Sensor maker AMS Osram's shares soar 19% on positive Q1 outlook (updated)
09/02/2024 07:34
(Recasts with share reaction and analyst comments)
By Anastasiia Kozlova and Marleen Kaesebier
Feb 9 (Reuters) - AMS Osram's AMS.S shares soared 19%
on Friday after the Austrian sensor maker forecast a
first-quarter profit margin above market expectations, easing
some investor fears about a slowing semiconductor market.
The company, which designs and produces optical sensors
used in cars, medical devices and industrial applications,
forecast first-quarter revenue of 800 million-900 million euros
($861 million-$969 million), down from 927 million euros a year
earlier.
It also expects an operating profit margin of between 4% and
7% in the first quarter, compared with 5.4% in the same period
of last year, with analysts at Stifel, Vontobel and JP Morgan
saying the target exceeded consensus expectations.
Stifel said in a note that the margin outlook was "a
positive surprise in light of negative peer reporting and
pronounced weakness in industrial applications".
AMS Osram reported a 23% drop in fourth-quarter revenue to
908 million euros, in line with analysts' expectations, as
strong demand for automotive applications in China partly offset
weak demand in the industrial and medical segments.
Erste Group analyst Daniel Lion said the share reaction
could be a sign of relief after there were fears ahead of the
earnings statement that AMS could see slower business dynamics,
in line with its semiconductor rivals.
The semiconductor business generated 69% of the Swiss-listed
company's quarterly sales.
The company did not give a detailed outlook for 2024 but
said it expected some improvement in the second half of the
year, helped by new business wins and potential demand
normalisation for industrial and medical applications.
"Looking beyond H1 weakness, market share gains in the
consumer market and auto project ramps should lead to
fundamental improvements for AMS in H2-2024," Stifel said.
AMS expects weakness in the industrial and medical markets
to persist in the current quarter, while automotive demand in
China should also normalise.
($1 = 0.9288 euros)
(Reporting by Anastasiia Kozlova and Marleen Kaesebier; editing
by Milla Nissi, Kirsten Donovan)
((anastasiia.kozlova@thomsonreuters.com))