Company: AMKR
Filing Date: 2025-10-28
Form Type: 10-Q
Source: 0001047127-25-000190
Chunk: 71

Company: AMKOR TECHNOLOGY, INC.
Filing Date: 2025-10-28
Form: 10-Q
Item: Part II, Item 1A
Chunk 71
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 from the negative publicity associated with such a lawsuit or with adverse public perceptions in general regarding our customers’ products.  Further, if our packages are delivered with defects, we could incur additional development, repair or replacement costs or suffer other economic losses, and our credibility and the market’s acceptance of our packages could be harmed.

Due to our high percentage of fixed costs, we may be unable to maintain satisfactory gross margins if we are unable to achieve relatively high-capacity utilization rates.

Our operations are characterized by high fixed costs and the absence of any material backlog.  Our profitability depends in part not only on pricing levels for our packaging and test services but also on the efficient utilization of our human resources and packaging and test equipment.  Increases or decreases in our capacity utilization can significantly affect gross margins.  Transitions between different packaging technologies can also impact our capacity utilization if we do not efficiently redeploy our equipment for other packaging and test opportunities.  We cannot assure you that we will be 

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able to achieve consistently high-capacity utilization, and if we fail to do so, our gross margins may be negatively impacted.  

In addition, our fixed operating costs have increased as a result of capital expenditures for capacity expansion.  The anticipated customer demand for which we have made capital investments may not materialize, and our sales may not adequately cover fixed costs, resulting in reduced profit levels or even significant losses, either of which may materially and adversely impact our business, liquidity, results of operations, financial condition and cash flows.

The lack of contractually committed customer demand may materially and adversely affect our sales.

Our packaging and test business does not typically operate with any material backlog.  Our quarterly net sales from packaging and test services are substantially dependent upon our customers’ demand in that quarter.  Generally, our customers do not commit to purchase any significant amount of packaging or test services or provide us with binding forecasts of demand for packaging and test services for any future period, in any material amount.  In addition, we sometimes experience double booking by customers, and our customers often reduce, cancel or delay their purchases of packaging and test services for a variety of reasons, including industry-wide, customer-specific and Amkor-specific reasons.  This makes it difficult for us to forecast our capacity utilization and net sales in future periods.  Since a large portion of our costs is fixed and our expense levels are based in part on our expectations of future sales, we may not be able to adjust costs in a timely manner to compensate for any sales shortfall.  If we are