ASE Technology Holding Co (2DQ) AI Stock Analysis

ASE Technology Holding Co

(Frankfurt:2DQ)

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Positive Factors

Advanced Packaging DemandNear-full utilization and demand exceeding available LEAP capacity demonstrate strong customer pull in advanced packaging. The richer LEAP mix also lifted margins materially, supporting revenue growth, operating leverage and a more favorable earnings mix as adoption continues.

Negative Factors

Deeply Negative Free Cash FlowLarge negative free cash flow means current earnings are not translating into cash after investment needs. Continued outflows can increase reliance on external funding, reduce capital-allocation flexibility and make the expansion program more financially demanding if returns take longer to arrive.

ASE Technology Holding Co (2DQ) vs. iShares MSCI Germany ETF (EWG)

Market Cap: EUR 87.20B
Dividend Yield: 0.94%
Average Volume (3M): 120
Price to Earnings (P/E): 38.1
Beta (1Y): 0.62
Revenue Growth: 18.41%
EPS Growth: 104.10%
Country: Germany
Employees: 96,436
Sector: Technology
Sector Strength: 61
Industry: Semiconductors

ASE Technology Holding Co Business Overview & Revenue Model

Company Description

Established in 1984 and headquartered in Kaohsiung, Taiwan, ASE Technology Holding Co., Ltd. operates as a leading global provider of essential services for the semiconductor industry. Its primary business encompasses a full range of semiconductor pa...

ASE Technology Holding Co Earnings Call Summary

Earnings Call Date:Oct 28, 2026(Q3-2026)|% Change Since:-5.29%|Next Earnings Date:Feb 10, 2027

Earnings Call SentimentPositive

The call was strongly positive overall. Record consolidated and ATM results, substantial year-over-year profit and margin expansion, near-full utilization, raised LEAP expectations, strong full-process and CPO ramps, and favorable fourth-quarter and 2027 outlooks significantly outweighed the stated challenges. The main negatives were capacity and facility constraints, higher debt and investment-related cash needs, EMS component-cost pressure, and softness in cell phone and PC demand.

Positive Updates

Record Consolidated Revenue and Strong Profit Growth

Q3 consolidated net revenue reached a record TWD 244.2 billion, up 28% sequentially and 45% year-over-year. Net income was TWD 27 billion, up 28% sequentially and 148% year-over-year. Fully diluted EPS was TWD 5.84 and basic EPS was TWD 6.13.

Negative Updates

Operating Expenses Increased in Absolute Terms

Operating expenses totaled TWD 20.8 billion, up TWD 1.8 billion sequentially and TWD 5.1 billion year-over-year, primarily due to higher headcount, profit-sharing expenses and additional R&D spending for LEAP initiatives. Management expects operating expenses to continue rising on an absolute level, although the percentage of revenue should remain near the current-year range.

Company Guidance

For Q4 2026, based on an exchange rate assumption of USD 1 to TWD 31.9, consolidated revenue should grow by 6% to 8% quarter-over-quarter, consolidated gross margin should be between 23% to 24%, and consolidated operating margin should be between 14.5% to 15.5%; ATM revenue should grow by 11% to 13% quarter-over-quarter and ATM gross margin should increase by 100 to 200 basis points quarter-over-quarter, while EMS revenue should be flattish quarter-over-quarter with operating margin around 2%. Full year effective tax rate is expected to be between 16% to 17%; 2026 LEAP revenue is expected to be over USD 4 billion versus originally USD 3.7 billion, 2027 LEAP revenue is expected to double, 2026 full process revenue remains USD 300 million and next year is expected to be over USD 1 billion, and CPO revenue is expected to be over USD 0.5 billion next year with mass production continuing into 2027. CapEx for 2026 is increasing from USD 10.5 billion to USD 11.5 billion, next year’s CapEx will be even larger than this year, and next year is expected to have negative cash flow; gross margin is expected to continue sequential improvement on a quarterly basis from the base of 30% next year, general market business is expected to have more than 20% growth in 2026 and that is expected to happen again next year, and EMS is expected to continue to see some growth going into 2027, with high-performance computing representing roughly mid-teens of overall EMS revenue.

ASE Technology Holding Co Risk Analysis

ASE Technology Holding Co disclosed 51 risk factors in its most recent earnings report. ASE Technology Holding Co reported the most risks in the "Finance & Corporate" category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added

1 New Risk

1.Failure to grasp the future development of AI could adversely affect our business, financial condition, and results of operations.Q4, 2023

ASE Technology Holding Co Peers Comparison

Overall Rating

UnderperformOutperform

Sector (61)

Financial Indicators

DE:2DQ against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
KLIC	77Outperform	$3.88B	33.58	13.55%	1.10%	44.44%	2283.94%
TER	76Outperform	$42.90B	31.29	42.04%	0.19%	74.93%	218.54%
Sector *	61Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
AMKR	61Neutral	$9.79B	15.80	13.43%	0.85%	15.70%	100.67%
IMOS	61Neutral	$1.96B	28.41	9.29%	1.36%	22.52%	1433.51%
COHU	60Neutral	$2.40B	-105.07	-2.90%	―	34.00%	69.09%

* Technology Sector Average

Performance Comparison

DE:2DQ and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
DE:2DQ	Ase Technology Holding	35.80	22.30	165.19%
AMKR	Amkor Technology	39.50	1.92	5.11%
IMOS	ChipMOS Technologies Ltd.	54.39	32.75	151.31%
COHU	Cohu Inc	50.79	26.58	109.79%
KLIC	Kulicke & Soffa Industries, Inc.	74.21	34.47	86.73%
TER	Teradyne	274.37	91.65	50.16%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.

ASE Technology Holding Co AI Stock Analysis