Infineon Technologies has lowered its revenue guidance to €15.1 billion ($16.3 billion), plus or minus €400 million, for the year, down from its previous guidance of €16 billion euros, plus or minus €500 million.
German chip manufacturer Infineon Technologies has reported 12 percent drop in revenue to €3,632 million during January-March 2024.
Infineon’s Automotive (ATV) revenue remained stable, totaling €2,078 million, compared with €2,085 million in the first quarter. Revenue from classical car components was unchanged.
Infineon’s Green Industrial Power (GIP) revenue decreased by 4 percent to €469 million, compared with €487 million in the first quarter. As a result of high direct customer and distributor inventory, demand in the areas of renewable energy and energy infrastructure was weaker.
Infineon’s Power & Sensor Systems (PSS) revenue decreased in the second quarter of the 2024 fiscal year by 7 percent to €713 million, compared with €765 million in the prior quarter. The reason for the decline in revenue was weak demand for components for PCs, notebooks, consumer electronics, battery-powered devices and microinverters for roof-top solar systems. Revenue from silicon microphones and components for smartphones continued to recover.
Infineon’s Connected Secure Systems (CSS) revenue increased slightly in the second quarter of the 2024 fiscal year to €371 million, up from €364 million in the first quarter. The growth in revenue of 2 percent was mainly the result of a higher level of sales relating to Wi-Fi.
Infineon announced a cost savings program as it again lowered its full-year revenue outlook, blaming ongoing industry-wide weak demand.
Infineon had cut its outlook in February but at the time predicted a recovery in the second half.
However, Infineon CEO Jochen Hanebeck on Tuesday said that many end markets were developing weakly due to the economic situation, and customers and distributors continue to reduce semiconductor inventory levels, with the automotive sector in particular seeing a noticeable slowdown in growth.
To counter this, Infineon is launching measures focused on production, portfolio management, prices and operating costs that the company said should start to have a positive result on the adjusted, or segment, result beginning in fiscal 2025.
“We are aiming to achieve structural improvements in our segment result in the high triple-digit million euro range per year,” Jochen Hanebeck said in a statement.
Infineon has also lowered its guidance on Capex to about €2.8 billion against the previous guidance of about €2.9 billion for the 2024 fiscal year. The focus will be investments in the manufacturing module at the Kulim site (Malaysia), which is designed to produce compound semiconductors, as well as the manufacturing module in Dresden (Germany), designed to produce analog/mixed-signal components, Infineon said.
