Electronics: Infineon plans record investment after peak year

Business at Infineon is booming.

Electronics: Infineon plans record investment after peak year

Business at Infineon is booming. After a fiscal year with record profits and sales, the semiconductor company not only raised its targets, but also announced the highest single investment in the company's history. The group wants to invest 5 billion in Dresden and create 1000 jobs.

Infineon intends to use the investment, which is still subject to "appropriate public funding", to further expand its production capacities. According to the plans, the plant could be ready for production by autumn 2026. At full capacity, it is expected to generate up to 5 billion in sales per year.

Record sales and profits

Infineon is on course for growth. Just last year, the company started production in a new plant in Villach. In the spring, the group also announced the expansion of production in Indonesia. With the announced investment in Dresden, Infineon is "broadening the basis for our accelerated profitable growth course in a forward-looking manner," said CEO Jochen Hanebeck.

The developments are based on the figures for the past fiscal year, in which Infineon increased its profits by a whopping 86 percent to EUR 2.2 billion. Sales also jumped sharply: by 29 percent to 14.2 billion. Both are record values.

The current new financial year also got off to a good start, said Hanebeck. However, he also warned: "In view of the ongoing macroeconomic and geopolitical uncertainties, great vigilance is required in the coming quarters. We are prepared to act quickly and flexibly if necessary."

Overall, however, the company is optimistic, because it has also raised its targets: In the future, Infineon wants to grow by 10 percent per year over the cycle - instead of 9 percent as before - and earn significantly more at the same time. The target for the so-called segment result margin was increased from 19 to 25 percent.

"Decarbonization and digitization ensure structurally increasing demand for semiconductors," explained Hanebeck. Infineon will benefit disproportionately from this. "This momentum has continued to accelerate, so now is the right time to give us an even more ambitious target business model."

Order worth billions from the Opel parent company

Just a few hours before the announcement of its business figures, Infineon had already announced an upcoming order worth billions. The Neubibergers signed a letter of intent with the Opel parent company Stellantis for the delivery of silicon carbide semiconductors for electric cars with a "potential procurement volume" of "significantly more than 1 billion euros".