Amkor is taking its Arizona chip packaging campus to $12bn

Amkor is roughly tripling the size of the chip packaging campus it is building in Arizona.

The company announced phase 2 on Tuesday. It adds 60,000 square metres of cleanroom to the 33,000 already planned, taking the site to about 93,000 square metres, and lifts the total planned investment to approximately $12bn.

Construction starts in late 2027 and should finish by the end of 2029. Together the two phases should employ more than 3,500 people in Arizona.

Why now

Amkor gives one reason: demand.

Customer commitments have “surpassed” the cleanroom capacity planned for phase 1, according to the announcement. Chief executive Kevin Engel, who took the job in January, said the expansion reflects “the confidence our customers have placed in Amkor” and that it is “critical to have that capacity in the U.S.”

Amkor describes the campus as the first outsourced assembly and test site in the United States doing advanced packaging in high volume. The 170-acre site is in Peoria, north west of Phoenix. Tempe, which appears on the release, is the company headquarters.

The number has moved three times

Amkor first announced the Arizona project in November 2023 at about $2bn.

At the groundbreaking in October 2025 it became $7bn. On Tuesday it became $12bn. That is six times the original figure in under three years, on a site that has grown from around 55 acres to 170.

One caution on reading those as a clean series. What counts as a phase has changed. In October 2025 the company described $7bn across two phases buying roughly 70,000 square metres. Tuesday’s release puts phase 1 alone at 33,000 and phase 2 at 60,000.

Who is paying

Three sources of money sit behind the build, and only one of them is public subsidy.

Amkor received up to $407m in US CHIPS Act funding, finalised in December 2024. Against $12bn of planned investment that is about 3%.

Nvidia committed $1.5bn as a prepayment in July, cash paid upfront against future packaging capacity rather than an equity stake. Neither company said how much capacity it buys.

The rest is Amkor’s own capital. The company guided to $2.5bn to $3bn of capital spending this year, close to 40% of revenue, and its long-term debt roughly doubled to $2.33bn in the first half.

For scale, Amkor’s market capitalisation is around $12.6bn. The campus will cost roughly what the company is worth.

Who the customers are, and who they are not

Phase 1 has three names attached to it, all on the record.

Amkor named Apple as its first and largest customer in 2023. At the 2025 groundbreaking, Apple chief operating officer Sabih Khan said the site would package and test Apple silicon made at TSMC’s Arizona fabs. TSMC itself signed a ten-year US advanced packaging agreement with Amkor in June. Nvidia is a customer as well as a prepayer.

Phase 2 names nobody. The release refers only to “strong customer commitments”.

What advanced packaging is, and why it is scarce

Packaging used to be the dull end of chipmaking. It is now one of the tightest points in the supply chain.

As shrinking transistors gets harder and more expensive, chipmakers have turned to stitching several dies together inside one package. That is how a modern AI accelerator gets built: compute dies and stacks of memory joined on a single substrate.

Doing that at volume is difficult, and the capacity to do it has not kept pace with demand for accelerators. Reporting through this year has put TSMC’s own advanced packaging lines close to sold out. The company broke ground on a second phase at Chiayi in July.

Amkor is the second largest outsourced packaging firm in the world by revenue, behind Taiwan’s ASE, though that comparison flatters ASE slightly because its reported revenue includes an electronics manufacturing arm.

Europe has one plant, and it does car chips

The European position is worth stating plainly, because it is easy to miss inside an American announcement.

Amkor already operates in Europe. Its plant at Vila do Conde near Porto came with the acquisition of Nanium in 2017, and the company describes it as the only high-volume tier-one advanced packaging site on the continent.

It is busy. Infineon has an engineering team on site under a multi-year partnership, and GlobalFoundries has been moving bump and sort lines there from its Dresden fab. The work is largely automotive: electrification, driver assistance, body electronics.

That is useful capacity and it is not the same thing. Nothing publicly announced in Europe approaches 93,000 square metres of cleanroom aimed at the packaging step that AI accelerators depend on.

So chips designed in Europe, and increasingly the ones European data centres buy, go elsewhere for that step.

The company doing this has a bumpy year behind it

Amkor reported second quarter revenue of $1.9bn in July, up 26%, with net income more than tripling. The shares then fell about a quarter in a day, because third quarter guidance came in below what analysts expected.

The shares traded around $86 at the end of June. They closed at $50.72 on Tuesday, before this announcement went out after the US market closed, and barely moved on Wednesday.

The company is also weighing a stake sale in its Chinese unit, which Bloomberg reported in August at a valuation of $1bn to $1.5bn. Building in Arizona while looking for buyers in Shanghai is the same strategy seen from two ends.

What to watch

Whether Amkor names a customer for phase 2. It has named Apple, Nvidia and TSMC before, and named nobody this time.

Whether the timeline holds. Construction does not start for more than a year, and Amkor’s own risk factors say there is no assurance the campus gets built on the expected timeline, at the expected cost, or at all.

And whether Europe announces anything comparable. Samsung is building test capacity in Vietnam, TSMC is expanding at Chiayi, and Amkor is expanding in Arizona. Somebody is drawing the map of who packages the world’s most advanced chips, and it is happening now.