Munich: German chipmaker Infineon Technologies has increased its investment plans as demand grows rapidly from artificial intelligence data centres around the world.
The company said it will spend an extra 500 million euros in the current financial year, taking its total planned investment to about 2.7 billion euros. The move is aimed at boosting production of power chips and other components used in large data centres that run AI systems.
Infineon expects strong growth from this sector in the coming years. Revenue linked to AI data centres is forecast to rise from about 1.5 billion euros this year to around 2.5 billion euros by 2027. Company executives said the need for reliable and energy efficient chips is increasing as AI models become bigger and more power hungry.
In its latest quarterly results, Infineon reported revenue of about 3.66 billion euros for the period ending in December. This was slightly higher than market expectations. The company’s profit margin stood at 17.9 percent, showing stable performance despite weaker demand in some traditional markets such as automotive electronics.
Investors reacted positively to the announcement, as Infineon’s focus on AI infrastructure is seen as a way to balance slower growth in other parts of the business. Analysts say power management chips and cooling related components are becoming essential for the expansion of data centres worldwide.
Infineon said its expanded investment will support factory upgrades and capacity growth, especially in Europe, as it prepares for long term demand from cloud and AI companies.
The company added that while overall growth in 2026 is expected to be moderate, AI driven demand is likely to remain a key engine for future revenue and profits.