Infineon Offloads Memory Unit for $1.12 Billion, Channels Proceeds Into EV and AI Power Chips

Infineon is divesting a legacy memory business to Winbond for USD 1.12 billion while launching new power components for EV inverters and AI accelerators.

Infineon is redrawing its business map. The DAX-listed chipmaker is shedding a legacy memory operation to Winbond Electronics while simultaneously rolling out new components aimed at electric drivetrains and artificial-intelligence accelerators — a two-track move that management frames as a deliberate tilt toward higher-margin, technologically demanding markets.

A $1.12 Billion Cash Deal, Closing in 2027

The divestment carries a cash value of USD 1.12 billion on a debt- and cash-free basis, with completion targeted for the second half of 2027 and subject to customary closing conditions. Roughly 350 employees across ten countries will transfer to Winbond under the agreement, according to Handelsblatt. Infineon also gives up about EUR 350 million in annual revenue, and production of the affected products will shift to contract manufacturers.

By cutting loose these more mature technologies — which face relentless pricing pressure — the company frees up capital to fund capacity for highly integrated power semiconductors. The expected inflow adds financial headroom for other priorities.

New Silicon for Traction Inverters and AI Servers

The product pipeline tells the same story. On September 8, Infineon unveiled the OPTIREG PMIC TLE9744QK, a power-management component built for high-voltage traction inverters in electric and hybrid vehicles. A day earlier, it presented the two-phase TDA235E5 and TDA235E0 family, aimed at higher power-density applications in AI accelerators.

Those launches underscore where development resources are now concentrated. Rising compute demands in data centers and the accelerating electrification of vehicles both call for specialized power devices that meet stringent efficiency standards. Infineon is also pursuing partnerships in specific application areas, with systems designed for AI and hyperscale data centers — where safeguarding and controlling high direct voltages is a central challenge when server farms scale up.

Analysts Split on the Road Ahead

Opinion on the sell side is far from uniform. Oddo BHF upgraded Infineon from "Neutral" to "Outperform" last Friday, setting a price target of EUR 80. UBS stayed on the sidelines, confirming its "Neutral" rating and a EUR 64 target on September 14. Berenberg struck a more bullish tone, reiterating its Buy recommendation on September 9 with a EUR 100 target.

The wide spread of targets highlights how much of the company's future valuation rests on demand momentum in automotive and data-center markets — and on how smoothly the development projects in its target segments are executed.

Market Response

Investors have taken the overall picture positively. The stock closed Friday at EUR 55.90, a gain of 2.4%, bringing its advance since the start of the year to 48%.