Infineon Technologies AG

Investor Presentation • May 9, 2022

Second Quarter FY 2022 Quarterly Update

Infineon Technologies AG Investor Relations

Infineon at a glance

Financials FY21 revenue by product category

~5%	memory ICs
~12%	RF & sensors
~28%	embedded control and connectivity
~55%	power semi conductors
of total revenue		ATV	IPC	PSS	CSS

Since 1999, Infineon has grown by more than 10% p.a., thereby consistently outperforming the semiconductor market

Revenue Infineon Semiconductor World Market³ (adjusted for the Infineon fiscal year ending Sep 30)

1 In FY09 Infineon's management changed the measure it uses to assess the operating performance of its operating segments to "Segment Result" 2 Based on Infineon's portfolio (excl. Other Operating Segments and Corporate & Eliminations) per end of FY21 | 3 Source: WSTS (World Semiconductor Trade Statistics) in EUR adjusted for fiscal year, September 2021

Infineon is a global player, #1 in power semiconductors, and ranked #4 in the overall microcontroller market

1 Based on or includes research from Omdia: Annual 2001-2021 Semiconductor Market Share Competitive Landscaping Tool – 4Q21. March 2022.

2 Based on or includes research from Omdia: Power Semiconductor Market Share Database – 2020. September 2021. | 3 Diodes acquired Lite-On Semiconductor in November 2020. Both companies are reported combined as Diodes. Results are not an endorsement of Infineon Technologies AG. Any reliance on these results is at the third party's own risk.

Well-balanced portfolio among key trends Decarbonization and Digitalization

FY21 revenue of €11,060m by target application

We continue the broad presence of Infineon power semiconductors in Automotive applications with new SiC design wins

Examples of OEMs powered by Infineon Latest CoolSiC™ design wins including new applications

• customer base with broadest portfolio and full system
• › Seamless and cost-effective upgrade path across entire
• › Latest SiC design wins include next-generation traction inverter and OBC (on-board charger) at two Chinese OEMs with a combined triple-digit

Infineon offers complete power management solutions for compute servers based on Intel's Xeon processors

Infineon's power management solution maximizes overall system performance Advantages of Infineon's System Solution

Roughly 40 Infineon components located on the server board are supplying energy efficient power for Intel Xeon CPUs

• XDP™ digital power controller: Flexibility with software-defined architecture enables customizations for best performance

• OptiMOSTM Power Stage: Best-in-class efficiency & robustness minimizes total cost of ownership (TCO). Accurate telemetry and intelligent fault handling maximizes system performance and reliability

• OptiMOSTM Smart IPOL: Best-in-class efficiency and smart telemetry enables superior system performance

This total system solution drives superior performance and energy efficiency in data centers

The world's first TPM with a quantum-resistant firmware upgrade path

The market for long-term secure applications is opening today

• › Quantum-resistant designs offers vast market potential new devices with longer lifetimes and potential replacement cycles
• › Quantum computing market estimated to reach €9bn revenues for semiconductor manufacturers by 2030¹
• › Connecting devices in a secure way will enable the upcoming growth of IoT
• › Quantum-secure encryption methods should already be employed for devices with longer service lives today
• › With a leadership position in TPM and a successful R&D team, Infineon is uniquely positioned to capitalize on growth

OPTIGA™ TPM SLB 9672 – new generation of future-proof TPMs

• › Post-quantum cryptography (PQC) protected firmware update mechanism
• › Stronger cryptographic algorithms

• › Extended memory space

• › Improved computational performance

• › Resiliency features
• security › Fully compliant with the TCG requirements and certified accordingly

In 10-20 years, quantum computers are likely to attack today's cryptography

Easy integration

• › Easy replacement of existing TPMs
• › Tools to support design activities

1 McKinsey – Quantum Computing – what's in for semiconductor companies | ECDSA: elliptic curve digital signature algorithm | XMSS: extended Merkle signature scheme

Robust

Future-proof

Infineon's value creation is crystallized in a resilient through-cycle Target Operating Model

1 Infineon financial performance to approach targets as Cypress integration progresses

Growing annual revenues by €5bn+ in FY25 – multitude of growth drivers across markets/applications; well-diversified divisional split

Key levers identified to get to the target profitability flight level – 19% Segment Result Margin over the (next) cycle

Strategic differentiation through in-house manufacturing

In-house manufacturing

• › We manufacture power and sensor technologies in-house where we can gain a strategic advantage from our leading-edge manufacturing technologies and our outstanding process expertise
• › This results in a differentiation potential in terms of cost and/or performance
• › The current chip shortage highlights the strategic value of in-house manufacturing

Infineon's outsourcing share

Outsourcing

• › We work with outsourcing partners where we see no or only little differentiation to optimize our capital efficiency (CMOS and derivate technologies and standard packages)
• › We cooperate with subcontractors and foundries in order to ensure adequate capacity growth and flexibility
• › Infineon's outsourcing share is expected to increase from ~30% in FY21 to ~40% in FY25

We focus our investments to those areas with highest differentiation

1 Frontend clean rooms and major office buildings are not included

	Outlook Q3 FY221	Outlook FY221
Revenue	~ €3.4bn	€13.5bn +/- €500m
Segment Result Margin	~ 21%	At the mid-point of the revenue guidance: > 22%
Investments in FY22	~ €2.4bn
D&A in FY22	€1.7bn2 €1.6bn -
Free Cash Flow in FY22	~ €1.1bn

1 Based on an assumed average exchange rate of \$1.10 for €1.00

2 Including the amortization of around 400 million Euros from the purchase price allocation for Cypress and, to a lesser extent, International Rectifier

ESG: targets and achievements

We contribute a net CO² reduction of more than 70 million tons

Net ecological benefit: CO² emissions reduction of more than 70 million tons

Infineon is excellent in resource efficiency

We are committed to CO² neutrality by 2030

Our CO² -saving applications are high-growth, we are part of the solution!

The ~1:33 ratio is expected to further improve in the coming years

1 | 2 For explanatory notes see "ESG footnotes" in the appendix.

Infineon is excellent in resource efficiency and committed to CO² neutrality – sustainability is in our DNA

Infineon ranks among the 10 percent most sustainable companies in the world¹

In CY20, we used resources in our manufacturing processes much more efficiently than the global average of the semiconductor industry:

Infineon's CO² target² by 2025 and 2030

Net CO² emissions in million tons of CO² equivalents²

• Avoiding direct emissions and further reducing energy consumption
• Purchasing green electricity with guarantees of origin
• Compensate the smallest part by certificates that combine development support and CO² abatement

1 Based on the results of The Sustainability Yearbook 2022 by S&P Global in cooperation with RobecoSam | 2 Related to Scope 1 and 2 emissions

High-growth applications offer further additional CO² savings potential

In CY20:

PV energy: Annual installation capacity increase of ~15%²

Drives: Increasing penetration of more efficient drives³

EVs: Increased sales contributed to an average fleet emission reduction of 14 g/km in Europe⁴

1 Wood Mackenzie: Global Wind Power Market Outlook, Q2 2021. June 2021 | 2 Based on or includes content supplied by IHS Markit Climate and Sustainability Group: PV Installations Tracker, Q2 2021. June 2021 3 Based on or includes research from Omdia: Industrial Motor Control Sourcebook 2020. December 2020 | 4 CO² emissions from new passenger cars in Europe: Car manufacturers' performance in 2020 - 08/2021

External recognitions confirm our engagement in contributing to a sustainable society

	Rating/Score	Scale	Date
MSCI ESG	AA	CCC to AAA	02/2021
CDP	B climate scoring B water scoring	F to A	12/2021
Ecovadis	99th percentile "Platinum" award	0 to 100	02/2022
Dow Jones Sustainability Index	83 Dow Jones Sustain ability™ World and Europe Index listing	0 to 100	11/2021
Ethibel Sustainability Index Excelence Europe"	Index member	-	05/2020
ISS ESG Corporate Rating	B Prime Status	D- to A+	01/2021
FTSE4Good Index	Index member	-	06/2021
Euronext Vigeo Eurozone 120 Index Euronext Vigeo Europe 120 Index	Indices member	-	05/2021
Sustainalytics	Top ESG performer	-	01/2022

Infineon's Wide Bandgap Strategy

Leveraging full potential based on the power ratings and switching frequency required by the application

Si

• › Si remains the mainstream technology
• › Targeting 25 V 6.5 kV
• › Suitable from low to high power

SiC

• › SiC complements Si in many applications and enables new solutions
• › Targeting 650 V 3.3 kV
• › High power high switching frequency

GaN

• › GaN enables new horizons in power supply applications and audio fidelity
• › Targeting 80 V 600 V
• › Medium power highest switching frequency

SiC – Infineon is serving all relevant applications

Focus applications Customers

SiC – US\$ 1 billion revenue in sight

SiC revenue development

SiC power devices¹ 2021 total market: \$1,137m

• › Strengthening #2 position in SiC device market
• › Highest yoy growth of all peers
• › Broadest portfolio fits customers' individual needs
• › Scalable portfolio allows for easy and seamless upgrade from IGBT to SiC-based inverters

1 Yole Développement: Compound Semiconductor Quarterly Market Monitor. Q1 2022

CoolSiC™ trench design optimized performance and reliability

Our Cold Split technology leads to significant reduction of raw material losses during SiC manufacturing

Strong CoolSiC™ portfolio expansion: by packages and by voltages

Broadest and best-in-class SiC portfolio

	Industrial					Automotive grade
	CoolSiC™ Diode		CoolSiC™ Hybrid		CoolSiC™ MOSFET		CoolSiC™ Diode	CoolSiC™ Hybrid		CoolSiC™ MOSFET
	Discrete	Discrete	Module	Discrete	IPM	Module	Discrete	Discrete	Discrete	Module
voltages
600 V
650 V
1200 V
1700 V

Continuous expansion of portfolio

Expansion of SiC and GaN capacity follows our long-term strategy > €2bn investment to build a 3rd module at our site in Kulim

Rationale

• › Seize structural growth opportunities linked to electrification
• › Prepare manufacturing cluster for acceleration of WBG
• › Create higher resilience of WBG supply by further expanding capacities with Kulim 3 and in Villach
• › Leverage economies of scale

Total frontend investment	> €2bn
Revenue potential	~ €2bn per year
Groundbreaking	January 2022
Start of construction	June 2022
Ready for equipment	Summer 2024
First volumes out	Second half of calendar year 2024

GaN technology – Infineon well positioned to address key markets

1 GaN power devices market Yole Développement (Yole): SiC and GaN power devices: market trends and supply chain evolutions Q2 2022

GaN for power applications GaN for RF applications

• › GaN discretes, GaN drivers, integrated power stages (including the right-fit driver) for 650 V, 600 V, 200 V and 100 V with a broad package portfolio, as well as controllers addressing the consumer and industrial market
• › GaN for power chips are focused on high current-carrying capacity at frequencies below 10 MHz

• › Increasing revenue and design wins, e.g. in charger and adapter, servers for data center, edge computing and telecom, notebook as well as handhelds

• › GaN power amplifier with frequencies of 2.5 to 2.7 GHz and 8 W output power for 5G applications and satellite communications. Power amplifier modules including a RF GaN chip and an integrated bias and control-IC in development

• › GaN for RF chips are focused on high frequencies beyond 1 GHz
• › GaN power amplifiers are already shipped to a leading global infrastructure provider of power antennas for 5G basebands

GaN design wins of more than €1bn achieved

Automotive

ATV at a glance

ATV revenue and Segment Result Margin FY21 revenue split by product group

Key customers

• › Acceleration of OEMs' xEV roadmap, build up of battery capacities and charging infrastructure are expected to continue into 2022

• › CY22 battery pack prices on par or above 2021 level due to increased raw materials prices

• › L1 and L2 will see strong growth as L0 share decline

• › L2+ shipments will grow from a comparatively small base; first L3 model launches from OEMs will continue
• › Robotaxi pilot and small-scale launches continue

Infineon's top market position is built on system competence based on an industry-leading product portfolio

Automotive semiconductors (2021 total market: \$46.7bn; +31.5% yoy)

• › total market grew by 31.5% yoy, reaching all-time-high of \$46.7bn, exceeding previous high in 2018 of \$38.2bn
• › growth clearly supported by content-per-car growth
• › #1 in power semiconductors; gaining 1.3%-pt thanks to outstanding position in booming xEV business
• › Undisputed #1 in automotive NOR Flash memory ICs

Strategy Analytics: Automotive Semiconductor Vendor Market Shares. March 2022.

Electromobility

xEV (PHEV + BEV) penetration reaching all-time high of more than 10% globally in Q1 CY22

Source: Based on or includes content supplied by IHS Markit Automotive: EV Sales Volumes. April 2022; EV-Volumes.com. April 2022.

The road to emission-free cruising: Governments and OEMs indicated when to ban the ICE

The penetration of PHEV + BEV is accelerating; the incremental content of power semis in xEV is a significant opportunity for Infineon

1 Based on or includes content supplied by IHS Markit Automotive: Alternative Propulsion Forecast. September 2019, August 2021.

2 Strategy Analytics: Automotive Semiconductor Demand Forecast 2019 - 2028. July 2021; Infineon. "power" includes voltage regulators, ADCs and ASICs. 3 Due to missing ICE engine in BEV the weighted incremental semiconductor content for PHEV and BEV starts below the "~\$490" line.

Automated Driving

The car of the future is driving digitalization in many aspects and Infineon provides the ingredients

ADAS/AD

• › object recognition
• › advanced spatial sensing
• › MCU (AURIX™, TRAVEO™ 2, PSoC™)
• › radar sensor
• › NOR flash and RAM memory

software-over-the-air

• › remote OS updates
• › secure feature upgrades
• › NOR flash memory
• › security solution

infotainment and HMI

• › seamless digital entertainment
• › always-on, secure connectivity
• › intuitive user interface (UI)
• › MCU (AURIX™, TRAVEO™ 2, PSoC™)
• › Wi-Fi, Bluetooth®, USB Type C
• › touch controller with CapSense™

comfort / premium

• › automatic exterior and interior lighting
• › passenger-specific automatic settings
• › MCU (AURIX™, TRAVEO™ 2, PSoC™)
• › pressure and magnetic sensors
• › LED driver ICs

digital instrument cluster

• › real-time driver information
• › user-specific digital content
• › MCU (AURIX™, TRAVEO™ 2, PSoC™)
• › NOR flash and RAM memory

AURIX™ – the "gold standard" of Automotive MCUs continues its success story with the recently announced TC4x

Current AURIX™ TC2x/TC3x microcontroller family New AURIX™ TC4x microcontroller family

• › AURIX™ is one of the leading Automotive microcontrollers with more than 320m units shipped to date
• › 32-bit real-time capable multi-core architecture based on up to 6 unified RISC/MCU/DSP TriCore™ processor cores, applicationspecific accelerators and security subsystem

• › Wide array of automotive applications: inverter control, engine and battery management, transmission control, safety control, ADAS, active suspension, LED pixel lighting, sensor fusion, domain control

• › New AURIX™ TC4x family for next generation eMobility, ADAS, automotive E/E architectures and affordable artificial intelligence (AI)

• › Highest standards in real-time execution, security and dependability
• › New zero downtime SOTA (Software Over the Air) features
• › Smart accelerators like for AI-based real-time control and 4D radar signal processing – up to 78x acceleration vs. previous generation
• › Enabling the next generation of intelligent and connected electric cars

AI-based xEV features

› Predictive control and virtual sensing › Advance State of Health (SoH) and State of Charge (SoC) algorithms

Intelligent safety host

• › Companion chip for safety critical applications next to high-performance MPUs
• › Highest safety standards ASIL-D, ISO26262

New AI and neural network features

Enhanced safety and control

AI-based ADAS features

• › Object classification
• › Advanced radar signal processing
• › Sensor fusion

Domain/zone control

• › E/E architecture reduce complexity
• › Model predictive control
• › Intrusion prevention and detection

The Infineon AURIX™ MCU family has become the first-choice automotive architecture for high-growth and safety-critical applications

Infineon AURIX™ revenue development over time

Industrial Power Control

IPC at a glance

IPC revenue and Segment Result Margin FY21 revenue split by product group (indicative)

Key customers

Market outlook remains positive across most target applications; growth rates returning to normal long term patterns

Clear leader in discrete IGBTs and IGBT modules; fostering position in IPMs

Discrete IGBTs 2020 total market: \$1.59bn		IPMs 2020 total market: \$1.43bn		IGBT modules1 2020 total market: \$3.63bn
Infineon	29.3%	Mitsubishi	32.9%	Infineon	36.5%
Fuji Electric	15.6%	onsemi	17.1%	Fuji Electric	11.4%
Mitsubishi	9.3%	Infineon	11.6%	Mitsubishi	9.7%
onsemi	7.7%	Fuji Electric	11.2%	Semikron	5.8%
Toshiba	5.5%	Semikron	5.5%	Vincotech	3.3%
STMicro	4.6%	Sanken Electric	3.0%	Starpower	2.8%
Littelfuse	4.2%	STMicro	2.4%	Hitachi	2.7%
Renesas	3.8%	ROHM Semi	1.7%	Danfoss	2.5%
MagnaChip	3.1%	Hangzhou Silan	1.6%	Hitachi ABB PGS	2.3%
Hangzhou Silan	2.6%	Jilin Sino-Micro	0.9%	Bosch	2.1%

1 Including standard (non-integrated) IGBT modules and power integrated modules (PIMs) / converter inverter brake (CIB) modules Based on or includes research from Omdia: Power Semiconductor Market Share Database 2020. September 2021

Infineon provides solutions for all links in the energy conversion chain

Green energy generation provides large business opportunities

1 IEA: Net Zero by 2050 - A Roadmap for the Global Energy Sector. May 2021 | 2 Based on or includes content supplied by IHS Markit Climate and Sustainability Group: Grid Connected Energy Storage Market Tracker H1 2021. August 2021 3 Extrapolation; conservative assumption of equal ratio renewable generation to storage capacity

Increasing share of renewables requires stronger grid

Planned grid expansion in Germany

Source: Bundesnetzagentur

Infineon's 4.5 kV IGBT modules enable HVDC lines

• › HVDC High Voltage Direct Current lines are the technology of choice to strengthen the grid
• › Converter stations are equipped with power semiconductors
• › Infineon offers highly robust, low-loss 4.5 kV IGBT solutions
• › 6.5 kV IGBT is in development and will complement offering

4.5 kV IGBT module in IHV-B housing

Converter station

Source: Siemens Energy

Infineon will benefit from all CO² saving measures

State-of-the art charging infrastructure powered by Infineon gives a perfect P2S example

Voice of Customer

"The project […] shows that we can not only optimize the noise levels of our vehicles but also improve our energy efficiency. We would be very interested in this solution if these improvements could be commercially mass-produced." Ingo Wortmann, Head of Mobility at Stadtwerke München

Power & Sensor Systems

PSS at a glance

PSS revenue and Segment Result Margin FY21 revenue split by product group

Key customers

Market outlook remains positive across most target applications but impact of current macro environment to be further closely monitored

Applications (% of FY21 segment revenue)1	Market Outlook for CY22
Computing ~20%	› Structural growth driven by cloud computing and to a lesser extent by enterprise servers › Notebook PC shipments are expected to move steadily
Communication ~5%	› 5G cycle will continue to drive telecom equipment spending in CY22
Smartphone ~17%	› Still slight positive unit growth is expected for CY22 but reduced due to demand reduction mainly in Europe and intensifying supply constraints
Consumer ~24%	› Consumer confidence declined due to current macro environment, implying headwinds for consumer spending
Industrial ~25%	› Demand in renewable energy, EV and EV charging expected to be accelerated; value chain risks increasing and to be watched › Tailwinds from US, EU and Asia stimuli packages for infrastructure / green energy initiatives support long-term growth
1 does not sum up to 100% due to other applications not shown here

PSS's growth is built on many applications from different sectors in power and non-power

• › data center
• › enterprise server
• › PC, notebook
• › peripherals

• › chargers and adapters

• › base stations

• › backhaul cellular infrastructure
• › 5G massive MIMO
• › telecommunication servers

Computing Communications Smartphones Consumer Industrial

• › smartphones
• › mobile devices
• › wearables

• › USB Type-C, USB Type-C PD

• › eBikes, eScooter

• › multicopter
• › gaming
• › TV sets

• › smart home

• › power supplies

• › EV on-board charger
• › charging infrastructure
• › PV inverter
• › power tools
• › lighting
• › Industry 4.0
• › aerospace

PSS – Power

Infineon is the clear leader in MOSFETs; growth potential in power ICs

15.8%

1 Discrete Power MOSFET market includes automotive MOSFETs, protected MOSFETs, SiC MOSFETs and GaN power transistors. | 2 Power IC market includes automotive power ICs. Based on or includes research from Omdia: Power Semiconductor Market Share Database 2020. September 2021

Data center – AI hyperscaler and telecom/edge computing are driving the growth

Exponential increase in AI Training & Networking (ASIC/SoC/FPGA/CPU/ GPU) power level requires cutting-edge innovation in Device & Packaging technologies to solve power efficiency and density challenges

→ The bill of material is outpacing unit growth by a factor of ~1.3x.

1 Normalized overall power requirement per server board for x-comparison

Based on or includes research from Omdia: Data Center Server Equipment Market Tracker – 2Q21 Database. September 2021

Transition from 3G/4G to 5G drives demand in power semis for antennas and power supplies

• › driver #1: massive growth of data and computing power
• › driver #2: higher number of base stations due to dense network
• › driver #3: ~4x higher power semi content per radio board: from ~\$25 for MIMO antenna to ~\$100 for massive MIMO antenna array
• › driver #4: fog computing data center as a completely new market

PSS – RF and Sensing

Main applications addressed by PSS sensors portfolio

Sensor markets targeted by PSS offer attractive growth potential

3D ToF image sensor market Environmental sensor market*

* Infineon is addressing smart building, smart home, smart appliances, consumer IoT devices and automotive Source: Infineon estimates

Source: Infineon estimates

Unparalleled audio characteristics of our XENSIV™ MEMS microphones made Infineon #1 in 2019 with further m/s gain in 2020

Infineon's market share development in MEMS microphones (by units)

Based on or includes research from Omdia: MEMS Microphones Dice Market Shares 2021. July 2021

Technological progression of Infineon XENSIV™ MEMS microphones

Presence detection Health monitoring

• › Room Occupancy Devices e.g. human localization and counting
• › Occupancy based heating and ventilation e.g. reduction of CO² level to prevent spreading of diseases

› Device switch on/off

e.g. reduction of energy consumption (e.g. lamp, TV, air conditioning…)

› Directional audio effects on individuum e.g. to improve audio quality (e.g. smart speaker, TV)

› Home surveillance

e.g. detection of intruders

› Sleep monitoring

Sleep detection, sleep quality, apnea & snoring detection (radar combined with MEMS microphone)

› Vital sensing for home Fitness

Heart rate and breathing rate measurement (person standing still after exercise)

Segmentation with radar enables smart devices to recognize each person in the room

Infineon 3D ToF is a versatile technology for many consumer applications

Infineon XENSIV™ PAS CO2 sensor enables highly-precise CO² measuring in an extremely small size

Photoacoustic spectroscopy (PAS) technology based on Infineon's high (SNR) signal-to-noise ratio MEMS microphone

• › Infineon XENSIV™ PAS CO2 sensor enables highly-precise, cost-effective and space saving CO² measuring
• › The technology offers an exceptionally small form factor (14 mm x 13.8 mm x 7.5 mm) that is 4x smaller and 3x lighter (2 grams) than the typical NDIR (non-dispersive infrared) sensor, allowing for more than 75% space savings in customer systems
• › The SMD package ensures compatibility with high-volume manufacturing standards, enabling cost-effective, fast assembly and system integration
• › Advanced compensation and configuration algorithms enable a plug-&-play sensor performance and fast design-to-market

XENSIVTM PAS CO2 leads to demand-oriented and energy efficient control of air conditioning systems

Infineon system solution addresses IoT market via combining XENSIV™ sensors, PSoC™ 6 MCU and connectivity

Key facts

• › Infineon offers system solutions comprising of sensor, MCU, connectivity and software libraries (apps, SDKs)
• › BLE functionality monolithically integrated on MCU
• › IoT target applications for radar: entrance control or presence detection for smart home and smart building
• › Radar solutions are anonymous and therefore respecting privacy
• › First orders for presence detection received from several Asian customers
• › Radar solution can perfectly be combined with Infineon's XENSIV™ PAS CO2 sensor for air quality monitoring

Example offering: Combination of sensors, microcontrollers and connectivity in development kit

Advantages of radar over passive infrared

• › super compact design; smaller system sizes
• › determination of person's direction, speed, distance
• › programmable; can flexibly be adapted to the target application
• › higher accuracy; more precise measurements of detected objects

Connected Secure Systems

CSS at a glance

CSS revenue and Segment Result Margin FY21 revenue split by product group

Key customers

Positive outlook for most markets for CY22, while allocation has varying effects on the segments with the strongest impacts on payment

Infineon remains top player in security ICs

Security ICs (excl. NFC controllers; excl. NFC eSE) 2020 total market: \$2.8bn

Security ICs (excl. NFC controllers; excl. NFC eSE) 2020 by application

ABI Research: Smart Card and Embedded Security IC Technologies. October 2021

MCU and software are key for the success in IoT as they define the functionality and time-to-market of the device

With a broad set of key enabling technologies, Infineon is well positioned to capture growth opportunities

1 ABI Research: Wireless Connectivity Technology Segmentation and Addressable Markets. July 2021; excluding Chromebooks, desktop PCs, feature phones, media tablets, netbooks, smartphones, white box tablets.

Infineon acts as one-stop-shop with excellent RF, sensor, connectivity, power, memory and security solutions

1 ABI Research: Wireless Connectivity Technology Segmentation and Addressable Markets. July 2021; excluding Chromebooks, desktop PCs, feature phones, media tablets, netbooks, smartphones, white box tablets.

We are driving the smart home opportunity together with marketshaping customers

1 ABI Research: Wireless Connectivity Technology Segmentation and Addressable Markets. July 2021; excluding Chromebooks, desktop PCs, feature phones, media tablets, netbooks, smartphones, white box tablets. 2 ABI Research: Smart Home Hardware Market. June 2021. | 3 Incl. Smart Appliances, Smart Lighting, Flat Panel TVs, Smart Speakers & Displays, Smoke & Air Quality Sensors, Consumer Robotics, Thermostats and others.

Significant synergy potential of a combined company product portfolio

Edge AI is a fast developing market enabled by and calling for many of our core competencies

Edge AI to offer additional growth opportunities as inference workloads move to device level

Cloud AI

› Public and private clouds offer scalability and flexibility

Cloud AI

› Growing performance demand with higher power consumption (ASIC/SoC/FPGA/CPU/GPU)

Edge AI

Infineon:

• › Smart subsystems offer low latency, improved privacy, higher power efficiency
• › Growing solution demand for e.g. image and object recognition, autonomous material handling, predictive maintenance, and human-machine interface

Infineon: Power supply (AC-DC) Power conversion (DC-DC) Smart sensors with AI capabilities

Embedded control including connectivity and edge AI accelerators Smart power, toolchain/ecosystem, deployment services

For the Industrial IoT, Edge AI enables predictive maintenance and other use cases – playing right into our core competences

Predictive maintenance is a significant lever for productivity

Maintenance prediction for key assets (avoidance of fixed preventive maintenance cycles)

Advantages

• › Reduced downtime through optimized maintenance
• › Lower maintenance costs
• › Increase transparency on device usage

Edge AI-enabled control and field-level devices

Products and services from Infineon enable safe, secure, power-efficient, dependable implementation

Smart sensors

Edge AI enhances Industrial IoT to enable predictive maintenance,

Detect and pre-process signals through AI capabilities to recognize potential abnormal operation of equipment

increasing production efficiency and robustness

Edge AI processing and control

Edge AI enabled MCUs to identify at-risk equipment, repair urgency and control adaptation

Smart Actuators

Receive and implement instructions to reduce potential impacts in production

Security

Ensure secure communication and protection of critical information

Connectivity

Enable dependable communication across devices, factory levels, cloud and secure device management

AIROC™ portfolio expansion to support Matter with multiprotocol solutions including BLE and IEEE 802.15.4 low-power SoC

Infineon joins Connectivity Standards Alliance – shaping the future of IoT AIROC™ CYW30739

• › Launching the new AIROC™ Bluetooth® Low Energy (BLE) and IEEE 802.15.4 to support Matter with multiprotocol solutions
• Built on market-proven wireless IP technology for maximum interoperability
• Superior RF performance enables robust and reliable connectivity
• Low power consumption supports applications requiring long battery life
• Software enablement reduces development time for BLE and Matter over Thread applications

Low power system on chip (SoC) with multiprotocol connectivity and integrated MCU

Multi-protocol subsystem features:

• › Bluetooth® v5.3 with LE 2-Mbps support
• › Fully compliant IEEE 802.15.4 MAC and PHY layers
• › Best-in-class Rx sensitivity of -95.5 dBm (BLE) and -103.5 dBm (IEEE 802.15.4)

Examples of target applications

A proprietary, license-free home automation connectivity standard that aims to reduce fragmentation between different vendors and achieve interoperability between smart home devices and Internet of Things platforms.

Other members include Amazon, Apple, Google, Comcast, the Zigbee Alliance, IKEA, Signify, etc.

Selected financial figures

Group financial performance

Automotive (ATV)

› Positive development supported by additional capacity availabilities, favorable pricing and a supportive US-Dollar exchange rate

• › Macroeconomic and geopolitical developments continue to disrupt automotive production the supply chain remains fragile
• › ADAS and electromobility continue their strong growth trajectory further SiC design-wins in China achieved

Industrial Power Control (IPC)

• › Automation and drives, home appliances and power infrastructure showed particular strength in Q2
• › The current business perspective remains positive:
• − Decarbonization is a strong structural driver for renewable energies and the related power infrastructure
• − Industrial applications benefit strongly from our differentiating SiC offering

Power & Sensor Systems (PSS)

• › Strong demand across key applications but: delivery capability was hampered by strict Covid containment measures in China
• › Server business benefiting from industry-leading portfolio of power management solutions
• › Some signs of slowdown in consumer and smartphones

Connected Secure Systems (CSS)

› Revenue and segment result improved – in particular microcontrollers for IoT applications as well as payment and identity solutions contributed

• › Demand continues to outstrip supply capacity constraints from foundries will continue to limit revenue potential
• › Market momentum remains strong in key areas such like industrial IoT, smart buildings and identity

Gross margin and Opex

Investments, Depreciation & Amortization and Free Cash Flow

Working Capital, in particular trade working capital components

Inventories [EUR m] [EUR m] [days] [days] [days] 101 112 111 113 121 Q2 FY21 Q3 FY21 Q4 FY21 Q1 FY22 Q2 FY22 1,937 2,053 2,181 2,319 2,540

1 For definition please see page "Notes"

2 Along with the integration of Cypress refund liabilities to customers are presented under "other current liabilities" instead of "trade receivables". Prior quarters' figures were adjusted accordingly for better comparability.

Return on capital employed

Earnings-per-share and total cash return

15 18 36 35 35 24 27 41 41 44 Q2 FY21 Q3 Q4 Q1 FY22 Q2 EPS basic EPS adjusted [EUR cent]

Development of earnings-per-share (EPS) from continuing operations

Total cash return to shareholders

[EUR m]

• › Dividend for FY21: €0.27 per share
• › Dividend payout of €351m for FY21

Liquidity development

Historical liquidity development

[EUR m]

Maturity profile

Maturity profile from 2022 to 2033

Graph excludes additional debt with maturities between 2022 and 2023 totaling €4.5m.

1) On 1 Oct 2019, Infineon issued a perpetual hybrid bond with two tranches: €600m with first call date in 2025 and €600m with first call date in 2028; both are accounted as equity under IFRS.

Conservative financial policy and strict commitment to investmentgrade rating are the basis for through-cycle flexibility

	Financial Policy Targets	Status Quo (LTM 31 March 2022)
Cash1 Gross	€1bn + at least 10% of revenues → €2.2bn	€1bn + 18% of revenues → €3.2bn
Debt2 Gross	≤ 2.0x EBITDA	1.6x EBITDA
Comfortable liquidity position	› Flexibility for financing operating activities and investments through the cycle › Cushion for net pension liabilities and contingent liabilities
Balanced debt position	› Gross debt target temporarily exceeded for CY acquisition, but still compatible to investment-grade rating › Public commitment to return to target level of ≤ 2.0x – deleveraging steps taken	achieved FY22 Q1, one year ahead of schedule, further
Rating	Investment grade	BBB stable outlook (by S&P Global)

1 Gross cash position is defined as cash and cash equivalents plus financial investments | 2 Gross debt is defined as short-term debt and current maturities of long-term debt plus long-term debt. EBITDA is calculated as the total of earnings from continued operations before interest and taxes plus scheduled depreciation and amortization

Disclaimer

This presentation contains forward-looking statements and/or assessments about the business, financial condition performance and strategy of the Infineon Group. These statements and/or assessments are based on assumptions and management expectation resting upon currently available information and present estimates. They are subject to a multitude of uncertainties and risks, many of which are partially or entirely beyond Infineon's control. Infineon's actual business development, financial condition, performance and strategy may therefore differ materially from what is discussed in this presentation.

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

Specific disclaimer for Omdia – part of Informa Tech – reports, data and information referenced in this document:

The Omdia reports, data and information referenced herein (the "Omdia Materials – mostly former IHS Markit Technology Materials") are the copyrighted property of Informa Tech Research Ltd. and its subsidiaries or affiliates (together "Informa Tech") and represent data, research, opinions or viewpoints published by Informa Tech, and are not representations of fact. The Omdia Materials speak as of the original publication date thereof and not as of the date of this document. The information and opinions expressed in the Omdia Materials are subject to change without notice and neither Informa Tech nor, as a consequence, Infineon have any duty or responsibility to update the Omdia Materials or this publication as a result. Omdia Materials are delivered on an "as-is" and "as-available" basis. No representation or warranty, express or implied, is made as to the fairness, accuracy, completeness or correctness of the information, opinions and conclusions contained in the Omdia Materials. To the maximum extent permitted by law, Informa Tech and its affiliates, IHS Markit and its Affiliates and their respective, officers, directors, employees and agents, disclaim any liability (including, without limitation, any liability arising from fault or negligence) as to the accuracy or completeness or use of the Omdia Materials. Informa Tech and/or IHS Markit will not, under any circumstance whatsoever, be liable for any trading, investment, commercial or other decisions based on or made in reliance of the Omdia Materials. The "IHS Markit" brand and logo have been licensed for use by Informa Tech. The "IHS Markit" brand and logo and any third-party trademarks used in the IHS Markit Technology Materials are the sole property of IHS Markit Group or their respective third-party owners.

Specific disclaimer for IHS Markit – reports, data and information referenced in this document:

The IHS Markit reports, data and information referenced herein (the "IHS Markit Materials") are the copyrighted property of IHS Markit Ltd. and its subsidiaries ("IHS Markit") and represent data, research, opinions or viewpoints published by IHS Markit, and are not representations of fact. The IHS Markit Materials speak as of the original publication date thereof and not as of the date of this document. The information and opinions expressed in the IHS Markit Materials are subject to change without notice and neither IHS Markit nor, as a consequence, Infineon have any duty or responsibility to update the IHS Markit Materials or this publication. Moreover, while the IHS Markit Materials reproduced herein are from sources considered reliable, the accuracy and completeness thereof are not warranted, nor are the opinions and analyses which are based upon it. IHS Markit and the trademarks used in the Data, if any, are trademarks of IHS Markit. Other trademarks appearing in the IHS Markit Materials are the property of IHS Markit or their respective owners.

Glossary

AC	alternating current
AD	automated driving
ADAS	advanced driver assistance system
AI	artificial intelligence
AR	augmented reality
ASIC	application-specific integrated circuit
ASIL-D	automotive safety integrity level D
BEV	battery electric vehicle
BLE	bluetooth low energy
BMS	battery management system
CMOS	complementary metal-oxide-semiconductor
CPU	central processing unit
DC	direct current
DSP	digital signal processor
E/E	electrical/electronic architecture
eSIM	embedded subscriber identity module
EV	electric vehicle
FHEV	full hybrid electric vehicle
FPGA	field programmable gate array
GaN	gallium nitride
GPU	graphics processing unit
HMI	human machine interaction
HVAC	heating, ventilation, air conditioning
IC	integrated circuit
ICE	internal combustion engine
IGBT	insulated gate bipolar transistor
IoT	internet of things
IPM	intelligent power module
LED	light-emitting diode

Mbps	megabit per second
MCU	microcontroller unit
MEMS	micro electro-mechanical systems
MHEV	mild hybrid electric vehicle
MIMO	multiple input, multiple output
MOSFET	metal-oxide silicon field-effect transistor
MPU	microprocessor unit
OBC	on-board charger
OEM	original equipment manufacturer
P2S	Infineon's strategic product-to-system approach
PAS	photo-acoustic spectroscopy
PD	power delivery
PHEV	plug-in hybrid electric vehicle
PSoC	programmable system-on-chip
PV	photovoltaic
RAM	random-access memory
RF	radio frequency
RISC	reduced instruction set computer
SDK	software development kit
Si	silicon
SiC	silicon carbide
SMD	surface mounted device
SNR	signal-to-noise ratio
SoC	system-on-chip
SOTA	software over-the-air
SWP	single wire protocol
ToF	time-of-flight
USB	universal serial bus
VR	virtual reality
WBG	wide band gap, specifically referring to SiC and GaN based devices
xEV	all degrees of vehicle electrification (EV, HEV, PHEV)

Notes and ESG footnotes

Investments =	'Purchase of property, plant and equipment' + 'Purchase of intangible assets and other assets' incl. capitalization of R&D expenses
Capital Employed =	'Total assets' – 'Cash and cash equivalents' – 'Financial investments' – 'Assets classified as held for sale – ('Total Current liabilities' – 'Short-term debt and current maturities of long-term debt' – 'Liabilities classified as held for sale')
RoCE =	Operating profit from continuing operations after tax / Capital Employed = ('Operating profit' – 'Financial result excluding interest result' – 'Share of profit (loss) of associates and joint ventures accounted for using the equity method'-'Income tax') / Capital Employed
Working Capital =	('Total current assets' – 'Cash and cash equivalents' – 'Financial investment' – 'Assets classified as held for sale') – ('Total current liabilities' – 'Short term debt and current maturities of long-term debt' – 'Liabilities classified as held for sale')
DIO (days inventory outstanding; quarter-to-date) =	('Net Inventories' / 'Cost of goods sold') x 90
DPO (days payables outstanding; quarter-to-date) =	('Trade payables' / ['Cost of goods sold' + 'Purchase of property, plant and equipment']) x 90
DSO (days sales outstanding; quarter-to-date) =	('Trade receivables' - 'reimbursement obligations')* / 'revenue' x 90
	*without debtors with credit balances

Order backlog = The total amount of orders received regardless of their current status

ESG footnotes:

• 1) This figure takes into account manufacturing, transportation, own vehicles, travel, raw materials and consumables, chemicals, water/waste water, direct emissions, energy consumption, waste, etc. as well as direct and indirect energy-related emissions by manufacturing service providers. It is based on data collected internally and publicly available conversion factors and relates to the 2021 fiscal year.
• 2) This figure is based on internally established criteria, which are described in the explanatory notes. The figure relates to the 2020 calendar year and takes into account the following application areas: automotive, LED, induction cookers, servers, renewable energy (wind, photovoltaic) and cell phone chargers as well as drives. CO2 savings are calculated based on the potential savings generated by technologies in which semiconductors are used. The CO2 savings are allocated based on Infineon's market share, semiconductor share, and the lifetime of the technologies concerned, based on internal and external experts' estimations. Despite the fact that carbon footprint calculations are subject to imprecision due to the complex issues involved, the results are nevertheless clear.

For further reading

Financial calendar

Date	Event	Location
11 May 2022	IPC Call along with PCIM trade show
16 May 2022	17th Equita European Conference	virtual
17 May 2022	J.P. Morgan European Technology, Media and Telecoms Conference	London
23 May 2022	J.P. Morgan Global Technology, Media and Communications Conference	Boston
24 May 2022	Berenberg Conference USA 2022	Tarrytown
25 May 2022	Deutsche Bank dbAccess German Corporate Conference	Frankfurt
25 May 2022	Erste Bank Erste CEE Technology & Innovation Conference 2022	virtual
31 May 2022	Kepler One Stop Shop Conference	Madrid
14-15 Jun 2022	Exane BNP CEO Conference	Paris
21 Jun 2022	BofA TMT Conference	London
3 Aug 20221	Q3 FY22 Results
15 Nov 20221	Q4 FY22 and FY 2022 Results

1 preliminary

Institutional Investor Relations contacts

Alexander Foltin

Executive Vice President Finance, Treasury & Investor Relations

+49 89 234-23766 alexander.foltin@infineon.com

Isabell Diel

Manager Investor Relations

+49 89 234-38297 isabell.diel@infineon.com

Alexander Groschke

Director Investor Relations

+49 89 234-38348 alexander.groschke@infineon.com

Daniel Györy

Senior Director Investor Relations

+49 89 234-35078 daniel.gyoery@infineon.com

Holger Schmidt

Director Investor Relations

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