Infineon Technologies AG — Investor Presentation 2011

Sep 7, 2011

Deutsche Bank European TMT Conference London, 07 September 2011

Infineon Technologies AG Peter Bauer, CEO

Infineon Results and Outlook

Business Highlights

Segment Result Margin Maintained at High Level

Revenue and Segment Result [EUR m] 885 942 922 ^{994 1043 138 171 177 202 212} Q3 FY10 Q4 Q1 FY11 Q2 Q3 Revenue Segment Result Segment Result margin 16% 18% 19% 20% 20% +18%

Strong Revenue Growth With High Margins in ATV and IMM

Investments Rise Significantly to Exploit Growth Potential

1) Investments =

'Purchase of property, plant and equipment' + 'Purchase of intangible assets, and other assets' incl. capitalization of R&D expenses.

Expanding 200mm Capacity in Kulim; Driving 300mm Thin Wafer in Dresden

Kulim 2

In order to fully exploit Infineon's growth potential, Infineon will expand the cost-efficient 200mm manufacturing site in Kulim, Malaysia.

Dresden 300mm

Infineon will further extend its technology leadership by driving 300mm thin wafer manufacturing of power semiconductors out of the newlyacquired facility in Dresden.

Guidance for Q4 and FY 2011

Outlook Q4 FY11 (compared to Q3 FY11)

Revenue

Revenue to be at least flat. As implied by Q4 outlook:

Revenue to grow more than 20%.

previously: Revenue to grow by 20%.

Total Segment Result

Segment Result to be broadly flat.

As implied by Q4 outlook:

Segment Result margin to be about 20 percent.

previouly: Segment Result margin to be about in line with H1 FY11.

Infineon Results and Outlook

Business Highlights

Infineon Holds Top Positions in All Target Markets

New Era: Multiple Factors Driving Demand for Power Semiconductors

10% Growth or More p.a. Expected for Infineon

Infineon: ≥ 10% p.a.

07 June 2011

Sustainable Profitability: We Will Keep High Margins

Infineon: ~20% under normal industry conditions ~15% through cycle

Target Operating Model

	FY 2010	FY 2011e	Longer term
Revenue	> 20% EUR 3.295bn growth yoy		 10% growth p.a.
Gross margin	37.5%	Low 40ies %	Low 40ies %
R&D-to-sales	12.1%	Low-to-mid ~12% teens %
SG&A-to-sales	11.7%	~12% Low-teens %
Total Segment Result margin	14.4%	~20%	~20%

ICEs Still Bread-and-Butter Business; New Opportunities in HEV/EV

Sources: CSM, Strategy Analytics (May 2011). TAM = total addressable market.

Power Supplies, VSD are Main Businesses; Renewables and DPM are Growth Drivers

IMM: > 10% p.a.

Sources: EPIA 2011, Gartner 2010, IMS Research 2010, UNIFE 2010, Yole 2010, Infineon 2011. DPM = digital power management

28 July 2011

Strong Growth in New Businesses Allows Us to Grow Above Market

CCS: ~5-7% p.a.

Sources: IMS Research 2011, Infineon 2011. TAM = total addressable market

28 July 2011

Another Quarter of Strong Financial Performance

	[EUR m]	FY 2010	Q2 FY11	Q3 FY11
	Revenue	3,295	994	1,043
	Segment Result	475	202	212
	SR Margin	14%	20%	20%
1043 994	Net Income*	660	572	190
	Investment	325	164	319
	FCF from cont'd. operations	573	13	-8
212 202 Q2 FY11 Q3 FY11	Gross Cash	1,727	2,691	2,585
Revenue Segment Result	Net Cash	1,331	2,335	2,246

* Net Income FY 2010 includes a book gain of EUR 93m from the sale of WLC to Lantiq. Net Income Q2 FY11 includes a book gain of EUR 378m from the sale of WLS to Intel Mobile Communications.

High Gross Cash and Net Cash Position Maintained

* Consists of Convertible Bond 2014 (nominal value EUR 156m; book value EUR 127m).

• Gross and net cash decreased slightly.
• Repurchases of CB 2014 of EUR 16m cash (nominal EUR 4m) equivalent to roughly 2m underlying shares.

Infineon Consolidated Statements of Operations (IFRS) (unaudited)

	3	mont hs ended		9 mont	hs ended
in Euro million; except for the per share data	Jun 3 0 , 11	M ar 3 1, 11	Jun 3 0 , 10	Jun 3 0 , 11	Jun 3 0 , 10
Revenue	1,043	994	885	2,959	2,353
Cost of goods sold	(613)	(573)	(553)	(1,724)	(1,495)
Gro ss pro fit	430	421	332	1,235	858
Research and development expenses	(109)	(112)	(100)	(329)	(285)
Selling, general and administrative expenses	(114)	(113)	(100)	(330)	(283)
Other operating income	2	9	2	13	11
Other operating expense	(8)	(18)	(15)	(32)	(107)
Operating inco me	201	187	119	557	194
Financial income	13	8	5	27	24
Financial expense	(14)	(11)	(11)	(43)	(79)
Income from investments accounted for using the equity method	(1)	2	4	1	7
Inco me fro m co ntinuing o peratio ns befo re inco me taxes	199	186	117	542	146
Income tax expense	(24)	(13)	(14)	(45)	(27)
Inco me fro m co ntinuing o peratio ns	175	173	103	497	119
Income from discontinued operations, net of income taxes	15	399	23	497	151
N et inco me	190	572	126	994	270
Attributable to:
Non-controlling interests	-	-	-	-	1
Shareholders of Infineon Technologies AG	190	572	126	994	269
Basic earnings per share attributable to shareholders of Infineon Technologies AG (in Euro):
Weighted average shares outstanding (in million) – basic	1,087	1,087	1,087	1,087	1,087
Basic earnings per share (in Euro) from continuing operations	0.16	0.16	0.10	0.46	0.11
Basic earnings per share (in Euro) from discontinued operations	0.01	0.37	0.02	0.45	0.14
B asic earnings per share (in Euro )	0.17	0.53	0.12	0.91	0.25
Diluted earnings per share attributable to shareholders of
Infineon Technologies AG (in Euro): Weighted average shares outstanding (in million) – diluted	1,157	1,160	1,172	1,161	1,087
Diluted earnings per share (in Euro) from continuing operations	0.16	0.15	0.09	0.44	0.11
Diluted earnings per share (in Euro) from discontinued operations	0.01	0.35	0.02	0.43	0.14
	0.17	0.50	0.11	0.87	0.25

Infineon Consolidated Statements of Financial Position (IFRS) (unaudited)

in Euro million	Jun 30, 11	M ar 31, 11	Sep 30, 10
A ssets:
Current assets:
Cash and cash equivalents	822	1,162	1,667
Financial investments	1,763	1,529	60
Trade and other receivables	828	829	687
therin: Trade accounts receivables	584	593	622
Inventories	631	615	514
Income tax receivable	15	13	7
Other current financial assets	4	9	72
Other current assets	101	97	88
Assets classified as held for sale	4	-	495
T o tal current assets	4,168	4,254	3,590
Property, plant and equipment	1,185	962	838
Goodwill and other intangible assets	103	97	87
Investments accounted for using the equity method	31	37	35
Deferred tax assets	221	223	308
Other financial assets	124	126	119
Other assets	31	25	16
T o tal assets	5,863	5,724	4,993
Liabilities and equity:
Current liabilities:
Short-term debt and current maturities of long-term debt	83	130	133
Trade and other payables	760	779	665
therin: Trade accounts payables	718	685	659
Current provisions	619	582	553
Income tax payable	113	142	111
Other current financial liabilities	121	11	16
Other current liabilities	315	323	153
Liabilities classified as held for sale	-	-	177
T o tal current liabilities	2,011	1,967	1,808
Long-term debt	256	226	263
Pension plans and similar commitments	147	147	146
Deferred tax liabilities	9	11	11
Long-term provisions	45	42	55
Other financial liabilities	6	5	6
Other liabilities	69	77	79
T o tal liabilities	2,543	2,475	2,368
Shareholders' equity:
Ordinary share capital	2,173	2,173	2,173
Additional paid-in capital	5,875	5,880	6,048
Accumulated deficit	(4,619)	(4,809)	(5,613)
Other reserves	4	5	17
Put options on treasury shares	(113)	-	-
T o tal equity	3,320	3,249	2,625
T o tal liabilities and equity	5,863	5,724	4,993

Infineon Consolidated Statements of Cash Flows (IFRS) (unaudited)

3	mont hs ended
Jun 3 0 , 11	M ar 3 1, 11	Jun 3 0 , 10
190	572	126
(15)	(399)	(23)
94	89	80
24	13	14
4	3	12
(2)	3	1
(2)	-	-
-	-	(4)
-	-	(1)
1	(2)	(4)
5	-	3
		5
		-
		(82)
		(18)
		(3)
		83
		(46)
		142
		(6)
		5
		(25)
		(8)
		251
		(11)
279	261	240
(550)	(1,468)	-
		376
(11)	(9)	(9)
		(72)
		3
		298
		(35)
		263
		(8)
		2
		(264)
(16)	(27)	(3)
	-	(1)
(1)
4	-	-
-	(109)	-
(28)	(152)
-	1	-
(28)	(151)
(340)	(445)	(274) (274) 229
-	(3)	(5)
1,162 822	1,610 1,162	1,228 1,452
	- - (5) (20) 1 31 50 (10) (13) 6 (12) (16) 311 (32) 321 (308) - (548) (43) (591) - 2 (17)	(3) 1 (72) 13 2 13 20 (39) (21) 6 - (22) 177 84 - (155) - (1,632) 1,077 (555) - - (16)

Financial Calendar

Date * preliminary date	Location	Event
28 Sep 2011	Munich	UniCredit German Investment Conference
16 Nov 2011*		Q4 FY11 Results
17-18 Nov 2011	Barcelona	Morgan Stanley TMT Conference
01 Feb 2012*		Q1 FY12 Results
08 Mar 2012*	Munich	Annual General Meeting
03 May 2012*		Q2 FY12 Results
28 Jun 2012	Munich	IFX Day (Capital Markets Day)
31 Jul 2012*		Q3 FY12 Results
13 Nov 2012		Q4 FY12 Results

Copyright © Infineon Technologies 2010. All rights reserved. 2011 28 July 2011 Page 23

Institutional Investor Relations Contacts

Ulrich Pelzer

Corporate Vice President, Corporate Development & Investor Relations +49 89 234-26153 ulrich.pelzer@infineon.com

Joachim Binder

Senior Director, Investor Relations

+49 89 234-25649 joachim.binder@infineon.com

Aleksandar Josic Manager, Investor Relations

+49 89 234-83045 aleksandar.josic@infineon.com

Holger Schmidt Manager, Investor Relations

+49 89 234-22332 holger.schmidt@infineon.com

Disclaimer

This presentation was prepared as of 28 July 2011 and is current only as of that date. This presentation includes forward-looking statements and assumptions about the future of Infineon's business and the industry in which we operate. These include statements and assumptions relating to general economic conditions, future developments in the world semiconductor market, our ability to manage our costs and to achieve our growth targets, the resolution of Qimonda's insolvency proceedings and the liabilities we may face as a result of Qimonda's insolvency, the benefits of research and development alliances and activities, our planned levels of future investment, the introduction of new technology at our facilities, our continuing ability to offer commercially viable products, and our expected or projected future results.

These forward-looking statements are subject to a number of uncertainties, such as broader economic developments, including the market environment; trends in demand and prices for semiconductors generally and for our products in particular, as well as for the end-products, such as automobiles, drives, renewable energies and consumer electronics , that incorporate our products; the success of our development efforts, both alone and with partners; the success of our efforts to introduce new production processes at our facilities; the actions of competitors; the continued availability of adequate funds; any mergers, acquisitions or dispositions we may undertake; the outcome of antitrust investigations and litigation matters; and the resolution of Qimonda's insolvency proceedings; as well as the other factors mentioned in this presentation and those disclosed at other occasions.

As a result, Infineon's actual results could differ materially from those contained in or suggested by these forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements. Infineon does not undertake any obligation to publicly update or revise any forward-looking statements in light of developments which differ from those anticipated.