Infineon Technologies AG reported revenue that missed analysts’ expectations after the hoped-for resurgence in the electric vehicle (EV) market was delayed.
Sales fell 9.5 percent to 3.7 billion euros (US$4.1 billion) in the past quarter from the same period a year ago, the company said yesterday. That compared to the average 3.79 billion analyst forecast compiled by Bloomberg.
Infineon’s segment result margin, a measure of profitability, was 19.8 percent for the quarter, in line with analysts’ estimates.
Photo: Michaela Rehle, Reuters
Infineon is among the European chipmakers that specialize in making the type of chips used in cars and have grown especially dependent on automakers for their sales.
The company, alongside peers STMicroelectronics NV and NXP Semiconductors NV, has been affected by the auto industry’s pullback from EVs, which in turn has been driven by higher interest rates, weaker-than-expected economic growth and a continued lack of charging stations.
“Prolonged weak economic momentum has resulted in inventory levels in many areas overlaying end demand,” Infineon CEO Jochen Hanebeck said. “In addition to managing the current demand cycle, we are working on further strengthening our competitiveness.”
Infineon said it forecast revenue this quarter to drop from a year earlier to about 4 billion euros, and anticipates a segment result margin of about 20 percent. Analysts had anticipated revenue of 3.94 billion euros and segment result margin of about 22 percent.
Sales from Infineon’s automotive business, its largest, were 2.11 billion euros last quarter. That compared to 2.13 billion euros a year earlier, but was a sequential improvement from the previous quarter, because of an increase in “software-defined” vehicles, the company said.
These cars use Infineon’s chips to help run systems that connect sensors and computers inside vehicles.
Infineon also said it would slash 1,400 jobs and relocate 1,400 more due to a tough market environment.
The job cuts, from a workforce of about 58,600 worldwide, are part of a company-wide restructuring that was launched in May.
The program is aimed at "strengthening our competitiveness," Hanebeck said.
Additional reporting by AFP
SPEED OF LIGHT: US lawmakers urged the commerce department to examine the national security threats from China’s development of silicon photonics technology US President Joe Biden’s administration on Monday said it is finalizing rules that would limit US investments in artificial intelligence (AI) and other technology sectors in China that could threaten US national security. The rules, which were proposed in June by the US Department of the Treasury, were directed by an executive order signed by Biden in August last year covering three key sectors: semiconductors and microelectronics, quantum information technologies and certain AI systems. The rules are to take effect on Jan. 2 next year and would be overseen by the Treasury’s newly created Office of Global Transactions. The Treasury said the “narrow
SPECULATION: The central bank cut the loan-to-value ratio for mortgages on second homes by 10 percent and denied grace periods to prevent a real-estate bubble The central bank’s board members in September agreed to tighten lending terms to induce a soft landing in the housing market, although some raised doubts that they would achieve the intended effect, the meeting’s minutes released yesterday showed. The central bank on Sept. 18 introduced harsher loan restrictions for mortgages across Taiwan in the hope of curbing housing speculation and hoarding that could create a bubble and threaten the financial system’s stability. Toward the aim, it cut the loan-to-value ratio by 10 percent for second and subsequent home mortgages and denied grace periods for first mortgages if applicants already owned other residential
EXPORT CONTROLS: US lawmakers have grown more concerned that the US Department of Commerce might not be aggressively enforcing its chip restrictions The US on Friday said it imposed a US$500,000 penalty on New York-based GlobalFoundries Inc, the world’s third-largest contract chipmaker, for shipping chips without authorization to an affiliate of blacklisted Chinese chipmaker Semiconductor Manufacturing International Corp (SMIC, 中芯). The US Department of Commerce in a statement said GlobalFoundries sent 74 shipments worth US$17.1 million to SJ Semiconductor Corp (盛合晶微半導體), an affiliate of SMIC, without seeking a license. Both SMIC and SJ Semiconductor were added to the department’s trade restriction Entity List in 2020 over SMIC’s alleged ties to the Chinese military-industrial complex. SMIC has denied wrongdoing. Exports to firms on the list
ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip assembly and testing manufacturing (ATM) service provider, expects to double its leading-edge advanced technology services revenue next year to more than US$1 billion, benefiting from strong demand for artificial intelligence (AI) chips, a company executive said on Thursday. That would be the second year that ASE has doubled its advanced chip packaging and testing technology revenue, following an estimate of more than US$500 million for this year. ASE is one of the major beneficiaries from the AI boom as Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) is outsourcing production of advanced chip