Amkor Technology, Inc. (Ticker: AMKR) is a crucial player behind the scenes in the world of electronics, helping to bring the tiny brains of our devices to life.

The Business Model (How They Make Money)

Amkor Technology is like a specialized factory for semiconductor chips, which are the tiny electronic brains found in everything from your smartphone to advanced artificial intelligence (AI) systems and cars. Instead of designing these chips themselves, Amkor focuses on two critical steps after a chip is designed: packaging and testing.

Think of it this way: a raw semiconductor chip coming out of a silicon factory is very fragile and can't be directly used in an electronic device. Amkor takes these delicate chips and puts them into protective "packages" that allow them to connect to circuit boards and withstand the rigors of daily use. They offer a wide range of packaging solutions, including advanced packaging, wafer-level processing, and system-in-package solutions. After packaging, they rigorously test these chips to ensure they work perfectly before they are sent to electronics manufacturers.

This allows their customers, which include leading semiconductor companies, to focus on designing innovative chips, while Amkor handles the complex and capital-intensive manufacturing steps to make them functional and reliable. Their primary revenue streams come directly from these packaging and testing services, especially for high-growth areas like high-performance computing and artificial intelligence.

For the full year 2025, Amkor Technology reported net sales of $6.71 billion. More recently, their revenue for the last twelve months (TTM) as of June 30, 2026, was $7.45 billion.

The Metrics That Matter Most

To understand Amkor Technology's financial health and how well it's executing its business, here are the most important metrics to watch:

1. Revenue: This is the total amount of money Amkor brings in from selling its packaging and testing services. For a company that thrives on the overall demand for electronic devices and the chips inside them, growing revenue shows that Amkor is capturing more business and expanding its reach in the semiconductor market. In 2025, Amkor's net sales were $6.71 billion.
2. Gross Margin: This metric tells you how much money Amkor has left from its sales after paying for the direct costs of making its products, such as materials and the labor involved in packaging and testing. In a manufacturing business like Amkor's, a healthy and consistent gross margin indicates efficient operations and good control over its production costs, which is vital for long-term profitability. For the full year 2025, Amkor's gross margin was 14.0%.
3. Capital Expenditures (CapEx): This represents the money Amkor spends on buying, maintaining, or improving its physical assets, like its factories, advanced machinery, and specialized packaging equipment. For a company in the semiconductor packaging industry, significant CapEx is essential to stay competitive, invest in new technologies (especially for advanced packaging needed for AI), and expand its capacity to meet growing customer demand. It shows their commitment to future growth and technological leadership. For example, Amkor's capital expenditures totaled $904.6 million in 2025, with an expectation of approximately $2.5 billion to $3.0 billion for 2026, primarily for a new facility in Arizona.
4. Free Cash Flow: This is the cash a company generates after covering its day-to-day operating expenses and making the necessary investments in its business (like CapEx). For Amkor, positive and growing free cash flow means they are generating enough cash from their core business to fund their growth initiatives and still have money left over. This leftover cash can be used for things like paying down debt or returning money to shareholders. In 2025, Amkor reported free cash flow of $308 million.

How to Value This Company

The most relevant valuation metric for Amkor Technology's business model is EV/EBITDA (Enterprise Value to Earnings Before Interest, Taxes, Depreciation, and Amortization).

Here's why: Amkor is a capital-intensive company, meaning it owns a lot of physical assets like factories and equipment, and it often takes on debt to fund these investments. The EV/EBITDA ratio helps you figure out if the stock is cheap or expensive by looking at the company's total value (its "Enterprise Value," which includes both its stock market value and its debt) compared to its operating earnings before certain non-cash expenses (like depreciation and amortization) and financing costs.

This metric is particularly useful for Amkor because it removes the impact of different ways companies account for depreciation (which can vary) and also accounts for the debt a company carries. By using EV/EBITDA, you get a clearer picture of how much you're paying for the company's core business operations, making it easier to compare Amkor to other similar companies in the capital-intensive semiconductor industry, regardless of their specific accounting practices or debt levels. For 2025, Amkor's EBITDA was $1.16 billion.