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Amkor cuts jobs, hikes prices amid Q3 loss

Posted: 28 Oct 2005 ?? ?Print Version ?Bookmark and Share

Keywords:amkor? semisys? packaging? test?

Amid ongoing losses in its chip packaging and test business, Amkor Technology Inc. on Wednesday (Oct. 27) said that it has raised prices for select products, but it also implemented a series of cost-cutting measures.

Amkor (Chandler, Ariz.) said that it reduced its headcount by an undisclosed number and also terminated the operations of Semisys, a Korean-based subsidiary that produced molds and other equipment used in semiconductor packaging.

Earlier in the fourth quarter, Amkor sold its specialty test operation based in Wichita, Kansas, in a leveraged buyout transaction. To further streamline its organization, Amkor said it also made "selective reductions in corporate staff and [reduced] manufacturing overhead expenses in our Japan factory."

The move follows ongoing losses at the company. It reported third quarter 2005 sales of $550 million, up 12 percent sequentially and up 12 percent from the third quarter of 2004.

Amkor's third quarter net loss was $19 million, or minus $0.11 per share, compared with a net loss of $22 million, or minus $0.13 per share, for the third quarter of 2004.

"Third quarter business developed better than expectations, building on the strong revenue platform we established in the second quarter," said John Boruch, Amkor's president and chief operating officer, in a statement.

"We have selectively increased prices, and this should result in higher ASPs in the fourth quarter," said Boruch. "We believe that current and forecast business strength, coupled with tight industry capacity and moderate capital expansion, will lead to improved economics for the industry."

In Q4, Amkor projects sequential revenue will increase in the range of 6-to-8 percent. Net income will in the range of $0.02 to minus $0.02 per diluted share.

- Mark LaPedus

EE Times

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