Technology: Chip manufacturer Infineon expects AI sales to rise massively

Munich. Infineon is heading for a new sales record. Europe's largest chip manufacturer is forecasting revenues of 20 billion euros for the fiscal year that has just begun, 20 percent more than in the previous year.

At the same time, the group, which is listed in the German DAX stock index, is aiming for an operating margin of around 25 percent, which is a good five percentage points more.

The drivers of the business are the billion-dollar investments worldwide in data centers, mostly for artificial intelligence (AI). Sales of chips for powering these data factories will increase to four billion euros, the Munich-based company announced on Tuesday morning. According to the group, it was 2.2 billion euros in the last financial year, which ended on September 30th.

Customers would conclude multi-year supply contracts in this area and secure capacity, said CEO Jochen Hanebek. The sales volume of these agreements amounts to more than ten billion euros. This shows that demand is not only strong, but also long-term.

Recently, the share prices of chip manufacturers worldwide have come under pressure because investors fear that the AI ​​bubble will burst. The positive forecast could now give Infineon's shares a new boost. Since peaking in June, shares have lost more than 40 percent of their value. Nevertheless, they are still up around 28 percent compared to the beginning of the year. For comparison: The DAX has gained around nine percent since the beginning of January.