AT&S raises forecast significantly and announces multi-billion investment in Malaysia

Technology leap in high-performance chips

The boom is driven by a technology leap in high-performance computing toward more interconnectivity rather than just faster individual chips, AT&S CEO Michael Mertin explained in an interview with the Reuters news agency on Monday. In so-called Advanced Packaging, up to 16 processors and memory components are networked on a single IC substrate in order to exchange data extremely quickly in the smallest of spaces. "Das wird die Performance der Supercomputer der Zukunft wesentlich steigern," said Mertin. In addition, the new components are significantly more energy-efficient.

The investment of 1.5 to 2 billion euros at the Kulim site in Malaysia is expected to be fully covered by long-term customer commitments, which, however, still need to be finally negotiated and signed. "Wir gehen davon aus, dass wir mindestens fünf der Top-Hightech-Kunden, die wir als Tech-Partner aus den USA kennen, vertreten haben werden," said Mertin. They form a "Schicksalsgemeinschaft," in which the customers share the investment burden and cannot simply drop out.

Multi-billion investment in Kulim

"Wir werden unseren Park in Kulim vollständig ausbauen," announced Mertin. The workforce in Kulim is to increase by at least 5,000 to around 8,000. In the future, electronic components are also to be inserted directly into the substrates there, a process known in the industry as embedding. The company did not name the second major customer – alongside a well-known US chip group.

The planned convertible bond of up to 500 million euros, on the other hand, serves exclusively to refinance existing structures and not the expansion in Malaysia, the CEO made clear. The additional funds are not part of the billion-euro growth investment, but serve to reshuffle existing financing.

Largest daily gain in company history

Investors at the Vienna Stock Exchange celebrated the plan and the significantly raised forecast: the AT&S stock shot up by as much as 30 percent on Monday, putting it on course for the largest daily gain in its history. At one point, the price climbed to 194.40 euros, an increase of around 26 percent compared to the previous closing price. The stock is thus among the biggest daily winners in Austria's leading index.

The stock receives additional momentum from its ascent into the European stock exchange league: AT&S shares will be included in the STOXX Europe 600 on June 22. Index inclusions are usually associated with greater attention from international investors and, as experience shows, drive demand for the affected stocks.

AI boom as a growth driver

With the business in Kulim, AT&S is positioning itself more strongly in the rapidly growing market for AI components. High-performance computers for training and operating large AI models require increasingly powerful connections between processors and memory. The Advanced Packaging produced by AT&S is considered a key technology for efficiently bundling the enormous data flow within a chip.

Demand for corresponding substrates will continue to rise, according to management's assessment, due to the global expansion of AI data centers. AT&S is one of a handful of manufacturers in this niche market that have the necessary production capacity and technological know-how to equip the next generation of high-performance chips.

AT&S recently delivered solid figures for the current fiscal year 2025/26. With the now raised forecast for 2026/27, the group underlines its ambition to assume a leading role as a supplier to the semiconductor industry in the course of the AI boom. The expansion in Malaysia is to be largely completed by the end of the next fiscal year.

However, risks remain: the billion-euro investments are subject to the condition that the long-term customer commitments are actually signed in full. Should a major customer drop out, AT&S would either have to restructure its financing or slow the pace of capacity expansion.