**ASE Technology Reports Strong First-Quarter Results Amid Margin Expansion**
ASE Technology (ASX) reported significant margin expansion in its first-quarter results for 2026, with gross margins rising to 20.1% from 16.8% year-over-year, and operating margins improving to 10.1% from 6.5%. The growth was attributed to an enhanced mix of Assembly, Testing, and Materials (ATM) revenues, which now account for approximately two-thirds of the company’s total revenue and over 90% of operating profit. Management has raised the 2026 revenue forecast for its advanced LEAP platform to exceed $3.5 billion, and anticipates further gross margin improvement in the upcoming quarter.
As ASE Technology increases its investments in new LEAP production lines, short-term profitability might be impacted by higher depreciation costs. However, if demand for semiconductor packaging remains robust, particularly driven by AI-related applications, the company expects to continue its upward margin trajectory. ASE’s stock has increased 151.9% year-to-date, significantly outperforming the industry growth of 65.3%, and the Zacks Consensus Estimate for its earnings per share in 2026 has risen to 82 cents, indicating a projected growth rate of 43.9% from the previous year.
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