Company: AMKR
Filing Date: 2025-07-29
Form Type: 10-Q
Source: 0001047127-25-000168
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Company: AMKOR TECHNOLOGY, INC.
Filing Date: 2025-07-29
Form: 10-Q
Item: Part I, Item 3
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Item 3.        Quantitative and Qualitative Disclosures about Market Risk

Market Risk Sensitivity

We are exposed to market risks, primarily related to foreign currency and interest rate fluctuations.  In the normal course of business, we employ established policies and procedures to manage the exposure to fluctuations in foreign currency values and changes in interest rates. 

Foreign Currency Risk

The U.S. dollar is our reporting and functional currency for our subsidiaries, except for our Japan operations, where the Japanese yen is the functional currency.  In order to reduce our exposure to foreign currency gains and losses, we use natural hedging techniques and forward contracts to mitigate foreign currency risk.

We have foreign currency exchange rate risk associated with the remeasurement of monetary assets and liabilities on our Consolidated Balance Sheets that are denominated in currencies other than the functional currency.  We performed a sensitivity analysis of our foreign currency exposure as of June 30, 2025 to assess the potential impact of fluctuations in exchange rates for all foreign denominated assets and liabilities.  Assuming that all foreign currencies appreciated 10% against the U.S. dollar and taking into account our foreign currency forward contracts, our income before taxes for the six months ended June 30, 2025 would have been approximately $16 million lower, due to the remeasurement of monetary assets and liabilities. 

In addition, we have foreign currency exchange rate exposure on our results of operations.  For the six months ended June 30, 2025, approximately 90% of our net sales were denominated in U.S. dollars.  Our remaining net sales were 

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principally denominated in Japanese yen.  For the six months ended June 30, 2025, approximately 55% of our cost of sales and operating expenses were denominated in U.S. dollars and were largely for raw materials and costs associated with property, plant and equipment.  The remaining portion of our cost of sales and operating expenses was principally denominated in the Asian currencies where our production facilities are located and largely consisted of labor.  To the extent that the U.S. dollar weakens against these Asian-based currencies, similar foreign currency denominated income and expenses in the future will result in higher sales, higher cost of sales and operating expenses, with cost of sales and operating expenses having the greater impact on our financial results.  Similarly, our sales, cost of sales and operating expenses will decrease if the U.S. dollar strengthens against these foreign currencies.