AMS Osram slumps 40% after customer cancels microLED project
29/02/2024 08:45
(Updates shares)
** Shares in AMS Osram AMS.S plunge around 40% as the
Swiss sensor maker said it would take a 600-900 mln euros hit in
the first quarter after a customer had unexpectedly cancelled a
"cornerstone" microLED project
** AMS said it expects to record non-cash impairment charges
on microLED related assets and goodwill of 600-900 million
euros; eyes around 30-50 million euros lower adjusted EBIT for
2024
** AMS did not name the customer, but analysts at J.P.Morgan
believe it could be Apple
** Company added it would revisit the future use of its
assets related to its microLED strategy, particularly the new
8-inch LED facility in Kulim, Malaysia
** It now sees its mid-term revenue CAGR growth of 6%-8% on
like-for-like basis vs an earlier projection of 6%-10%
** Vontobel downgrades the stock to "hold" from "buy",
adding the project was a key element of its investment case,
which is now nullified
** If losses hold, the stock will see its worst day ever; by
0833 GMT it was down 43%
(Reporting by Amir Orusov)
((Amir.orusov@thomsonreuters.com))