Infineon is fighting against production problems

The semiconductor company Infineon is fighting against production problems in the chip boom. Despite the strong demand, sales in the third quarter of 2020/21 (April to June) were only marginally higher than the value of the second quarter at 2.72 billion euros, because new corona outbreaks in Asia slowed production, especially in Malacca in Malaysia . The production in Texas, which was stopped in winter, is still having an effect. CEO Reinhard Ploss spoke of a "Still very tense delivery situation. Inventories are at an all-time low. Our chips go straight from production to end use." Infineon is doing its best and trying to provide additional capacity. In the current fourth quarter, sales are expected to rise to around 2.9 billion euros, with an increasing segment result margin of around 19 percent. Then the business with smartphone chips in particular should pick up, which has recently been somewhat paralyzed. In the third quarter, the margin improved to 18.2 (previous quarter: 17.4) percent. The sum of the results in the individual divisions (segment result) increased by six percent to 496 million euros. The chip company is sticking to the most important forecasts for the 2020/21 financial year (as of the end of September): sales of eleven billion euros and a segment result margin of more than 18 percent. This is in line with the expectations of analysts, who expect an average of 11.04 billion euros in sales and a margin of 18.1 percent. Infineon raised the forecast for the inflow of funds for the year as a whole to 1.5 from 1.2 billion euros - more than the experts believed the company could do. Before the trading day, the Infineon share went to its knees anyway by 1.7 percent. The corona pandemic has triggered a global surge in digitization that is massively boosting chip demand. There are also catch-up effects after the supply chains stalled in the Corona crisis. Infineon's sales in the third quarter were a quarter above the previous year's level, and over the first nine months even a third. The net profit from October to June more than doubled compared to the previous year to 705 (259) million euros.