Ams-Osram to Focus on Profitable Operations and Exit Noncore Semiconductor Businesses
- Wednesday, October 16, 2024
Ams-Osram, an Austria-based electronics company, announced that it plans to exit its noncore semiconductor businesses in order to sharpen its focus on its profitable operations. The company aims to expand in automotive, industrial, and medical semiconductor markets, as well as in select segments of the consumer-device semiconductor market where it can differentiate itself.
During the second quarter, Ams-Osram reported a net loss of 1.34 billion euros ($1.47 billion), compared to a profit of EUR58 million in the same period last year. This loss was primarily due to noncash impairment charges of EUR1.3 billion. The company attributed the impairment to weaker prospects for some low-performing consumer businesses. Adjusted earnings for the quarter halved to EUR50 million, while sales dropped 28% to EUR851 million.
As part of its restructuring efforts, Ams-Osram aims to deliver annual savings of EUR150 million by the end of 2025, with one-time costs of approximately EUR50 million. Despite the challenges faced in the second quarter, the company expects revenue to grow at a compound annual rate of 6%-10% over the 2023-2026 period from its reduced base.
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