BERLIN – Hold on to your hats folks, the German whizz-kid of chipmakers, Infineon (OTC:IFNNY), announced an eye-popping ramp-up of their investment in Malaysia, right on the heels of an oh-so-slightly higher-than-forecasted third-quarter earnings. The semiconductor sphere? Well, it’s a bit like a bag of mixed candies at the moment.
Not just your average chip company, Infineon’s circuitry magic powers everything from our speed demon cars to our pulsating data centres. They racked up a whopping 4.09 billion euros ($4.47 billion) in revenue this third quarter, marking a commendable 13% jump compared to the same time last year. This surge even managed to edge past the slightly lower 4.05 billion euros expectation from the number-crunchers.
Shares in Lang & Schwarz took a bit of a tumble in the premarket trade, slipping by 2.7% post-results, but hey, you win some, you lose some, right?
Jochen Hanebeck, Infineon’s main man, described the semiconductor scene as a “mixed bag of tricks,” with demand surging in fields like electric mobility and renewable energy, but cooling off for consumer gadgets like PCs and smartphones.
The big news? Infineon’s making it rain to the tune of around 3 billion euros in investments for the year. The big ticket item on their shopping list is a mega-construction project in Malaysia where they’re planning to erect the planet’s most colossal 200-mm SiC Power Fab.
Backing this bold venture is a handsome 5 billion euros from customer commitments and another cool billion in upfront payments. Infineon’s not stopping there, though. They’ve got another 5 billion euros they’re itching to plow into the project over the next half-decade.
Early-bird customers from the car sector, like Ford and China’s Cherry and SAIC, have already signed on the dotted line, along with SolarEdge and a trio of top Chinese photovoltaic manufacturers.
Hanebeck confidently stated, “With this expansion in Kulim, we’re locking down our leadership in the market.”
Infineon envisions their expanded plant in Malaysia, along with their Austrian sibling in Villach, to pull in a staggering 7 billion euros in annual revenues.
Looking forward, the company reaffirmed their revenue forecast of a cool 16.2 billion euros, a figure they had optimistically bumped up back in May.
However, it wasn’t all sunshine and roses. Infineon’s third-quarter adjusted, or “segment”, result was a bit of a letdown, dipping 10% from the previous quarter at 1.067 billion euros, while its margin was just a hair below what was anticipated, at 26.1%.
But hey, as they say, every cloud has a silver lining, right?
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