Apple-supplier Infineon is still ‘far away’ from meeting chip demand


Matthias Balk | picture alliance | Getty Images

German chipmaker and Apple-supplier Infineon is struggling to meet demand for its semiconductors, according to the company’s CEO, Reinhard Ploss.

“The automotive, but also other verticals, are very tight currently on supply,” Ploss told CNBC’s “Squawk Box Europe” on Wednesday.

“We are far away from matching the demand,” he said, adding that demand is constantly increasing because there’s a backlog building up. “The problems are rising and piling up over time.”

Apple lists Infineon as a supplier in its 2021 supplier list, but it does not specify what products it buys from the company. Infineon makes a wide range of semiconductor technologies including microcontrollers, LED drivers, sensors and integrated circuits for power management.

It’s unclear if Apple is getting all the components that it needs from Infineon. Infineon declined to comment on the matter while Apple did not immediately respond to a CNBC request for comment.

Last month, Apple CEO Tim Cook said the Cupertino-headquartered company had “larger than expected supply constraints” on iPhones, iPads and Macs in the third quarter that cost the company an estimate $6 billion.

“The supply constraints were driven by the industry wide chip shortages that have been talked about a lot, and COVID-related manufacturing disruptions in Southeast Asia,” Cook said.

Infineon shares were up over 2% Wednesday after the company announced that it almost doubled its profit to 464 million euros ($535 million) in the three months to the end of September, from the quarter before.

Asked if the Munich-based company is charging higher prices for its products due to their relative scarcity, Ploss said: “We do not take advantage of the current situation because we have a long term relationship to our customers.”

However, he admitted that there are “bits and packets” of Infineon’s product portfolio that “follow market prices.”

Infineon opened a new 1.6 billion euro semiconductor factory in Villach, Austria, in September as part of an effort to meet demand for its products. It said chips from the plant will primarily be used to meet demand from the automotive industry, data centers and renewable energy generation of solar and wind power.

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