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ASX vs. AMKR: Which Chip Packaging Stock Should You Buy Right Now?
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Key Takeaways
ASX expects LEAP revenues to double in 2027 as AI demand drives advanced packaging growth.
ASX added $2 billion to 2026 CapEx plans, while ATM gross margin is expected to exceed 30% in Q4.
AMKR faces weak smartphone demand and production shifts that could weigh on communications growth.
ASE Technology Holding (ASX - Free Report) and Amkor Technology (AMKR - Free Report) are both major players in the semiconductor industry, specializing in outsourced semiconductor assembly and testing. ASE Technology provides outsourced semiconductor assembly, packaging and testing services, while Amkor Technology is a major outsourced semiconductor packaging and test provider, helping chipmakers integrate and validate increasingly complex devices.
Both ASX and AMKR are well-positioned to benefit from growing demand for advanced semiconductor packaging and testing, as AI adoption, increasingly complex chip designs and rising investment in high-performance computing drive demand for specialized semiconductor solutions. However, from an investment point of view, one stock offers a more favorable outlook than the other right now. Let’s break down their fundamentals, growth prospects, market challenges and valuation to determine which stock offers a more compelling investment case.
The Case for ASX Stock
ASE Technology is seeing strong demand for its leading-edge advanced packaging (LEAP) services as the growth of AI increases demand for more complex semiconductor packaging and testing. LEAP revenues are tracking ahead of the company’s earlier 2026 target of $3.5 billion. Management now expects to add another few hundred million dollars to this year's LEAP revenues and is targeting a doubling of LEAP revenues in 2027.
The company has clear visibility into customer demand and the capacity needed to support this growth. ASX plans to add facilities and equipment to expand LEAP capacity, with another $2 billion of CapEx added to its 2026 plans. Management said the company expects to continue making heavy investments in both advanced packaging and testing to support customer demand.
The growth is already showing up in ASX's results. In the second quarter of 2026, ATM revenues rose 36% year over year to TWD 126.1 billion. Higher LEAP volumes also helped lift ATM gross margin to 27.3% from 21.9% a year earlier. Management expects LEAP and test businesses to remain margin accretive and sees ATM gross margin moving above 30% in the fourth quarter of 2026.
Still, execution remains a key factor. ASX said its near-term growth is limited by how quickly it can install equipment and complete new facilities. ASX is working on 13 greenfield and eight brownfield projects. These projects are expected to provide capacity through 2028 and into part of 2029. However, managing so many projects at the same time might create execution risks, particularly around construction, equipment installation and meeting required timelines.
Nonetheless, strong AI-related demand, expanding capacity and higher-margin LEAP services give ASX a solid base for growth. Its target to double LEAP revenues in 2027 looks achievable, but timely capacity expansion and execution will be important for the company to meet that goal.
The Case for AMKR Stock
Amkor Technology is expanding its advanced packaging business to benefit from rising demand for AI data centers and high-performance computing. Semiconductor companies are increasingly relying on advanced packaging to support more complex chip designs and improve performance. AMKR is investing in its packaging and testing capabilities to meet this demand and strengthen its position in the semiconductor supply chain.
AMKR's advanced packaging business is gaining traction across several applications. The company is working on 2.5D packaging, high-density fan-out and co-packaged optics technologies. Its new data center CPU program began ramping in the second quarter of 2026 and is expected to scale further in the second half of 2026. Management expects computing revenues to increase nearly 30% sequentially in the third quarter of 2026, supported by AI data center demand and the CPU program ramp.
Strategic partnerships with Taiwan Semiconductor Manufacturing Company and NVIDIA are also expected to support AMKR's growth. The company signed a 10-year advanced packaging agreement with Taiwan Semiconductor Manufacturing Company to expand packaging and testing capacity and strengthen the U.S. semiconductor supply chain. Its multiyear partnership with NVIDIA focuses on advanced packaging and testing for next-generation AI infrastructure. Amkor is also expanding its manufacturing footprint, with construction progressing at its Arizona facility to support demand for advanced packaging and testing in the United States.
Communications remains Amkor Technology’s largest end market, but the company expects revenues from this end market to decline by a high-single-digit percentage sequentially in the third quarter of 2026. In the second quarter of 2026, Android revenues declined 20% sequentially due to memory supply constraints and weaker demand. Management expects these pressures, along with changes in customer production schedules, to limit the usual seasonal increase in smartphone-related demand during the second half of 2026.
The shift of system-in-package production from South Korea to Vietnam is adding to the near-term pressure. Although the move is intended to improve manufacturing efficiency and free up capacity in South Korea for higher-value computing products, the transition is creating temporary production and timing challenges. Management expects communications revenues to remain somewhat soft in the fourth quarter of 2026, with the impact of the transition in one application area potentially extending into the first half of 2027. This weakness could limit growth in AMKR's largest end market and partially offset momentum in AI-related computing and advanced packaging.
How do Earnings Estimates Compare for ASX & AMKR?
The Zacks Consensus Estimate for ASX’s 2026 EPS is pegged at $1.27, revised up by 4 cents over the past 30 days, indicating year-over-year growth of 112.8%.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for AMKR’s 2026 EPS is pegged at $2.60, unchanged over the past 30 days, indicating year-over-year growth of 73.3%.
Image Source: Zacks Investment Research
ASX vs. AMKR: Price Performance and Valuation
Year to date, shares of ASX have surged 163.4%, while AMKR shares have returned 10.8%.
ASX Vs. AMKR: YTD Price Return Performance
Image Source: Zacks Investment Research
Currently, ASX is trading at a forward 12-month P/E ratio of 22, higher than AMKR’s forward 12-month P/E multiple of 16.24. ASX’s higher valuation reflects strong investor confidence in AI-related packaging demand, putting it above AMKR in terms of valuation, reflecting the high growth expectations of the company in the long term.
ASX vs. AMKR: Forward 12-Month P/E Ratio
Image Source: Zacks Investment Research
Conclusion: Buy ASX, Hold AMKR Right Now
Both ASX and AMKR are benefiting from growing demand for advanced semiconductor packaging and testing, driven by AI and high-performance computing. However, AMKR faces near-term pressure from weaker communications demand, lower smartphone-related revenues and the shift of production from South Korea to Vietnam.
In contrast, ASE Technology is seeing strong demand for LEAP services, rising ATM margins and growing customer demand. The company is also expanding capacity to support its target of doubling LEAP revenues in 2027. Further, ASX’s valuation reflects high growth expectations, as the company remains well positioned to benefit from rising AI-driven packaging demand over the long term.
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ASX vs. AMKR: Which Chip Packaging Stock Should You Buy Right Now?
Key Takeaways
ASE Technology Holding (ASX - Free Report) and Amkor Technology (AMKR - Free Report) are both major players in the semiconductor industry, specializing in outsourced semiconductor assembly and testing. ASE Technology provides outsourced semiconductor assembly, packaging and testing services, while Amkor Technology is a major outsourced semiconductor packaging and test provider, helping chipmakers integrate and validate increasingly complex devices.
Both ASX and AMKR are well-positioned to benefit from growing demand for advanced semiconductor packaging and testing, as AI adoption, increasingly complex chip designs and rising investment in high-performance computing drive demand for specialized semiconductor solutions. However, from an investment point of view, one stock offers a more favorable outlook than the other right now. Let’s break down their fundamentals, growth prospects, market challenges and valuation to determine which stock offers a more compelling investment case.
The Case for ASX Stock
ASE Technology is seeing strong demand for its leading-edge advanced packaging (LEAP) services as the growth of AI increases demand for more complex semiconductor packaging and testing. LEAP revenues are tracking ahead of the company’s earlier 2026 target of $3.5 billion. Management now expects to add another few hundred million dollars to this year's LEAP revenues and is targeting a doubling of LEAP revenues in 2027.
The company has clear visibility into customer demand and the capacity needed to support this growth. ASX plans to add facilities and equipment to expand LEAP capacity, with another $2 billion of CapEx added to its 2026 plans. Management said the company expects to continue making heavy investments in both advanced packaging and testing to support customer demand.
The growth is already showing up in ASX's results. In the second quarter of 2026, ATM revenues rose 36% year over year to TWD 126.1 billion. Higher LEAP volumes also helped lift ATM gross margin to 27.3% from 21.9% a year earlier. Management expects LEAP and test businesses to remain margin accretive and sees ATM gross margin moving above 30% in the fourth quarter of 2026.
Still, execution remains a key factor. ASX said its near-term growth is limited by how quickly it can install equipment and complete new facilities. ASX is working on 13 greenfield and eight brownfield projects. These projects are expected to provide capacity through 2028 and into part of 2029. However, managing so many projects at the same time might create execution risks, particularly around construction, equipment installation and meeting required timelines.
Nonetheless, strong AI-related demand, expanding capacity and higher-margin LEAP services give ASX a solid base for growth. Its target to double LEAP revenues in 2027 looks achievable, but timely capacity expansion and execution will be important for the company to meet that goal.
The Case for AMKR Stock
Amkor Technology is expanding its advanced packaging business to benefit from rising demand for AI data centers and high-performance computing. Semiconductor companies are increasingly relying on advanced packaging to support more complex chip designs and improve performance. AMKR is investing in its packaging and testing capabilities to meet this demand and strengthen its position in the semiconductor supply chain.
AMKR's advanced packaging business is gaining traction across several applications. The company is working on 2.5D packaging, high-density fan-out and co-packaged optics technologies. Its new data center CPU program began ramping in the second quarter of 2026 and is expected to scale further in the second half of 2026. Management expects computing revenues to increase nearly 30% sequentially in the third quarter of 2026, supported by AI data center demand and the CPU program ramp.
Strategic partnerships with Taiwan Semiconductor Manufacturing Company and NVIDIA are also expected to support AMKR's growth. The company signed a 10-year advanced packaging agreement with Taiwan Semiconductor Manufacturing Company to expand packaging and testing capacity and strengthen the U.S. semiconductor supply chain. Its multiyear partnership with NVIDIA focuses on advanced packaging and testing for next-generation AI infrastructure. Amkor is also expanding its manufacturing footprint, with construction progressing at its Arizona facility to support demand for advanced packaging and testing in the United States.
Communications remains Amkor Technology’s largest end market, but the company expects revenues from this end market to decline by a high-single-digit percentage sequentially in the third quarter of 2026. In the second quarter of 2026, Android revenues declined 20% sequentially due to memory supply constraints and weaker demand. Management expects these pressures, along with changes in customer production schedules, to limit the usual seasonal increase in smartphone-related demand during the second half of 2026.
The shift of system-in-package production from South Korea to Vietnam is adding to the near-term pressure. Although the move is intended to improve manufacturing efficiency and free up capacity in South Korea for higher-value computing products, the transition is creating temporary production and timing challenges. Management expects communications revenues to remain somewhat soft in the fourth quarter of 2026, with the impact of the transition in one application area potentially extending into the first half of 2027. This weakness could limit growth in AMKR's largest end market and partially offset momentum in AI-related computing and advanced packaging.
How do Earnings Estimates Compare for ASX & AMKR?
The Zacks Consensus Estimate for ASX’s 2026 EPS is pegged at $1.27, revised up by 4 cents over the past 30 days, indicating year-over-year growth of 112.8%.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for AMKR’s 2026 EPS is pegged at $2.60, unchanged over the past 30 days, indicating year-over-year growth of 73.3%.
Image Source: Zacks Investment Research
ASX vs. AMKR: Price Performance and Valuation
Year to date, shares of ASX have surged 163.4%, while AMKR shares have returned 10.8%.
ASX Vs. AMKR: YTD Price Return Performance
Image Source: Zacks Investment Research
Currently, ASX is trading at a forward 12-month P/E ratio of 22, higher than AMKR’s forward 12-month P/E multiple of 16.24. ASX’s higher valuation reflects strong investor confidence in AI-related packaging demand, putting it above AMKR in terms of valuation, reflecting the high growth expectations of the company in the long term.
ASX vs. AMKR: Forward 12-Month P/E Ratio
Image Source: Zacks Investment Research
Conclusion: Buy ASX, Hold AMKR Right Now
Both ASX and AMKR are benefiting from growing demand for advanced semiconductor packaging and testing, driven by AI and high-performance computing. However, AMKR faces near-term pressure from weaker communications demand, lower smartphone-related revenues and the shift of production from South Korea to Vietnam.
In contrast, ASE Technology is seeing strong demand for LEAP services, rising ATM margins and growing customer demand. The company is also expanding capacity to support its target of doubling LEAP revenues in 2027. Further, ASX’s valuation reflects high growth expectations, as the company remains well positioned to benefit from rising AI-driven packaging demand over the long term.
Currently, ASX sports a Zacks Rank #1 (Strong Buy), making the stock a stronger pick over AMKR, which has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.