKR earnings call
“When we think about the mix between Korea versus Arizona, obviously, for Korea, we're ramping today.” - Kevin Engel, CEO, AMKR earnings call
Engel's response centered on the operating sequence in Korea. SiP migration to Vietnam is freeing Korean clean-room space, Songdo capacity is scheduled to support the next ramp, and two new Gwangju buildings are aimed at later advanced-packaging growth. The message was practical: Korea handles the active ramp, while Arizona supports the longer capacity plan.
Bottom Line
This Amkor Technology, Inc. earnings analysis points to an improving business with a demanding investment cycle. AMKR earnings show stronger margins and powerful Computing growth, but the $0.76 EPS miss, Communications decline, and $0.65 to $0.75 fourth-quarter EPS guide explain the sharp regular-session drop. The investment case now rests on Amkor converting HDFO and 2.5D customer commitments into profitable capacity without allowing handset weakness and capital spending to dilute returns.
+Why did Amkor Technology stock drop after earnings?
Amkor Technology (AMKR) fell after reporting third-quarter 2026 EPS of $0.76 and revenue of $1.99 billion, both below consensus estimates of $0.783 and $2.04 billion. The market also reacted to fourth-quarter guidance that called for lower EPS and continued weakness in communications and consumer demand.
+Did Amkor beat or miss earnings estimates in Q3 2026?
Amkor missed both earnings and revenue estimates in Q3 2026. The company reported $0.76 EPS versus $0.783 expected and $1.99 billion in revenue versus $2.04 billion consensus.
+What was Amkor's Q4 2026 guidance?
Amkor guided fourth-quarter 2026 revenue to $1.9 billion to $2.0 billion and EPS to $0.65 to $0.75. Management also projected gross margin of 18% to 19% and said communications revenue should decline at a high-single-digit rate.
+Which business segments helped and hurt Amkor's quarter?
Computing revenue rose 25% sequentially to a record, and Automotive and Industrial revenue increased 7% sequentially to another record. Communications revenue fell 8% sequentially, and management said it expects another high-single-digit decline in the fourth quarter.
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