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Siltronic Slashes Sales Forecast as Chip Demand Remains Sluggish
29 Jul
Summary
- Siltronic cuts annual sales guidance amid continued weakness in semiconductor business
- High customer inventories prevent recovery in demand for Siltronic's products
- Siltronic confirms earnings margin target for the current year
Siltronic, a German semiconductor materials supplier, has recently cut its annual sales guidance for the current year. The company now expects its sales to be in the mid-single-digit percentage range below the previous year, a significant change from its previous guidance of sales being in the same region as the previous year.
The primary reasons behind Siltronic's decision to lower its sales forecast are the continued weakness in its semiconductor business and the high customer inventories. According to Siltronic's CEO, Michael Heckmeier, the visible growth in end markets has not yet led to a normalization of inventory levels at chip manufacturers, resulting in a lack of noticeable recovery in demand for Siltronic's products.
Despite the challenging market conditions, Siltronic has confirmed its earnings before interest, taxes, depreciation and amortization (EBITDA) margin target of between 21% and 25% for the current year. The company's financial performance will be closely watched by industry analysts and investors as it navigates the ongoing semiconductor industry slump.
