Amid a disappointing third-quarter revenue report, Infineon Technologies is set to cut 1,400 jobs and relocate an additional 1,400 employees. The chipmaker has adjusted its full-year revenue forecast downward for the third time in recent months.
This move follows lower-than-expected Q3 2024 revenue results.
The global workforce at Infineon will see significant changes as part of the ‘Step Up’ cost-saving initiative. This programme, first announced in May, aims to improve the company’s adjusted results by the 2025 fiscal year. Despite the challenging market environment, Infineon aims to strengthen its competitiveness through this structural improvement programme. The company is managing inventory levels and addressing slow recovery in target markets due to prolonged weak economic momentum.
The revised annual revenue guidance is now around 15 billion euros, down from the previous forecast of 15.1 billion euros.
This decision comes as the company’s third-quarter revenue fell to 3.702 billion euros, missing the projected 3.8 billion euros. This marks a nine per cent decline from the same period last year. Net profit also fell short, reaching 403 million euros against an estimated 447 million euros.
In the earnings call, it was noted that forced redundancies in Germany are being ruled out, but several hundred positions at Infineon’s German plant are expected to be affected. Infineon, which manufactures power semiconductors, sensors and microcontrollers, employs 58,600 staff worldwide.
Despite the challenging market conditions, Infineon’s segment result margin for the quarter exceeded expectations at 19.8 per cent. The company reported a slight increase in revenue for its automotive segment, reaching 2.11 billion euros, driven by higher demand for software-defined vehicles and a strong performance in its microcontroller business.
