X-FAB Silicon Foundries (XFAB) Investor Day 2024 summary

Business performance and market outlook

• Strong demand in 2023 led to capacity constraints, especially in 180 nm technologies, with long-term agreements supporting stable pricing and prepayments into 2024.

• Automotive, industrial, and medical segments are expected to see double-digit CAGRs, with automotive and industrial at 12% from 2024–2027 and medical at 23%.

• Automotive growth is driven by increased electronic content, EV adoption, and strong demand in China.

• Industrial SiC business currently makes up 90% of SiC revenue, with automotive SiC expected to accelerate in the next three years.

• Medical segment leverages differentiated technologies for high-value applications like DNA sequencing and advanced imaging.

Capacity expansion and technology investments

• Nearly tripled 180 nm/110 nm CMOS capacity since 2022; 85% of $750M CapEx executed, with full production available by Q3 2026.

• Microsystems capacity at Erfurt to increase by 60% by Q1 2026, with $59M investment; 40% completed.

• 6,000 sq m clean room added in Malaysia; new equipment installation underway, with first wafers expected by end of 2024.

• Silicon carbide facility in Texas ready to triple output, with $100M invested and further growth supported by the U.S. CHIPS Act; SiC investment paused due to market softness but can scale rapidly.

• CapEx for 2023–2025 totals $1.1B, with 66% allocated to CMOS technology; funding secured through credit lines, prepayments, and internal cash generation.

Financial guidance and strategic priorities

• Revenue target of ~$1.05B and ~30% EBITDA margin for 2026; $1.5B revenue and ~35% EBITDA margin by 2030.

• Free cash flow projected at $160M in 2026 and $225M in 2030, representing 15% of revenue.

• CapEx to normalize at 15% of sales post-expansion, with positive cash flow expected in H2 2025.

• No plans for capital increase or stock buyback in the near term; focus remains on completing expansions and achieving positive cash flow.

• CHIPS Act and IPCEI subsidies being leveraged, with €80M confirmed for ongoing projects.