Ase Technology to Report Q2 Earnings: What's in Store for the Stock?

The Zacks Consensus Estimate for second-quarter 2026 revenues is pegged at $5.99 billion, indicating a year-over-year increase of 22.22%.

Let us see how things have shaped up prior to the announcement.

Factors Likely to Influence ASX’s Q2 Performance

ASX’s second-quarter performance is expected to benefit from broad-based revenue growth across both its LEAP advanced packaging services and its traditional ATM (Assembly, Test, Material) business. Management projects consolidated second-quarter 2026 revenues to grow by 7% to 9% quarter over quarter, with ATM revenues expected to increase by 9% to 11%. This growth can be attributed to strong demand for artificial intelligence (AI)-related products, which are less subject to traditional seasonality and robust momentum in both assembly and test services.

The company is expected to have benefited from broad-based growth across both its LEAP and mainstream semiconductor packaging businesses in the to-be-reported quarter. Although smartphone and PC demand remained soft, rising demand for AI-related peripheral chips, including power management, connectivity, sensors and edge devices, along with improving automotive and industrial semiconductor demand, is expected to have more than offset weakness in traditional consumer markets. The mainstream ATM business is expected to have maintained growth rate similar to last year, providing an additional tailwind to second-quarter revenues.

Another key benefit in the second quarter of 2026 is the sequential improvement in profitability. ASX anticipates a sequential increase in gross margin by 20 to 100 basis points and operating margin by 50 to 120 basis points in the to-be-reported quarter. The company projected ATM gross margin of 26-27% for the second quarter, compared with 26% in the first quarter. A favorable pricing environment, supported by Ase Technology’s strong market position, is likely to have aided margins, although higher costs associated with early deployment of resources for new product transitions and ongoing LEAP capacity expansion are expected to have partially offset these gains.

ASX's second-quarter performance is also expected to have benefited from improving momentum in its Electronics Manufacturing Services (EMS) business in the to-be-reported quarter. EMS revenues are expected to increase at least 10% year over year, supported by stronger demand for AI accelerator products and an improving product mix.

What Our Model Says About ASX

Our proven model predicts an earnings beat for Ase Technology this time around. Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is the exact case here.

ASX has an Earnings ESP of +21.21% and a Zacks Rank #2 at present. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Other Stocks to Consider

Here are some other companies worth considering, as our model shows that these too have the right combination of elements to beat earnings in their upcoming releases.

Amphenol APH has an Earnings ESP of +1.12% and sports a Zacks Rank #1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here. 

Amphenol shares have gained 10.5% year to date. APH is scheduled to report its second-quarter 2026 results on July 29.

Lam Research LRCX currently has an Earnings ESP of +1.38% and a Zacks Rank #2.

Lam Research shares have surged 70.3% year to date. LRCX is set to report its fourth-quarter 2026 results on July 29.

Fortive FTV has an Earnings ESP of +2.82% and a Zacks Rank #2 at present. 

Fortive shares have risen 13.9% in the year-to-date period. FTV is set to report its second-quarter 2026 results on July 29.

Beyond Nvidia: AI's Second Wave Is Here

The AI revolution has already minted millionaires. But the stocks everyone knows about aren't likely to keep delivering the biggest profits. AI’s second wave is moving from infrastructure to implementation and these companies are at the forefront of this transition, positioned to become what Amazon and Google were to the internet era.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research