Infineon reported third quarter segment profit of 220 million euros ($259 million), beating analyst estimates of 119 million euros, but warned the Covid-19 pandemic continues to have a significant impact on its target markets, resulting in weaker demand in many product areas.
- The Munich-based company said it expects the guided range of its full-year revenue to be around 8.5 billion euros. The third-quarter figures include those of Infineon’s $8.7 billion acquisition of Cypress Semiconductor Corp.
- Infineon said it is seeing concrete signs of recovery within the automotive sector, which had been hit particularly hard as a result of the Covid-19 crisis.
- Chief Executive Officer Reinhard Ploss said the “business performance is highly dependent on how the coronavirus pandemic continues to unfold worldwide, on the impact of the economic stimulus packages that have been implemented, and on a variety of geopolitical factors.”
- Full year revenue of about 8.5 billion euros, versus estimate of about 8.4 billion euros.
- Target markets include automotive, automation and trains. While Infineon sees a recovery in automotive, the sector is still strongly impacted by the pandemic in the third quarter.
- With the acquisition of Cypress, Infineon became the largest chipmaker for the automotive industry.
- Revenue for the three-month period increased from 1.97 billion euros to 2.17 billion euros quarter-on-quarter. The 9% growth in Group revenue was mainly attributable to the Power & Sensor Systems and Connected Secure Systems.
- Shares rose as much as 4.2% in early trading Tuesday.
- The integration of the acquisition of Cypress could be delayed due to the Covid-19 pandemic, German FAZ reported in June citing management board member Peter Schiefer.
- The company announced a capital increase of about 1 billion euros through ABB which will be used to partially re-finance the purchase price for the acquisition of Cypress
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