EQS-News: Infineon Technologies AG: INFINEON CONCLUDES A SIGNIFICANTLY BETTER-THAN-EXPECTED QUARTER AND AGAIN RAISES ITS OUTLOOK FOR THE CURRENT FISCAL YEAR

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EQS-News: Infineon Technologies AG / Key word(s): Quarter Results/Forecast
Infineon Technologies AG: INFINEON CONCLUDES A SIGNIFICANTLY BETTER-THAN-EXPECTED QUARTER AND AGAIN RAISES ITS OUTLOOK FOR THE CURRENT FISCAL YEAR

04.05.2023 / 07:30 CET/CEST
The issuer is solely responsible for the content of this announcement.


 

  • Q2 FY 2023: REVENUE €4.119 BILLION, SEGMENT RESULT €1.180 BILLION, SEGMENT RESULT MARGIN 28.6 PERCENT
  • OUTLOOK FOR Q3 FY 2023: BASED ON AN ASSUMED EXCHANGE RATE OF US$1.10 TO THE EURO, REVENUE OF AROUND €4 BILLION WITH A SEGMENT RESULT MARGIN OF AROUND 26 PERCENT EXPECTED
  • OUTLOOK FOR FY 2023: DESPITE A CHANGE IN THE ASSUMED EXCHANGE RATE FROM US$1.05 TO US$1.10 TO THE EURO, THE REVENUE FORECAST OF €15.5 BILLION (PLUS OR MINUS €500 MILLION) HAS BEEN RAISED TO €16.2 BILLION (PLUS OR MINUS €300 MILLION). AT THE MID-POINT OF THE GUIDED REVENUE RANGE, AN ADJUSTED GROSS MARGIN OF AROUND 47 PERCENT (PREVIOUSLY AROUND 45 PERCENT) AND A SEGMENT RESULT MARGIN OF AROUND 27 PERCENT (PREVIOUSLY AROUND 25 PERCENT) ARE NOW EXPECTED. INVESTMENTS ARE STILL ANTICIPATED TO AMOUNT TO APPROXIMATELY €3.0 BILLION. TAKING THE PLANNED INVESTMENTS IN FRONTEND BUILDINGS INTO ACCOUNT, INFINEON NOW EXPECTS FREE CASH FLOW TO BE AROUND €1.1 BILLION (PREVIOUSLY €0.8 BILLION) AND AN ADJUSTED FREE CASH FLOW OF AROUND €1.8 BILLION (PREVIOUSLY 1.5 BILLION)

 

Neubiberg, 4 May 2023 – Today, Infineon Technologies AG is reporting results for the second quarter of its 2023 fiscal year (period ended 31 March 2023).

 

"Infineon is performing very well. We are seeing strong growth in our businesses relating to electromobility, renewable energy generation and energy infrastructure. These are precisely the key applications we are serving in terms of the decarbonization," says Jochen Hanebeck, CEO of Infineon. "Although an improvement in consumer goods markets such as smartphones, PCs and home appliances is not yet visible, we are nevertheless very confident overall about Infineon’s future business performance. We are therefore revising our expectations for revenue and profitability in the current fiscal year upwards, as already announced at the end of March."

 

Euro in millions Q2 FY23 Q1 FY23 +/- in %
       
Revenue 4,119 3,951 4
Gross margin (in %) 46.6% 47.2%  
Adjusted gross margin1 (in %) 48.6% 49.2%  
Segment Result 1,180 1,107 7
Segment Result Margin (in %) 28.6% 28.0%  
Profit (loss) from continuing operations 827 729 13
Profit (loss) from discontinued operations, net of income taxes (1) (1) -
Profit (loss) for the period 826 728 13
       
in Euro      
Basic earnings (loss) per share 0.63 0.55 15
Diluted earnings (loss) per share 0.63 0.55 15
Adjusted earnings (loss) per share diluted1,2 0.69 0.64 8

1 The reconciliation of net income to adjusted net income and adjusted earnings per share as well as of cost of goods sold to adjusted cost of goods sold and adjusted gross margin can be found in the quarterly information at www.infineon.com.

2 The calculation for earnings per share and for adjusted earnings per share is based on unrounded figures.

 

GROUP PERFORMANCE IN THE SECOND QUARTER OF THE 2023 FISCAL YEAR

In the second quarter of the 2023 fiscal year, Group revenue was €4,119 million. Compared with revenue in the prior quarter of €3,951 million, this was an increase of 4 percent. Revenue in the Automotive (ATV) and Green Industrial Power (GIP)3 segments improved significantly. The Connected Secure Systems (CSS) segment saw a slight increase in revenue, whereas the Power & Sensor Systems (PSS) segment experienced a significant decline as expected. The weaker US dollar compared with the prior quarter had a negative impact on revenue in all segments.

 

The gross margin in the second quarter of the current fiscal year was 46.6 percent, compared with 47.2 percent in the prior quarter. The adjusted gross margin was 48.6 percent, compared with 49.2 percent in the prior quarter.

 

The Segment Result increased in the second quarter of the 2023 fiscal year to €1,180 million, from €1,107 million in the prior quarter. The Segment Result Margin was 28.6 percent, compared with 28.0 percent in the first quarter of the current fiscal year.

 

The second-quarter non-segment result was a net loss of €107 million, compared with a net loss of €141 million in the prior quarter. The non-segment result for the second quarter of 2023 included €81 million relating to cost of goods sold, €54 million relating to selling, general and administrative expenses and €8 million relating to research and development expenses. In the second quarter, the non-segment result included a net figure for other operating income of €36 million. This includes a gain from the sale of the HiRel DC-DC converter business to Micross Components, Inc. in February 2023.

 

Operating profit improved in the second quarter of the 2023 fiscal year to €1,073 million, up from €966 million in the previous three-month period.

 

The financial result in the second quarter of the current fiscal year was a net loss of €17 million, compared with a net loss of €24 million in the first quarter of the 2023 fiscal year.

 

The tax expense in the second quarter of the 2023 fiscal year increased to €237 million, compared with €216 million in the prior quarter.

 

Profit from continuing operations in the second quarter of the 2023 fiscal year rose to €827 million from €729 million in the preceding quarter. As in the first quarter of the current fiscal year, the result from discontinued operations was a loss of €1 million. The profit for the period improved in the second quarter of the 2023 fiscal year to €826 million, up from €728 million in the prior quarter.

 

Earnings per share from continuing operations in the second quarter of the 2023 fiscal year increased to €0.63, from €0.55 in the preceding quarter (basic and diluted in each case). Adjusted earnings per share4 (diluted) rose in the second quarter of the current fiscal year to €0.69, from €0.64 in the first quarter of the 2023 fiscal year.

 

Investments – which Infineon defines as the sum of investments in property, plant and equipment, investments in other intangible assets and capitalized development costs – totaled €565 million in the second quarter of the current fiscal year, compared with €605 million in the prior quarter. Depreciation and amortization in the second quarter of the 2023 fiscal year amounted to €434 million, compared with €429 million in the first quarter of the 2023 fiscal year.

 

Free Cash Flow in the second quarter of the current fiscal year increased to €193 million, compared with €25 million in the preceding quarter. Cash flow from operating activities from continuing operations improved slightly to €647 million, compared with €631 million in the first quarter of the 2023 fiscal year.

 

The gross cash position at the end of the second quarter of the 2023 fiscal year decreased to €3,446 million, compared with €3,708 million at 31 December 2022. This was mainly due to the dividend payout in February of €417 million, which more than offset the positive Free Cash Flow. Financial debt decreased slightly from €5,467 million at the end of the first quarter of the current fiscal year to €5,428 million at 31 March 2023 as a result of exchange rate movements. The net cash position was net financial debt of €1,982 million, compared with net financial debt at the end of the prior quarter of €1,759 million.

 

OUTLOOK FOR THE THIRD QUARTER OF THE 2023 FISCAL YEAR

Based on an assumed exchange rate of US$1.10 to the euro, Infineon expects to generate revenue of around €4 billion in the third quarter of the 2023 fiscal year. Revenue growth in the ATV segment is expected to increase slightly compared with the previous quarter. Revenue in the GIP segment should stay at about the level reached in the preceding quarter. In the PSS and CSS segment a revenue decline is forecast compared with the second quarter of the current fiscal year. Based on the revenue forecast for the group, the Segment Result Margin should be around 26 percent.

 

OUTLOOK FOR THE 2023 FISCAL YEAR

Notwithstanding the less favorable exchange rate now assumed of US$1.10 to the euro (previously US$1.05), the revenue forecast for the 2023 fiscal year has been revised up from €15.5 billion (plus or minus €500 million) to €16.2 billion (plus or minus €300 million). This is equivalent to a growth rate of 14 percent compared with the 2022 fiscal year. Revenue growth for both the ATV and GIP segments is expected to be above the average rate for the Group. In the CSS segment, revenue is likely to grow at around the average rate for the Group. Revenue in the PSS segment is expected to be lower than in the prior year. At the mid-point of the guided revenue range, the adjusted gross margin is now expected to be around 47 percent (previously around 45 percent) and the Segment Result Margin around 27 percent (previously around 25 percent).

 

Investments – which Infineon defines as the sum of investments in property, plant and equipment, investments in other intangible assets and capitalized development costs – are planned at around €3.0 billion for the 2023 fiscal year. The focus here will be on the construction of the third manufacturing module on the Kulim site (Malaysia) designed to produce compound semiconductors, the planned start of construction work on the fourth manufacturing module in Dresden (Germany) designed to produce analog/mixed-signal components and power semiconductors, and the continuing expansion of frontend manufacturing capacity especially in Dresden (Germany) and Villach (Austria).

 

Depreciation and amortization are now anticipated to be about €1.8 billion in the 2023 fiscal year (previously about €1.9 billion), of which approximately €450 million is attributable to purchase price allocations arising mainly from the acquisition of Cypress. Taking the planned investment in frontend buildings into account, Free Cash Flow is now forecast to be around €1.1 billion (previously €0.8 billion). Adjusted Free Cash Flow is now expected to reach around €1.8 billion (previously €1.5 billion), or about 11 percent of the forecast revenue for the year of €16.2 billion.

 

The outlook for Infineon for the 2023 fiscal year is presented without taking into account the planned acquisition of GaN Systems (in particular, not taking into account the purchase price payment), as the transaction is still subject to customary closing conditions, including regulatory approvals.

 

3 With effect from 1 April 2023, the "Industrial Power Control" segment was renamed "Green Industrial Power". The change of name has no impact on the organizational structure, strategy or scope of the business.

 

4 Adjusted net income and adjusted earnings per share (diluted) should not be seen as a replacement or superior performance indicator, but rather as additional information to the net income and earnings per share (diluted) determined in accordance with IFRS.

 

Infineon’s segments’ performance in the second quarter of the 2023 fiscal year can be found in the quarterly information at www.infineon.com.

 

All figures in this quarterly information are preliminary and unaudited.

 

ANALYST TELEPHONE CONFERENCE AND TELEPHONE PRESS CONFERENCE

The Management Board of Infineon will host a telephone conference call including a webcast for analysts and investors (in English only) on 4 May 2023 at 9:30 am (CEST), 3:30 am (EDT). During the call, the Infineon Management Board will present the Company’s results for the second quarter of the 2023 fiscal year as well as the outlook for the third quarter and the 2023 fiscal year. In addition, the Management Board will host a telephone press conference with the media at 11:00 am (CEST), 5:00 am (EDT). It can be followed over the Internet in both English and German. Both conferences will also be available live and for download on Infineon’s website at www.infineon.com/investor

 

The Q2 Investor Presentation is available (in English only) at:

https://www.infineon.com/cms/en/about-infineon/investor/reports-and-presentations/

 

 

INFINEON FINANCIAL CALENDAR (* preliminary)

  •   10 May 2023 Berenberg Madrid Seminar, Madrid
  •   11 May 2023 GIP business update call along with PCIM trade show
  •   12 May 2023 Stifel German Corporate Conference, Frankfurt
  •   15 – 16 May 2023 J.P. Morgan European Technology, Media and Telecoms Conference, London
  •   17 May 2023 UBS Best of Europe Conference (virtual)
  •   23 May 2023 Equita European Conference, Milan
  •   31 May 2023 Goldman Sachs Global Semis Conference, New York
  •   6 Jun 2023 Berenberg Innovation Conference, Zurich
  •   6 – 7 Jun 2023 24th CEO Conference of BNP Paribas Exane, Paris
  •   12 Jun 2023 Future of the auto industry Conference, Newstreet Research (virtual)
  •   20 Jun 2023 dbAccess German Corporate Conference, Frankfurt
  •   21 Jun 2023 BofA EU TMT Conference, London
  •   3 Aug 2023* Earnings Release for the Third Quarter of the 2023
    Fiscal Year
  •   15 Nov 2023* Earnings Release for the Fourth Quarter and the 2023
    Fiscal Year

 

 

ABOUT INFINEON

Infineon Technologies AG is a global semiconductor leader in power systems and IoT. Infineon drives decarbonization and digitalization with its products and solutions. The company has around 56,200 employees worldwide and generated revenue of about €14,2 billion in the 2022 fiscal year (ending 30 September). Infineon is listed on the Frankfurt Stock Exchange (ticker symbol: IFX) and in the USA on the OTCQX International over-the-counter market (ticker symbol: IFNNY). Further information is available at www.infineon.com

 

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D I S C L A I M E R

This press release contains forward-looking statements about the business, financial condition and earnings performance of the Infineon Group.

These statements are based on assumptions and projections resting upon currently available information and present estimates. They are subject to a multitude of uncertainties and risks. Actual business development may therefore differ materially from what has been expected.

Beyond disclosure requirements stipulated by law, Infineon does not undertake any obligation to update forward-looking statements.

Due to rounding, numbers presented throughout this press release and other reports may not add up precisely to the totals provided and percentages may not precisely reflect the absolute figures.

All figures mentioned in this press release are preliminary and unaudited.

 




Contact:
Bernd Hops, Media Relations, phone: +49 89 234 23888


04.05.2023 CET/CEST Dissemination of a Corporate News, transmitted by EQS News - a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

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Language: English
Company: Infineon Technologies AG
Am Campeon 1-15
85579 Neubiberg
Germany
Phone: +49 (0)89 234-26655
Fax: +49 (0)89 234-955 2987
E-mail: investor.relations@infineon.com
Internet: www.infineon.com
ISIN: DE0006231004, XS2056730679, XS2056730323, XS2443921056, XS2194282948, XS2194283672, XS2194283839, XS2194192527, US45662N1037
WKN: 623100, A2YN1J, A2YN1H, A3MQS8, A3E44U, A3E44V, A3E44W, A3E44X, 936207
Indices: DAX, TecDAX, EURO STOXX 50
Listed: Regulated Market in Frankfurt (Prime Standard); Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Hanover, Munich, Stuttgart, Tradegate Exchange; OTC QX, Luxembourg Stock Exchange
EQS News ID: 1623611

 
End of News EQS News Service

1623611  04.05.2023 CET/CEST

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