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Summary of Risk Factors
−Removed: An investment in our common stock involves various risks, and you are urged to carefully consider all of the matters discussed in Part I, Item 1A of this Form 10-K under the caption “Risk Factors” (in addition to those discussed under this
−Removed: “Summary of Risk Factors” section) in considering our business and prospects.
+Added: An investment in our common stock involves various risks, and you are urged to carefully consider all of the matters discussed in Part I, Item 1A of this Form 10-K under the caption “Risk Factors” (in addition to those discussed under this “Summary of Risk Factors” section) in considering our business and prospects.
The following is a list of some of these risks:
Risks Related to Our Business, Operations and Industry
−Removed: • competition with established competitors in the packaging and test business, the internal capabilities of IDMs, and new competitors, including foundries;
+Added: • dependence on the cyclical and volatile semiconductor industry and vulnerability to industry downturns and declines in global economic and financial conditions;
• changes in costs, quality, availability and delivery times of raw materials, components and equipment;
• fluctuations in operating results and cash flows;
−Removed: • dependence on the cyclical and volatile semiconductor industry and vulnerability to industry downturns and declines in global economic and financial conditions;
+Added: • competition with established competitors in the packaging and test business, the internal capabilities of IDMs, and new competitors, including foundries and contract manufacturers;
• our substantial investments in equipment and facilities to support the demand of our customers;
+Added: • warranty claims, product return and liability risks, and the risk of negative publicity if our products fail, as well as the risk of litigation incident to our business;
• difficulty achieving the relatively high-capacity utilization rates necessary to realize satisfactory gross margins given our high percentage of fixed costs;
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• dependence on international factories and operations, and risks relating to trade restrictions and regional conflict.
−Removed: • significant severance plan obligations associated with our manufacturing operations in Korea.
Risks Related to Cybersecurity, Data Privacy and Intellectual Property
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Risks Related to Regulatory, Legal and Tax Challenges
−Removed: • warranty claims, product return and liability risks, and the risk of negative publicity if our products fail, as well as the risk of litigation incident to our business;
• maintaining an effective system of internal controls;
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• environmental, health and safety liabilities and expenditures;
+Added: • conditions and obligations in connection with the receipt of government awards and incentives.
General Risk Factors
−Removed: • health conditions or pandemics, such as the Covid-19 pandemic, impacting labor availability and operating capacity, capital availability, the supply chain and consumer demand for our customers’ products and services;
• natural disasters and other calamities, health conditions or pandemics, political instability, hostilities or other disruptions.
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Our business is impacted by market conditions in the semiconductor industry, which is cyclical by nature and impacted by broad economic factors, such as worldwide gross domestic product and consumer spending.
−Removed: We believe that the general semiconductor market is currently going through a cyclical correction.
The semiconductor industry has experienced significant and sometimes sudden and prolonged downturns in the past.
If the industry or markets in which we compete experience slower, or even negative growth, our business and results of operations may be materially and adversely affected.
−Removed: Since our business is, and will continue to be, dependent on the requirements of semiconductor companies for outsourced packaging and test services, any downturn in the semiconductor industry or any other industry that uses a significant number of semiconductor devices, such as telecommunications, automotive, computing, or consumer electronics, could have a material adverse effect on our business and operating results.
+Added: Since our business is, and will continue to be, dependent on the requirements of semiconductor companies for outsourced packaging and test services, any downturn in the semiconductor industry or any other industry that uses a significant
+Added: number of semiconductor devices, such as communications, computing, automotive and industrial or consumer electronics, could have a material adverse effect on our business and operating results.
During downturns, we have experienced, among other things, reduced demand, excess capacity and reduced sales.
For example, the Covid-19 pandemic disrupted demand in the automotive and industrial end market in 2020, and during 2019, there was weakness in the general market and an inventory correction in the smartphone market.
−Removed: New variants or the potential re-emergence of the Covid-19 pandemic or the occurrence of other epidemics or pandemics, and the imposition of related public health measures and travel and business restrictions, may materially and adversely impact our business, financial condition, operating results and cash flows.
−Removed: For example, as part of a broad effort to mitigate a rising number of Covid-19 cases in Shanghai, the Chinese government mandated a lockdown of our Shanghai factory from March 2022 to June 2022.
−Removed: Other national, regional, and local governments have implemented, and may implement in the future, public health measures in jurisdictions in which we, our customers and our suppliers operate, and such restrictions may materially and adversely impact our operations and the operations of our customers and suppliers.
−Removed: We also remain subject to industry-wide supply constraints and inflationary price pressures, which have resulted in long lead times, rising prices and supply chain disruptions.
−Removed: It is difficult to predict the timing, strength or duration of any economic disruption caused by epidemics or pandemics or which end markets will experience a slowdown or subsequent economic recovery which, in turn, makes it more challenging for us to forecast our operating results, make business decisions and identify risks that may materially affect our business, sources and uses of cash, financial condition and results of operations.
−Removed: Additionally, if industry conditions
−Removed: deteriorate, we could suffer significant losses, as we have in the past, that could materially and adversely impact our business, liquidity, results of operations, financial condition and cash flows.
Our business may suffer if the cost, quality or supply of materials or equipment changes adversely.
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A disruption to the operations of one or more of our suppliers could extend lead times for materials and equipment and have a negative impact on our business.
−Removed: For example, the Covid-19 pandemic and resulting supply chain disruptions and economic turbulence created extended lead times for some materials and equipment.
−Removed: To the extent the impact of such disruptive events continues or worsens, we anticipate having greater difficulty obtaining, or waiting longer to obtain, certain equipment, supplies and other materials necessary for performance of our services or necessary to increase the services we provide to customers.
−Removed: Furthermore, fire, severe weather, earthquakes, flooding and tsunamis in the past have impacted the supply of specialty chemicals, substrates, silicon wafers, equipment and other supplies to the electronics industry.
+Added: For example, the Covid-19 pandemic and resulting supply chain disruptions and economic turbulence created extended lead times for some materials and equipment, and furthermore, fire, severe weather, earthquakes, flooding and tsunamis in the past have impacted the supply of specialty chemicals, substrates, silicon wafers, equipment and other supplies to the electronics industry.
In addition, we purchase the majority of our materials on a purchase order basis.
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• costs associated with legal claims, indemnification obligations, judgments and settlements;
−Removed: • political instability, conflicts (such as the ongoing conflict in Ukraine and Israel) and government shutdowns, civil disturbances and international events;
+Added: • political instability, conflicts (such as the ongoing conflicts in Ukraine and Israel) and government shutdowns, civil disturbances and international events;
• environmental or natural disasters such as earthquakes, typhoons and volcanic eruptions;
−Removed: • pandemics or other widespread illnesses that may impact our labor force, operations, liquidity, supply chain and end-user demand for products which incorporate semiconductors, such as the Covid-19 pandemic;
+Added: • pandemics or other widespread illnesses that may impact our labor force, operations, liquidity, supply chain and end-user demand for products which incorporate semiconductors;
• costs of acquisitions and divestitures and difficulties integrating acquisitions;
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• restructuring charges, asset write-offs and impairments.
−Removed: On October 7, 2022 and October 17, 2023, the U.S.
−Removed: Bureau of Industry and Security announced export control regulations applicable to Chinese acquisition of U.S.
−Removed: semiconductor technology (collectively, the “BIS Regulations”).
+Added: In recent years, the U.S.
+Added: Bureau of Industry and Security announced new export control regulations applicable to the sale of U.S.
+Added: semiconductor technology in China (collectively, the “BIS Regulations”).
The above factors, in addition to the BIS Regulations and other similarly restrictive trade barriers adopted by U.S.
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In addition, these factors may materially and adversely affect our credit ratings, which could make it more difficult and expensive for us to raise capital and could materially and adversely affect the price of our securities.
−Removed: We compete against established competitors in the packaging and test business as well as internal capabilities of IDMs and face competition from new competitors, including foundries.
+Added: We compete against established competitors in the packaging and test business as well as internal capabilities of IDMs and face competition from new competitors, including foundries and contract manufacturers.
The outsourced semiconductor packaging and test services market is very competitive.
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If we experience a significant loss of IDM or foundry business, it could have a material adverse effect on our business, liquidity, results of operations, financial condition and cash flows, especially during a prolonged industry downturn.
−Removed: We also face competition from contract foundries, such as Taiwan Semiconductor Manufacturing Company Limited and Samsung Electronics Co., Ltd., which offer full turnkey services from silicon wafer fabrication through packaging and final test.
+Added: We face competition from foundries, such as TSMC and Samsung, which offer full turnkey services from silicon wafer fabrication through packaging and final test.
These foundries, which are substantially larger than us and have greater financial resources than we do, have expanded their operations to include packaging and test services and may continue to expand these capabilities in the future.
If a key customer decides to purchase wafers from a semiconductor foundry that provides packaging and test services, our business could be adversely affected if the customer also engages that foundry for related packaging and test services.
−Removed: We cannot assure you that we will be able to compete successfully in the future against our existing or potential competitors, that our customers will not rely on internal sources or foundries for packaging and test services or that our business, liquidity, results of operations, financial condition or cash flows will not be materially and adversely affected by such increased competition.
+Added: We also face competition from contract manufacturers and electronic manufacturing service providers, many of which are larger than us, have lower cost structures, and may be willing or able to sell their services at lower margins.
+Added: These competitors have increased and could increase pricing and competitive pressures.
+Added: We cannot assure you that we will be able to compete successfully in the future against our existing or potential competitors, that our customers will not rely on internal sources, foundries or contract manufacturers for packaging and
+Added: test services or that our business, liquidity, results of operations, financial condition or cash flows will not be materially and adversely affected by such increased competition.
We make substantial investments in equipment and facilities to support the demand of our customers, which may materially and adversely affect our business if the demand of our customers does not develop as we expect or is adversely affected.
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and economic, political and other global conditions.
−Removed: In October 2023, we completed the initial phase of construction for our Vietnam Facility.
−Removed: There can be no assurance, however, that high-volume manufacturing will begin on schedule or that the actual scope, costs or benefits of the project will be consistent with our current expectations.
+Added: In October 2023, we completed the initial phase of construction for the Vietnam Facility.
+Added: While manufacturing has begun at the Vietnam Facility, there can be no assurance that the actual scope, costs or benefits of the project will be consistent with our current expectations.
+Added: We may face warranty claims, product return and liability risks, economic damage claims and negative publicity if our packages fail .
+Added: Our packages are incorporated into a number of end products.
+Added: If our packages fail, our business may be exposed to warranty claims, product return and liability risks, economic damage claims and negative publicity.
+Added: We receive warranty claims from our customers from time to time in the ordinary course of our business.
+Added: If we were to experience an unusually high incidence of warranty claims, we could incur significant costs and our business could be materially and adversely affected.
+Added: In addition, we are exposed to the product and economic liability risks and the risk of negative publicity affecting our customers.
+Added: Our sales may decline if any of our customers are sued on a product liability claim.
+Added: We also may suffer a decline in sales from the negative publicity associated with such a lawsuit or with adverse public perceptions in general regarding our customers’ products.
+Added: Further, if our packages are delivered with defects, we could incur additional development, repair or replacement costs or suffer other economic losses, and our credibility and the market’s acceptance of our packages could be harmed.
Due to our high percentage of fixed costs, we may be unable to maintain satisfactory gross margins if we are unable to achieve relatively high-capacity utilization rates.
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In addition, our fixed operating costs have increased as a result of capital expenditures for capacity expansion.
−Removed: The anticipated customer demand for which we have made capital investments may not materialize, and our sales may not adequately cover fixed costs, resulting in reduced profit levels or even significant losses, either of which may materially and adversely impact our business, liquidity, results of operations, financial condition and cash flows.
+Added: The anticipated customer demand for which we have made capital investments may not materialize, and our sales may not
+Added: adequately cover fixed costs, resulting in reduced profit levels or even significant losses, either of which may materially and adversely impact our business, liquidity, results of operations, financial condition and cash flows.
The lack of contractually committed customer demand may materially and adversely affect our sales.
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This makes it difficult for us to forecast our capacity utilization and net sales in future periods.
−Removed: Since a large portion of our costs is fixed and our expense levels are based in part on our expectations of future sales, we may not be
−Removed: able to adjust costs in a timely manner to compensate for any sales shortfall.
+Added: Since a large portion of our costs is fixed and our expense levels are based in part on our expectations of future sales, we may not be able to adjust costs in a timely manner to compensate for any sales shortfall.
If we are unable to adjust costs in a timely manner, our margins, operating results, financial condition and cash flows could be materially and adversely affected.
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Our production yields on new packages, particularly those packages which are based on new technologies, typically are significantly lower than our production yields on our more established packages.
−Removed: Our failure to qualify new processes, maintain quality standards or acceptable production yields, if significant and prolonged, could result in the loss of customers, increased costs of production, delays, substantial amounts of returned goods and claims by customers relating thereto.
+Added: Our failure to qualify new processes, maintain quality standards or acceptable production yields, if significant and prolonged, could result in the loss of customers, increased costs of production, delays, substantial amounts of returned
+Added: goods and claims by customers relating thereto.
Any of these problems could have a material adverse effect on our business, liquidity, results of operations, financial condition and cash flows.
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A downturn or lower sales to customers in the automotive industry could materially affect our business and results of operations.
−Removed: A significant portion of our sales are to customers within the automotive industry.
+Added: A significant portion of our sales is to customers within the automotive industry.
The automotive industry is cyclical, and, as a result, our customers in the automotive end-market are sensitive to changes in general economic conditions, inflationary pressure, disruptive innovation and end-market preferences, which can adversely affect sales of our products and, correspondingly, our results of operations.
The automotive industry is also subject to long design-in time frames, long product life cycles and a high degree of regulatory and safety requirements, necessitating suppliers to the industry to comply with stringent qualification processes, very low defect rates and high reliability standards, all of which result in significant operational challenges, risk to our results of operations, and increased costs of our investments in serving customers in the automotive end-market.
−Removed: Additionally, the quantity and price of our products sold to customers in the
−Removed: automotive end-market could decline despite continued growth in such end-market.
+Added: Additionally, the quantity and price of our products sold to customers in the automotive end-market could decline despite continued growth in such end-market.
Lower sales to customers in the automotive end-market may have a material adverse effect on our business and results of operations.
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Each of these factors could vary significantly from time to time resulting in the loss or reduction of customer orders, and we cannot be sure that our key customers or any other customers will continue to place orders with us in the future at the same levels as in past periods.
−Removed: For example, as seen in the automotive end market in 2020, the Covid-19 pandemic and restrictions imposed by governmental authorities to mitigate the spread of Covid-19 in our customers’ end markets may decrease demand for our customers’ products and services, thereby adversely impacting their demand for our services.
+Added: For example, as seen in the automotive end market in 2020, the Covid-19 pandemic and restrictions imposed by governmental authorities to mitigate the spread of Covid-19 decreased demand for our customers’ products and services, thereby adversely impacting their demand for our services.
In addition, from time to time, we may acquire or build new facilities or migrate existing business among our facilities.
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We fund our operations, including capital expenditures and other investments and servicing principal and interest obligations with respect to our debt, from cash flows from our operations, existing cash and cash equivalents, borrowings under available debt facilities, or proceeds from any additional debt or equity financing.
−Removed: Our liquidity is affected by, among other factors, volatility in the global economy and credit markets, the performance of our business, our capital expenditures and other investment levels, other uses of our cash, including any payments of dividends and purchases of stock under any stock repurchase program, any acquisitions or investments in joint ventures and any decisions we might make to either repay debt and other long-term obligations out of our operating cash flows or refinance debt at or prior to maturity with the proceeds of debt or equity financings.
+Added: Our liquidity is affected by, among other factors, volatility in the global economy and credit markets, the performance of our business, our capital expenditures and other investment levels, other uses of our cash, including any payments of dividends and purchases of stock under any stock repurchase program, any acquisitions or investments in joint ventures and any decisions we might make to either repay debt and
+Added: other long-term obligations out of our operating cash flows or refinance debt at or prior to maturity with the proceeds of debt or equity financings.
Servicing our current and future customers requires that we incur significant operating expenses and continue to make significant capital expenditures and other investments, and the amount of our capital expenditures for 2025 and thereafter may vary materially and will depend on several factors.
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If financial institutions that have extended credit commitments to us are adversely affected by the conditions of the United States, foreign or international banking system and capital markets (including as a result of rising interest rates, economic downturns or other developments), they may refuse or be unable to fund borrowings under their credit commitments to us.
−Removed: Federal Reserve has raised interest rates several times during 2022 and 2023.
−Removed: Volatility in the banking system and capital markets, as well as any further increase in interest rates or adverse economic, political, public health or other
−Removed: global conditions, could also make it difficult or more expensive for us to maintain our existing credit facilities or refinance our debt.
+Added: Volatility in the banking system and capital markets, as well as any further increase in interest rates or adverse economic, political, public health or other global conditions, could also make it difficult or more expensive for us to maintain our existing credit facilities or refinance our debt.
The trading price of our common stock has been, and is likely to continue to be, highly volatile and could be subject to wide fluctuations.
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Our factories and operations, and those of our customers and vendors, are located in various foreign jurisdictions, which exposes us to risks arising from international trade restrictions and regional conflict.
−Removed: We provide packaging and test services through our factories and other operations located in China, Japan, Korea, Malaysia, the Philippines, Portugal, Singapore and Taiwan and are preparing to offer packaging and test services from the Vietnam Facility.
+Added: We provide packaging and test services through our factories and other operations located in China, Japan, Korea, Malaysia, the Philippines, Portugal, Singapore, Taiwan and Vietnam.
Substantially all of our property, plant and equipment is located outside of the United States, and many of our customers and the vendors in our supply chain are also located outside the United States.
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companies that sell certain semiconductor and chipmaking equipment products to customers in China;
+Added: • international trade disputes, geopolitical tensions, increasing protectionism and economic nationalism leading to increasing export restrictions, trade barriers, tariffs, and other changes in trade policy;
• laws, rules, regulations and policies within China and other countries that may favor domestic companies over non-domestic companies, including customer- or government-supported efforts to promote the development and growth of local competitors;
−Removed: • health and safety concerns, including widespread outbreak of infectious diseases, such as Covid-19, and governmental responses thereto;
+Added: • health and safety concerns, including widespread outbreak of infectious diseases and governmental responses thereto;
• changes in consumer demand resulting from current or expected inflation or other variations in local economies;
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These expanded export restrictions limit our ability to sell to certain Chinese companies and to third parties that do business with those companies.
−Removed: Certain of the Company’s
−Removed: competitors may be exempt from the BIS Regulations by virtue of being non-U.S.
+Added: Certain of the Company’s competitors may be exempt from the BIS Regulations by virtue of being non-U.S.
manufacturers.
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Furthermore, there has been a history of conflict and tension within and among other countries in the region.
−Removed: The Covid-19 pandemic impacted our operations and the operations of our customers and suppliers as a result of illness, quarantines, facility closures and travel and logistics restrictions in connection with the outbreak.
−Removed: National, regional, and local governments have implemented, and may implement in the future, public health measures to mitigate the spread of Covid-19, the emergence of new variants or the re-emergence of Covid-19 in jurisdictions in which we, our customers and our suppliers operate, and such restrictions may materially and adversely impact our operations and the operations of our customers and suppliers.
−Removed: Such restrictions may also affect end-user demand in each geography where our customers sell their products and services, which may materially and adversely affect demand for our services, our operating results and financial condition.
−Removed: We also remain subject to industry-wide supply constraints and inflationary price pressures, which have resulted in long lead times, rising prices and supply chain disruptions.
−Removed: We have significant severance plan obligations associated with our manufacturing operations in Korea which could reduce our cash flow and negatively impact our financial condition.
−Removed: Our subsidiary in Korea maintains an unfunded severance plan, under which we have an accrued liability of $47.8 million as of December 31, 2023.
−Removed: The plan covers certain employees that were employed prior to August 1, 2015.
−Removed: In the event of a significant layoff or other reduction in our labor force in Korea, our subsidiary in Korea would be required to make lump-sum severance payments under the plan, which could have a material adverse effect on our liquidity, financial condition and cash flows.
−Removed: We have made, and may in the future make, offers to some or all of the covered employees the option to convert from the severance plan to a defined contribution plan.
−Removed: Some employees have accepted previous offers, and future offers to make similar conversions could impact the timing of future payments, reducing our cash flow and materially and adversely affecting our financial condition.
+Added: Global pandemics and the spread of infectious diseases may impact our operations and the operations of our customers and suppliers as a result of illness, quarantines, facility closures and travel and logistics restrictions in connection with such outbreaks.
+Added: National, regional, and local governments may implement public health measures to mitigate the spread of such outbreaks in jurisdictions in which we, our customers and our suppliers operate, and such restrictions may materially and adversely impact our operations and the operations of our customers and suppliers.
+Added: Such restrictions may also affect end-user demand in each geography where our customers sell their products and services, which may materially and adversely affect demand for our services, our operating results and our financial condition.
Risks Related to Cybersecurity, Data Privacy and Intellectual Property
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The confidentiality agreements on which we rely to protect these technologies may be breached or may not be adequate to protect our proprietary technologies.
−Removed: There can be no assurance that other countries in which we market our services will protect our intellectual property rights to the same extent as the U.S.
+Added: There can be no assurance that other countries in which we market our services will protect our intellectual property rights to the same extent as the United States.
Our competitors may develop, patent or gain access to know-how and technology similar or superior to our own.
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While we have not experienced a material information security breach, we cannot be sure that such a breach will not occur in the future.
−Removed: The IT systems in our factories are at varying levels of sophistication and maturity as the factories have different sets of products, processes and customer expectations.
+Added: The information technology systems in our factories are at varying levels of sophistication and maturity as the factories have different sets of products, processes and customer expectations.
Some of our key software has been developed by our own programmers, and this software may not be easily integrated with other software and systems.
−Removed: From time to time,
−Removed: we make additions or changes to our information technology systems.
−Removed: For example, we continue to further integrate our Japan operations’ information technology systems into our existing systems and processes.
+Added: From time to time, we make additions or changes to our information technology systems.
+Added: For example, we continue to further integrate information technology systems in our facilities in Japan into our existing systems and processes.
We face risks in connection with current and future projects to install or integrate new information technology systems or upgrade our existing systems.
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Risks Related to Our Common Stock
−Removed: Kim and members of his family can effectively determine or substantially influence the outcome of all matters requiring stockholder approval.
−Removed: As of December 31, 2023, James J.
−Removed: Kim, the Executive Chairman of our Board of Directors, Susan Y.
−Removed: Kim, the Executive Vice Chairman of our Board of Directors, and members of the Kim family and affiliates owned approximately 132.0 million shares, or approximately 54%, of our outstanding common stock.
+Added: Kim and members of her family can effectively determine or substantially influence the outcome of all matters requiring stockholder approval.
+Added: As of December 31, 2024, Susan Y.
+Added: Kim, the Chairman of our Board of Directors and members of the Kim family and affiliates owned approximately 132.1 million shares, or approximately 54%, of our outstanding common stock.
The Kim family also has options to acquire approximately 0.6 million shares.
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The voting agreement for the Convert Shares terminates upon the earliest of (i) such time as the Kim family no longer beneficially owns any of the Convert Shares, (ii) consummation of a change of control (as defined in the voting agreement) or (iii) the mutual agreement of the Kim family and Amkor.
−Removed: Kim and his family and affiliates, acting together, have the ability to effectively determine or substantially influence matters submitted for approval by our stockholders by voting their shares or otherwise acting by written consent, including the election of our Board of Directors.
+Added: Kim and her family and affiliates, acting together, have the ability to effectively determine or substantially influence matters submitted for approval by our stockholders including the election of our Board of Directors, by voting their shares or otherwise acting by written consent.
There is also the potential, through the election of members of our Board of Directors, that the Kim family could substantially influence matters decided upon by our Board of Directors.
−Removed: This concentration of ownership may also have the effect of impeding a merger, consolidation, takeover or other business consolidation involving us, or discouraging a potential acquirer from making a tender offer for our shares, and
−Removed: could also negatively affect our stock’s market price or decrease any premium over market price that an acquirer might otherwise pay.
+Added: This concentration of ownership may also have the effect of impeding a merger, consolidation, takeover or other business consolidation involving us, or discouraging a potential acquirer from making a tender offer for our shares, and could also
+Added: negatively affect our stock’s market price or decrease any premium over market price that an acquirer might otherwise pay.
Concentration of ownership also reduces the public float of our common stock.
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Risks Related to Regulatory, Legal and Tax Challenges
−Removed: We may face warranty claims, product return and liability risks, economic damage claims and negative publicity if our packages fail .
−Removed: Our packages are incorporated into a number of end products.
−Removed: If our packages fail, our business may be exposed to warranty claims, product return and liability risks, economic damage claims and negative publicity.
−Removed: We receive warranty claims from our customers from time to time in the ordinary course of our business.
−Removed: If we were to experience an unusually high incidence of warranty claims, we could incur significant costs and our business could be materially and adversely affected.
−Removed: In addition, we are exposed to the product and economic liability risks and the risk of negative publicity affecting our customers.
−Removed: Our sales may decline if any of our customers are sued on a product liability claim.
−Removed: We also may suffer a decline in sales from the negative publicity associated with such a lawsuit or with adverse public perceptions in general regarding our customers’ products.
−Removed: Further, if our packages are delivered with defects, we could incur additional development, repair or replacement costs or suffer other economic losses, and our credibility and the market’s acceptance of our packages could be harmed.
If we fail to maintain an effective system of internal controls, we may not be able to accurately report financial results or prevent fraud.
−Removed: Our internal controls over financial reporting may not prevent or detect misstatements because of their inherent limitations, including the possibility of human error, the circumvention or overriding of controls, fraud or corruption.
+Added: Our internal controls over financial reporting may not prevent or detect misstatements because of their inherent limitations, including the possibility of human error, the circumvention or overriding of controls and fraud or corruption.
Therefore, even effective internal controls can provide only reasonable assurance with respect to the preparation and fair presentation of financial statements.
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We earn a substantial portion of our income in foreign countries, and our operations are subject to tax in multiple jurisdictions with complicated and varied tax regimes.
−Removed: Tax laws and income tax rates in these jurisdictions are subject to
−Removed: change due to economic and political conditions.
+Added: Tax laws and income tax rates in these jurisdictions are subject to change due to economic and political conditions.
Changes in the tax laws of foreign jurisdictions could arise as a result of the base erosion and profit shifting project that was undertaken by the Organization for Economic Cooperation and Development (“OECD”).
The OECD, which represents a coalition of member countries, recommended changes to long-standing tax principles related to transfer pricing and has developed model rules including establishing a global minimum corporate income tax tested on a jurisdictional basis (the “Pillar Two Model Rules”).
−Removed: Some countries have already started to implement laws based on the Pillar Two Model Rules to be effective in 2024.
−Removed: There can be no assurance that our effective tax rate, tax payments or conditional reduced tax rates will not be adversely affected as countries independently amend their tax laws to adopt Pillar Two Model Rules.
+Added: Some countries we operate in have enacted laws based on the Pillar Two Model Rules effective in 2024.
+Added: While the Pillar Two Model Rules did not have a material impact on our 2024 results, additional countries where we operate, including Singapore, have adopted Pillar Two Model Rules effective in 2025.
+Added: Enactment of this legislation is expected to adversely affect our effective tax rate, tax payments and conditional reduced tax rates.
Changes in U.S.
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We could also be held liable for damages, including fines, penalties and the cost of investigations and remedial actions, and we could be subject to revocation of permits, which may materially and adversely affect our ability to maintain or expand our operations.
−Removed: Additionally, if Amkor is unable to align its environmental, health and safety practices with shifting customer preferences, we could suffer reputational harm, which could have a material and adverse effect on our business, results of operations, liquidity and cash flows.
+Added: Additionally, if Amkor is unable to align its environmental, health and
+Added: safety practices with shifting customer preferences, we could suffer reputational harm, which could have a material and adverse effect on our business, results of operations, liquidity and cash flows.
There has also been an increase in regulatory and public attention and industry and customer focus on the materials contained in semiconductor products, the environmental impact of semiconductor operations and the risk of chemical releases from such operations, climate change, sustainability and related environmental concerns.
−Removed: Increased regulation of and restriction on the use of hazardous substances may impact our supply chain due to decreased availability,
−Removed: necessitate changes in our packaging processes, require us to seek substitutes that may not be readily available in the marketplace or eliminate the use of such hazardous substances although there may not be a technically feasible alternative.
+Added: Increased regulation of and restriction on the use of hazardous substances may impact our supply chain due to decreased availability, necessitate changes in our packaging processes, require us to seek substitutes that may not be readily available in the marketplace or eliminate the use of such hazardous substances although there may not be a technically feasible alternative.
This increased focus on sustainability and the environmental impact of semiconductor operations and products has caused industry groups and customers to impose additional requirements on us and our suppliers, sometimes exceeding regulatory standards.
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To comply with these additional requirements, we may need to procure additional, or increase the use of, renewable energy, procure additional equipment or make factory or process changes, which could result in increased operating costs.
+Added: The awards and incentives from the agreement with the U.S.
+Added: Department of Commerce (“Commerce”) pursuant to the U.S.
+Added: CHIPS and Science Act of 2022 (“CHIPS Act”) might not materialize as such awards and incentives are conditional upon achieving or maintaining certain outcomes and compliance with other obligations, are subject to reduction, termination, or clawback and would impose certain restrictions on our business.
+Added: In December 2024, Commerce awarded us up to $407 million in direct funding pursuant to the CHIPS Act for the Arizona Facility.
+Added: This award requires us to achieve construction and production milestones and restricts us from undertaking certain activities.
+Added: We cannot guarantee that we will successfully achieve and maintain outcomes or be able to comply with other obligations required to qualify for this award or that Commerce will provide or continue to provide such funding.
+Added: The award arrangements provide Commerce with rights to audit our compliance with their terms and obligations, and such audits could result in modifications to, or termination of, the award.
+Added: To a lesser extent, we also receive incentives from state and local governments for the Arizona Facility, which have similar terms and conditions.
+Added: Any awards or incentives we receive could be subject to reduction, termination, or clawback, and any decrease, termination, or clawback of such government awards and incentives could have a material adverse effect on our business, results of operations, or financial condition.
General Risk Factors
−Removed: The Covid-19 pandemic has impacted, and may impact in the future, the supply chain and consumer demand for our customers’ products and services, and such impact on the supply chain and consumer demand may ultimately have a material and adverse effect on our business, results of operations and financial condition.
−Removed: The impacts of the Covid-19 pandemic varied by location, by industry and by end market.
−Removed: We, our suppliers and our customers were disrupted by worker illness and absenteeism, quarantines and restrictions on employees’ ability to work, office and factory closures, disruptions to ports and other shipping infrastructure and border closures or other travel or health-related restrictions.
−Removed: Restrictions on our workforce or access to our manufacturing facilities, or similar limitations for our suppliers, or restrictions or disruptions of transportation in order to contain the spread of Covid-19 caused disruptions to our supply chain in connection with the sourcing of equipment, supplies and other materials, and similar restrictions in the future could limit our capacity to meet customer demand and have a material adverse effect on our business, results of operations and financial condition.
−Removed: Restrictions may be implemented in response to the emergence of new variants or re-emergence of Covid-19, and such restrictions may materially and adversely impact our operations and the operations of our customers and suppliers.
−Removed: We also remain subject to industry-wide supply constraints and inflationary price pressures, which have resulted in long lead times, rising prices and supply chain disruptions.
−Removed: The spread of Covid-19 caused us to modify our business practices (including corporate hygiene protocols at factories, restricting employee travel and employee work locations and cancelling physical participation in meetings, events and conferences) and, while the long-term impact of the Covid-19 pandemic remains uncertain, we have retained certain of those enhanced measures as part of our commitment to protect the health and safety of our employees.
−Removed: We may also take further actions in the future as may be required by government authorities or that we determine to be in the best interests of our employees, customers and suppliers.
−Removed: There is no certainty that such measures will be sufficient to mitigate the future impact of Covid-19, and our ability to perform critical functions could be harmed.
Our business and financial condition has been adversely affected, and could be adversely affected in the future, by natural disasters and other calamities, health conditions or pandemics, political instability, hostilities or other disruptions.
−Removed: We have significant packaging and test services and other operations in China, Japan, Korea, Malaysia, the Philippines, Portugal, Singapore, Taiwan and the Vietnam Facility.
+Added: We have significant packaging and test services and other operations in China, Japan, Korea, Malaysia, the Philippines, Portugal, Singapore, Taiwan and Vietnam.
Such operations are or could be subject to:
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While our global manufacturing footprint allows us to shift production to other factories without substantial cost or production delays, certain of our services are currently performed using equipment located in one or only a subset of our factories.
−Removed: A major disruption or shutdown of any such factory could completely impair our ability to perform those services or
−Removed: require us to shift them to another location.
+Added: A major disruption or shutdown of any such factory could completely impair our ability to perform those services or require us to
+Added: shift them to another location.
As a result, our ability to fulfill customer orders may be impaired or delayed, and we could incur significant losses.
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.