Company: AMKR
Filing Date: 2025-04-29
Form Type: 10-Q
Source: 0001047127-25-000087
Chunk: 58

Company: AMKOR TECHNOLOGY, INC.
Filing Date: 2025-04-29
Form: 10-Q
Item: Part I, Item 4
Chunk 58
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 health and safety practices with shifting customer preferences, we could suffer reputational harm, which could have a material and adverse effect on our business, results of operations, liquidity and cash flows.

There has also been an increase in regulatory and public attention and industry and customer focus on the materials contained in semiconductor products, the environmental impact of semiconductor operations and the risk of chemical releases from such operations, climate change, sustainability and related environmental concerns.  Increased regulation of and restriction on the use of hazardous substances may impact our supply chain due to decreased availability, necessitate changes in our packaging processes, require us to seek substitutes that may not be readily available in the marketplace or eliminate the use of such hazardous substances although there may not be a technically feasible alternative.  This increased focus on sustainability and the environmental impact of semiconductor operations and products has caused industry groups and customers to impose additional requirements on us and our suppliers, sometimes exceeding regulatory standards.  These industry and customer requirements include increased tracking and reporting of GHG emissions, reductions in waste and wastewater from operations, additional reporting on the materials and components used in the products for which we perform our services, and the use of renewable energy sources in our factory operations.  In addition, recent and ongoing changes to climate change regulation could increase our compliance costs, including as a result of carbon pricing impacts on electrical utilities as well as increased indirect costs resulting from our customers, suppliers, and other stakeholders incurring additional compliance costs that are passed on to us.  We have started to incur compliance costs within our existing manufacturing infrastructure, and such costs may increase as we expand our manufacturing capacity.  To comply with these additional requirements, we may need to procure additional, or increase the use of, renewable energy, procure additional equipment or make factory or process changes, which could result in increased operating costs.

The awards and incentives from the agreement with Commerce pursuant to the CHIPS Act might not materialize as such awards and incentives are conditional upon achieving or maintaining certain outcomes and compliance with other obligations, are subject to reduction, termination, or clawback and would impose certain restrictions on our business.

In December 2024, Commerce awarded us up to $407 million in direct funding pursuant to the CHIPS Act for the Arizona Facility.  This award requires us to achieve construction and production milestones and restricts us from undertaking certain activities.  We cannot guarantee that we will successfully achieve and maintain outcomes or be able to comply with other obligations required to qualify for this award or that Commerce will provide or continue to provide such funding.  The award arrangements provide Commerce