Infineon Technologies raises 2026 outlook as AI demand for data centers surges

Infineon lifts 2026 outlook as AI demand boosts growth prospects

BERLIN, May 6 (Reuters) - Infineon Technologies (IFXGn.DE), opens new tab raised its full-year guidance on Wednesday as demand for power supply solutions for AI data centers surged and automotive order intake improved, joining a wave of chipmakers benefiting from AI infrastructure spending. The German chipmaker, which provides parts for automotive, power and ⁠security systems, posted second-quarter revenue of 3.81 billion euros ($4.47 billion), up 6% from the same quarter a year earlier. Infineon now expects revenue to rise significantly year-on-year for fiscal 2026, up from a previous forecast of moderate growth. It also raised its 2026 segment result margin target to ⁠around 20% from the previously expected high-teens percent range. The upgrade reflects higher demand across multiple business areas. "The AI boom strengthens further, and our power supply ⁠solutions for AI data centers are in very high demand," CEO Jochen Hanebeck said in a statement. The ⁠company said it expects revenue of around 1.5 billion euros from AI data center ⁠applications in fiscal 2026, rising to around 2.5 billion euros in fiscal 2027. ($1 = 0.8522 euros) Reporting by Kirsti Knolle, Editing by Linda Pasquini Our Standards: The Thomson Reuters Trust Principles., opens new tab

Infineon raises annual guidance, driven by AI demand

The German semiconductor manufacturer has reported higher quarterly results and raised its targets for 2026. The company is benefiting from the boom in AI-dedicated data centers, while its automotive order intake is showing signs of improvements. On Wednesday Infineon Technologies announced Q2 revenue of €3.81bn (up 6% y-o-y). Net profit rose to €301m, compared with €232m a year earlier. In particular, the German group raised its annual outlook, now estimating that revenue will grow "significantly" in 2026, whereas it previously anticipated moderate growth. It expects its operating margin to be around 20%. Infineon, like several chipmakers, is benefiting from massive investments in AI infrastructure. CEO Jochen Hanebeck said that the group's power supply solutions for AI data centers are seeing "very strong demand." The group forecasts revenue of about €1.5bn related to AI data centers in FY 2026, before a further acceleration expected in 2027. In the automotive sector, Infineon noted an improvement in its order intake, particularly in software-defined vehicles. However, the group remains cautious about this market, which is still weighing on certain margins. Infineon also announced a reorganization of its operations from Q4. The group will move from four divisions to three in order to accelerate decision-making. However, investors appear concerned by margin pressure and weakness in the electric vehicle segment. The market also reacted to the fact that the group did not raise its €1.5bn revenue forecast for AI data centers for FY 2026. In pre-market trading, the stock was down about 4%, after gaining 6.5% the previous day.