Chipmaker Infineon plans 50% funding increase

  • 2022 investments seen at 2.4 bln euros
  • 2021 income, margin steering confirmed
  • 2022 income seen up round 15%
  • Shares up 3%

BERLIN, Oct 5 (Reuters) – German chipmaker Infineon Technologies (IFXGn.DE) stated on Tuesday it plans a 50% hike in investments subsequent yr, boosting its shares because it seems to be to learn from hovering demand and a worldwide scarcity in semiconductors.

Infineon stated it might make investments round 2.4 billion euros ($2.8 billion) in 2022, up from about 1.6 billion euros this yr.

“We are initially investing in existing plants,” finance chief Sven Schneider advised Reuters. He stated Infineon was contemplating whether or not it wanted so as to add extra capability, however added it was too early to determine on that but.

The main provider of chips to the auto trade forecast income would develop by a mid-teens share subsequent yr, with a section consequence margin – a measure of operational profitability – of round 20%, up from a 2021 goal for 18%.

“The main part of the sales growth will come from capacity building, but also a decent part from higher prices, some of which we will pass on to customers,” Schneider stated.

Infineon shares had been up 3% at 1317 GMT.

The firm has blamed an absence of funding in new capability by its manufacturing companions for tightness in semiconductor markets as demand rebounded after coronavirus lockdowns, disrupting chip provides particularly within the automotive trade. learn extra

Contract chipmakers have invested mainly in manufacturing of higher-margin processors utilized in gadgets like smartphones, leaving current vegetation unable to fulfill demand for the older chips utilized in automobiles.

Infineon opened a 1.6 billion euro plant in Austria final month, boosting its means to produce energy chips for automobiles, information centres and renewable energy. learn extra

The Munich-based agency might determine to construct one other manufacturing unit quickly, assuming the fast adoption of electrical automobiles continues to take up capability in its current vegetation, Stifel analyst Juergen Wagner predicted.

Schneider stated he anticipated the scarcity of chips to tug on nicely in to 2022, welcoming European efforts to extend semiconductor manufacturing capability.

Infineon confirmed steering for 2021 revenues of 11 billion euros.

The firm has itself confronted issues assembly supply commitments after a winter storm knocked out a plant within the United States and lockdowns disrupted operations in Malaysia.

($1 = 0.8622 euros)

Writing by Riham Alkousaa and Emma Thomasson
Editing by Jason Neely and Mark Potter

The logo of semiconductor manufacturer Infineon is seen in Villach, Austria, June 3, 2018. REUTERS/Lisi Niesner/File Photo