Chips remain in short supply for the time being: Infineon is creaming heavily in the semiconductor crisis

Chips remain in short supply for the time being
Infineon is creaming heavily in the semiconductor crisis

Business at the semiconductor company is booming even more than expected. Compared to the previous year, the profit climbed more than threefold in the business quarter. The persistently high chip demand makes Infineon more optimistic for the year as a whole. “We are more powerful than ever,” says Infineon boss Ploss.

The high demand for semiconductors gave Infineon a record quarter. In the fourth quarter of the fiscal year (until the end of September), the company generated sales of three billion euros, 21 percent more than in the same quarter of the previous year and ten percent more than from April to June, as Infineon announced.

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The segment result has improved since the spring quarter by 24 percent to 616 million euros, which exceeded the analysts’ estimates of an average of 558 million euros. The segment result margin was 20.5 percent and thus higher than three months ago. “We are more powerful than ever,” said Infineon boss Reinhard Ploss. In view of the continuing high demand for semiconductors for the energy-efficient and connected world, the company expects a strong financial year 2022.

Infineon raises the bar higher

Infineon expects a strong increase, especially in the business with automakers and security systems. The automotive sector is Infineon’s segment with the highest sales and also grew strongly in the past year.

The margin based on operating profit, the so-called segment result, is expected to be around 21 percent in the twelve months to the end of September 2022, which is significantly higher than the previous year’s figure. At the beginning of October, the company had announced a figure of around 20 percent.

In terms of sales, the group expects an increase to 12.7 billion euros, with the forecast fluctuating upwards and downwards of 500 million euros. If the middle value is reached, the proceeds would increase by almost 15 percent and thus within the range of the last promised range.

The boom was also noticeable among employees: their number rose year-on-year by more than 3,600 to 50,288. The shareholders also benefit: The dividend is to rise by 5 cents to 27 cents. That is a little more than expected by experts.

Infineon boss Ploss also announced investments: “We are expanding our production capacities – both for silicon and for the compound semiconductors silicon carbide and gallium nitride.” Ploss expects the chip crisis to ease from the second half of 2022, as he explained. Capacity is currently being built in the industry, said Ploss. That will lead to overcapacity: “We will have a bubble that will disappear and then everything will be fine,” said Ploss. “The bubble then fizzles out again.”

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