Infineon Technologies AG — Investor Presentation 2014

Sep 17, 2014

Investor and Analyst Call 17 September 2014

Jochen Hanebeck Division President Automotive (ATV)

ATV Segment Overview

Market Growth Drivers

High-growth Applications and Infineon's Offering

Impact of International Rectifier Acquisition

Summary

What Has Changed Since Last Investor Call in September 2013?

• Market share increase CY2013 continued: +0.5 percentage points to 9.6%
• Solid market growth drives more than EUR 500m of quarterly turnover with margin improvement
• Continued efforts for further CO² reduction led to strong growth in e. g. Electric Power Steering (EPS) and Brush-Less-DC motors
• Strong growth in comfort features
• Strong traction with RADAR in ADAS/safety applications

FY 2014 Expectations

• Continued demand on high level, driven by unit car production in US, China and Europe
• Growing importance of electrification of drivetrain (CO² : ICE, EV/HEV)
• Continued democratization of safety, ADAS and comfort features in new car models drive semiconductor content further
• In case of successful acquisition of International Rectifier additional revenue in ATV of ~\$150m p.a.

Automotive (ATV) at a Glance

Revenue and Segment Result development

* Based on Q4 guidance, as of 30 July 2014.

Annual revenue growth driven by strong demand for CO² reduction solutions and in general high proportion of optional features. Demand especially strong in US and China.

Top Customers and Distributors; Revenue Split by Region

Infineon is the global #2, #1 in Europe and Korea, #3 in Japan and #5 in China

Market shares by product category

Source: Strategy Analytics, April 2014

ATV Offers a Complete Product Portfolio: Sensors, MCU and Power

Revenue split* by product category

* Based on revenues from FY13. ** Power semiconductors include discretes, power ICs and power modules.

ATV Focuses on Powertrain, Safety and Body Applications

* Based on revenues from FY13.

ATV Segment Overview

Market Growth Drivers

High-growth Applications and Infineon's Offering

Impact of International Rectifier Acquisition

Summary

China and Asia-Pacific to Account for Majority of Car Production Growth

Source: IHS Inc., August 2014

Market Growth Fuelled by Car Production Growth and Increasing Number of Features

Source: Strategy Analytics, July 2014 * Safety = "Safety" + "Chassis" according to SA definition. **Body = "Body" + "Security" according to SA definition.

Semi Content of EV/HEV Vehicles Falls Right Into Infineon's Core Competence

Average semiconductor content per car 2013

Source: Strategy Analytics, "Automotive Semiconductor Demand Forecast 2012 – 2021", May 2014

Wide Adoption of CO2 Reduction, ADAS and Premium Features Drive ATV's Growth

ATV: ~8% p.a.

Sources: IHS Inc., Strategy Analytics, Infineon

ATV Segment Overview

Market Growth Drivers

High-growth Applications and Infineon's Offering

Impact of International Rectifier Acquisition

Summary

Semiconductors Are Indispensable in Reaching CO² Emissions Targets

Historical national fleet emissions performance and future targets

Two main trends drive reaching the CO² emission goals – enabled by semiconductors

Source: The International Council for Clean Transportation

Further CO² Reduction Possible Through Dual Clutch Automatic Transmission

CO² Reduction Through Innovation in Established High Volume Markets: Alternator

CO² Reduction Potential Infineon's Innovation

High-efficiency diode has ~ 30% less losses enabling up to 3% better system efficiency:

• i.e. -15…20W system loss
• i.e. -0.5g CO² /km

Comments

• Infineon addresses market with a superior technology
• The biggest alternator manufacturers in the world are enthusiastic about this innovation

Alternator

Up to 12 conventional rectifier diodes are being replaced by Infineon's High-Efficiency Diode.

Safety Evolvement towards Automated and Autonomous Driving

Increasing degree of automation

Product to system: Complete System Solution for Radar

Euro NCAP 5-star rating will require Autonomous Emergency Braking for pedestrian, city and inter-urban safety systems.

Forecast for distance warning systems

Source: Strategy Analytics, 2014; incl. 24/77 GHz radar, camera, and LIDAR

Market trends Infineon's offering

Comments

Design wins in Europe, Asia and US incorporating complete chipset (Microcontroller, High Frequency Transceiver, Communication and Power Supply Devices) confirm Infineon's leading position in Driver Assistant Products.

ADAS functions represent high growth opportunities

Safe Power Supply

Hypersonic: safe system shut down in critical cases

Optimized, High Performance MCUs for 10 Target Applications in 3 Segments

ATV Segment Overview

Market Growth Drivers

High-growth Applications and Infineon's Offering

Impact of International Rectifier Acquisition

Summary

Infineon ATV and International Rectifier Automotive: Multiple Strategic Benefits

Adding to scope	Adding to scale
Complementing the product  portfolio  Broadening of application understanding	Adding automotive revenue  (~\$150m p.a.)  Manufacturing synergies
Adding technology	Adding market presence

ATV Segment Overview

Market Growth Drivers

High-growth Applications and Infineon's Offering

Impact of International Rectifier Acquisition

Summary

Summary

Automotive commitment:

• 2 in Automotive globally first time #3 in Japan

• Consistent revenue growth and profitability since the 1990s

Growth drivers:

• Compound annual car production growth of ~4%
• Compound annual semiconductor content growth of 2%-4%
• CO2 reduction, Advanced Safety and Comfort

Differentiators:

• Innovative products and technologies for e.g. electric motor drives, efficient alternators, xEV and ADAS based on Product to System approach
• Application-optimized automotive and industrial MCUs
• System know-how, quality excellence and a broad customer base

ATV Segment Overview

Market Growth Drivers

High-growth Applications and Infineon's Offering

Impact of International Rectifier Acquisition

Summary

Glossary

• ABS Anti-lock braking system
• ACC Adaptive Cruise Control
• AEB Autonomous Emergency Braking
• ADAS Advanced driver assistance systems
• ATV Automotive segment
• CAGR Compound annual growth rate
• DC/DC Direct current/Direct current converter
• ECU Electronic control unit
• EMS Engine management system
• EPS Electric power steering
• ESC Electronic stability control
• EV Electric vehicle
• HEV Hybrid electric vehicle
• IC Integrated circuit
• ICE Internal combustion engine
• ROW Rest of world
• TPMS Tire-pressure monitoring system

Disclaimer:

This presentation contains forward-looking statements about the business, financial condition and earnings performance of the Infineon Group.

These statements are based on assumptions and projections resting upon currently available information and present estimates. They are subject to a multitude of uncertainties and risks. Actual business development may therefore differ materially from what has been expected.

Beyond disclosure requirements stipulated by law, Infineon does not undertake any obligation to update forward-looking statements.