CHANDLER, Ariz., Oct. 26 -- Amkor Technology, Inc. (Nasdaq: AMKR) reported third quarter sales of $491 million, essentially flat with the second quarter of 2004 and up 16% over the third quarter of 2003. Amkor's third quarter net loss was $22 million, or ($0.13) per share, compared with net income of $16 million, or $0.09 per share, in the third quarter of 2003. Amkor's third quarter 2003 net income included a gain of $10 million, or $0.06 per share, in connection with the reversal of a tax accrual, and a charge of $2 million, or $0.01 per share, for debt retirement costs.

"Our recent financial performance reflects the impact of the current semiconductor industry correction on an operating plan that was predicated on stronger business conditions," said James Kim, Amkor's chairman and chief executive officer. "In January of this year, business forecasts were robust across our customer base, and I expressed our belief that 2004 revenues would exceed $2 billion. We put in place an operating plan that would position Amkor to capitalize on this growth. Over the past six months, however, semiconductor industry conditions have softened, and we now expect full year revenue closer to $1.9 billion. As we work through the current industry correction, absorb our expanded operational footprint and integrate our recent acquisitions, there will be a near term impact on our financial performance. However our industry is cyclical, and we firmly believe that we are properly positioning Amkor for the long term."

"Due to a strengthening of die support in the last week of September, our third quarter revenue was stronger than we expected when we revised our Q3 outlook one month ago," said John Boruch, Amkor's president and chief operating officer. "Nonetheless, as indicated in our revised outlook, we experienced declining customer forecasts during the third quarter."

"Our third quarter gross margin of 18% was slightly better than the 17% we anticipated in our revised outlook one month ago, as third quarter revenue came in much closer to original guidance," said Ken Joyce, Amkor's chief financial officer. "During the quarter we also increased our material reserves by $6 million to better align our raw material inventory with expected customer demand."

SG&A expenses decreased by $1 million from the second quarter. These expenses included a total of $8 million in legal fees and expenses in connection with the mold compound litigation and Amkor's patent infringement lawsuit against Carsem Semiconductor Sdn Bhd. An evidentiary hearing in the Carsem litigation has been conducted and an initial determination by the International Trade Commission Administrative Law Judge is expected in the fourth quarter, with a final review by the ITC expected in early 2005. The legal fees and expenses were partially offset by the reversal of $2.4 million in employee bonus compensation that was accrued in the first half of 2004.

"Given the continuing inventory correction by our customers, it is difficult to accurately project our revenue, the product mix associated with that revenue, and the resulting gross margin. Near term, we expect our margins to remain under pressure due to the combined impact of competitive pricing actions, excess manufacturing capacity relative to demand, and absorption of costs associated with our recent acquisitions," said Joyce.

"Due to a reduction in forecasted taxable income for the full year 2004, we would have had a nominal tax benefit in the third quarter; however we have recorded a tax provision of $7 million in connection with new guidance issued by tax authorities during the third quarter relating to taxation of our foreign operations," said Joyce.

"Third quarter capital expenditures totaled $73 million and were focused on expanding our test and flip chip capabilities," said Joyce. "We are currently budgeting capital expenditures of $32 million for the fourth quarter, approximating total 2004 capital expenditures of $400 million. For 2005, we are targeting total capital expenditures of $100 million compared with estimated annual depreciation and amortization of approximately $250 million. Next year's capital plan will also be focused on supporting our test and flip chip operations."

In connection with the IBM transaction and related building purchase in China announced in May of this year, we will be making scheduled payments totaling approximately $122 million in the fourth quarter of this year. On our balance sheet at September 30, we include $120 million of this obligation under "short term borrowings and current portion of long-term debt."

As previously announced we are structuring a $300 million six-year term loan facility, with closing scheduled for October 27, 2004. Under terms of the loan agreement we will make a single bullet payment six years from closing of the credit facility. We believe it is prudent to raise these funds at this time to ensure that the company has adequate liquidity during the current industry downturn.

At September 30, 2004 Amkor had U.S. net operating losses available for carryforward totaling $417 million expiring through 2024. Additionally, at September 30, 2004, we had $43 million of non-U.S. operating losses available for carryforward, expiring through 2013.

Selected operating data for the third quarter of 2004 is included in a separate section before the financial tables.

Business outlook

Our customers remain cautious about end-market demand and are exercising tight control over inventory. The high degree of uncertainty in the semiconductor sector is reflected by continued weakness in our customers' forecasts, and this is impairing our business visibility.

On the basis of current customer forecasts, we have the following expectations for the fourth quarter of 2004:

     -  Revenue in the range of 5% to 10% below the third quarter.

     -  Gross margin in the range of 15% to 17%.

     -  Net loss in the range of $0.16 to $0.23 per share.

Amkor will conduct a conference call on October 26, 2004 at 5:00 p.m. eastern time. The call can be accessed by dialing 303-262-2075 or by visiting the investor relations page of our web site: www.amkor.com or CCBN's website, www.companyboardroom.com. An archive of the webcast can be accessed through the same links and will be available until our next quarterly earnings conference call. An audio replay of the call will be available for 48 hours following the conference call by dialing 303-590-3000 passcode: 11006479#.

About Amkor

Amkor is a leading provider of contract semiconductor assembly and test services. The company offers semiconductor companies and electronics OEMs a complete set of microelectronic design and manufacturing services. More information on Amkor is available from the company's SEC filings and on Amkor's web site: www.amkor.com.

Forward Looking Statement Disclaimer

This press release contains forward-looking statements within the meaning of federal securities laws, including, without limitation, statements regarding the following: Amkor's expected revenues for 2004; Amkor's expected revenue, gross margin and net loss for the fourth quarter of 2004; Amkor's near term financial performance, including expected gross margins; Amkor's positioning for the long term; the trend in declining customer forecasts; the judicial determination and final review of the Carsem litigation; budgeted capital expenditures; estimated depreciation and amortization; payments in connection with the IBM transaction; and the closing of the $300 million six-year term loan facility. These forward-looking statements are subject to a number of risks and uncertainties that could affect future results and cause actual results and events to differ materially from historical and expected results, including, but not limited to, the following: the highly unpredictable nature of the semiconductor industry; volatility of consumer demand for products incorporating our semiconductor packages; weakness in the forecasts of Amkor's customers; customer modification of and follow through with respect to forecasts provided to Amkor; deterioration of the U.S. or other economies; the highly unpredictable nature of litigation; our relationship with IBM; the satisfaction of conditions in the agreements entered into in connection with the IBM transaction; the ability of Amkor to attract potential lenders; the results of any additional negotiations with potential lenders; the ability of the Amkor to successfully close the term loan facility; worldwide economic effects of terrorist attacks; military conflict in the Middle East and potential military conflict in Asia, Africa and elsewhere; competitive pricing and declines in average selling prices; timing and volume of orders relative to the production capacity; fluctuations in manufacturing yields; competition; the risk of adverse results of litigation against us; dependence on international operations and sales; dependence on raw material and equipment suppliers; changes in tax laws; exchange rate fluctuations; dependence on key personnel; difficulties in managing growth; enforcement of intellectual property rights; environmental regulations and technological challenges.

Further information on risk factors that could affect the outcome of the events set forth in these statements and that could affect the company's operating results and financial condition is detailed in the company's filings with the Securities and Exchange Commission, including the Report on Form 10-K for the year ended December 31, 2003 and Form 10-Q for the quarter ended June 30, 2004.

     Contact:
     Jeffrey Luth
     VP Corporate Communications
     480-821-5000 ext. 5130
     jluth@amkor.com


    Selected operating data for the third quarter and nine months of 2004

                                            3rd Quarter         Nine Months

      - Capital expenditures:               $73 million        $368 million

      - Depreciation and amortization:      $59 million        $169 million

      - Free cash flow*                    ($39 million)      ($174 million)

      *Reconciliation of free cash flow to the most directly comparable GAAP
       measure:

      Net cash provided by continuing
       operating activities                 $34 million        $194 million
      Less purchases of property, plant
       and equipment                       ($73 million)      ($368 million)
      Free cash flow from continuing
       operations                          ($39 million)      ($174 million)

        We define free cash flow from continuing operations as net cash
        provided by continuing operating activities less purchases of
        property, plant and equipment.  Free cash flow is not defined by
        generally accepted accounting principles, and our definition of free
        cash flow may not be comparable to similar companies.

      - Capacity utilization was approximately 72%.  We calculate capacity
        utilization as quarterly revenue divided by revenue generating
        capacity (RGC) at quarter-end.  We define RGC as 100% of installed
        production capacity (based on the bottleneck limitations for each
        production line), using quarterly average selling price.

      -  Assembly unit shipments were 1.9 billion, down 7% from Q2 2004.

      -  Percentage of revenue:

            Leadframe packages                      43%

            Laminate packages                       44%

            Other packages                           3%

            Test                                    10%

Starting with the second quarter of 2004 we no longer provide end-market revenue distribution. We discontinued this practice because it is difficult for Amkor to accurately determine end-market distribution of our revenue, and we believe that extrapolation of inaccurate data by analysts and investors can be misleading.

                            AMKOR TECHNOLOGY, INC.
                      CONSOLIDATED STATEMENTS OF INCOME
                    (in thousands, except per share data)

                                                   For the Three Months Ended
                                                         September 30,
                                                      2004           2003
                                                          (unaudited)

    Net revenues                                    $490,843       $423,784
    Cost of revenues                                 403,076        322,369
    Gross profit                                      87,767        101,415
    Operating expenses:(1)
      Selling, general and administrative             53,236         43,977
      Research and development                         8,664          7,882
      Gain on disposal of fixed assets, net             (292)          (148)
      Amortization of acquired intangibles             1,867          2,035
         Total operating expenses                     63,475         53,746
    Operating income                                  24,292         47,669
    Other (income) expense:
      Interest expense, net                           38,075         35,151
      Foreign currency loss (gain)                     1,503           (895)
      Other (income) expense, net                       (534)           671
       Debt retirement costs(2)                           --          2,071
         Total other expense                          39,044         36,998
    Income (loss) before income taxes,
     equity investment gain, minority interest
     and discontinued operations                     (14,752)        10,671
    Equity investment gain                                12             --
    Minority interest                                 (1,266)        (1,809)
    Income (loss) from continuing operations
     before income taxes                             (16,006)         8,862
    Provision for income taxes (benefit)               6,328         (6,908)
    Net income (loss)                               $(22,334)       $15,770

    Per Share Data:
      Basic and diluted net income (loss)
       per common share                               $(0.13)         $0.09

      Shares used in computing basic net
       income (loss) per common share                175,717        166,628

      Shares used in computing diluted net
       income (loss) per common share                175,717        171,440

    (1) Certain previously reported amounts have been reclassified to conform
        with the current presentation.

    (2) Debt retirement costs include the following:
          Call premium                                   $--         $1,648
          Unamortized deferred debt acquisition costs     --            423
          Other debt retirement costs                     --             --
                                                         $--         $2,071


                            AMKOR TECHNOLOGY, INC.
                      CONSOLIDATED STATEMENTS OF INCOME
                    (in thousands, except per share data)

                                                   For the Nine Months Ended
                                                         September 30,
                                                     2004           2003
                                                         (unaudited)

    Net revenues                                  $1,448,025     $1,144,862
    Cost of revenues                               1,153,635        922,617

    Gross profit                                     294,390        222,245

    Operating expenses:(1)
      Selling, general and administrative            160,993        128,607
      Research and development                        27,541         22,675
      Gain on disposal of fixed assets, net             (490)          (870)
      Amortization of acquired intangibles             5,032          6,103
         Total operating expenses                    193,076        156,515
    Operating income                                 101,314         65,730
    Other (income) expense:
      Interest expense, net                          107,725        107,494
      Foreign currency loss (gain)                     4,213         (1,083)
      Other (income) expense, net                    (26,953)         2,076
       Debt retirement costs(2)                        2,863         32,632
         Total other expense                          87,848        141,119
    Income (loss) before income taxes, equity
     investment gain (loss), minority interest
     and discontinued operations                      13,466        (75,389)
    Equity investment gain (loss)                          2         (3,555)
    Minority interest                                 (1,621)        (2,135)
    Income (loss) from continuing operations
     before income taxes                              11,847        (81,079)
    Provision for income taxes (benefit)              13,291         (6,072)
    Loss from continuing operations                   (1,444)       (75,007)
    Discontinued operations:
      Income from wafer fabrication services
       business, net of tax of $419 in 2003               --          3,047
      Gain on sale of wafer fabrication services
       business, net of tax of $7,081 in 2003             --         51,519
      Income from discontinued operations                 --         54,566

    Net loss                                         $(1,444)      $(20,441)
    Per Share Data:
      Basic and diluted loss per common share
       from continuing operations                     $(0.01)        $(0.45)
      Basic and diluted income per common share
       from discontinued operations                       --           0.33
      Basic and diluted net loss per
       common share                                   $(0.01)        $(0.12)

      Shares used in computing basic and
       diluted income (loss) per common share        175,216        165,883

    (1) Certain previously reported amounts have been reclassified to conform
        with the current presentation.

    (2) Debt retirement costs include the following:
          Call premium                                $1,687        $21,304
          Unamortized deferred debt acquisition costs  1,176          8,787
          Other debt retirement costs                     --          2,541
                                                      $2,863        $32,632


                            AMKOR TECHNOLOGY, INC.
                         CONSOLIDATED BALANCE SHEETS
                                (in thousands)

                                                  September 30,  December 31,
                                                      2004           2003
                                                         (unaudited)
                               Assets
    Current assets:
      Cash and cash equivalents                     $231,311       $313,259
      Accounts receivable:
         Trade, net of allowance of $5,010
          in 2004 and $6,514 in 2003                 272,325        310,096
         Other                                         4,785          4,413
      Inventories                                    119,969         92,439
      Other current assets                            32,147         49,606
            Total current assets                     660,537        769,813
    Property, plant and equipment, net             1,387,742      1,007,648
    Investments                                       11,626         51,181
    Other assets:
      Goodwill                                       654,226        629,850
      Acquired intangibles                            46,309         37,730
      Other                                           73,448         67,697
                                                     773,983        735,277
            Total assets                          $2,833,888     $2,563,919

                Liabilities and Stockholders' Equity
    Current liabilities:
      Bank overdraft                                  $6,805         $2,690
      Short-term borrowings and current
       portion of long-term debt                     171,174         28,665
      Trade accounts payable                         235,888        230,396
      Accrued expenses                               175,908        170,145
            Total current liabilities                589,775        431,896
    Long-term debt                                 1,744,545      1,650,707
    Other noncurrent liabilities                      97,273         78,974
            Total liabilities                      2,431,593      2,161,577

    Minority interest                                  7,304          1,338

    Stockholders' equity:
      Common stock                                       176            175
      Additional paid-in capital                   1,323,557      1,317,164
      Accumulated deficit                           (932,980)      (931,536)
      Accumulated other comprehensive gains            4,238         15,201
            Total stockholders' equity               394,991        401,004
            Total liabilities and
             stockholders' equity                 $2,833,888     $2,563,919


                            AMKOR TECHNOLOGY, INC.
               CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                (in thousands)

                                                    For the Three Months Ended
                                                             September 30,
                                                           2004        2003
                                                              (unaudited)

    Cash flows from continuing operating activities:

      (Loss) income from continuing operations           $(22,334)    $15,770
      Depreciation and amortization                        58,503      52,660
      Equity investment loss                                  (12)         --
      Other adjustments to reconcile (loss)
       income to net cash provided by operating
       activities                                           8,916      16,297
      Changes in assets and liabilities
       excluding effects of acquisition                   (11,285)    (38,826)
         Net cash provided by operating activities         33,788      45,901

    Cash flows from continuing investing activities:
      Purchases of property, plant and equipment          (73,421)    (63,649)
      Other investing activities                          (27,547)     32,853
         Net cash used in investing activities           (100,968)    (30,796)

    Cash flows provided by (used in) continuing
     financing activities                                   4,370     (23,007)

    Effect of exchange rate fluctuations on cash
     and cash equivalents related to continuing
     operations                                              (474)      2,041

    Cash flows provided from discontinued operations           --          60

    Net decrease in cash and cash equivalents             (63,284)     (5,801)

    Cash and cash equivalents,  beginning of period       294,595     346,304
    Cash and cash equivalents, end of period             $231,311    $340,503

    Supplemental disclosures of cash flow information:
      Cash paid during the period for:
         Interest                                         $34,608     $32,105
         Income taxes                                      $7,663      $3,030


                            AMKOR TECHNOLOGY, INC.
               CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                (in thousands)

                                                     For the Nine Months Ended
                                                             September 30,
                                                           2004        2003
                                                             (unaudited)

    Cash flows from continuing operating activities:

      Loss from continuing operations                     $(1,444)   $(75,007)
      Depreciation and amortization                       169,164     165,360
      Equity investment (income) loss                          (2)      3,555
      Other adjustments to reconcile (loss) income
       to net cash provided by operating activities        (6,196)     53,980
      Changes in assets and liabilities excluding
       effects of acquisitions                             32,423     (47,879)
         Net cash provided by operating activities        193,945     100,009

    Cash flows from continuing investing activities:
      Purchases of property, plant and equipment         (368,078)   (148,230)
      Other investing activities                           11,521      52,865
         Net cash used in investing activities           (356,557)    (95,365)

    Cash flows provided from continuing
     financing activities                                  81,515       8,455

    Effect of exchange rate fluctuations on cash and
     cash equivalents related to continuing operations       (962)      2,522

    Cash flows provided from discontinued operations          111      13,633

    Net (decrease) increase in cash and cash
     equivalents                                          (81,948)     29,254

    Cash and cash equivalents, beginning of period        313,259     311,249
    Cash and cash equivalents, end of period             $231,311    $340,503

    Supplemental disclosures of cash flow information:
      Cash paid during the period for:
         Interest                                         $96,210    $107,869
         Income taxes                                     $22,114      $7,553