(JW Insights) Feb 13 -- The Shanghai unit of the US’ Amkor Technology, the world’s second-largest IC packaging and testing company, has refuted rumors that it will start to let staff go and that it will move out of China, as demand drops amid a weak global semiconductor market, Yicai Global reported on February 13.

Amkor Technology does not intend to shift production out of Shanghai or even China and the company, which employs more than 5,400 staff at its facility in the Shanghai Waigaoqiao Free Trade Zone, has no plans to reduce its headcount, Amkor Shanghai said on February 11. No further information was given about the company’s business performance and future plans.

There are also rumors circulating that the Shanghai plant, which covers an area of 120,000 square meters, might shut down for one week from February 27 to March 5 due to a lack of orders. Both the Amkor headquarters and its Shanghai unit have not responded to Yicai Global’s queries about the authenticity of these rumors.

Since the fourth quarter last year, weak consumer demand and high inventories have affected packaging and testing service providers.

Global semiconductors sales plunged 14.7 percent in the fourth quarter 2022 from a year earlier, and dropped 7.7 percent from the previous quarter, to $130.2 billion, according to data from the Semiconductor Industry Association.

Chipmakers stocked up on raw materials during the busy times and the overall equipment utilization rate of the industry is currently very low, Yicai Global quoted Zheshang Securities’ research report. As one of the final stages of production, packaging and testing will continue to be affected by a drop in sales in the first quarter, it added.

(Yuan XY)