November 12, 2024 08:34 GMT
TECHNOLOGY: Infineon: Mixed Results With An Op Profit Beat But Weak Guidance
TECHNOLOGY
BBB+ EUR Spreads ~1bp Steeper
Infineon posts top line miss, op profit beat and weak FY25 guidance. Report looks negative on the whole though the equity reaction is muted; analyst takes cite low risk of cuts to this outlook (they cut three guidance three times this year) while efficiency improvements are feeding through to op income.
- Q4 revenue -6% YoY (-1.6% vs. BBG cons) for FY24 -8.3%.
- Op profit -20% YoY (+5% vs. BBG cons) for an FY24 margin of 20.8% from 27% in FY23.
- Q4 FCF of EUR 1.15bn from EUR 0.6bn in Q423 and EUR 0.4bn in Q324.
- Net debt of EUR 2.6bn from EUR 1.1bn at FY23 and EUR 3bn at Q324.
- FY25 guidance; “slight decline” in revenue (BBG c.+5.3%), gross margin ~40% (BBG c.41.4%), op profit margin mid-to-high teens (BBG c.21.1%), reported FCF of EUR ~900mn (BBG c.EUR 1.4bn).
- “"Currently, there is hardly any growth momentum in our end markets except from AI, the cyclical recovery is being delayed…We are therefore preparing for a muted business trajectory in 2025.”
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