Amkor Technology, Inc.

Good day, ladies and gentlemen, and welcome to the AMCOR Technology fourth quarter and full year 2025 earnings conference call. My name is Diego, and I will be your conference facilitator today. At this time, all participants are in a listen-only mode. After the speaker's remarks, we will conduct a question-and-answer session. As a reminder, this conference is being recorded. I would now like to turn the call over to Jennifer Ju, Head of Investor Relations. Ms. Chu, please go ahead.

Good afternoon, and welcome to AMCOR's fourth quarter 2025 earnings conference call. Joining me today are CEO Kevin Engel and CFO Megan Faust. Our earnings press release was filed with the SEC this afternoon and is available on the investor relations page of our website, along with the presentation slides that accompany today's call. During this presentation, we will use non-GAAP financial measures, and you can find the reconciliation to the comparable GAAP financial measures in the slides. We will make forward-looking statements today based on our current beliefs, assumptions, and expectations. Please refer to our press release for a disclaimer on forward-looking statements and our SEC filings for a discussion of the risk factors and uncertainties that may affect our future results. I will now turn the call over to Kevin.

Thank you, Jennifer. Good afternoon, everyone. And thank you for joining us today. Before I get to results, I want to begin by saying how honored I am to speak with you for the first time as a CEO of Amcor. I'm grateful to the board for placing their confidence in me to lead the company into the next phase of our journey. I want to acknowledge Heal for his leadership and vision. which guided us to where we are today. Having spent more than two decades with Amcor, I've seen firsthand the strength of our people, the trust of our customers, and the ability to evolve with the industry, adapting with agility and executing through market transitions and periods of uncertainty. Amcor is an exceptional organization with a team dedicated to delivering customer value and advancing leading-edge technologies. My leadership approach is grounded in transparency, disciplined execution, and a strong customer focus. I'm energized to lead Amcor as we enter the next chapter of growth. I'll turn to our fourth quarter performance. Amcor delivered strong fourth quarter results to close out a dynamic year. Q4 revenue was $1.89 billion. and EPS was 69 cents, outperforming the high end of our guidance. All end markets exceeded expectations, with the largest upside coming from communications, driven primarily by strong iOS demand. For the full year, revenue grew 6% to $6.7 billion. Computing continued its multi-year acceleration. Automotive delivered strong advanced content growth. consumer demand improved, and communication stabilized with a key socket gain. Our team executed exceptionally well, navigating shifts in the market conditions, a fluid geopolitical environment with agility and precision, which enabled us to deliver strong fourth quarter results. As we look back on 2025, it was a year marked with meaningful progress across each pillar of our strategy. We delivered record advanced and computing revenue driven by deep customer engagements across AI and HPC. We successfully ramped our first high density fan out programs into high volume production, expanding across multiple customers and positioning our platform for strong tailwinds in 2026. Operationally, we made solid progress in Vietnam, reaching breakeven in Q4. We also broke ground on our Arizona campus, with construction of Phase 1 now underway. Collectively, these accomplishments strengthened our strategic position, expanded our global footprint, and reinforced our alignment with the fastest-growing megatrends shaping the semiconductor industry. Now let me share an update on our strategic initiatives. Our strategy remains firmly grounded and well aligned with current market dynamics. As we move into the next phase of growth, we see opportunities to further strengthen our execution while staying anchored in our three strategic pillars. First, elevate our technology leadership. Second, expand our geographic footprint And third, enhance strategic partnerships and focus markets. These pillars have been central to our progress and will continue to shape our path forward as we support accelerated demand for advanced packaging and deliver greater resiliency, flexibility, and value to our customers. On technology leadership, we will continue to invest in advanced packaging platforms including HDFO, flip chip, and test, which are critical to next generation AI and high performance computing. In 2026, our focus is on launching new programs across these platforms. We have two additional programs and final qualification for HDFO supporting AI data centers, in addition to the two HDFO PC devices we've discussed previously. Our Korea team is preparing for launching both programs into high volume in the second half of the year. The majority of our 2026 equipment investment is focused on HDFO and tests. As AI and HPC demand continues, we are well positioned to enable the next wave of advanced products. We are expanding our footprint to provide customers with diversified regional options for advanced packaging and test. Our presence across Asia, Europe, and soon the US gives customers meaningful supply chain flexibility. In 2026, our priorities include meeting construction milestones of our Arizona facility, expanding advanced packaging capacity in Korea and Taiwan, and continuing to scale in Vietnam. The ongoing ramp in Vietnam, including the migration of SIP products from Korea, is expected to free up manufacturing space in Korea for HDFO and test growth. This provides needed flexibility until our Arizona facility comes online. We're also working closely across the ecosystem with foundries, fabulous companies, IDMs, and OEMs to align technology roadmaps and scale capacity. In 2026, our focus is on enhancing these partnerships with clear milestones and investment commitments. For example, one of the HDFO CPU devices ramping this year includes customer commitments to support our capacity investment, demonstrating how tightly our three pillars come together to support AI market expansion. Across all three pillars, we remain focused on margin improvement driven by operational excellence, optimization in Japan, Vietnam ramp-up efficiencies, a more favorable pricing environment, and a sustained mixed shift towards high-value advanced packaging. We look forward to sharing more details at the Investor Day in May. For full year 2026, we expect revenue growth to be driven by continued acceleration in computing with expected to grow over 20%, and continued strong growth in advanced automotive. The remainder of our business is expected to grow in the single digits. We continue to monitor export control and trade policies, as well as dynamics around substrates, advanced silicon, and memory supply. We have considered these items in our guidance for Q1. With a strong technology roadmap, targeted capital investments, and deep customer partnerships, Amcor is well positioned to enable the industry's next wave of innovation. I will now turn the call over to Megan to provide more details on our fourth quarter performance and near-term outlook.

Thank you, Kevin, and good afternoon, everyone. Fourth quarter revenue was $1.89 billion. down 5% sequentially, and up 16% year-on-year. The sequential decline reflected typical seasonal trends in communications and consumer, following strong Q3 builds, partially offset by continued strength in advanced automotive. In communications, revenue grew 28% year-on-year in Q4 and 1% for the full year, reflecting a stronger footprint in the current generation of iOS phones and healthy demand across both iOS and Android ecosystems. Computing revenue increased 6% year-on-year in the fourth quarter and 16% for the full year, driven by strength in AI-related PC devices and networking infrastructure. Automotive and industrial revenue increased 25% year-on-year in Q4 and 8% for the full year, driven by strength in advanced automotive content for ADAS applications. Mainstream automotive continued a gradual recovery in Q4, marking the third consecutive quarter of sequential growth. In consumer, revenue declined 10% year-on-year in the fourth quarter, reflecting the product lifecycle of a high-volume wearable product introduced in the second half of 2024. For full year, consumer grew 9% with growth driven by both a full year of the wearable product and a broad improvement across traditional consumer applications. Gross profit for the quarter was $315 million, which included a benefit of approximately $30 million. from asset sales as noted in guidance for the quarter. Gross margin was 16.7%. Operating expenses for the quarter were $130 million. Operating income was $185 million, and operating income margin was 9.8%. Our effective tax rate for the quarter was 4.8%, primarily due to discrete tax benefits related to the recognition of deferred tax assets. Net income was $172 million, resulting in EPS of 69 cents. EBITDA was $369 million, and EBITDA margin was 19.5%. Now let's turn to our full year performance. 2025 revenue increased 6% to $6.7 billion. All end markets grew, and we achieved record revenue in the computing end market. Advanced packaging revenue also set a new record, growing 7% year-on-year, driven by growth in computing, automotive, and consumer. Full-year gross profit was $939 million, and gross margin was 14%, which includes a 90 basis point headwind from the ramp-up of our Vietnam facility. Operating income was $467 million, and operating income margin was 7%. Our full-year effective tax rate was 15.4%, lower than anticipated due to the discrete tax benefits recognized in the fourth quarter. Net income for the year was $374 million, resulting in EPS of $1.50. EBITDA was $1.16 billion and EBITDA margin was 17.3%. Capital expenditures for 2025 were $905 million, lower than our guidance due to the timing of cash payments for our Arizona facility. These investments remain in our plan and will shift into 2026. Full year free cash flow was $308 million. Throughout 2025, we proactively positioned our balance sheet without its strength and flexibility, meaningfully enhancing liquidity. At year end, we held $2 billion in cash and short-term investments, and total liquidity was $3 billion, a 30% increase from the prior year. Total debt was $1.4 billion, and debt-to-EBITDA ratio was 1.2 times. Now turning to our outlook, Q1 2026 revenue is expected to be between $1.6 and $1.7 billion, representing a 25% year-on-year increase at the midpoint. We see strong growth year-on-year in communications, computing, and the automotive and industrial end markets. Gross margin is projected to be between 12.5 and 13.5%. We expect operating expenses to increase to approximately $135 million as we continue to invest in R&D for anticipated growth. Our full year effective tax rate is expected to be around 20%. Net income is forecasted to be between $45 and $70 million, resulting in EPS between 18 and 28 cents, a strong start to the year. 2026 CapEx is expected to increase to a range of $2.5 to $3 billion. 65% to 70% is projected for facility expansion, including phase one of our Arizona campus. About 30% to 35% is projected for HDFO, test, and other advanced packaging capacity. The remaining spend is projected for R&D and quality programs. In closing, our fourth quarter and full year 2025 results reflect AMCOR's focus and discipline on executing our strategic pillars. We enter 2026 with strong momentum, a clear strategy, and an investment agenda to enable our next chapter of growth. This concludes our prepared remarks. We will now open the call up for your questions. Operator?

Thank you. And at this time, we'll conduct our question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate that your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we pull for questions. And your first question comes from Charles Shee with Needham & Company. Please, your question.

Hey, thanks for taking my question, Kevin, Megan, especially Kevin. I work on board. I'm looking forward to working with you going from here. Maybe the first question regarding your CapEx guidance, obviously, that's well above what we thought. So when you announced, when AMCO announced the plan, Arizona, there was a $7 billion total CapEx investment. So we automatically thought that was like a more incrementally, you're going to do that over multiple years. But we kind of have to guess that embedded in your pretty large CapEx guidance, a good amount of that investment is going to be a little bit more front-loading than we thought. So wonder, is there something we kind of missed or what has changed over the last three or four months? I didn't notice you mentioned that there was a customer commitment for a data center HDFO project that feels like that has played a role there. Mind if you give us some sense on why the CapEx numbers are so high and what's the reason for that? Thank you.

Yeah, sure. Thanks, Charles. Good to hear from you. So I think you kind of have to break it into two pieces. If you look at the CapEx projection, again, what Megan highlighted in their prepared remarks, it was about 65 to 70% of that is for facilities. So then you take that percentage and let's talk about the U.S. spend. So when we talk about the U.S., the $7 billion, we talked about two-phased approach. Phase one is you can think about about half of that $7 billion. And then the construction is about 60% of that. So, and then if you think about the construction timeframe that we talked about, we talked about the building being completed in 2027, you know, the basically around middle of the year. So if you kind of overlay that together, you can imagine that between this year and the first half of next year, you get an idea of that capital spending for the phase one build out. In general, if you talk about the other portion of the capex, the 30% to 35% that's equipment, I think there's a couple key things to highlight there. Obviously, that's not equipment for U.S. manufacturing. That's all in support of Korea, supporting the HDFO and test, as well as 300-millimeter capacity expansion in Taiwan. That is an increase year on year, pretty significantly, about a 40% increase on equipment, and that just highlights the strong demand that we're seeing in this advanced packaging area. On the commitment side, let me touch on that. Obviously, we're not going to talk about the details of commitments, but in general, that comes in multiple forms. There could be items like a prepayment agreement or loading agreements, other things that give us confidence that we're going to have high utilization in that facility once it's ready.

Thanks. Maybe a follow-up question on the CapEx. At least for your Arizona facility, you do have a 35% investment tax credit. You may also have the CHIPS Act, the direct funding that's available to you. We know that there are U.S. companies benefiting from those programs. There's a little bit of variance in terms of how they guide CapEx. Some were guiding gross CapEx. Some were guiding net CapEx. So, Megan, this is a question for you. What's that number, CapEx number? Is it the growth or is it the net? And if it's growth, how should we think about how to flow through the benefits government subsidies into the numbers, into our models?

Thank you. Yeah, great question, Charles. So those government incentives as well as the investment tax credits, as well as the grants, those are going to come in on a lag. So you're highlighting a really good point that the Arizona CapEx is going to be front loaded. And so our Arizona investment most likely could peak in 26 because we'll start to have those benefits come through subsequent to the investment periods. So to come around to your original question, there's really minimal offsets in our guide with regards to benefits. And going forward, we will net those. But this is a net position, but there's really minimal in the 2026 guide.

Thank you. And another reminder to the audience, to ask a question, press star 1. And please limit yourself to one question plus one follow-up question so we can get through all the questions today in the time allotted. And your next question comes from Craig Ellis with B. Reilly Securities. Please state your question.

Yeah, thanks for taking the question. I wanted to follow up on some of the full year end market color, which was very helpful. And as I do, Kevin, welcome. Good luck in the role, and I look forward to working with you. So I'll start with computing. In the 20% year-on-year growth, can you help us with color on how the potential size of the two data center HDFO programs might compare to the existing PC-related programs? And as you look at the data center contribution in 2026, would you expect those programs to be at full volume by the time we exit the year, or are they still ramping up as we exit the year? Just some additional color on how that plays out will be helpful.

Okay. Hey, Craig, and thanks for the remarks. You know, when we think about the compute segment, you know, maybe I'll focus on the Q1 color first. You know, we talk about 20% year-on-year growth for the year. You know, what we're talking about there is, again, you need to remember that compute is obviously PC as well as data center. If we look at the PC market, you know, in general, that's showing some headwinds. I'd say that's relatively soft compared to data center. And if we pivot that over onto the technology side, when we look at the 2.5D and HDFO platforms, we're expecting that to nearly triple over the course of this year. Commenting on the devices that are ramping, we would expect one of those to be in very high volume. It'll be a pretty steep ramp. The other one is also ramping. Hard to project if it'll really be full volume towards the end of the year, but definitely meaningful revenue contribution.

Got it. That's helpful. And then, Megan, going back to one of the questions Charles asked just on investment, it certainly seems like you'll have a lot of help from credits and government funding next year. But to the extent that you would need to augment your current cash balance with supplements, are you able to take advantage of debt markets that historically have been very attractive, such as Japan? to provide any additional cash as we work through this first phase of increased investment?

Hey, Craig. Yes. So, as we have mentioned, a significant portion of funding will come from government incentives on the total project. So, that could be upwards of $2.85 billion. I also want to comment before we talk about the debt capacity that we do have I would say commitments from customers. Also, we have some that have already been executed and others that are in discussion. So we expect that that will also contribute to funding. And then as it relates to the AMCOR finance piece, we have been preparing for this for some time to give us, I would say, the flexibility on how to manage that. So yes, we do have access to debt capacity in various forms. especially being at only 1.2 times debt to EBITDA. So we are evaluating those options carefully, and we will manage that in order to optimize that return to shareholders.

That's very helpful. Thank you.

Your next question comes from Randy Abrams with UBS. Please state your question.

Yes. Hi. Thank you. Yeah, my first question wanted to just touch more on the outlook outside of the advanced packaging. The other segments for the single-digit growth, could you talk about the puts and takes within that for comms, the iOS versus Android, and also the SIP programs, if you expect much on the consumer or communication SIP? and then into the auto industrial. You just want to see a bit more color of what you're seeing across the other markets outside the compute.

Hey, Randy. So let me have a couple comments here. So some of this will be more market-driven data rather than what we're seeing internally, but let me give you some color at least. On comms, obviously market data would project that the phone units are roughly flat. I think there's some potential benefits there as there continues to be more of this shift towards premium tier. And typically that would benefit Amcor due to our content and the more premium phones. When we think in compute, again, the PC market, you know, projected to be slightly down on units. So, you know, that's a little bit of a headwind. But then we continue to expect the shift to AI applications as well as more ARM-based, where, again, that benefits Amcor a little bit, you know, basically because we're moving from a vertically integrated kind of IDM model versus outsourced fabulous company type model with Arm. Then on auto and industrial, again, expected overall unit sales in cars to be roughly flat, continued migration over to hybrid and EVs. That's helping to continue to increase the semi-content per car. So, you know, we basically are seeing on the mainstream side, you know, very slow recovery. We have seen three-quarters of positive direction in mainstream. We expect to continue that slow progression out of the trough. And then on the advanced side, again, think about things like, you know, computing in the car, ADAS, infotainment. That's an area we're seeing very strong growth for this year. So very, very positive momentum there. So I think overall, and then on the consumer side, you know, again, I think that'll be heavily driven by consumer sentiment and, you know, new product launches potentially. But in general, what we see across that kind of non-AI, non-advanced auto area is that it will be single-digit type growth.

Okay. Thanks for the color on those. And if I could follow up, then it might be a question more for Megan on the outlook for the margins. I think first, just into first quarter, is that the leverage effect in the one time coming out for the lower guide for Q1? And then as we go through the year with the mix more toward the advanced packaging, which I think you said is accretive, but want to see as it ramps in the ramp-up phase, if you're at the point it's accretive, how to think about the incremental leverage with the stronger growth out of the compute segment.

Thanks, Randy. Yeah, so for Q1, the guide at the midpoint of 13%, there is the, I'm going to say, asset sale that happened in Q4 that's going to impact that flow-through. Without that, the sequential flow through would pretty much be in line with our 30% model. Sequentially, there is some favorable product mix, and then that's being offset by some incremental costs. When I look year over year, there is a, I would say, material content impact, as well as some potential currency headwinds that are impacting that. So Q1 is typically our seasonally lowest top line, but also bottom line. As it relates to the full year, you know, we're able to see good progression in the profit initiatives that Kevin had outlined in prepared remarks, such that we would anticipate, you know, being able to achieve that 30% incremental flow through absent that, you know, the one-time asset sale.

Okay, great. Thanks, Kevin and Megan.

Your next question comes from Ben Reitzes with Malleus Research. Please state your question.

Yeah, hi. How are you doing? Welcome, Kevin. Good to be talking with you. I wanted to ask about comms again because I know it was mentioned in a prior question, but be a little more specific because Qualcomm's guidance obviously indicated a pretty severe decline in the Android, and you tend to have much higher exposure to the, you know, to your large customer and the premium tier. So I was just wondering if you could be a little more specific about the guide for the quarter and the year in terms of comms. It would seem like it would be significantly, meaningfully better than flat just given those premium tier and who you're exposed to, but I just wanted to be sure. Thanks.

Yeah, thanks, Ben. So a couple things. I think when we think about iOS, obviously, and I'm talking more about Q1 at this point, I think about iOS, we're exiting a pretty solid cycle in the phone launches. So I'd say that we're pretty positive on what we're seeing for Q1. For Android, you're right. I think what we're seeing is that, and maybe this is related to memory and other things, but we're continuing to see relative strength in Android devices. and maybe a little bit of a step down, but in general, nothing that's concerning for us. And again, that could be related to the shift to more premium where we participate a little more heavily.

Okay, got it. Thanks. And then with regard to the Arizona project, do you mind just clarifying a little bit more on your partnership with TSMC? How's that progressing? How does that impact that CapEx guidance of yours, and how's the partnership going? Obviously, significant shortages being reported out of them, or at least some, and it seems like they really need your help. So just hoping for a bit of an update there on them. Thanks.

Yeah, thanks for the question. Obviously, U.S. manufacturing is still a couple years away. You know, so when we think about the constraints today, slightly different dynamics, you know, we're trying to support those dynamics, you know, out of our Korea facility, a little bit out of Taiwan as well. You would think about the partnership with TSMC. I'd say that discussion continues. We have a very strong ongoing relationship on technology as well as what type of manufacturing is going to be needed in the U.S. And then you can imagine that collaboration also kind of spirals down to the end customers that are going to ultimately benefit from that U.S. supply chain. If I think about the overall interest level for the U.S., it's continuing to increase. If you go back to our, as an example, our groundbreaking in October last year, that groundbreaking had many customers that attended that, just again reinforcing their interest. And it was really across all of the markets that we support. So it was communications, comms, automotive, as well as even, you know, customers that support consumer products. So we feel really good about the momentum from the customer perspective and expect that to increase as we start to build out the facility.

Okay. Thanks, Kevin.

Your next question comes from Stephen Fox with Fox Advisors. Please state your question.

Hi, good afternoon.

First question, Megan, I'm kind of struggling with the plan for the balance sheet for the coming year, fully recognizing that obviously you're going to have government benefit inflows after you put the cash out. But relative to, you know, doing a couple hundred million dollars of free cash flow in 2005, and I assume excess cash on the balance sheet, can you maybe help us maybe prepare for how much of a debt increase you're going to have to do during the year, the timing, and how quickly you've been deleveraged after that, maybe in 27. Another follow-up.

Yeah, great question. So as it relates to our approach for funding, we are, you know, I would say pursuing various different mechanisms. I had mentioned earlier that we're in discussions with customers, and so we're evaluating that in parallel with what you know, if any, we would need to do this year with respect to the balance sheet. So there's not any updates on timing or magnitude at this time. As you mentioned, we do have significant liquidity that exists today. So we are confident in how we'll be able to manage, you know, the balance sheet and that CapEx need for 2026.

I guess just a couple of things maybe you could help with. Do you Can you give us a sense for what you can run the business on, like how much cash you need to run the business in 26? And should we be thinking of a better material increase in interest expense later in the year? And then just a follow-up on the business in general.

Sure. I'll answer your second question first because I think it's important to note that we'll actually expect a decrease in interest expense even in the event where we may increase debt, and that's associated with capitalizing interest as far as the construction project. And then the first part of your question, you know, really centers around the amount of cash that we would say we'd be comfortable having on the balance sheet. And I would say we can operate with $500 million on the balance sheet. That's a comfortable level for us.

Great. That explains a lot. Just from a bigger picture with the expansions that are going on in Korea and, I guess, more broadly with the advanced packaging, I know you mentioned sort of a 3X increase year over year. Like, how do we think about sort of that flowing through in terms of a curve of ramping and, you know, whether there's any kind of income statement impacts or margin impacts that we should consider as you ramp? Thank you very much.

I'll start with the profile, and Megan can talk a bit more about the other financial aspects. So if we look at the ramp profile, again, we have these PC-related products that are ramping earlier in the year, one already in production today. Then as we get into the second half of the year, there'll be a pretty sizable step up in the CPU data center type devices. So I would expect it to definitely be back end second half loaded related to revenue growth and Megan can you add anything on that?

Sure so that those investments that we've been putting in place even second half of 25 and I would say the equipment will be front end loaded in 26 that is going to put pressure on depreciation expense and as we ramp those as Kevin mentioned in the second half of the year we will see efficiencies such that we will be able to get some accretive outcome from those products.

Thank you. And your next question comes from Steve Barger with KeyBank Capital Markets. Please state your question.

Thanks, and I'll echo the congratulations to you, Kevin. Maybe first for Megan, as you think about revenue growth and mix for 2026, Do you expect to recover the 90 basis point headwind from ramping Vietnam last year, meaning you can get gross margin back in line or better to 2024's 14.8%? Or will something in mix make that hard to get all the way to?

Hi, Steve. Great question. So we are seeing great ramp in 26 as far as our visibility today. So I want to reiterate Kevin's remarks that we did have, I would say, break even in Q4, which was a significant milestone for us in Vietnam. And we see that continuing in Q1, which usually is the lowest quarter. So that's really good foundation. As it relates to the whole year, you know, if you think about with or without, I think you've nailed it. There will be a product mix story in Vietnam related to the products that we have there, which is SIP. But what we will have is, I would say, good fall through to the bottom line as it relates to that business. So we are going to have, I would say, not meaningful gross margin impact, and it's more about product mix at that point going forward.

Got it. Thank you. And, Kevin – With compute showing the strongest growth this year, can you just help nail down what you expect for AI-related packaging revenue this year, or maybe what AI-related advanced packaging revenue as a percentage of total revenue is? We get this question a lot from investors, and just any light you could shed on that would be great.

Yeah, not a whole lot more color I can give there. Obviously, compute in general exited 25% at about 20% of revenue. So you can take that, and then obviously, you know, there have been some estimates that we've given in the past related to the growth rate for the advanced, you know, going back into last year. That's about all I want to show or talk about, but definitely we're going to continue to see accelerated growth in that AI data center slash, you know, even PC area.

Thank you. And your next question comes from Peter Pang with JP Morgan, please say your question.

Hey, thanks for taking my questions and congratulations. I'm looking forward to working with you more closely. Just on your computing, you guys are ramping pretty aggressively and talked about three times. I guess maybe if you can talk about whether, you know, there's any constraints and how much capacity you have to capture additional opportunities. Yeah.

Yeah, thanks, Peter. So when we think about limitations, I won't say necessarily constraints, but limitations on growth, I'd say there's a couple things there. So obviously, labor in general, and this is predominantly on the R&D side, we think about the amount of MPIs that customers want to run, making sure the quals are successful. And that is creating some constraints where we're prioritizing larger opportunities, specifically in Korea. I think another dynamic is space. In the prepared remarks, we talked a little bit about how SIP is migrating over to Vietnam. That helps to free up space in our Korea facility. Also, over the course of 2025, we basically converted some of our existing building space into clean room area. So we saw a little bit of an increase in space in 2025. And then we're continuing to build out a new building where we had the groundbreaking last year. And that new building will come online as we exit 2026. So overall, by the time we exit 2026, we'll basically be increasing our career space around 20% since the beginning of 25. So space is definitely an area that we're accelerating. And then obviously the equipment delivery, as Megan said, that will be more front end loaded in the year to make sure that we're able to support these second half launches.

Got it. And then in your prepared remarks, you also talked about, you know, two additional programs and final qualification. Can you maybe provide some color, whether this is existing customers for any products, these are new customers, any color on that?

Well, they're existing customers, but they're One of them is new to the HDFO platform, so I'll say that. You know, they're both, we mentioned before, they're both CPU related. And, yeah, so, you know, a lot of positive momentum that we've been working with these customers for quite some time on rolling out that next generation technology to them.

Thank you. And at this time, I'm showing no further questions. I would like to turn the call back over to Kevin for closing remarks.

Thank you now, let me give a quick recap of our key messages 2025 was a pivotal year for am core we delivered strong results advanced our strategic initiatives and we position we strengthen our position in the fastest growing areas of the semiconductor industry. As we enter 2026 we are doing so a strong momentum, a clear strategy and deep engagements with partners across the ecosystem. Our first quarter guidance is $1.65 billion, reflecting a 25% year-on-year growth rate. I'm confident in our ability to execute with discipline and for Amcor to enable and capture the next wave of advanced packaging growth. Thank you for joining the call today.

Ladies and gentlemen, this concludes today's conference call. You may now disconnect.