Amkor and Nvidia expand partnership with $1.3 billion South Korea deal
Key Facts
Amkor Technology announced a new $1.3 billion agreement with Nvidia in October 2026 to expand production capacity in South Korea as part of their AI chip packaging partnership. According to an Amkor statement, the companies' multiyear agreements in Arizona and South Korea total $3 billion. The partnership uses advance payments to align Amkor's manufacturing capacity with Nvidia's long-term growth plans. The upfront funding is tied to arranging the manufacturing capacity Nvidia needs under those plans, according to the mechanism Amkor described in its expansion announcement. Following the announcement, Amkor shares rose 8.4% in premarket trading on October 21, 2026, according to Investing.com, in response to the new agreement.
The South Korean expansion aims to increase interposer chip production capacity by more than 300% by the end of 2028, according to Nvidia's announcement on expanding supply chain capacity for AI infrastructure. Describing the scale of demand and the obstacle to meeting the needs of this expansion, Jensen Huang said: "Demand is extraordinary, and production capacity is the constraint." Huang linked the ability to scale AI infrastructure to the availability of the necessary production capacity at supply chain partners. Amkor, for its part, linked the importance of advanced packaging to improving the performance of upcoming computing systems, alongside their energy efficiency. The company's statement also listed integration between those systems' components among the benefits supported by advanced packaging, in its account of the role these capabilities play in the partnership.
The current collaboration builds on an earlier $1.5 billion partnership Amkor announced in July 2026 to support the expansion of advanced packaging capabilities in the United States. The company described the July deal as a multiyear advanced packaging and development agreement, as part of its collaboration with Nvidia on U.S. capabilities. The companies' joint development roadmap includes high-density interconnects, according to Amkor's statement on that partnership. It also includes next-generation heterogeneous integration as part of the development of packaging technologies. Amkor was already providing packaging solutions for Nvidia platforms, including data center processors and networking chips, before the new agreement was announced. When the July agreement was announced, Amkor shares jumped 17% in extended trading on July 23, 2026, according to Reuters.
On the U.S. side of Amkor's expansion, the company announced in September that it was raising planned investment in its Arizona packaging and testing campus to about $12 billion. The project's second phase is planned to add 60,000 square meters of cleanrooms to the campus, according to the company's announcement on the facility's expansion. The Arizona project forms part of a broader collaboration in the state, including an agreement Amkor reached with Taiwan Semiconductor Manufacturing Co. in June 2026. That agreement runs for 10 years and aims to strengthen advanced packaging capabilities in Arizona, according to Amkor's statement on the long-term partnership. The agreement includes a framework for the Taiwanese company to purchase packaging and testing services from Amkor, alongside the goal of strengthening domestic capabilities announced by the companies.
On financial performance, Amkor reported net sales of $1.90 billion in the second quarter of 2026, according to its earnings statement for the period. That represents a year-on-year increase of 26%, based on the company's comparison with the corresponding period a year earlier. In guidance accompanying the earnings announcement, Amkor forecast third-quarter sales of between $1.95 billion and $2.05 billion. Both the low and high ends of the third-quarter sales forecast exceed recorded second-quarter sales, according to the figures announced by the company. The financial guidance also included expected capital expenditure of about $2.5 billion to $3.0 billion for fiscal 2026, alongside plans to expand manufacturing capacity.
Amkor will announce third-quarter results on Monday, October 26, 2026, following its disclosure of the expansion agreement with Nvidia. The company scheduled the release for after the market close that day, according to its earnings date announcement. Its earnings call will take place at five p.m. Eastern time on October 26, 2026, as part of the third-quarter reporting schedule. Over the longer term, Amkor expects to begin construction on the second phase of its Arizona campus in late 2027, according to the timetable announced for the U.S. project. The company aims to complete construction of that phase by the end of 2029, concluding the period it set for implementing the campus's additional expansion.