Amkor's $12 billion Arizona campus: customers prepay, Washington has paid $0, the utility has no spare power

Amkor's▲+7.71% — Amkor, up 7.71 percent today $12 billion Peoria, Arizona packaging campus is being funded three ways, and only one of the three is paying: customers prepay cash to reserve space, the Arizona utility is building power on 25-year contracts it has signed with others, and the federal government has paid nothing yet on a $407 million award ⁴⁵². The stock's fall of 57% between May 10 and November 6↗ is the market repricing that funding structure, because the quarter's own revenue was nearly flat ³.

If prepaid capacity converts to revenue on the 2028 schedule Amkor has published, the price now on the screen is too low for 2027 and 2028. The rest of this piece is about who carries the plant until then.

Customers fund the plant, Washington has paid nothing yet

Start with the money, because it is new. CFO Megan Faust said on the October 26 call↗ that a dozen customers have signed advance-payment arrangements since 2025, putting cash up front to lock in multiyear advanced-packaging production space in Korea and Arizona ⁴. Customers are funding the expansion.

Washington is not: Amkor's October SEC filing↗ shows $553.3 million of construction costs incurred in Peoria through September 30 and zero received from the federal CHIPS award of up to $407 million, which pays only as construction and production milestones are met ².

The power for the campus is being built on other customers' contracts

On November 4, Pinnacle West, the utility that would serve the campus, said it has no excess generation or transmission capacity anywhere in its territory↗, and it is raising $700 million of notes and about $235 million of equity to build for chip customers on 25-year direct contracts ⁵. The one 25-year direct pricing contract it named is TSMC's▲+7.02% — TSMC, up 7.02 percent today, for about 1.88 gigawatts at full build-out ⁵.

It cites Amkor's campus only among new manufacturing demand, and uncontracted data center and manufacturing demand remains outside its current plan ⁵. A power contract for Peoria is still ahead of the company.

The quarter gives the market its case

Revenue was $1,991 million, up 0.2% year on year after 25.6% growth the quarter before, and the fourth quarter is guided flat↗ at $1.9 to 2.0 billion ¹³. Advanced products revenue fell to $1,632 million from $1,684 million, while mainstream wirebond, the older lower-technology packaging used for simpler chips, rose to $359 million from $303 million ¹. The gross margin gain to 18.3% was almost entirely cheaper materials; depreciation and labor took 2.8 points back, and more depreciation arrives as new plants open ¹.

Who carries the plant while it is empty

So who carries it? Customers reserve space and get locked-in capacity; Amkor gets cash for a plant it cannot yet fill; taxpayers have paid nothing; shareholders own the years between groundbreaking and advanced revenue ²³⁴.

The repricing has a before and after. Amkor traded at 2.9 times sales at the end of June, the highest multiple of any quarter-end back to late 2016, and by the November 6 close it stood at 1.1 times, with trailing earnings at 13.1 times against 21.8 for the S&P 500 ³. That is the price assuming the gap between the plant and its revenue lasts. The evidence to watch is fourth-quarter gross margin and the 2027 capital plan due in February ³.