Infineon Technologies Ag · XETR:IFX
Infineon Technologies — Morgan Stanley 4th Annual Technology, Media & Telecoms Conference 2004
29 slides from Infineon Technologies's conference presentation, Nov 19, 2004
Slide 1: Morgan Stanley 4th Annual Technology, Media & Telecoms Conference
Morgan Stanley 4th Annual Technology, Infineon Media & Telecoms Conference November 19, 2004 Dr. Wolfgang Ziebart President and CEO Infineon Technologies AG 2004 Year-end Roadshow Slide 1 Copyright © Infineon Technologies 2004. All rights reserved.
Slide 2: Disclaimer
Disclaimer Please note that while you are reviewing this information, this presentation was created as of the date listed, and reflected management views as of that date. This presentation contains certain forward-looking statements that are subject to known and unknown risks and uncertainties that
Slide 3: Agenda
Agenda Personal Introduction Financial Update and Outlook Regional Strategy Business Group Highlights Discussion of Integrated Infineon Business Model 2004 Year-end Roadshow Slide 3 Copyright © Infineon Technologies 2004. All rights reserved.
Slide 4: Agenda
Agenda Personal Introduction Financial Update and Outlook Regional Strategy Business Group Highlights Discussion of Integrated Infineon Business Model 2004 Year-end Roadshow Slide 4 Copyright © Infineon Technologies 2004. All rights reserved.
Slide 5: Development FY04 compared to FY03
Development FY04 compared to FY03 [EUR m] FY03 FY03 FY04 FY04 Change Change Net sales 6,152 7,195 1,043 Growth (%) 17% Gross margin 25% 35% R&D 1,089 1,219 130 in % of sales 18% 17% SG&A 679 718 39 in % of sales 11% 10% EBIT (299) 256 555 in % of sales (5%) 4% Therein impairment and antitrust-relate
Slide 6: Operating and free cash flow significantly improved
Operating and free cash flow significantly improved FY03 FY04 [EUR m] Operating cash flow 730 1,857 Capex (872) (1,163) Other investments (1) (1) 89 (488) Free cash flow (53) 206 2004 Year-end Roadshow Slide 6 (1) Excluding purchase/sale of marketable securities Copyright © Infineon Technologies 200
Slide 7: Outlook for first quarter of fiscal year 2005
Outlook for first quarter of fiscal year 2005 ! ! Expectations Expectations for for aa slowdown slowdown in in several several application application segments segments due due toto higher higher inventory inventory levels levels compared compared to to the the previous previous quarters. quarters.
Slide 8: Agenda
Agenda Personal Introduction Financial Update and Outlook Regional Strategy Business Group Highlights Discussion of Integrated Infineon Business Model 2004 Year-end Roadshow Slide 8 Copyright © Infineon Technologies 2004. All rights reserved.
Slide 9: Strong growth in Asia and Japan
Strong growth in Asia and Japan + 21.3% Total 7,195 +16.9% [EUR m] Total +25.8% 6,152 7000 Total 6000 4,890 33% APAC* 5000 30% 5% Japan 4000 31% 4% 21% NAFTA 3000 23% 24% 18% 18% Europe** 2000 19% 1000 Germany 26% 25% 23% 0 2004 Year-end FY 01/02 FY 02/03 FY 03/04 Roadshow Slide 9 * Including rest o
Slide 10: Increasing proportion of employees in lower-cost regions leads to lower personnel expenses
Increasing proportion of employees in lower-cost regions leads to lower personnel expenses Average number of employees Total personnel expenses per employee [EUR k] by geographic region11 23% 25% 27% 56.8 56.6 53.9 9% 9% 8% 14% 15% 16% 52% 51% 48% FY02 FY03 FY04 FY02 FY03 FY04 Germany Asia/Pacific 2
Slide 11: Agenda
Agenda Personal Introduction Financial Update and Outlook Regional Strategy Business Group Highlights Discussion of Integrated Infineon Business Model 2004 Year-end Roadshow Slide 11 Copyright © Infineon Technologies 2004. All rights reserved.
Slide 12: Memory Products: Significant margin improvement
Memory Products: Significant margin improvement Revenue share Revenues and EBIT margin Q4 FY04 [EUR m] 765 811 807 643 665 609 569 542 21% 17% 21% (1) 18% 18% 6% -22% 1% 9% 40% 2% -6% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY03 FY04 ! Sequential revenue decrease was mainly caused by a lower ASP and a weakening US-
Slide 13: 110nm technology: In volume production – 90nm and 70nm: At customers and in pipeline
110nm technology: In volume production – 90nm and 70nm: At customers and in pipeline Key Key innovations innovations inin 90nm 90nm Key Key facts facts on on 110nm: 110nm: and and 70nm: 70nm: ! Best ! Best wafer wafer yield yield >93.9% >93.9% ! 90nm: ! 90nm: -- New New cell cell layout layout -- Tr
Slide 14: 110nm: Basis for global 300mm ramp-up in 2005
110nm: Basis for global 300mm ramp-up in 2005 Richmond Dresden Beijing Taiwan 100% Share of 300mm-based 80% 60% capacities 40% Taiwan 20% 0% FY04 FY05e FY06e FY07e FY08e FY09e 2004 Year-end Roadshow Slide 14 Copyright © Infineon Technologies 2004. All rights reserved.
Slide 15: Add resources in South East Asia
Add resources in South East Asia Capacities Capacities in in Share of SEA based capacities 60% South South East East Asia Asia 50% 40% Based on the additional capacities 30% from SMIC, Inotera and Winbond we 20% plan to increase the share of capacities 10% SEA from around 5% in the current 0% fiscal
Slide 16: Bit shipment share of non-computing applications increased to more than 30% in Q4 FY04
Bit shipment share of non-computing applications increased to more than 30% in Q4 FY04 Q1 FY04 Q4 FY04 Non- Non- computing** computing** Computing* Computing* * Desktop PCs, Notebooks and Workstations; ** Infrastructure, Consumer, Mobile Applications " A leading supplier to server manufacturers " Le
Slide 17: Automotive & Industrial: Record revenues and stable margins at a high level
Automotive & Industrial: Record revenues and stable margins at a high level Revenue share Revenues and EBIT margin Q4 FY04 473 501 414 407 414 411 435 399 25% 13% 12% 12% 9% 12% 13% 14% 15% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY03 FY04 ! Sequential revenue increase was mostly due to increased sales of products
Slide 18: A&I – Complete coverage of customers' needs
AI – Complete coverage of customers' needs Defining automotive intelligence Applications: Applications: Products: ! Powertrain ! Powertrain ! Sensors ! Safety management ! Safety management ! Microcontrollers ! Power devices ! Body & convenience ! Body & convenience ! Wireless chipsets Infotainment
Slide 19: Leading positions by increasing market shares in both segments
Leading positions by increasing market shares in both segments Infineon Infineon Automotive Automotive 2003 2003 Infineon Infineon Power Power 2003* 2003* No. No. 22 World, World, No. No. 11 EU, EU, No. No. 33 US US No. No. 11 World, World, No. No. 11 EU, EU, No. No. 44 US US 2003 2002 2003 2002 1.
Slide 20: Secure Mobile Solutions: Strong revenue growth and EBIT margin improvement
Secure Mobile Solutions: Strong revenue growth and EBIT margin improvement Revenue share Revenues and EBIT margin Q4 FY04 508 467 409 410 405 347 316 331 25% 9% 9% 2% 3% 5% -5% -10% -8% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY03 FY04 ! Sequential revenue improvement was mainly driven by higher demand for mobile s
Slide 21: Infineon grows faster than the market
Infineon grows faster than the market IFX Wireless IFX Chip card Wireless semiconductor market Chip card market IFX Wireless IFX Chip card 43% 28% 31% 23% Revenue growth CY03 vs. CY02 Revenue growth CY03 vs. CY02 ! Improved ! Improved to to No. No. 33 from from No. No. 55 ! Clear ! Clear No. No. 1;
Slide 22: Continued to gain market share in RF and baseband
Continued to gain market share in RF and baseband Total Total handset handset market market CY00 CY00 to to CY03 CY03 Unit Unit growth growth 1H 1H CY04 CY04 vs. vs. 1H 1H CY03 CY03 [units IFX RF transceiver Handsets m] IFX Baseband IFX Baseband 100% IFX RF transceiver 600 520 500 81% 407 423 80% 40
Slide 23: Significant growth potential from a rapidly growing contactless market
Significant growth potential from a rapidly growing contactless market through a complete product portfolio Contactless Contactless market market Contactless Contactless project project overview overview [units CAGR m] 34% 516 ePassport ePassport GER GER // NL NL // UK UK // ePassport Japan Japan eP
Slide 24: Wireline Communications: Strategic measures initiated to achieve profitability
Wireline Communications: Strategic measures initiated to achieve profitability Revenue share Revenues and EBIT margin Q4 FY04 [EUR m] 106 112 119 122 107 109 104 114 6% -7% -14% -17% -40% -35% -83% -34% -96% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY03 FY04 ! Sequential revenue increase was mainly driven by higher
Slide 25: Transforming from traditional telecom voice vendor into data- and home-networking provider
Transforming from the leading traditional telecom voice vendor into a data- and home-networking solution provider From Core to DoorTM TM From the network … to the home … ... within the home Step Step 22 Step Step 44 Step Step 33 Data/IP DSLAM VoIP ADSL CPE bridge Home networking Step Step 11 ! Route
Slide 26: Agenda
Agenda Personal Introduction Financial Update and Outlook Regional Strategy Business Group Highlights Discussion of Integrated Infineon Business Model 2004 Year-end Roadshow Slide 26 Copyright © Infineon Technologies 2004. All rights reserved.
Slide 27: Infineon has the technical competencies to target converging markets of the future
Infineon has the technical competencies to target converging markets of the future Infineon's Infineon's exposure exposure to to product product and and industry industry segments segments Application Application Segments Segments Auto- Auto- Data Data Consumer Consumer Industrial Industrial Wireles
Slide 28: Integrated manufacturing to maximized flexibility and minimized cost
Integrated manufacturing to maximized flexibility and minimized cost Maximize: Opportunities during market upturns Minimize: Impact of downturns and investments ! Internal flexibility: Between MP and Advanced Logic Cluster ! External flexibility: Silicon foundries and subcontractors ! Cost optimizat
Slide 29: Never stop thinking.
Never stop thinking. 2004 Year-end Roadshow Slide 29 Copyright © Infineon Technologies 2004. All rights reserved.