Infineon slides to Q3 net loss as it consolidates Cypress


Adds CEO quote, results detail, outlook

BERLIN, Aug 4 (Reuters) - German chipmaker Infineon IFXGn.DE on Tuesday posted a net loss as it reported fiscal third-quarter results that were skewed by the closing in mid-April of its $10 billion takeover of U.S. peer Cypress Technologies.

The supplier of automotive, power management and security chips reported a net loss of 128 million euros ($151 million), down from a profit of 178 million euros in the prior quarter and below analyst expectations it would just break even.

Infineon slashed its outlook in May, forecasting a 5% decline in revenue for the fiscal year to Sept. 30, as the car industry that accounts for two-fifths of sales was hit by the coronavirus pandemic.

"The pandemic continues to have a significant impact on our target markets, resulting in weaker demand in many product areas," CEO Reinhard Ploss said.

"Thankfully, we are seeing concrete signs of recovery within the automotive sector, which has been particularly hard hit."

Revenue increased by 9% from the prior quarter to 2.174 billion euros while segment result - management's preferred measure of operating profitability - fell by 20% to 220 million euros. The segment result margin came in at 10.1%.

Infineon forecast revenue of 2.3-2.6 billion euros in the fiscal fourth quarter, when it will fully consolidate Cypress for the first time. At the midpoint it sees the segment result margin at 14%.

For fiscal 2020 as a whole, Infineon forecast revenue of around 8.5 billion euros and a segment result margin of 13%.

($1 = 0.8501 euros)

(Reporting by Douglas Busvine Editing by Michelle Martin)

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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