Munich Chip manufacturer Infineon is more optimistic about the full year after an increase in sales in the third quarter. In the financial year that ends at the end of September, the Munich–based company now expects sales of around 14 billion euros – that is half a billion euros more than previously expected. The segment result margin is expected to be more than 23 percent, Infineon said on Wednesday.
Rising commodity prices, energy costs and interest rates weighed on economic growth, said Infineon CEO Jochen Hanebeck; demand had weakened in some consumer-oriented end markets. “We are closely monitoring the market development and are prepared to act immediately. However, the structural drivers of decarbonization and digitization continue to create high semiconductor demand.“
Infineon mainly manufactures power semiconductors, which are used in the automotive industry, but also in power generators and in industry.
In the past quarter, revenues improved by a third year-on-year to EUR 3.6 billion, exceeding analysts’ expectations. At EUR 842 million, the segment result was 70 percent higher than a year ago. The shares rose two percent in early trading in Frankfurt.
The group is benefiting from the global chip shortage, which is driving up prices, and the weak euro. The common currency has lost significantly in value against the dollar, which means that Infineon’s profit and sales are higher. The currency effect alone is expected to drive sales up by EUR 140 million in the full year. Since the acquisition of US rival Cypress, Infineon has generated a large part of its revenues in the US currency.
Rival STMicro also recently reported sales above analyst expectations and raised its forecast.