ams OSRAM (SIX:AMS, OTCPK:AMSSY) released solid results for Q4 and Full Year FY2022, noting continued challenging market environments and muted demand going into FY2023. Q4 Revenue was $1.26B (EUR 1.18B) with Adjusted EBIT margin of 7.3%, showing “a slight 2% increase year-on-year for like-for-like portfolio” (comparing the equivalent portfolio 2022 to 2021). Full year FY2022 revenue came in at $5.16B (EUR 4.82B) a decline against the prior FY2021 of -4.4%, with EBIT margin for FY2022 at 8.4%.
With a strategy of differentiating itself by combining LED technology with sensing functionality, ams OSRAM’s product range includes LED emitters, optical components & micro-modules, detectors and sensor interfaces & processors for use in consumer, automotive, industrial and medical applications. In its mission to be the “uncontested leader in optical solutions”, ams OSRAM provides optical solutions for sensing, illumination and visualization.
The company announced recently that CEO Alex Everke will hand over the ams OSRAM CEO position this Spring to Aldo Kamper. Since 2018, Kamper has been CEO of Leoni AG, a global player in energy and data management solutions for the automotive industry. Kamper also spent 15 years at OSRAM in management roles, most recently as GM of OSRAM’s Opto Semiconductor business. CEO Everke is stepping down after seven successful years at the helm, leading the company’s rapid growth from a relatively small operation of around $535M (EUR 500M) in 2016, to $5.35B (EUR 5.0B) by FY2021. Two years after operationally completing the acquisition of OSRAM Licht into the ams business, ams OSRAM is nearing completion of the planned disposals of the low-margin legacy units of the OSRAM business (five disposals were announced and/or closed in FY2022, with only two remaining to be completed in the first half of FY2023). Integration programs, including “significant IT systems and ERP harmonization, aligning the fiscal year for the group, streamlining corporate structures and aligning policies and processes” are reported to have advanced in line with milestones set for 2022.
The company tracks its percentage share of revenues by segment, by end market and by region – here is the breakdown for FY2022:
Full Year 2022 Revenues by Segment:
Semiconductors 66%
Lamps & Systems 34%
Full Year 2022 Revenues by End Market:
Automotive 41%
Industrial & Medical 35%
Consumer 24%
Full Year 2022 Revenues by Region:
APAC 52%
EMEA 30%
Americas 18%
During the Q4 FY2022 Earnings Call, CEO Everke described FY2022 as a “demanding year for the global semiconductor sector” and noted the particularly solid results recorded by their semiconductor automotive business. While major segments of the smartphone and consumer market held up well overall in FY2022, ams OSRAM’s consumer business was meaningfully impacted by the lack of recovery in China’s Android market, along with China’s COVID-19-related reductions in manufacturing.
CEO Everke provided a brief comment on ams OSRAM’s ongoing development and industrialization program for small structure size microLED technology, indicating the company continues to spend significant amounts of R&D on the program, and continues with “very deep, significant and active” customer engagement in this area. The company expects to start recording revenue from their microLED technology in 2025. An 8-inch LED facility is being built (for completion in 2024) to support both the microLED program as well as “very differentiated LEDs”.
Looking ahead to Q1 FY2023, ams OSRAM guided for weakening demand with negative macroeconomic trends continuing through the first half of the coming fiscal year, with revenue in the range of $963M to $1.07B (EUR 900M to EUR 1B), with expected operating profitability in the range of 4% to 7% adjusted EBIT margin. CEO Everke noted the company currently expects a recovery of demands in the second half of FY2023 which will create an improved business environment.
Go Deeper
ams OSRAM Press Release – Q4 + Full Year 2022 Results: https://ams-osram.com/documents/4390887/7195804/Ad-hoc_2023_eng+Financial+results+FY%2BQ4+2022+f.pdf/d5b2921d-52f8-1c2a-6136-5eb861e5b95f?t=1675945691565
ams OSRAM Q4 & Full Year 2022 Investor Presentation: https://ams-osram.com/documents/4390887/7195835/Roadshow+presentation+ams+OSRAM+FY+%2B+Q4+2022+f.pdf/90fea2c5-1ba3-85ed-a3cb-d0f75ccd2738?t=1675747927388