Infineon Faced High Expectations on Margins

Dow Jones08-05

0743 GMT - Infineon Technologies missed elevated margin expectations in its fiscal third quarter and guidance for the current quarter, Citi analysts write in a research note. The German chip maker's segment result--a closely watched profitability metric--came in at 797 million euros with a 19.1% margin for the three months to the end of June, below Vara Research consensus of 809 million euros and 19.6%. Guidance for a roughly 23% margin in the current quarter is also below consensus of 23.7%. "While the revenue beat and guidance is positive and supports the fundamentals moving in the right direction, market expectations have moved even quicker given the improving cycle and peer results, and hence the lower margins may be the focus this morning," analysts say. Infineon shares trade 3.6% lower at 61.40 euros.

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