Packaging Firms Post Mixed Results In Q4 '24

Updated: JCET restructures amid strong results

By Mark LaPedus

IC packaging is an important part of the semiconductor industry.

In the semiconductor process flow, a company designs a chip line using specialized software. Then, a chipmaker manufactures the chip line based on that design in a facility called a fab.

Finally, the chip is assembled in a package. A package is a product that houses a chip and protects it from harsh operating conditions. A package is also used to boost the overall performance of a given chip line.

Nonetheless, it’s important to keep tabs on the leading outsourced semiconductor assembly and test (OSAT) vendors, which specialize in providing third-party packaging and testing services for customers. Here’s the latest financial results from leading OSATs:

JCET

On April 20, JCET Group, China’s largest OSAT, reported its results for the fourth quarter of 2024.

JCET reported robust sales for the quarter amid a major restructuring at the company. The company recently announced a restructuring of its board following the acquisition of a 22.5% stake by China Resources Group, according to recent reports in the South China Morning Post and TrendForce.

China Resources Group, a state-owned Chinese conglomerate, is now JCET’s largest shareholder. JCET’s chairman, Gao Yonggang, resigned from his role. “These changes come as China Resources strengthens its influence in the local semiconductor market,” according to the reports. “The conglomerate, which also owns the semiconductor subsidiary China Resources Microelectronics, acquired its stake in JCET through a Hong Kong-based subsidiary.”

Meanwhile, JCET’s revenue was RMB 10.98 billion (US$1.5 billion) for the quarter, an increase of 19.0% year-on-year, and an increase of 15.7% quarter-on-quarter, a record quarter in the company's history. Net profit attributable to owners of the parent was RMB 0.53 billion, an increase of 7.3% year-on-year and 16.7% quarter-on-quarter.

For 2024, revenue was RMB 35.96 billion (US$4.9 billion), an increase of 21.2% year-on-year, and a record high in the company's history. Net profit attributable to owners of the parent was RMB 1.61 billion, an increase of 9.4% year-on-year.

As of Q4 2024, wafer-level packaging, other advanced packaging, and high-end testing operations had reached full capacity, with revenue from advanced packaging accounting for over 72% of total annual revenue.

For 2024, revenue from the computing electronics segment grew by 38.1% year-on-year. In the automotive electronics sector, breakthroughs in ADAS sensors and electrified drive systems spurred a year-on-year revenue increase of 20.5%.

Here are some of the other major events for JCET:

*In the field of heterogeneous integration, JCET's fan-out packaging platform, called XDFOI, has achieved mass production.

*The company’s acquisition of an 80% stake in SanDisk (Shanghai) has been finalized and consolidated into the financial statements from Q4 onwards.

*The JCET Microelectronics Microsystem Integration High-End Manufacturing Base in Jiangyin has been put into operation, providing turnkey back-end manufacturing services for high-performance chips.

*The Automotive Chip Back-End Manufacturing Base in Shanghai has completed structural topping-out and is expected to begin operations in the second half of 2025, further supporting the company's expansion into the high-end automotive electronics market.

ASE

Taiwan’s ASE reported mixed results for the fourth quarter of 2024.

ASE, the world’s largest OSAT, continues to see strong growth in its advanced packaging business. In addition, ASE and its subsidiary, SPIL, are quietly ramping up several new packaging facilities in 2025, according to TrendForce.

On Feb. 13, ASE reported sales of NT$162,264 million (US$4.95 billion) for the fourth quarter of 2024, up by 1.0% year-over-year and up by 1.3% sequentially. Net income attributable to shareholders of the parent for the quarter totaled NT9,312 million (US$284.3 million), down 1% year-over-year and down 4% sequentially.

Revenues from packaging operations, testing operations, EMS operations, and others represented approximately 43%, 10%, 46%, and 1% of the total net revenues for the quarter, respectively.

For ASE’s assembly and test manufacturing (ATM) business, net revenues were up by 7.8% year-over-year and up by 3.0% sequentially. For the EMS business, net revenues were down by 5.4% year-over-year and down by 0.6% sequentially.

Net revenues for the full year of 2024 amounted to NT$595,410 million (US$18.2 billion), up by 2.3% from the full year of 2023.

Leading-edge advanced packaging and testing revenues were over US$600 million in 2024, accounting for around 6% of ATM revenues, up from US$250 million in 2023. ASE’s testing business grew 9% year-over-year in 2024.

“We have seen a very strong demand for leading-edge packaging and testing, while the mainstream segment was a mixed bag. We saw a soft recovery in some segments, and some other segments due to inventory correction as well as market demand were lacking behind the general market,” said Tien Wu, chief operating officer at ASE, in a conference call.

Going forward, 2025 is expected to be a mixed bag for ASE. Based on the current business outlook and exchange rate assumptions, ASE projects its performance for the first quarter of 2025 to be as follows:

*In NT dollar terms, ASE’s ATM first-quarter 2025 revenues should decline by mid-single digits quarter-over-quarter.

* In NT dollar terms, the company’s EMS first-quarter 2025 revenues should decline slightly year-over-year.

In 2025, ASE’s leading-edge advanced packaging and testing revenues are expected to increase by US$1 billion versus 2024, contributing 10% of growth. That represents around US$1.6 billion in sales for 2025. Some 75% of this business involves advanced packaging, while 25% is test.

To meet demand in the advanced packaging arena, ASE is boosting its capital spending. In 2024, capital spending was US$1.9 billion. In 2025, capital spending is expected to be US$2 billion.

Last month, SPIL celebrated the grand opening of its new Tan Ke Plant in Taichung, Taiwan. Jensen Huang, Nvidia’s chief executive, attended the event at the new packaging facility. The Tan Ke Plant is specifically designed to meet the growing demand for Nvidia’s accelerated computing devices. Currently, the packaging manufacturing facility has reached the ramp up stage.

Along with the inauguration of the Tan Ke Plant, SPIL continues to expand with new plants in other cities in Taiwan, including Changhua, Erlin, and Huwei, Yunlin.

“We will continue to accelerate in preparation for the AI-led super cycle, which we believe have started in 2024 and we will see the momentum in 2025, 2026 and beyond,” Wu said. “We believe the total semiconductor revenues are likely to reach $1 trillion in the next decade, driven by AI, robotics, electrification of all systems, also the energy and the IoT related products. ASE is well positioned to benefit from the strong demand of leading-edge advanced technology, as well as the growing volume of peripheral chips on accelerating edge AI adoption.”

Amkor

On Feb. 10, U.S.-based Amkor reported its financial results for the fourth quarter and full year ended Dec. 31, 2024. Amkor reported sales of $1.63 billion in the fourth quarter, down 7% year-over-year and down 12% quarter-over-quarter.

Net income was $106 million, or $0.43 per share, for the fourth quarter, compared to $123 million, or $0.49 per share, in the previous quarter and $118 million, or $0.48 per share, in the like period a year ago.

“In 2024, weakness in the automotive and industrial and communications end markets contributed to a full year decline. In contrast, we achieved record revenue in our computing end market with growth in ARM-based PCs and AI devices,” said Giel Rutten, Amkor’s president and chief executive. “During the year, we also successfully ramped our new facility in Vietnam, secured CHIPS funding to bolster U.S. manufacturing, and set a new record for advanced SiP revenue.”

In 2024, Amkor ramped up production in a new facility in Vietnam, which is making system-in-package (SiP) and other products. Amkor was also awarded CHIPS funding, but it’s unclear when the company will actually receive those funds. At present, the Trump administration is evaluating the entire CHIPS Act program.

Nonetheless, Amkor’s results were also impacted by other factors. “We think the weakness stemmed from communications softness due to the temporary loss of a socket on the iOS platform, and continued weakness and low visibility in automotive,” said Steve Barger, an analyst at KeyBanc Capital Markets, in a research note.

Amkor also “tempered (its) 2.5D demand outlook driven by an accelerated transition to a new AI GPU product family and incremental trade restrictions,” Barger said.

The following information presents Amkor’s guidance for the first quarter 2025:

*Net sales of $1.225 billion to $1.325 billion

*Net income of $3 million to $43 million, or $0.01 to $0.17 per diluted share

*Full year 2025 capital expenditures of approximately $850 million