Infineon Technologies AG Analyst Call Q3 FY26 Dresden; order backlog near €30 billion
Infineon Analyst Call Q 3 FY26 Intro Statement; 5 August 2026 Page 1
Q3 FY 2026 105th Quarterly Results of Infineon Technologies AG Analyst Call Intro Statement Jochen Hanebeck (CEO), Dr. Sven Schneider (CFO)
Jochen Hanebeck: General Introduction At present, positive cyclical momentum and structural growth are converging into a bright picture – and Infineon is generating value from it. The recovery continues to gain traction, the upcycle is fully on track. What initially started in selected segment s is now becoming broad, supported by improving demand patterns, normalized inventory levels and increasing order activity across many end markets. The strongest dynamic continues to come from AI -related infrastructure. Investments in datacenters continue to go up. Energy -efficient power delivery solutions are required to support ever-growing processing capabilities. Use cases for agentic and physical AI are emerging at a fast clip. Industrial markets are also showing improving dynamics, in particular related to power infrastructure. In Automotive, we are seeing a pick -up of customer order momentum. In this environment, we are combining a strong operat ional focus on the current upcycle with targeted investments in our broad set of future growth opportunities. The prime example for the latter is the recent opening of our new Smart Power Fab in Dresden. The cleanroom space available there enables us to ramp the world’s largest fab for cutting edge power semiconductors and analog/mixed -signal technologies – at just the right point in time. Furthermore, we closed the acquisition of the sensor portfolio from ams OSRAM as planned within a very short timeframe. Let us now turn to our third -quarter performance. Group performance in Q 3 The third quarter of our 2026 fiscal year was the first one with over 4 billion Euros of revenue for two and a half years. With 4 billion 172 million Euros we achieved an all -time high in quarterly revenues and came in a bit ahead of expectations, even considering a minor positive currency effect. All our divisions contributed to 9.4 percent sequenti al growth on group level. Compared to the same quarter one year earlier, our reported revenue grew by close to 13 percent. The Segment Result for the June quarter amounted to 797 million Euros, corresponding to a Segment Result Margin of 19.1 percent, 200 basis points up from the quarter before, mainly driven
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by volume fall -through and positive mix -effects, and clearly in the upper part of the predicted high - teens range. Our order backlog witnessed another material increase and stood close to 30 billion Euros at the end of June, a clear indication of recovery momentum getting even stronger. Now to our divisional review, beginning with Automotive. Division-level performance in Q 3 1 Automotive In the third quarter of our 2026 fiscal year, revenues increased by 6 percent quarter -over-quarter to 1 billion 932 million Euros. Growth was driven mainly by microcontrollers and smart power components, as well as our Ethernet products. All these are core building blocks of software
defined vehicles. The Segment Result increased by 8 percent sequentially to 356 million Euros, corresponding to a Segment Result Margin of 18.4 percent. As a reminder, the refocusing of our business with high - voltage components for electric powertrains that we explained in our last earnings call is expected to burden Segment Result Margin of ATV in this fiscal year by a low -to-mid single digit percentage, reflected in our guidance. We continue to see strong order intake in Automotive, against the backdrop of a muted car market. In its latest update, market researcher Mobility Global, carved out from S&P Global, is forecasting around 91 million light vehicles to be produced in 2026. T his is slightly above its previous estimate and broadly in line with the approximately 2 percent year -over-year decline we had assumed since the beginning of our fiscal year. The long-term trends driving automotive semiconductor demand remain firmly intact and continue to support content growth. Rising fuel costs are beginning to support xEV adoption in Europe, India, and Southeast Asia, while the shift toward software -defined vehicles continues to accelerate globally. Alongside these structural growth drivers, supply constraints in the Chinese automotive grade semiconductor market create opportunities for us. Furthermore, ongoing inventory replenishment is contributing to near -term demand recovery. We have secured a major design win for a zone -controller architecture with the software company of a leading global car manufacturer. The solution combines latest generation AURIX ™ microcontrollers, power -management ICs and PROFET ™ smart power switches. This demonstrates the breadth of our system offering across compute, connectivity and smart power management.
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We are also seeing further design-win momentum in China. For Xiaomi, we will support a cockpit and ADAS fusion unit incorporating three different microcontroller families. In another win with a leading Chinese car manufacturer, our silicon -carbide bare die s will be used in the traction inverter. Finally, we further simplify the evaluation of our automotive microcontrollers for our customers. Together with Amazon Web Services, we have launched a cloud -based platform for virtual MCU evaluation. By removing the dependency on physical hardware, the pl atform can shorten evaluation cycles from several weeks to minutes, lower evaluation costs significantly and support hundreds of concurrent users globally. The platform already includes our next -generation RISC -V architecture enabling customers to gain han ds-on experience with new microcontrollers much earlier in their development cycle and further accelerates innovation for software -defined vehicles. 2 Green Industrial Power Let’s now take a look at Green Industrial Power: GIP’s revenues grew by 11 percent quarter-over- quarter to 447 million Euros, making the June quarter the second one in a row with double digit growth. Reflecting the recovery of industrial markets, all application areas developed positively, in particular power infrastr ucture and HVAC. The higher revenue notwithstanding, the Segment Result of GIP contracted slightly to 44 million Euros, equivalent to a Segment Result Margin of 9.8 percent, after 11.7 percent in the quarter before. The decline was due to temporary operati onal and inventory -related effects and hence not indicative of underlying profitability, as will be evidenced by the positive margin evolution in the running quarter. Power infrastructure is seeing strong structural momentum: investments in grid expansion and modernization continue to grow, driving demand for energy storage systems, transmission & distribution gear and high -voltage solid state devices. AI data center gr owth is fueling demand for uninterruptible power systems, general power supply as well as cooling. Semiconductors are poised to replace electro -mechanical parts in various use cases. For example, a semiconductor -based solid -state circuit breaker can prote ct electrical circuits from damage caused by short circuits or overloads up to 1,000 times faster than conventional systems. This capability is essential for direct current grids and offers a significant increase in system availability in industrial manufa cturing and AI data centers. As part of a partnership with Siemens, we will supply 1.2 kilo Volt silicon carbide power modules for use in circuit breakers to enhance the efficiency, power density and reliability of Siemens’ protection solution . 3 Power & Sensor Systems Now to Power & Sensor Systems. On the back of unabated AI power strength PSS recorded revenues of 1 billion 442 million Euros in the June quarter, 14 percent up sequentially, and a staggering 34 percent more compared to the same quarter one year ago. The margin evolution of
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PSS shows a bright picture as well: the Segment Result increased to 359 million Euros, corresponding to a Segment Result Margin of 24.9 percent. The further increase of 4.5 percentage points compared to the previous quarter is evidence of profitable growth and value creation, strongly driven by our leadership position in AI power solutions. This leadership position is being recognized by industry researchers: in a recent report covering AI data center power semiconductors, Gartner® identified Infineon as “t he company to beat”. Portfolio breadth and system-level expertise in conjunction with manufacturing capacity are the defining capabilities for data center operators seeking to scale AI. Infineon offers a unique portfolio spanning the entire power delivery chain and manufactures relevant technologies in -house. By seamlessly integrating wide bandgap materials – specifically silicon carbide for high -efficiency, high -voltage grid -to-rack conversions and gallium nitride for ultra dense, high -frequency intermedia te power stages – alongside silicon at the processor level, energy losses are minimized at every single conversion step. Demand for our AI power solutions continues to outstrip available supply, we are in allocation. Successful execution of capacity ramps and conversions from other areas will help us achieve more than 1.6 billion Euros of dedicated AI power revenues in the c urrent fiscal year, ahead of the so -far planned 1.5 billion. In addition, our business with non -AI data center power solutions is amounting to around 500 million Euros annually, making Infineon clearly the leading force in the overall space.
We are represented in almost all platforms across all relevant players in the industry. Enabling further steep growth in the coming years will be a function of ramping and deploying additional manufacturing capacities. Our new Smart Power Fab in Dresden to gether with available cleanroom space at our other large frontend sites in Austria and Malaysia puts us in a unique position. To strategically secure access to critical power delivery solutions, several leading customers across the AI Data center ecosystem have signed or are in negotiation on multi -year capacity reservation agreements with us. These agreements encompass a total cumulative sales volume of a high single-digit billion Euro amount over multiple years. These agreements also feature certain prepayments, thus further strengthening our customer relationships and sharing investment risks. We will revise our projection of 2.5 billion Euros plus AI Datacenter revenues for our 2027 fiscal year upwards as part of the annual guidance to be given in our No vember earnings call. We expect such update to be material. The next waves of AI growth are already taking shape: higher density power architectures for running the latest frontier models, as well as the emergence of agentic and physical AI. The growing inference and task -coordination requirements of agentic AI pro vide a massive tailwind for us. Our undisputed leadership in power solutions for CPUs, combined with a highly differentiated, best-fit product portfolio, will represent another significant growth driver as early as next fiscal year. Accordingly, the aforem entioned update of our revenue projection for 2027 will also include our power solutions for all different forms of datacenter configurations.
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Beyond the data center, our solutions bring physical AI to life, enabling humanoid robots, collaborative machines and autonomous systems to perce