Infineon Technologies Returned to 3Q Net Profit Amid 'Unbroken' Chip Demand -- Update
August 03 2021 - 3:24AM
Dow Jones News
By Mauro Orru
Infineon Technologies AG said Tuesday that it swung back to a
net profit in the third quarter of fiscal 2021, while revenue
continued its ascent as demand for chips shows no signs of abating
amid a global supply shortage.
The German chip maker posted a net profit for the three months
ended June 30 of 245 million euros ($290.9 million), compared with
a net loss of EUR128 million a year earlier.
Revenue for the quarter climbed to EUR2.72 billion from EUR2.17
billion. However, coronavirus-related constraints on manufacturing
capacity in Malaysia, and the aftermath of the winter storm in
Texas held back revenue growth, harming its automotive, and power
and sensor systems segments.
The company's segment result--a closely watched metric
comparable to adjusted earnings before interest and taxes--rose to
EUR496 million from EUR220 million, with its segment result margin,
or adjusted EBIT margin, up to 18.2% from 10.1%, it said.
Infineon in May had guided for third-quarter revenue between
EUR2.6 billion and EUR2.9 billion, with adjusted EBIT margin at
around 18% at the midpoint.
"Demand for semiconductors is unbroken," Chief Executive
Reinhard Ploss said. "Inventories are at a historic low; our chips
are being shipped from our [fabrication plants] straight into the
end applications," he added.
For the fourth quarter, the company said it expects revenue of
around EUR2.9 billion, with adjusted EBIT margin at around 19%.
However, it cautioned that revenue at its automotive, and
industrial power control segments will likely remain at a similar
level to the previous quarter citing restrictions in Malaysia.
Infineon slightly tweaked its guidance for the fiscal year, and
now expects revenue of around EUR11 billion. It had previously
guided for revenue of around EUR11 billion, plus or minus 3%. Its
adjusted EBIT margin should come in above 18%.
Mr. Ploss said the company is continuously building up capacity
to tackle what he described as an "extremely tight supply
situation."
The company is investing around EUR1.6 billion this year in
properties, plants, equipment, intangible assets and capitalized
development costs.
"Under these circumstances, any pandemic-related restrictions on
manufacturing, such as those recently imposed in Malaysia, are
especially grave. We are doing our utmost to improve matters along
the entire value chain," he added.
Write to Mauro Orru at mauro.orru@wsj.com; @MauroOrru94
(END) Dow Jones Newswires
August 03, 2021 03:16 ET (07:16 GMT)
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