German Chipmaker Infineon to Lay Off 1,400, Announces Results and Outlook

TapTechNews August 5th news, German chipmaker Infineon said on Monday that as part of its previously announced cost-saving plan, the company will lay off 1,400 people globally and relocate another 1,400 positions to countries with lower labor costs. The layoffs include the hundreds of positions cancelled earlier at the company's factory in the southern German city of Regensburg.

Infineon today announced its results for the third quarter of fiscal year 2024 (April-June 2024):

Revenue was 3.702 billion euros (TapTechNews note: currently about 28.919 billion yuan), lower than the expected 3.8 billion euros, a year-on-year decrease of 9%;

Net profit was 403 million euros (currently about 3.148 billion yuan), lower than the expected 447 million euros, a year-on-year decrease of 52%;

The profit margin was 19.5%, compared to 26.1% in the same period last year.

Infineon CEO Jochen Hanebeck said in the conference after the earnings report that after the recovery of the electric vehicle market was postponed, There is still no sign of a full recovery yet.

Infineon is one of the European chipmakers specialized in producing automotive chips, and its sales depend particularly on automakers. The company said that fourth-quarter revenue will decline year-on-year to about 4 billion euros, and Infineon expects a department profit margin of about 20%. Analysts previously expected revenue of 3.94 billion euros and a department profit margin of about 22%.

The company has approximately 58,600 employees globally. According to its website, its annual revenue guidance has been twice downgraded to around 15 billion euros, and the most recent downgrade was to 15.1 billion euros with a fluctuation of 400 million euros.

TapTechNews noted that Hanebeck also mentioned on the phone: The healthy consumer demand in the Chinese market is very helpful to Infineon, especially considering the company's number one position in the largest automotive market in China.