What Happened?

Shares of semiconductor packaging and testing company Amkor Technology (NASDAQ:AMKR) fell 11.6% in the pre-market session after the company reported weak fourth-quarter results. Its revenue fell short of Wall Street's estimates, and its revenue guidance for the next quarter missed significantly, indicating a continued slowdown​. The decline was primarily driven by weakness in the automotive, industrial, and communications markets. On the other hand, Amkor blew past analysts' EPS expectations this quarter. Overall, this was a softer quarter.

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What The Market Is Telling Us

Amkor’s shares are quite volatile and have had 18 moves greater than 5% over the last year. But moves this big are rare even for Amkor and indicate this news significantly impacted the market’s perception of the business. 

The biggest move we wrote about over the last year was 4 months ago when the stock dropped 21.2% on the news that the company reported underwhelming third-quarter results, with revenue and EPS guidance for the next quarter falling below analysts' expectations, sending shares lower. In addition, EPS and EBITDA missed, suggesting that profitability might be under pressure. 

On the other hand, Amkor recorded strong improvement in inventory levels and operating margin. However, revenue beat by a narrow margin, despite a sequential growth acceleration, suggesting expectations were likely high heading into the quarter. Overall, this quarter could have been better.

Amkor is down 14.5% since the beginning of the year, and at $22.23 per share, it is trading 50.2% below its 52-week high of $44.68 from July 2024. Investors who bought $1,000 worth of Amkor’s shares 5 years ago would now be looking at an investment worth $1,679.

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