Infineon Technologies Ag · XETR:IFX

Infineon Technologies — Q3 FY2018 Earnings Presentation

84 slides from Infineon Technologies's earnings presentation, Aug 1, 2018

Slide 1: Third Quarter FY 2018 Quarterly Update
Third Quarter FY 2018 Quarterly Update Infineon Technologies AG Investor Relations
Slide 2: Agenda
Agenda 1 Infineon at a glance 2 Updated target operating model (TOM) 3 Quarterly highlights 4 Automotive 5 Industrial Power Control 6 Power Management & Multimarket 7 Chip Card & Security 8 Selected financial figures 2018-08-01 Copyright © Infineon Technologies AG 2018. All rights reserved. 2
Slide 3: Infineon at a glance; Q3 FY18 figures
Infineon at a glance; Q3 FY18 figures Business Segments Power represents ~65% of revenue Industrial Power [EUR m] 836 Automotive 18% Control (IPC) (ATV) 580 Power Manage- 349 43% 30% ment & Multi- 175 market (PMM) ATV IPC PMM CCS 9% Power Non-Power* Sensors Chip Card & revenue in Q3 FY18: €1,941 inc
Slide 4: Our strategy is targeted at value creation through sustainable organic growth
Our strategy is targeted at value creation through sustainable organic growth Focus Technology leadership System understanding › Focus on fastest growing › Leverage core competencies › Create value for customers segments of semi market in different end markets to through system under- › Tackle globa
Slide 5: Well diversified exposure to end-markets and applications provide resilient growth model
Well diversified exposure to end-markets and applications provide resilient growth model FY17 revenue by target application* payment & other CCS powertrain excl. xEV government ID 3% 11% 7% CCS xEV other PMM 4% 6% 10% industrial safety excl. ADAS 8% 12% PMM ATV data center, 31% 43% computing 10% ADA
Slide 6: Long platform life-times provide stickiness and visibility
Long platform life-times in majority of our businesses provide stickiness and visibility ATV – average platform life-time: ~6 years IPC – average platform life-time: ~5 years revenue share revenue share 55% 65% 35% 10% 15% 0% 5% 5% 5% 5% <1 1-3 3-5 5-7 >7 <1 1-3 3-5 5-7 >7 platform life-time in year
Slide 7: Tight customer relationships, based on system know-how and application understanding
Tight customer relationships, based on system know-how and application understanding ATV IPC PMM CCS EMS partners Distribution partners 2018-08-01 Copyright © Infineon Technologies AG 2018. All rights reserved. 7
Slide 8: Infineon holds a leading position in its target markets
Infineon holds a leading position in its target markets Automotive Power discretes microcontroller-based semiconductors and modules Smart Card ICs total market in 2017: $34.5bn total market in 2017: $18.7bn total market in 2016: $2.79bn NXP 12.5% Infineon 18.6% Infineon 24.8% Infineon 10.8% ON Semi
Slide 9: Q3 FY18 Group and Division Performance
Q3 FY18 Group and Division Performance Revenue: Segment Result: Segment Result Margin: IFX €1,941m (+6% y-y) €356m (+5% y-y) 18.3% ATV IPC PMM CCS [EUR m] [EUR m] [EUR m] [EUR m] 811 836 +4% 766 736 770 +9% 557 573 545 543 580 -5% +9% 321 328 296 317 349 23.2 22.0 19.6 19.9 23.6 15.7 14.8 13.4 14.3
Slide 10: Outlook for Q4 FY18 and FY18
Outlook for Q4 FY18 and FY18 Outlook FY18* Outlook Q4 FY18* (compared to FY17) Q4 FY18 outlook leads to an Increase of 3% increase between Revenue +/- 2%-points 6.4% and 7.4% (prev.: “Increase between 4 and 7%“) Segment At the mid-point of the At the mid-point of the revenue guidance: revenue guidan
Slide 11: Agenda
Agenda 1 Infineon at a glance 2 Updated target operating model (TOM) 3 Quarterly highlights 4 Automotive 5 Industrial Power Control 6 Power Management & Multimarket 7 Chip Card & Security 8 Selected financial figures 2018-08-01 Copyright © Infineon Technologies AG 2018. All rights reserved. 11
Slide 12: Infineon's organic revenue development clearly outperformed the total semi market
Infineon‘s organic revenue development clearly outperformed the total semi market [EUR m] organic CAGR(99-17): ~+9% 7500 CAGR(99-17): +5.9% 6000 4500 300,000 5,100 (excl. IRF) 6,059 (incl. IRF) 3000 126,895 1,200 200,000 296,383 295,996 353,884 1500 1,995 4,303 1,681 2,045 1,821 2,289 2,366 2,701 2,
Slide 13: After temporary growth acceleration, revised TOM assumes reversion to 9% trendline
After temporary growth acceleration, revised TOM assumes reversion to 9% trendline Organic revenue growth projection at constant currencies 10%+ Reversion to 9% trendline 9.5% 9.1% Trendline growth composition by division 4.9% … ATV ~10% IPC ~8% PMM ~9% CCS mid-single digit % FY15 FY16 FY17 FY18e FY
Slide 14: Increased average-cycle investment-to-sales model is necessary to fuel growth
Increased average-cycle investment-to-sales model is necessary to fuel growth Previous investment-to-sales New investment-to-sales model model ~8% p.a. ~13% ~9% p.a. ~15% revenue investment- revenue investment- growth to-sales growth to-sales Thereof 11% capex*, thereof: thereof 13% capex*, thereof:
Slide 15: Segment result margin target of 17% gradually improving due to economies of scale in opex
Segment result margin target of 17% gradually improving due to economies of scale in opex › We want to continuously drive the "virtuous circle" of market share gains by offering our customers competitive pricing while achieving above-cost-of- capital returns on our growth investments › Increased inv
Slide 16: Period of accelerated growth with correspondingly higher investments will precede long-term TOM
Period of accelerated growth with correspondingly higher investments will precede long-term TOM Current Near-term Long-term (FY19+) Revenue growth ~8% ~10%+ ~9% ~17%+ Segment result margin ~17% opex economies of scale Investment-to-sales ~13%* ~15%++ * ~15%* › Period of accelerated growth with corre
Slide 17: Reference to IFX Day presentations
Reference to IFX Day presentations Infineon Capital Markets Day London, 12 June 2018 IFX Day 2018 2018-08-01 Copyright © Infineon Technologies AG 2018. All rights reserved. 17
Slide 18: Agenda
Agenda 1 Infineon at a glance 2 Updated target operating model (TOM) 3 Quarterly highlights 4 Automotive 5 Industrial Power Control 6 Power Management & Multimarket 7 Chip Card & Security 8 Selected financial figures 2018-08-01 Copyright © Infineon Technologies AG 2018. All rights reserved. 18
Slide 19: Design-win for drivetrain platform proves Infineon's strength in xEV system solutions
Design-win for drivetrain platform proves Infineon’s strength in xEV system solutions Key facts › design-win at a North American tier-1 for a BEV drivetrain platform of a major European OEM › strategic platform as a base for future BEV developments › set of components for inverter solution: – Hybrid
Slide 20: First major 3D ToF sensor design-win for gesture camera and in-cabin sensing
First major 3D ToF sensor design-win for gesture camera and in-cabin sensing Key facts About 3D in-cabin sensing › major European OEM selected Infineon 3D Infineon automotive-grade ToF sensor XENSIV™ REAL3™ for current 3D ToF sensor XENSIV™ REAL3™ and next-generation platforms (IRS1125A) in optical
Slide 21: New Villach 300 mm module will add significant capacity in power semiconductors
New Villach 300 mm module will add significant capacity in power semiconductors Key criteria for site selection New 300 mm module › Economies of scale › Time to revenue › Geographic diversification Building space ~60,000 m² Total frontend investment > €1.6bn over 6 years Revenue potential > €1.8bn p
Slide 23: Infineon's position in the automotive semiconductor universe
Infineon’s position in the automotive semiconductor universe Automotive semiconductors 2017 total market size: $34.5bn NXP 12.5% Market share trend Infineon 10.8% +0.1%-pt – Infineon benefits disproportionately Renesas 10.0% from the two mega trends TI 8.0% – ADAS/AD STM 7.1% – clean cars Sensors Mi
Slide 24: Infineon is continuously outgrowing the market since 2010
Infineon is continuously outgrowing the market since 2010 Infineon automotive market share development* [USD bn] CAGR(10-17): +7.3% CAGR(10-17): +10.8% 45 10.8% 12% 10.5% 10.4% 10.7% 9.6% 9.6% 8.7% 9.0% 34.5 30.2 30 27.5 27.4 8% 24.0 25.2 23.5 21.0 15 4% 2.3 2.2 2.4 2.9 2.8 3.2 3.7 1.8 0 0% 2010 201
Slide 25: Clean cars, ADAS/AD, and adoption of premium features drive growth
Clean cars, ADAS/AD, and adoption of premium features drive growth Drivers for semiconductor content per car Vehicle production Electro-mobility Automated Driving Comfort, premium › Legislation Today › Premium cars › Improvements › crash avoidance are early of ICE › ADAS adopters of high-end › ~2% g
Slide 26: Electro-mobility
Electro-mobility Cinfineon
Slide 27: xEV growth driven by emission regulation; but consumer preferences thwart CO2 reduction
xEV growth driven by emission regulation; but consumer preferences thwart CO2 reduction CO2 emission development and Two consumer trends countervail CO2 regulations for main regions reduction China 2020 : 5 l/100 km (1) SUV share of registered cars in Europe1) CO2 emission values [g/km], normalized
Slide 28: Short-term, MHEV/FHEV/PHEVs are first choice; mid-term BEVs are preferred solution
Short-term, MHEV/FHEV/PHEVs are first choice; mid-term BEVs are preferred solution CO2 emission reduction by powertrain Growth drivers of electro-mobility system + Regulation 120 -15% -30% -77% -100% + Incentives; China industry politics 102 CO2 emission [g/km] + Decreasing Diesel share 84 + Increas
Slide 29: The incremental demand of power semiconductors is a significant opportunity
The incremental demand of power semi- conductors is a significant opportunity 2018 average xEV semiconductor content by degree of electrification 48 V / MHEV (in 2018) FHEV / PHEV (in 2018) BEV (in 2018) Sense Compute Actuate $95 $750 $25 $740 $300 $455 $75 $0 $475 $20 $375 $15 $375 $5 $20 $120 $80
Slide 30: System cost reduction can justify the higher SiC component price
System cost reduction can justify the higher SiC component price SiC is charac- Leading to Benefits on system level terized by battery size, battery cost lower higher › smaller battery capacity [kWh] losses efficiency  lower battery costs [$] [RDS(on); Ω] [W] › lower cooling efforts › extended rang
Slide 31: Infineon has unparalleled expertise and portfolio for high-power xEV applications
Infineon has unparalleled expertise and portfolio for high-power xEV applications Bare dies Discretes Modules Diodes MOSFETs molded frame-based Si will dominate the xEV market Modules will be preferred form SiC throughout next decade* factor in SiC mass market* [by $ value] [by $ value] 100% 100% 50
Slide 32: Infineon offers the complete automotive-grade portfolio of SiC components
Infineon offers the complete automotive-grade portfolio of SiC components CoolSiC™ Automotive CoolSiC™ Automotive Full SiC module Schottky diode MOSFET HybridPACK™ Drive CoolSiC™ on-board charger on-board charger main inverter ramp in ramp in ramp in 2018! 2019! 2020! › More than 20 leading OEMs and
Slide 33: Automated Driving
Automated Driving Infineon
Slide 34: For Automated Driving more compute power but also higher security and safety is needed
For Automated Driving more compute power but also a higher security and safety is needed Sense Interpret & decide Act Driver Sensors Controllers, algorithms, Actuators software Camera inside specialized driving Automated car sensor domain processors controller Radar Radar Camera outside sensor Ultra
Slide 35: Increased sensor requirements drive the content in the next 5 years and beyond
Increased sensor requirements drive the content in the next 5 years and beyond More sensors required for any next level of automation NCAP 5 Star, AD L2 AD L3 AD L4/L5 Automatic emergency brake/ forward collision warning Application* Parking assist Valet parking Lane keep assist Highway assist Highw
Slide 36: Infineon opens the door for mass-deployable lidar systems for Automated Driving
Infineon opens the door for mass-deployable lidar systems for Automated Driving Classification of long-range lidar systems solid state optical system mechanically moving mirror scanning optical flash lidar scanning MEMS-based mirror phased array + proven concept + allows optical + no moving parts +
Slide 37: Outstanding characteristics make AURIX first-choice µC in the AD platform market
Outstanding characteristics make AURIX™ first-choice µC in the AD platform market AURIX™ is the market reference as host controller in central computing platforms complementing CPU/GPU to make central computer robust and fail operational AURIX™ Go™ Automated Driving Drive Platform with AURIX™ › Safe
Slide 38: ADAS/AD semi growth driven by radar and camera sensor modules over the next 5 years
ADAS/AD semi growth driven by radar and camera sensor modules over the next 5 years Average semi content per car by level of automation at the given years NCAP 5 Star/AD L2 (~2020) AD L3 (~2025) AD L4/L5 (~2030) Sense Compute Actuate $55 $970 $300 $30 $630 $190 $160 $70 $230 $190 $180 $195 $30 $160
Slide 40: To empower this variety of applications we rely on the most comprehensive power portfolio
To empower this variety of applications we rely on the most comprehensive power portfolio Bare Die Controllers Discretes IPMs IGBTs and Si diodes Driver Modules Solutions SiC MOSFET SiC diodes 2018-08-01 Copyright © Infineon Technologies AG 2018. All rights reserved. 40
Slide 41: Clear leader in IGBT standard modules and discrete IGBTs
Clear leader in IGBT standard modules and discrete IGBTs; IPMs improved from #4 to #3 IGBT std. modules Discrete IGBTs IPMs total market in 2017: $2.16bn total market in 2017: $1.10bn total market in 2017: $1.57bn Infineon 33.9% Infineon 38.5% Mitsubishi 36.4% Mitsubishi 10.7% Fuji Electric 12.1% ON
Slide 42: Infineon serves all major players for PV inverters and wind turbines
Infineon serves all major players for PV inverters and wind turbines Infineon is powering all leading renewable IPC revenue in renewables energy players* [EUR m] total 320 – 410 PV inverter2) Wind4) CAGR(17-22): 4.3% - 9.6% 1 | Huawei  1 | Siemens/Gamesa  259 2 | Sungrow  2 | Vestas  232 203 3 |
Slide 43: SiC MOSFETs bring down system cost and size of PV inverters
SiC MOSFETs bring down system cost and size of PV inverters despite higher component cost Reduction of system cost, higher semi-value Total system cost [$] › 15-20% lower bill of material other for inverter manufacturer (e.g. resistor, other capacitor, › 2-3x higher semiconductor transformer etc.) v
Slide 44: Inverterization of home appliances is a key driver for our business
Inverterization of home appliances is a key driver for our business Uncontrolled Variable Number of home appliances by motor type2) motor speed drive [units m] CAGR(17-22) Semi content3) 244 585 +19% ~€9.50 161 (34%) (65%) 67 (12%) (25%) 474 475 467 317 -7% ~€0.70 (88%) (75%) (66%) (35%) Extended Le
Slide 45: IPC's business success in home appliances is based on several success factors
IPC's business success in home appliances is based on several success factors Early identification of trend for IPC revenue in home appliances inverterization is showing outstanding growth [EUR m] CAGR(14-17): 52% Market access through inorganic growth (acquisit. of LSPS and IRF) Improved delivery c
Slide 46: IPC's digital control strategy enables customers to shrink their system
IPC's digital control strategy enables customers to shrink their system Example: motor control solution for aircon indoor fan Solution based on Solution based on Solution based on standard IPM CIPOS™ Nano iMOTION™ Smart IPM Customer benefits of highly integrated power ICs › Significant system cost r
Slide 47: Digitalization: motor control platform with scalable integration of HW and SW
Digitalization: motor control platform with scalable integration of HW and SW Adjacent Core Controller Gate driver 3-phase inverter (IGBT) triggers low- translates power signal signal into AC appropriate Motor gate input iMOTION™ Controller iMOTION™ Smart IPM Standard IPM Key benefits System improve
Slide 48: HMI and AI are driving the penetration of collaborative robots (cobots)
HMI and AI are driving the penetration of collaborative robots (cobots) System understanding and extended product portfolio allow for growth in adjacent markets 700,000 new cobots by 20251) Advanced ~€350 semiconductor content2) Safe motion control position, force and object per cobot of which sensi
Slide 49: Growing penetration of electric vehicles will drive roll-out of charging infrastructure
Growing penetration of electric vehicles will drive roll-out of charging infrastructure power Charging infrastructure market; DC charging charging semi roll-out by rack performance3) system time1) content 350 kW [units k] [USD m] 7 ~$3,500 (6 racks of 60 kW each) min SiC-based CAGR(17-23): 21% 129 1
Slide 50: Electrification of trains is accelerating and Infineon is part of two subsystems
Electrification of trains is accelerating and Infineon is part of two subsystems Subsystem 1: Locomotive Metro HST/ EMU Auxiliary inverter Air conditioning, power sockets, air brake, control stand, etc. Courtesy: Toshiba SiC Trends in traction Electrification Urbanization Strong of freight and new g
Slide 51: With an increasing number of applications, particularly module players will win in SiC
With an increasing number of applications, particularly module players will win in SiC SiC power semiconductors SiC power semiconductors by application excl. xEV by product type excl. xEV [USD m] CAGR(17-27) [USD m] CAGR(17-27) CAGR(17-27): 14.8% 1,493 1,493 Others 14.3% Full SiC 29.9% Aerospace/ Mo
Slide 53: PMM's growth is built on many applications from different sectors
PMM's growth is built on many applications from different sectors in power and non-power PMM Computing Industrial Consumer / Misc Communications › Data Center › Power supplies › eBikes › Handsets › PC, Notebook › EV on-board › Multicopter › Wearables › Peripherals charger › Aviation › 5G massive MIM
Slide 54: PMM – Power
PMM - Power Cinfineon
Slide 55: In 2017, PMM grew by 15.1% vs market of 13.5%
In 2017, PMM grew by 15.1% vs market of 13.5%; now more than 2x as big as #2 Discrete power MOSFETs market shares total market in 2017: $6.65bn Infineon 26.4% ON Semi 12.9% Renesas 9.2% Toshiba 7.4% STMicro 6.8% Vishay 5.6% Alpha & Omega 4.6% Nexperia 3.7% Microchip* 2.6% MagnaChip 2.2% * On 29 May
Slide 56: Technology leadership in MOSFETs and digital power
Technology leadership in MOSFETs and digital power: highest efficiency and power density Adjacent Core Controller Driver IC MOSFET triggers low-power translates signal into signal to switch on high-current gate input switches on, current flows Power management solutions reduce TCO More efficient sem
Slide 57: Highly differentiating solution for data center enables significant opex and capex reduction
Highly differentiating solution for data center enables significant opex and capex reduction Powerflow (schematic) Customer benefit › reducing opex and VRM capex by >10% AC-DC DC-DC › saving >3bn kWh annually for US data centers PoL › doubling compute power per server rack DC-DC Infineon-enabled opt
Slide 58: AC-DC power supply by Eltek using CoolGaN
AC-DC power supply by Eltek using CoolGaN™ 1 Eltek "Flatpack2 SHE" › 3 kW / 48 V › Fixed and wireless telecom applications › Size: 4.25 x 1.61 x 13 inch³ › Weight: 4.5 lbs › High power density: 33 W/inch³ 98% efficiency Infineon content per device reduction in › 2x CoolGaN™ 600 V -50% power loss › 2
Slide 59: Server eco-system is supported by PMM's various DC-DC solutions
Server eco-system is supported by PMM's various DC-DC solutions 2 Data center market trends Saving space is a key requirement and a focus of product development Increasing memory and processing power Adoption of AI drives Digital controllers high-end analytics and data with flexible communications i
Slide 60: PMM – RF and Sensing
PMM — RF and Sensing Infineon
Slide 61: RF and Sensing devices enable new services and will shape the way we live and work
RF and Sensing devices enable new services and will shape the way we live and work Courtesy: BMW Courtesy: eluminocity Augmented Reality Voice-controlled devices Various use cases are enabled by a small set of versatile core technologies Smart streetlights Commercial and consumer Gesture control Ind
Slide 62: We focus on MEMS sensors and target to become the leader in 3D Imaging and Radar
We focus on MEMS sensors and target to become the leader in 3D Imaging and Radar Microphone Pressure Enviromental 3D Radar 3D ToF Best-in- World Highest Best-in No class smallest Energy class distortions resolution 6x6mm² form factor Efficiency resolution Receive Measure Measure clear audio Biometri
Slide 63: XENSIV Si microphones have plenty of growth opportunities beyond smartphones
XENSIV™ Si microphones have plenty of growth opportunities beyond smartphones TV, laptop and set- Smart home Smart speaker Robotics top box (appliances) + Extended + + voice Best Highest pick-up speech beam- distance recognition forming precision [units m] 100 Market snapshot: Global smart speaker ›
Slide 64: Leading base technologies for sensor solutions: Time-of-Flight
Leading base technologies for sensor solutions: Time-of-Flight Time-of-Flight: Modulated infrared-light is emitted and reflected by objects. Phase-shift of returned light is measured in each pixel of the image sensor. Time-of-Flight Infrared illumination 850 nm or 940 nm Resolution: up to 100k pixel
Slide 66: Security is a system approach
Security is a system approach Example: Automotive Security › As humans, machines, 'things' are getting connected, the risks of security attacks increase strongly as attack paths increase › Accordingly, there is a greater need for security in fields like smart home, connected cars, information and co
Slide 68: Continuous stream of new topics aging and exiting
Continuous stream of new topics aging and exiting maturity emerging growing maturing Pay TV SIM Card  Smart card form factor  Embedded form factor Contact-based Payment TPM for Computing Government ID Embedded Secure Element (NFC) Transport Ticketing Authentication Contactless Payment eSIM for Aut
Slide 69: Agenda
Agenda 1 Infineon at a glance 2 Updated target operating model (TOM) 3 Quarterly highlights 4 Automotive 5 Industrial Power Control 6 Power Management & Multimarket 7 Chip Card & Security 8 Selected financial figures 2018-08-01 Copyright © Infineon Technologies AG 2018. All rights reserved. 69
Slide 70: Organic RoCE as the key value metric typically amounts to ~2x WACC
Organic RoCE as the key value metric typically amounts to ~2x WACC 30% 20% 10% 0% FY15 FY16 FY17 Q1 FY18 Q2 Q3 Q4 RoCE (excluding PPA, Deferred Tax Effects and RF power sale) RoCE (reported) 2018-08-01 Copyright © Infineon Technologies AG 2018. All rights reserved. 70
Slide 71: Our commitment to investors: Continued value creation through growth
Our commitment to investors: Continued value creation through growth Earnings-per-share (EPS) development [EUR cent] +0% +9% 40 40 30 EPS basic 20 24 26 24 24 22 22 20 EPS adjusted 16 18 10 0 Q3 FY17 Q4 Q1 FY18 Q2 Q3 Total cash return to shareholders [EUR m] 1,809 › Policy of sustainable 308 283 div
Slide 72: SG&A on healthy level
SG&A - still including noticeable acquisition- related costs - on healthy level S and G&A* R&D** [EUR m] 209 210 218 209 206 205 195 189 200 200 195 15% 175 150 14% 125 13% 100 75 11.5% 12% 11.4% 11.3% 11.4% 11.2% 50 10.8% 11.0% 10.9% 10.6% 11% 25 10.4% 0 10% Q3 Q4 Q1 Q2 Q3 Q3 Q4 Q1 Q2 Q3 FY17 FY18
Slide 73: Inventory increased due to increase of work in progress and more raw material
Inventory increased due to increase of work in progress and more raw material Working capital* Inventories [EUR m] [EUR m] [days] 1,245 1,240 1,282 1,305 1,388 929 991 1200 120 1000 822 841 1000 100 800 621 800 99 98 102 102 104 80 600 600 60 400 400 40 200 20 200 0 0 0 Q3 FY17 Q4 Q1 FY18 Q2 Q3 Q3 F
Slide 74: Investments of ~€1.2bn due to strong order intake
Investments of ~€1.2bn due to strong order intake Investments* D&A [EUR m] ~1,200 1200 30% 1,022 1000 785 826 833 812 ~850 800 760 ~100 668 140 129 20% 280 114 600 514 15.9% 466 8 378 14.5% 15.5% 13.5% 263 7 400 12.8% 13.1% 12.9% 12.1% 11.9% 11.5% 11.3% 10% 9.8% 200 293 459 506 646 693 683 ~750 0 0%
Slide 75: Healthy gross cash and net cash position
Healthy gross cash and net cash position Liquidity development [EUR m] 1,829 1,789 1,834 1,809 1,859 358 2,621 2,217 2,452 2,312 2,438 792 649 618 503 Q3 Q4 Q1 Q2 Q3 FY17 FY18 Gross Cash Debt Net Cash › Operating cash flow from continuing operations was €462m › Free Cash Flow from continuing operati
Slide 76: Infineon has a balanced maturity profile and a solid investment grade rating (BBB) from S&P
Infineon has a balanced maturity profile and a solid investment grade rating (BBB) from S&P Maturity profile [EUR m; US$ m; nominal values] €500 $350 $350 €300 $235 €171 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25 FY26 FY27 FY28 Campeon 8-year 10-year 12-year Eurobond final re- Eurobond USPP USPP USPP S
Slide 77: Part of your life. Part of tomorrow.
Part of your life. Part of tomorrow. infineon
Slide 78: Glossary (1 of 2)
Glossary (1 of 2) AC alternating current ECU electronic control unit AC-DC alternating current - direct current ECU electronic control unit AD automated driving EMU electric multiple unit ADAS advanced driver assistance system EPS electric power steering AEB automatic emergency braking eSIM embedded
Slide 79: Glossary (2 of 2)
Glossary (2 of 2) IPM intelligent power module RF radio frequency iPol image processing line rhs right-hand scale IRF International Rectifier Si silicon LSPS LS Power Semitech Co. Ltd. SiC silicon carbide µC microcontroller SiGe silicon germanium MEMS micro electro-mechanical systems SMPS switch-mod
Slide 80: Disclaimer
Disclaimer Disclaimer: This presentation contains forward-looking statements about the business, financial condition and earnings performance of the Infineon Group. These statements are based on assumptions and projections resting upon currently available information and present estimates. They are
Slide 81: Infineon is a long-standing member of Europe's leading sustainability indices
Infineon is a long-standing member of Europe's leading sustainability indices Infineon’s most recent achievements › Sep 2017: Infineon is listed in the STOXX® Global ESG Leaders Indices, which serves as an indicator of the quality of Infineon’s performance in the governance, social and environmental
Slide 82: Financial calendar
Financial calendar Date Location Event 30 Aug 2018 Frankfurt Commerzbank Sector Conference Unterschleißheim Berenberg and Goldman Sachs German Corporate 24 Sep 2018 nearby Munich Conference 25 Sep 2018 Munich Baader Investment Conference 02 Oct 2018 London ATV Presentation by Peter Schiefer, Divisio
Slide 83: Notes
Notes Investments = 'Purchase of property, plant and equipment' + 'Purchase of intangible assets and other assets' incl. capitalization of R&D expenses Capital Employed = 'Total assets' – 'Cash and cash equivalents' Please note: All positions in ' ' refer to the – 'Financial investments' respective
Slide 84: Institutional Investor Relations contacts
Institutional Investor Relations contacts Alexander Foltin Corporate Vice President +49 89 234-23766 Finance, Treasury & alexander.foltin@infineon.com Investor Relations Joachim Binder Senior Director +49 89 234-25649 Investor Relations joachim.binder@infineon.com Holger Schmidt Senior Manager +49 8

Infineon Technologies — Q3 FY2018 Earnings Presentation on 6ix

Infineon Technologies — Q3 FY2018 Earnings Presentation

Slide 1: Third Quarter FY 2018 Quarterly Update

Slide 2: Agenda

Slide 3: Infineon at a glance; Q3 FY18 figures

Slide 4: Our strategy is targeted at value creation through sustainable organic growth

Slide 5: Well diversified exposure to end-markets and applications provide resilient growth model

Slide 6: Long platform life-times provide stickiness and visibility

Slide 7: Tight customer relationships, based on system know-how and application understanding

Slide 8: Infineon holds a leading position in its target markets

Slide 9: Q3 FY18 Group and Division Performance

Slide 10: Outlook for Q4 FY18 and FY18

Slide 11: Agenda

Slide 12: Infineon's organic revenue development clearly outperformed the total semi market

Slide 13: After temporary growth acceleration, revised TOM assumes reversion to 9% trendline

Slide 14: Increased average-cycle investment-to-sales model is necessary to fuel growth

Slide 15: Segment result margin target of 17% gradually improving due to economies of scale in opex

Slide 16: Period of accelerated growth with correspondingly higher investments will precede long-term TOM

Slide 17: Reference to IFX Day presentations

Slide 18: Agenda

Slide 19: Design-win for drivetrain platform proves Infineon's strength in xEV system solutions

Slide 20: First major 3D ToF sensor design-win for gesture camera and in-cabin sensing

Slide 21: New Villach 300 mm module will add significant capacity in power semiconductors

Slide 22: Automotive

Slide 23: Infineon's position in the automotive semiconductor universe

Slide 24: Infineon is continuously outgrowing the market since 2010

Slide 25: Clean cars, ADAS/AD, and adoption of premium features drive growth

Slide 26: Electro-mobility

Slide 27: xEV growth driven by emission regulation; but consumer preferences thwart CO2 reduction

Slide 28: Short-term, MHEV/FHEV/PHEVs are first choice; mid-term BEVs are preferred solution

Slide 29: The incremental demand of power semiconductors is a significant opportunity

Slide 30: System cost reduction can justify the higher SiC component price

Slide 31: Infineon has unparalleled expertise and portfolio for high-power xEV applications

Slide 32: Infineon offers the complete automotive-grade portfolio of SiC components

Slide 33: Automated Driving

Slide 34: For Automated Driving more compute power but also higher security and safety is needed

Slide 35: Increased sensor requirements drive the content in the next 5 years and beyond

Slide 36: Infineon opens the door for mass-deployable lidar systems for Automated Driving

Slide 37: Outstanding characteristics make AURIX first-choice µC in the AD platform market

Slide 38: ADAS/AD semi growth driven by radar and camera sensor modules over the next 5 years

Slide 39: Industrial Power Control

Slide 40: To empower this variety of applications we rely on the most comprehensive power portfolio

Slide 41: Clear leader in IGBT standard modules and discrete IGBTs

Slide 42: Infineon serves all major players for PV inverters and wind turbines

Slide 43: SiC MOSFETs bring down system cost and size of PV inverters

Slide 44: Inverterization of home appliances is a key driver for our business

Slide 45: IPC's business success in home appliances is based on several success factors

Slide 46: IPC's digital control strategy enables customers to shrink their system

Slide 47: Digitalization: motor control platform with scalable integration of HW and SW

Slide 48: HMI and AI are driving the penetration of collaborative robots (cobots)

Slide 49: Growing penetration of electric vehicles will drive roll-out of charging infrastructure

Slide 50: Electrification of trains is accelerating and Infineon is part of two subsystems

Slide 51: With an increasing number of applications, particularly module players will win in SiC

Slide 52: Power Management & Multimarket

Slide 53: PMM's growth is built on many applications from different sectors

Slide 54: PMM – Power

Slide 55: In 2017, PMM grew by 15.1% vs market of 13.5%

Slide 56: Technology leadership in MOSFETs and digital power

Slide 57: Highly differentiating solution for data center enables significant opex and capex reduction

Slide 58: AC-DC power supply by Eltek using CoolGaN

Slide 59: Server eco-system is supported by PMM's various DC-DC solutions

Slide 60: PMM – RF and Sensing

Slide 61: RF and Sensing devices enable new services and will shape the way we live and work

Slide 62: We focus on MEMS sensors and target to become the leader in 3D Imaging and Radar

Slide 63: XENSIV Si microphones have plenty of growth opportunities beyond smartphones

Slide 64: Leading base technologies for sensor solutions: Time-of-Flight

Slide 65: Chip Card & Security

Slide 66: Security is a system approach

Slide 67: Infineon offers security for the connected world

Slide 68: Continuous stream of new topics aging and exiting

Slide 69: Agenda

Slide 70: Organic RoCE as the key value metric typically amounts to ~2x WACC

Slide 71: Our commitment to investors: Continued value creation through growth

Slide 72: SG&A on healthy level

Slide 73: Inventory increased due to increase of work in progress and more raw material

Slide 74: Investments of ~€1.2bn due to strong order intake

Slide 75: Healthy gross cash and net cash position

Slide 76: Infineon has a balanced maturity profile and a solid investment grade rating (BBB) from S&P

Slide 77: Part of your life. Part of tomorrow.

Slide 78: Glossary (1 of 2)

Slide 79: Glossary (2 of 2)