German chipmaker Infineon will cut 1,400 jobs from its global workforce and relocate an additional 1,400 roles to countries with lower labor costs.
The announcements were made after the company posted lower-than-expected Q3 2024 revenue results and consequently downloaded its full-year revenue guidance for the third time this year.
The company’s CEO, Jochen Hanebeck, said the job-related decisions form part of a previously announced cost-cutting program called ‘Step Up’ which Infineon is hoping will bring about approximately €1bn ($1.1bn) of annual savings by 2027.
In a statement after today’s results were announced, Hanebeck said: “In a market environment that remains challenging, Infineon continues to hold up well.”
He added: "The recovery in our target markets is progressing only slowly. Prolonged weak economic momentum has resulted in inventory levels in many areas overlaying end demand. In addition to managing the current demand cycle, we are working on further strengthening our competitiveness through the ‘Step Up’ structural improvement program."
Commenting on the job cuts in the company’s earnings call, Hanebeck told analysts Infineon was “ruling out forced redundancies in Germany,” however, it’s believed that the cuts will impact several hundred positions at the company’s German plant.
According to Infineon’s website, the company, which manufactures power semiconductors, sensors, and microcontrollers, currently employs 58,600 staff worldwide.
In May, the company unveiled a number of new power supply unit solutions to meet the energy demands of AI data centers.
According to Infineon, the power supply units will combine silicon (Si), silicon carbide (SiC), and gallium nitride (GaN) in a “strategic configuration,” which the company said will allow its 8kW PSU to achieve benchmark efficiency and power density for 100 W/in3, compared to 32 W/in3 with the 3kW unit.
