Infineon Teams with LS Electric for AI Data Centers, but Stock Keeps Falling as Earnings Blackout Begins
Published on 07/13/2026 at 12:06 | Redaktion boerse-global.de
Infineon this week announced a strategic pact with South Korea’s LS Electric to develop direct-current power solutions for artificial-intelligence data centres — a partnership that checks every box for the growth narrative powering the semiconductor sector. Yet the stock shed another 2.42% on the day, closing at €71.05 and deepening its one-month decline to nearly 11%. The disconnect underscores a market that has already priced in much of the AI infrastructure boom and is now wrestling with valuation, technical signals and an earnings quiet period that began on 6 July.
The memorandum of understanding, signed on 10 July at LS Electric’s research facility in Anyang, focuses on three technology pillars: energy-storage power conversion systems (ESS PCS), solid-state transformers (SST) for more efficient voltage regulation, and solid-state circuit breakers (SSCB) for direct-current grids. Infineon will supply the power semiconductors while its Korean partner handles system design and integration. The collaboration aims to cut the steep energy losses that have become a headache for hyperscalers racing to build out AI compute capacity.
Those losses are only set to grow. According to studies from Allianz Trade and iM Securities cited by the companies, global data-centre electricity consumption could climb from 415 terawatt-hours in 2024 to as much as 945 TWh by 2030, with AI applications accounting for roughly 40% of that total. LS Electric is already riding the wave: in the first half of 2026 it booked North American data-centre orders worth 1.2 trillion won (about €800 million), exceeding its entire order book from the previous year.
Should investors sell immediately? Or is it worth buying Infineon?
Back in Munich, however, the market is more concerned with the near-term technical picture. Infineon now trades below its 50-day moving average of €74.73, a break that algorithmic trading systems tend to treat as a short-term sell signal. The 14-day relative strength index of 42.7 suggests buying pressure has faded without yet reaching oversold territory. The stock sits about 21% below its 52-week high of €89.67, touched on 3 June, though it remains up 85.48% since the start of the year.
Analyst opinions are split wide open. BofA Securities reiterated its buy recommendation last Friday, calling the broader semiconductor pullback a “healthy rotation” within the AI segment. Berenberg raised its price target to €100 earlier this month, Jefferies sees €96 and Deutsche Bank €90 — all with buy ratings. UBS takes a markedly more cautious stance, sticking to a neutral rating and a €61 target. The gap between €61 and €100 reflects a fundamental disagreement over how much of the expected demand surge is already baked into a stock trading at more than 43 times earnings.
The timing of the downturn is partly self-inflicted. Since 6 July the company has been in its quiet period ahead of third-quarter fiscal results due on 5 August. With management barred from giving new guidance, traders are left to debate a price-to-earnings ratio that critics argue already capitalises years of AI-driven growth. Chief Financial Officer Sven Schneider recently warned of a possible return to chip allocation — a sign that supply is tightening — even as Infineon raises prices in certain segments. That kind of messaging, from a company that is both a beneficiary of and a participant in the AI buildout, does little to calm valuation nerves.
For now, the LS Electric deal remains a narrative without numbers. Infineon has disclosed no specific revenue contribution from the partnership, and the first concrete impact on the chipmaker’s income statement will not appear until after the earnings blackout lifts. Until then, the stock’s trajectory will depend on whether the broader rotation out of richly valued tech names continues, or whether the 50-day average — now roughly 5% above the current price — can be reclaimed as support.
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Infineon Stock: New Analysis - 13 July
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