Infineon CEO looks to ‘30 by 30’ as customers pay it to hold inventory

Infineon CEO looks to ‘30 by 30’ as customers pay it to hold inventory

Business news |
By Nick Flaherty

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Customers are prepared to pay Infineon Technologies to hold stock to avoid supply chain issues, says CEO Jochen Hanebeck as the company aims to reach revenue of €30bn by 2030.

This comes as growth at Infineon is slowing down after revenues of €16.3bn in 2023, up 15%. Growth next year is expected to be significantly lower at 4% with significantly slower industrial and consumer markets holding back the growth in e-mobility and power.  

This is reflected in automotive customers using up inventory and even paying Infineon to hold stock for them.

“We are offering the semiconductor resilience fund and customers in automotive can mandate us to stock certain volumes,” Hanebeck (above) told eeNews Europe in Munich. “This makes a lot of sense, we are not a just in time product and manufacturing times are 6 to 9 months for microcontrollers. For this this service to stock we do charge a certain fee.”

The aim is to reach €30bn by 2030. “The long term revenue forecast growth is intended to be over 10% through the cycle so across 5,6,7 years we will get to €30bn easily,” he said, confirming the 2030 target.

“We saw a remarkable 2023 with record figures in a challenging environment,” said Haneback. “Revenue and earnings are above our expectations and are a confirmation of our more ambitious targets. Automotive demand continues unabated and the order backlog at the end of September was €29bn, which following €32bn last year shows that the customer behaviour is normalising. But the backlog in automotive is still more than double the division’s annual revenues,” he said.

“The market environment was very mixed in 2023. E-mobility and power were up but consumer, communications and IoT saw a temporary lull in demand. The slowdown in industrial will continue well into 2024 and a recovery is not yet in sight for consumer appliances,” he said.

The company is still looking for targeted acquisitions but ruled out buying a silicon carbide wafer supplier to provide vertical integration.

“We get substrates from all kinds of different suppliers,” said Hanebeck.  “We looked at substrates a few years ago with the [failed] Wolfspeed acquisition and we thought very carefully about taking a stake. That was back in 2017 and we  see a lot of players now in the market with over 50 in China who want to make substrates. We don’t see any need for our own supply, the market will develop just as the silicon substrate market did, we don’t see it as a strategic benefit and would rather use the funds available to expand other parts of the value chain,” he said.

“We are not dependent on acquisitions to achieve our growth targets but the world is very dynamic and there are always new technologies emerging. UWB is a great example so we are scouting the market for other M&A targets, that may or may not be in the billions of euros but we don’t need a transformational acquisition,” he said.

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