A lead frame strip includes a plurality of connected unit lead frames, each unit lead frame having a die paddle and a plurality of leads connected to a periphery of the unit lead frame. A semiconductor die is attached to the die paddles. A molding compound covers the unit lead frames, including the semiconductor dies. Prior to testing or other processing of the lead frame strip, a gap is etched into a region of the leads which are shared by adjacent ones of the unit lead frames. The gap extends at least mostly through the shared leads. A partial cut is made in the molding compound around the periphery of the unit lead frames prior to the subsequent processing, including below the gap in the shared leads, to electrically isolate the leads of the unit lead frames.