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Investing.com -- Infineon (OTC:IFNNY) Technologies (ETR:IFXGn) raised its full-year revenue outlook slightly on Tuesday, citing expected currency effects, after reporting a smaller-than-anticipated decline in fiscal first-quarter revenue.
The company’s shares jumped roughly 10% in European trading.
The German chipmaker now expects revenue for the fiscal year ending in September 2025 to be flat or slightly higher compared to the previous year. The company had previously projected a slight decline, but adjusted its forecast based on a weaker euro against the dollar.
"Infineon has held up well in a weak market environment, closing its first quarter slightly ahead of expectations," CEO Jochen Hanebeck said in a statement.
Revenue for the first quarter dropped 8% to 3.4 billion euros ($3.5 billion), surpassing the company-provided analyst estimate of 3.2 billion euros.
The segment result margin, Infineon’s preferred metric for operating profitability, also exceeded expectations, coming in at 16.7% versus a forecast of 15%.
Barclays (LON:BARC) analysts said they “attribute the entire beat and raise primarily” to currency (FX) effects.
“The key question will be why IFX isn’t seeing the softness others have recently commented on, with its auto division better than expected in the reported quarter and expected to increase in the current quarter,” they added.
Barclays analysts estimate that Infineon’s 2025 guidance suggests the company is trading at a price-to-earnings (P/E) ratio of 18 to 23 times. Assuming revenue growth of 5% to 15% in 2026, along with some margin expansion, the chipmaker’s valuation could range between 15 and 19 times earnings.