Infineon Show Strong First Quarter Profitability
▪ Q1 FY 2018: Revenue of €1,775 million; Segment Result €283 million; Segment Result Margin 15.9 percent; earnings per share €0.18 (basic and diluted); adjusted earnings per share €0.20 (diluted); gross margin 36.4 percent, adjusted gross margin 37.4 percent
▪ Outlook for FY 2018: Only due to the weaker US$ based on an assumed exchange rate of US$ 1.25 to the euro for the remainder of the fiscal year, year on-year revenue growth of about 5 percent (plus or minus 2 percentage points) and Segment Result Margin of 16,5 percent at mid-point of revenue guidance
▪ Outlook for Q2 FY 2018: quarter-on-quarter revenue growth of 4 percent (plus or minus 2 percentage points) and Segment Result Margin of 16 percent at mid-point of revenue guidance
Infineon Technologies has reported its results for the first quarter of the 2018 fiscal year (period ended 31 December 2017)
“Infineon has made a strong start to the new fiscal year," stated Dr. Reinhard Ploss, CEO of Infineon. “Earnings and margin were better than forecast – despite the expected
slight seasonal dip in revenues. The market for electro-mobility continues to drive growth. Infineon offers solutions for the entire range of drivetrain systems from hybrid to pure electric vehicles. Moreover, we continue to benefit from excellent market conditions, which are driving high demand for power components used in applications across the board, such as solar power plants, especially in China, and also for data centers. Operationally we are fully on track. We could still defy the headwind from the weaker US$ in the fiscal first quarter. Adjusted for the depreciation of the US$ from 1.15 to 1.25, our revenue momentum is unchanged, in terms of the Segment Result Margin
even slightly better. However, we are unable to compensate a further depreciation of the US$ by another 8 percentage points, which negatively affects more than half of our revenues. As such, we currency-adjusted our outlook accordingly."
Review of Group financials for the first quarter of the 2018 fiscal year
Compared to the preceding quarter, revenue declined by 2 percent to €1,775 million in the first quarter of the 2018 fiscal year. Revenue in the previous quarter had amounted to €1,820 million. Compared to the first quarter of the 2017 fiscal year, revenues increased by 8 percent. The Industrial Power Control (IPC), Power Management & Multimarket (PMM) and Chip Card & Security (CCS) segments all reported seasonal decreases, whereas the Automotive segment (ATV) recorded seasonally atypical revenue growth in line with expectations.
The gross margin in the first quarter came in at 36.4 percent, compared to 37.5 percent in the previous quarter. These figures include acquisition-related depreciation and amortization as well as other expenses attributable to the International Rectifier acquisition totaling €17 million. The adjusted gross margin came in at 37.4 percent, compared with 38.6 percent in the preceding quarter.
The first-quarter Segment Result amounted to €283 million, compared to €328 million in the fourth quarter of the previous fiscal year, with the Segment Result Margin declining from 18.0 percent to 15.9 percent.