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German chipmaker Infineon set to expand chip production for AI applications

Written by Mon 26 Feb 2024

Image of Infineon Headquarters - Reuters Image Credit: Reuters

German semiconductor manufacturer, Infineon, said it intends to produce and sell more expensive chips tailored for artificial intelligence (AI) applications.

The chipmaker said this is in response to growing demand for AI-related products and services. CEO at Infineon, Jochen Hanebeck, said this strategy is a means to generate substantial revenue and fuel the company’s future growth.

Infineon markets semiconductors and systems for automotive, industrial, and multimarket sectors, as well as chip card and security products.

“Conventional servers contain power semiconductors worth between £51 ($65) to £63 ($80). In an AI server, it is £670 ($850) to £1,420 ($1,800), depending on the architecture,” said Hanebeck at the company’s annual general meeting.

Hanebeck added that with semiconductors for data centres, Infineon expects to generate revenues in the low three-digit million euros range in the 2024 fiscal year. In a few years, Infineon expects annual revenues of around £855.3 million ($1.08 billion).

In the 2022 to 2023 financial year, Infineon achieved record results. However, the company adjusted its targets for 2023 to 2024 downwards due to the impact of a weakening global economy.

Earlier this month, Bloomberg reported Infineon expects lower-than-anticipated revenue this year due to reduced semiconductor demand from industrial customers amidst a broader slump in the industry.

Infineon announced revenue expectations of £13.2 billion ($16.8 billion) to £14.1 billion ($17.8 billion), down from its earlier guidance midpoint of £14.5 billion ($18.4 billion).

In May, Infineon acquired Stockholm-based startup Imagibob AB, a platform provider for machine Learning (ML) solutions. With the 100% acquisition, Infineon said it intends to offer a world-class ML solution that significantly complements its AI offerings.

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Written by Mon 26 Feb 2024

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