Amkor shares rally in late trade, to work with Nvidia on packaging
News Summary
Amkor Technology shares surged over 8% in after-the-bell trading on Wednesday after Nvidia's chief financial officer announced plans to work with Amkor (and Siliconware Precision Industries Co Ltd) to expand its U.S. chip manufacturing footprint over the next four years. Amkor's stock price hit a high of $34.75 before settling at $33.58, following a regular session close of $31.43. Nvidia had previously stated that its first "Blackwell" AI chips were produced at TSMC's Arizona factory, but these chips still require advanced packaging in Taiwan before they can be sold.
Background
Currently, AI chip giant Nvidia's "Blackwell" AI chips are produced at TSMC's Arizona factory in the U.S., but the critical advanced packaging process still takes place in Taiwan. This reliance on overseas packaging highlights geographical bottlenecks and strategic vulnerabilities within the global semiconductor supply chain. Under the Trump administration, the United States has aggressively promoted domestic semiconductor manufacturing and supply chain resilience to reduce dependence on critical technology imports. Advanced packaging technology is crucial for enhancing chip performance and integration, making it an indispensable part of the semiconductor value chain.
In-Depth AI Insights
What are the deeper strategic implications of Nvidia bringing advanced packaging to the U.S. for the global semiconductor supply chain? - Nvidia's move signals that the U.S. "de-risking" strategy in semiconductor manufacturing is extending from wafer fabrication to advanced packaging, reflecting not just supply chain resilience but a national bid for technological leadership. - This could prompt other fabless design companies to follow suit, driving more advanced packaging capacity to the U.S., thereby altering the global packaging market's competitive landscape. While potentially increasing costs, it helps diversify risk. - In the long term, this will accelerate the regionalization of the semiconductor supply chain, forming a U.S.-centric high-end manufacturing ecosystem, and potentially spurring investment in local packaging capabilities in other regions (e.g., Europe, Japan).