Infineon has joined the ranks of chipmakers taking advantage of global industry-wide semiconductor shortages, more than doubling profits in a sector with very long lead times.
Formerly Siemens Semiconductor, the Germany-based company reported revenue of 3.298 billion euros ($3.48 billion), up 22% year-on-year for Q2 of fiscal year 2022 ended March 31 [PDF]. Profit jumped 131% to 469 million euros ($494 million).
Jochen Hanebeck, CEO of the chip giant, said in a statement that the company “continues to perform well in an increasingly challenging environment.”
“Global uncertainties, particularly the war in Ukraine and the continuing coronavirus pandemic, are putting pressure on supply chains. At the same time, demand for our products and solutions continues to significantly exceed supply,” he added.
Infineon is a major supplier to the automotive industry, which has felt the shortage of chip availability strongly. This was due to rigid supply chains operated by automakers, which cut production at the start of the COVID-19 outbreak and then struggled to recover capacity.
Automakers are still on the hunt for chips, with Volkswagen’s chief financial officer saying last month that he expects underlying structural supply chain issues won’t be resolved until 2024.
Others, including General Motors, Volvo and Jaguar Landrover, said in February that a shortage of chips was costing them vital income.
At Infineon, the automotive division rose 23.1% to 1.491 billion euros ($1.57 billion) during the second quarter, with the Industrial Power Control unit up 21.7% to 430 million euros ($453 million). Power & Sensor Systems rose more than 25% to €925 million ($975 million) and Connected Secure Systems rose 24% to €448 million ($472 million).
For the year, Infineon has raised its guidance for 2022 from 500 million euros ($526 million) to 13.5 billion euros ($14.33 billion), so it’s clear the good times will come. ride for a while for chip makers.
The semiconductor industry grew over 26% in 2021 to $595 billion and 2022 is shaping up to be a prosperous year.
A range of companies made good starts to the year, including chip brands AMD and Intel as well as lithography maker ASML.
The lockdowns in China have not eased production pressure on actual chipmakers, with Texas Instruments and ST Microelectronics recently reporting lost sales. Meeting demand will be a challenge.
Gartner thinks chip shortages have peaked, but with semiconductor lead time extended to 26.6 weeks in March, some will disagree. ®