EQS-News: Infineon has a slightly better start to the fiscal year than expected and raises its outlook for the year due to currency effects

• Q1 FY 2025: Revenue €3.424 billion, Segment Result €573 million, Segment Result Margin 16.7 percent
• Outlook for Q2 FY 2025: Based on an assumed exchange rate of US$1.05 to the euro, revenue of around €3.6 billion expected. On this basis, Segment Result Margin forecast to be in the mid-teens percentage range
• Outlook for FY 2025: Based on an assumed exchange rate of US$1.05 to the euro
  (previously US$1.10), revenue is now expected to be flat to slightly up (previously: to decline slightly) compared with the prior year. The adjusted gross margin should be around 40 percent and the Segment Result Margin in the mid-to-high-teens percentage range. Investments of approximately €2.5 billion planned. Free Cash Flow adjusted for investments in frontend buildings should be around €1.7 billion and reported Free Cash Flow around €900 million

Neubiberg, 4 February 2025 – Today, Infineon Technologies AG is reporting results for the first quarter of the 2025 fiscal year (period ended 31 December 2024).

"Infineon has held up well in a weak market environment, closing its first quarter slightly ahead of expectations," says Jochen Hanebeck, CEO of Infineon. "Against a continued uncertain economic backdrop, our business trajectory in this fiscal year is following the pattern we expected: Following the expected inventory reduction, we continue to anticipate that the recovery in demand will be gradual for the current fiscal year. The positive stand-out is the move towards increased use of artificial intelligence, which is driving demand for our leading power supply solutions for AI data centers. This is a prime example of our long-term growth drivers, digitalization and decarbonization."

Group performance in the first quarter of the 2025 fiscal year

In the first quarter of the 2025 fiscal year, Group revenue decreased to €3,424 million, compared with €3,919 million in the prior quarter. The 13 percent decline in revenue was the result of weaker demand in all four segments: Automotive (ATV), Green Industrial Power (GIP), Power & Sensor Systems (PSS) and Connected Secure Systems (CSS).

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.

The gross margin in the first quarter of the current fiscal year was 39.2 percent, compared with 41.4⁴ percent in the prior quarter. The adjusted gross margin reached 41.1 percent, compared with 43.3⁴ percent in the fourth quarter of the 2024 fiscal year.

The Segment Result in the first quarter of the 2025 fiscal year declined to €573 million. Included in this figure is a compensation payment from a customer of a mid-double-digit million amount. The Segment Result in the prior quarter was €832 million. The Segment Result Margin decreased to 16.7 percent, compared with 21.2 percent for the last quarter of the 2024 fiscal year.

The first-quarter Non-Segment Result was a net loss of €255 million, compared with a net loss of €359 million in the prior quarter. The Non-Segment Result for the first quarter comprised €64 million relating to cost of goods sold, €18 million relating to research and development expenses and €56 million relating to selling, general and administrative expenses. In addition, it included other operating expenses of €117 million. In the course of restructuring its production process and portfolio as part of its Step Up program, impairment losses of €101 million were recognized and provisions for anticipated losses of €12 million were set up in the first fiscal quarter of 2025.

Operating profit for the first quarter of the current fiscal year reached €318 million, compared with €473 million in the prior quarter.

The financial result in the first quarter of the 2025 fiscal year was a net financial loss of €17 million, compared with a net financial loss of €26 million in the prior quarter.

The tax expense in the first quarter of the current fiscal year was €60 million, compared with €64 million in the final quarter of the 2024 fiscal year.

Profit from continuing operations in the first quarter of the current fiscal year amounted to €243 million, compared with €384 million in the preceding quarter. The result from discontinued operations in the first quarter was a profit of €3 million due to trailing tax effects. In the prior quarter, Infineon recognized a loss from discontinued operations of €468 million as a result of the settlement with the insolvency administrator of Qimonda. The profit for the period in the first quarter rose to €246 million, compared with a loss for the period of €84 million in the prior quarter.

Earnings per share from continuing operations (basic and diluted) stood at €0.18 at the end of the first quarter of the 2025 fiscal year, compared with €0.29 in each case one quarter earlier. Adjusted earnings per share⁴ (diluted) amounted to €0.33 in the first quarter of the current fiscal year, compared with €0.49 in the preceding quarter.

Investments – which Infineon defines as the sum of investments in property, plant and equipment, investments in other intangible assets and capitalized development costs –
in the first quarter of the 2025 fiscal year stood at €731 million, after €722 million in the prior quarter. Depreciation and amortization in the first quarter amounted to €487 million, compared with €473 million in the fourth quarter of the 2024 fiscal year.

Free Cash Flow in the first quarter of the current fiscal year was a negative figure of €237 million, compared with a positive figure of €1,145 million in the prior quarter.

The gross cash position at the end of the first quarter of the current fiscal year was €1,957 million, compared with €2,201 million at the end of the prior quarter. Due to the strength of the US dollar, financial debt increased slghtly from €4,811 million at 30 September 2024 to €4,943 million at 31 December 2024. The net debt position at the end of the first quarter was €2,986 million, compared with €2,610 million at the end of the prior quarter.

Termination and early redemption of the €600 million hybrid bond on 28 March 2025

On 27 January 2025, Infineon issued an irrevocable redemption notice for the outstanding €600 million subordinated notes. The hybrid bond, which was disclosed in equity at 31 December 2024, will be redeemed on 28 March 2025 at the principal amount plus accrued interest to the redemption date.

The €600 million hybrid bond with a first call date of 1 January 2028 will continue to be recognized in equity in accordance with IFRS.

Outlook for the second quarter of the 2025 fiscal year

Based on an assumed exchange rate of US$1.05 to the euro, Infineon expects to generate revenue of around €3.6 billion in the second quarter of the 2025 fiscal year. Revenue in the ATV segment is expected to increase at around the Group average percentage rate. The increase in revenue in the GIP segment should exceed the Group average, while revenue in the PSS and CSS segments is anticipated to remain more or less constant. The Segment Result Margin is expected to be in the mid-teens percentage range.

Outlook for the 2025 fiscal year

Based on an assumed exchange rate of US$1.05 to the euro (previously US$1.10), revenue in the 2025 fiscal year is now forecast to be flat to slightly up in comparison with the 2024 fiscal year. The previous forecast was for a slight decline in revenue. The increase of the annual prediction is thus primarily related to the expected stronger US dollar. Revenue in the ATV and CSS segments is expected to increase at around the Group average percentage rate. Compared with the prior year, a significant decline in revenue is anticipated in the GIP segment and a significant increase in revenue in the PSS segment. The adjusted gross margin should be around 40 percent and the Segment Result Margin in the mid-to-high-teens percentage range.

From 1 January 2025, the "Sense & Control" business line, which was previously allocated to the ATV segment, was reclassified to the PSS segment. This business line is expected to generate more or less the same level of revenue in the second quarter of the 2025 fiscal year respectively in the full 2025 fiscal year as it achieved in the first quarter of the 2025 fiscal year respectively in the full 2024 fiscal year (€707 million). The revenue forecasts for the segments presented above for the second quarter and for the 2025 fiscal year are thus based on the assumption that the revised segment structure had already been applied in the first quarter of the 2025 fiscal year and in the 2024 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 – continue to be planned at around €2.5 billion for the 2025 fiscal year.

Depreciation and amortization are anticipated to be around €2.0 billion in the 2025 fiscal year, of which approximately €400 million is attributable to amortization of purchase price allocations arising mainly from the acquisition of Cypress. Adjusted Free Cash Flow, which is adjusted for investments in frontend buildings, is expected to be about €1.7 billion. Reported Free Cash Flow should be around €900 million.

3 To provide more meaningful information, Infineon changed its accounting policy on the allocation of certain expenses
with effect from 1 October 2024. This resulted in expenses that were previously included in cost of goods sold being reclassified as research and development expenses. The prior-year figures have been adjusted accordingly.

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

Infineon’s segments’ performance in the first quarter of the 2025 fiscal year can be found in the quarterly information at www.infineon.com.

All figures in this quarterly information are preliminary and unaudited.

Telephone press conference and analyst telephone conference

On 4 February 2025 the Management Board of Infineon will host a telephone press conference with the media at 8:00 am (CET), 2:00 am (ET). It can be followed over the Internet in both English and German. In addition a telephone conference call including a webcast for analysts and investors (in English only) will take place at 9:30 am (CET), 3:30 am (ET). During both calls, the Infineon Management Board will present the Company’s results for the first quarter as well as the outlook for the second quarter and the 2025 fiscal year. The conferences will also be available live and for download on Infineon’s website at www.infineon.com/investor

The Q1 Investor Presentation is available (in English only) at:

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

Infineon Financial Calendar (* preliminary)

•      20 Feb 2025 Annual General Meeting 2025
•      13 Feb 2025 Morgan Stanley The Investment Forum Middle East, Abu Dhabi
•      25 – 26 Feb 2025 Goldman Sachs Flagship European Technology Conference, London
•      5 March 2025 Morgan Stanley TMT Conference, San Francisco
•      6 – 7 March 2025 Oddo BHF TMT Forum, virtual
•      11 March 2025 Exane BNP TMT Conference, London
•      12 March 2025 Citi TMT Conference, London
•      28 March 2025 Stifel Copenhagen Summit, Copenhagen
•      8 May 2025* Earnings Release for the Second Quarter of the 2025 Fiscal Year
•      5 August 2025* Earnings Release for the Third Quarter of the 2025 Fiscal Year
•      13 November 2025* Earnings Release for the Fourth Quarter and the 2025 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 had around 58,060 employees worldwide (end of September 2024) and generated revenue of about €15 billion in the 2024 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 https://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.