Infineon Technologies’ artificial intelligence power business is proving more durable than previously anticipated, but a sharp share price re-rating means much of the upside is already reflected in the valuation, according to mwb Research analysts in a note.
Analyst Abed Jarad raised his price target on the German chipmaker to €48.00 from €40.00 but maintained a Hold rating, noting that “the current valuation implies a balanced risk-reward unless further upside emerges from incremental AI monetization or a stronger-than-expected recovery in non-AI end-markets.”
With the stock trading closing Wednesday’s session at €49.39, the revised target implies a slight downside.
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The mwb note centers on supply constraints rather than demand weakness.
Jarad states that AI demand is turning power efficiency into a system bottleneck, with capacity, not end-market appetite, acting as the primary limiter.
That scarcity is said to be increasingly supportive of pricing and accelerating investment. The firm sees a growing probability of a beat to Infineon’s fiscal year 2026 AI revenue guidance of €1.5 billion, while the €2.5 billion ambition for fiscal year 2027 “appears achievable with upside potential.”
By 2030, mwb Research believes Infineon can capture 30% to 40% of the AI power market, which it estimates at €8 billion to €12 billion in total addressable value.
Beyond volumes, mwb Research argues the quality of earnings is structurally improving, with content per rack potentially expanding more than sixfold as architectures evolve toward megawatt-scale systems.
On non-AI segments, the firm sees automotive as resilient and industrial and IoT demand as “bottoming, limiting further drag.”
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