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Amkor vs. AXT: Which Semiconductor Stock Is the Better Buy Now?
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Key Takeaways
Amkor emerges as the better pick, backed by greater scale, diversification, valuation and earnings outlook.
AXTI's InP revenues hit a record $30.7M, with backlog above $100M and demand outpacing supply.
AMKR posted record Q2 revenues of $1.9B, up 26%, as gross margin rose to 16.8%.
Amkor Technology (AMKR - Free Report) is a major outsourced semiconductor assembly and test provider, offering advanced packaging solutions for AI, high-performance computing, automotive and communications markets. AXT, Inc. (AXTI - Free Report) manufactures compound-semiconductor substrates, including indium phosphide and gallium arsenide, which are used in optical communications and other high-performance applications.
Although the companies serve different parts of the semiconductor supply chain, both are benefiting from rising investment in AI infrastructure. Amkor recently reported record second-quarter 2026 revenues and is expanding its advanced-packaging capacity, while AXT posted record quarterly indium phosphide revenues amid strong data-center optical demand. These developments make AMKR and AXTI an interesting comparison for investors seeking exposure to semiconductor and AI-infrastructure growth.
But which stock offers greater upside potential today? Let’s compare the companies’ recent performance, growth opportunities and key risks to see how AMKR and AXTI stack up.
The Case for AMKR Stock
Amkor offers exposure to the semiconductor supply chain through outsourced semiconductor packaging and test (OSAT), with advanced packaging becoming increasingly important as AI and high-performance computing (HPC) chips grow more complex. The company’s second-quarter 2026 results showed this opportunity gaining traction: revenues reached a record $1.9 billion, up 26% year over year, while gross margin expanded to 16.8% from 12% and net income attributable to Amkor rose to $174 million from $54 million.
Growth prospects are increasingly tied to AI/HPC and advanced packaging. Amkor has active programs spanning 2.5D, high-density fan-out and co-packaged optics, while a new data-center CPU program began ramping in the second quarter and is expected to scale through the second half. Computing revenues rose 20% sequentially in the second quarter and were expected to increase nearly 30% sequentially in the third quarter, driven by AI data-center demand and the HDFO CPU ramp. Automotive & Industrial revenues advanced 17% sequentially, with ADAS the primary growth driver.
Strategic customer agreements strengthen the opportunity. A 10-year advanced-packaging agreement with TSMC is designed to expand U.S. packaging and test capacity, while a multi-year NVIDIA partnership targets next-generation AI infrastructure. Amkor expects a $1.5 billion NVIDIA-related customer prepayment in 2027, with services expected to extend roughly five to 10 years. Its Arizona facility is intended to provide high-volume advanced packaging and test capacity in the United States, while expansions in Korea, Vietnam, Portugal and Taiwan increase geographic flexibility.
However, investors should weigh these opportunities against Amkor’s semiconductor cyclicality, heavy capital requirements, customer concentration, supply-chain and memory constraints, intense OSAT competition and dependence on sustained AI/HPC packaging demand. The company spent $688 million on capital expenditures in the first half and expects $2.5-$3 billion for 2026. Therefore, a slowdown in AI infrastructure investment could lead to excess capacity, lower utilization and pricing pressure.
The Case for AXTI Stock
AXT is benefiting from strong demand for compound-semiconductor substrates as AI data centers increase their use of high-speed optical connectivity. In the second quarter of 2026, revenues surged 164.8% year over year to $47.6 million, while GAAP gross margin expanded to 44.9% from 8% and GAAP net income reached $11.1 million, versus a $7 million loss a year earlier. Substrate revenues rose 232.7% to $37.6 million, driven primarily by InP demand for data centers and passive optical networks.
The strongest opportunity is indium phosphide (InP), which is emerging as the company's primary growth driver. Second-quarter InP revenues reached a record $30.7 million, while backlog exceeded $100 million. Management said customer demand continues to outpace supply and expects InP revenue opportunity to more than triple by year-end 2026. AXT is doubling InP capacity in 2026, plans another major expansion in 2027 and is progressing toward 6-inch InP substrates, which can support higher-value applications. Demand is being driven by 800G/1.6T transceivers and longer-term co-packaged optics.
AXT has recently deepened relationships with key optical-component customers supporting AI data-center connectivity. It has secured supply agreements with Casela and Coherent and a long-term capacity reservation agreement with Lumentum. These agreements provide greater revenue visibility, validate strong customer demand and support AXT’s capacity expansion.
Despite AXT's strong growth prospects, its outlook remains exposed to several operational and geopolitical risks. The company manufactures its wafer substrates in China, making its business vulnerable to changing export controls, tariffs and trade restrictions. Notably, China's export-permit requirement for InP wafers remains a significant concern and can affect the timing of shipments and revenue recognition. AXT also faces semiconductor demand cyclicality, customer order volatility and the risk that major customers reduce, delay or cancel orders. In addition, maintaining high wafer yields and meeting stringent customer specifications are critical, as quality issues can lead to product returns, lower orders and higher manufacturing costs.
How Does the Zacks Consensus Estimate Compare for AMKR & AXTI?
The Zacks Consensus Estimate for AMKR’s 2026 and 2027 revenues stands at $7.64 billion and $8.55 billion, respectively, giving Amkor a significantly larger revenue base than AXT. The consensus mark for AMKR’s 2026 and 2027 earnings is pegged at $2.60 and $2.72 per share, implying growth of 73.3% and 4.3%, respectively. The earnings estimates have remained stable over the past seven days.
Image Source: Zacks Investment Research
In comparison, the Zacks Consensus Estimate for AXTI’s 2026 and 2027 revenues stands at $217.6 million and $453.6 million, respectively. The consensus mark for AXTI’s 2026 and 2027 earnings is pegged at 86 cents and $2.20 per share, indicating 309.8% and 155.8% growth, respectively. AXTI’s earnings estimates have also remained unchanged over the past seven days.
Image Source: Zacks Investment Research
AMKR vs. AXTI: Price Performance & Valuation Check
AMKR has outpaced AXTI over the past month, with its shares gaining 9.8% compared with a 7.7% rise for AXTI, reflecting stronger recent momentum.
AMKR and AXTI Stock’s Performance
Image Source: Zacks Investment Research
From a valuation perspective, AMKR appears more attractively valued than AXTI. Amkor carries a more favorable Zacks Value Score of B, compared with AXTI’s value score of F. AMKR also trades at a forward 12-month price-to-sales ratio of 1.6X, significantly below AXTI’s 12.26X.
AMKR and AXTI Valuation
Image Source: Zacks Investment Research
Final Take
Amkor and AXT are both positioned to benefit from growing AI infrastructure spending, with AMKR benefiting from advanced packaging demand and AXTI from strong InP substrate demand for optical connectivity. AMKR’s growth is supported by expanding AI/HPC packaging programs, strategic partnerships and capacity expansion across key manufacturing locations. AXTI, meanwhile, has a strong InP growth opportunity, supported by record revenues, a growing backlog and capacity expansion plans, but remains more exposed to external factors, including geopolitical and customer-related risks.
However, Amkor’s stronger revenue scale, more diversified business, favorable valuation and solid earnings outlook make it a better pick for investors than AXTI, though both stocks sport a Zacks Rank #1 (Strong Buy) at present.
View the Zacks #1 Rank List
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Amkor vs. AXT: Which Semiconductor Stock Is the Better Buy Now?
Key Takeaways
Amkor Technology (AMKR - Free Report) is a major outsourced semiconductor assembly and test provider, offering advanced packaging solutions for AI, high-performance computing, automotive and communications markets. AXT, Inc. (AXTI - Free Report) manufactures compound-semiconductor substrates, including indium phosphide and gallium arsenide, which are used in optical communications and other high-performance applications.
Although the companies serve different parts of the semiconductor supply chain, both are benefiting from rising investment in AI infrastructure. Amkor recently reported record second-quarter 2026 revenues and is expanding its advanced-packaging capacity, while AXT posted record quarterly indium phosphide revenues amid strong data-center optical demand. These developments make AMKR and AXTI an interesting comparison for investors seeking exposure to semiconductor and AI-infrastructure growth.
But which stock offers greater upside potential today? Let’s compare the companies’ recent performance, growth opportunities and key risks to see how AMKR and AXTI stack up.
The Case for AMKR Stock
Amkor offers exposure to the semiconductor supply chain through outsourced semiconductor packaging and test (OSAT), with advanced packaging becoming increasingly important as AI and high-performance computing (HPC) chips grow more complex. The company’s second-quarter 2026 results showed this opportunity gaining traction: revenues reached a record $1.9 billion, up 26% year over year, while gross margin expanded to 16.8% from 12% and net income attributable to Amkor rose to $174 million from $54 million.
Growth prospects are increasingly tied to AI/HPC and advanced packaging. Amkor has active programs spanning 2.5D, high-density fan-out and co-packaged optics, while a new data-center CPU program began ramping in the second quarter and is expected to scale through the second half. Computing revenues rose 20% sequentially in the second quarter and were expected to increase nearly 30% sequentially in the third quarter, driven by AI data-center demand and the HDFO CPU ramp. Automotive & Industrial revenues advanced 17% sequentially, with ADAS the primary growth driver.
Strategic customer agreements strengthen the opportunity. A 10-year advanced-packaging agreement with TSMC is designed to expand U.S. packaging and test capacity, while a multi-year NVIDIA partnership targets next-generation AI infrastructure. Amkor expects a $1.5 billion NVIDIA-related customer prepayment in 2027, with services expected to extend roughly five to 10 years. Its Arizona facility is intended to provide high-volume advanced packaging and test capacity in the United States, while expansions in Korea, Vietnam, Portugal and Taiwan increase geographic flexibility.
However, investors should weigh these opportunities against Amkor’s semiconductor cyclicality, heavy capital requirements, customer concentration, supply-chain and memory constraints, intense OSAT competition and dependence on sustained AI/HPC packaging demand. The company spent $688 million on capital expenditures in the first half and expects $2.5-$3 billion for 2026. Therefore, a slowdown in AI infrastructure investment could lead to excess capacity, lower utilization and pricing pressure.
The Case for AXTI Stock
AXT is benefiting from strong demand for compound-semiconductor substrates as AI data centers increase their use of high-speed optical connectivity. In the second quarter of 2026, revenues surged 164.8% year over year to $47.6 million, while GAAP gross margin expanded to 44.9% from 8% and GAAP net income reached $11.1 million, versus a $7 million loss a year earlier. Substrate revenues rose 232.7% to $37.6 million, driven primarily by InP demand for data centers and passive optical networks.
The strongest opportunity is indium phosphide (InP), which is emerging as the company's primary growth driver. Second-quarter InP revenues reached a record $30.7 million, while backlog exceeded $100 million. Management said customer demand continues to outpace supply and expects InP revenue opportunity to more than triple by year-end 2026. AXT is doubling InP capacity in 2026, plans another major expansion in 2027 and is progressing toward 6-inch InP substrates, which can support higher-value applications. Demand is being driven by 800G/1.6T transceivers and longer-term co-packaged optics.
AXT has recently deepened relationships with key optical-component customers supporting AI data-center connectivity. It has secured supply agreements with Casela and Coherent and a long-term capacity reservation agreement with Lumentum. These agreements provide greater revenue visibility, validate strong customer demand and support AXT’s capacity expansion.
Despite AXT's strong growth prospects, its outlook remains exposed to several operational and geopolitical risks. The company manufactures its wafer substrates in China, making its business vulnerable to changing export controls, tariffs and trade restrictions. Notably, China's export-permit requirement for InP wafers remains a significant concern and can affect the timing of shipments and revenue recognition. AXT also faces semiconductor demand cyclicality, customer order volatility and the risk that major customers reduce, delay or cancel orders. In addition, maintaining high wafer yields and meeting stringent customer specifications are critical, as quality issues can lead to product returns, lower orders and higher manufacturing costs.
How Does the Zacks Consensus Estimate Compare for AMKR & AXTI?
The Zacks Consensus Estimate for AMKR’s 2026 and 2027 revenues stands at $7.64 billion and $8.55 billion, respectively, giving Amkor a significantly larger revenue base than AXT. The consensus mark for AMKR’s 2026 and 2027 earnings is pegged at $2.60 and $2.72 per share, implying growth of 73.3% and 4.3%, respectively. The earnings estimates have remained stable over the past seven days.
Image Source: Zacks Investment Research
In comparison, the Zacks Consensus Estimate for AXTI’s 2026 and 2027 revenues stands at $217.6 million and $453.6 million, respectively. The consensus mark for AXTI’s 2026 and 2027 earnings is pegged at 86 cents and $2.20 per share, indicating 309.8% and 155.8% growth, respectively. AXTI’s earnings estimates have also remained unchanged over the past seven days.
Image Source: Zacks Investment Research
AMKR vs. AXTI: Price Performance & Valuation Check
AMKR has outpaced AXTI over the past month, with its shares gaining 9.8% compared with a 7.7% rise for AXTI, reflecting stronger recent momentum.
AMKR and AXTI Stock’s Performance
Image Source: Zacks Investment Research
From a valuation perspective, AMKR appears more attractively valued than AXTI. Amkor carries a more favorable Zacks Value Score of B, compared with AXTI’s value score of F. AMKR also trades at a forward 12-month price-to-sales ratio of 1.6X, significantly below AXTI’s 12.26X.
AMKR and AXTI Valuation
Image Source: Zacks Investment Research
Final Take
Amkor and AXT are both positioned to benefit from growing AI infrastructure spending, with AMKR benefiting from advanced packaging demand and AXTI from strong InP substrate demand for optical connectivity. AMKR’s growth is supported by expanding AI/HPC packaging programs, strategic partnerships and capacity expansion across key manufacturing locations. AXTI, meanwhile, has a strong InP growth opportunity, supported by record revenues, a growing backlog and capacity expansion plans, but remains more exposed to external factors, including geopolitical and customer-related risks.
However, Amkor’s stronger revenue scale, more diversified business, favorable valuation and solid earnings outlook make it a better pick for investors than AXTI, though both stocks sport a Zacks Rank #1 (Strong Buy) at present.
You can see the complete list of today’s Zacks #1 Rank stocks here.