Financial and Technology Glossary

FINANCIAL GLOSSARY

ADS • American Depositary Shares – ADSs are U.S.-traded securities represented by an American Depositary Receipt for non-U.S. issuers. These securities simplify the access to U.S. capital markets for non-U.S.-based companies, and in turn provide U.S. investors with investment opportunities in non-U.S. securities. Since the delisting from the New York Stock Exchange (“NYSE”), the Infineon ADSs have been traded over the counter on the OTCQX International Premier market as a sponsored Level 1 program. After the deregistration the ADSs continue being traded on the OTCQX market with the ticker symbol IFNNY.

Associated Companies • An entity in which the Company has significant influence, but not a controlling interest, over the operating and financial management policy decisions of the entity. Significant influence is generally presumed when the Company holds between 20 percent and 50 percent of the voting rights).

Carve-Out • Legal separation of business operations (e.g. business units).

Cash flow • The cash-effective balance arising from inflows and outflows of funds over the fiscal year. The Consolidated Statement of Cash Flows is part of the Consolidated Financial Statements and shows how the Company generated cash during the period and where it spent cash, in terms of operating activities (cash the Company made by purchasing / selling goods and services), investing activities (cash the Company spent for investment, or cash it raised from divestitures), and financing activities (cash the Company raised by selling stocks, bonds and loans or spent for the redemption of stocks or bonds).

Convertible bond • Convertible notes/bonds are interest-bearing securities which normally - in addition to the right to receive interest and repayment of the nominal amount - give the bearer a conversion option. During the term of the option (conversion period), the bearer can exchange the convertible bond/note for a specified number of shares of the issuing entity. The conversion ratio is stipulated and is typically adjusted for transactions affecting the shareholders, such as dividend payments. If the bondholder/noteholder does not convert the bond/note into shares during the conversion period, the issuer redeems the bond/note at the end of the term at its nominal amount.

DAX • Deutscher Aktienindex – The German Stock Index tracking the 30 major German companies traded on the Frankfurt Stock Exchange, in terms of order volume or market capitalization.

Deferred tax • Since tax laws often differ from the recognition and measurement requirements of financial accounting standards, differences can arise between (a) the amount of taxable income and pre-tax financial income for a year and (b) the tax bases of assets or liabilities and their reported amounts in financial statements. A deferred tax liability and corresponding expense results from income that has already been earned for accounting purposes but not for tax purposes. Conversely, a deferred tax asset and corresponding benefit results from amounts deductible in future years for tax purposes but that have already been recognized for accounting purposes.

Defined benefit obligations (DBO) • A measure of a pension plans’ liability at the calculation date assuming that the plan is ongoing and will not terminate in the foreseeable future.

Derivate • A financial instrument that derives its value from the price or expected price of an underlying asset (e.g. a security, currency or bond).

EPS • Earnings Per Share. Basic earnings per share is calculated by dividing net income by the weighted average number of ordinary shares outstanding during the period. Diluted EPS is calculated by dividing net income by the sum of the weighted average number of ordinary shares outstanding plus all additional ordinary shares that would have been outstanding if potentially dilutive instruments had been converted into ordinary shares.

Equity Method • Valuation method for interests in associated companies in which the investor has the ability to exercise significant influence over the investee’s operating and financial policies.

Free cash flow • Cash flow from operating and investing activities from continuing operations excluding purchases or sales of financial investments.

Goodwill • An intangible asset of the Company that results from a business acquisition, representing the excess of the purchase price (cost) paid for the acquired business over the fair value of the separately identifiable assets acquired and liabilities assumed. Under IFRS, goodwill is not reduced through scheduled amortization, but rather written down to its fair value if impaired. An impairment assessment is performed at least once a year.

Gross cash position • Total of cash and cash equivalents plus financial investments.

Gross profit • Revenues less cost of goods sold.

IFRS • International Financial Reporting Standards. Infineon prepares its Consolidated Financial Statements in accordance with IFRS, as adopted by the European Union.

Joint Venture • A contractual arrangement whereby two or more parties undertake an economic activity that is subject to joint control.

Net cash position • Gross cash position less long-term and short-term debt.

Profit or loss and capital-share attributable to non-controlling interests • Proportional share in net income and equity attributable to outside shareholders, and not to shareholders of the Infineon Group’s parent company.

Put options • In the case of a put option, the buyer acquires a contractual right to sell a stipulated quantity of an underlying asset (e.g. a share) at a predetermined date (European option) at a specified price (underlying price). In return, the issuer receives an option premium from the buyer of the put option.

Registered shares • Shares registered in the name of a certain person. This person’s details and number of shares are registered in the Company’s share ledger in accordance with securities regulations. Only individuals registered in the Company’s share ledger are considered shareholders of the Company and are, for example, able to exercise their rights at the Company’s Annual General Meeting.

RoCE • Return on capital employed is calculated as NOPAT (Net Operating Profits after Tax) divided by capital employed. RoCE shows the linkage between profitability and capital resources required to run the business.

Segment Result • We define Segment Result as operating income (loss) excluding asset impairments (net), restructuring charges and other related closure costs (net), share-based compensation expense, acquisition-related amortization and gains (losses), gains (losses) on disposal of assets, businesses, or interests in subsidiaries, and other income (expense), including litigation settlement costs. This is the measure that Infineon uses to evaluate the operating performance of its segments.

Segment Result Margin • An indicator of operating performance, calculated as the percentage of Segment Result in relation to revenue.

Working capital • Working capital consists of current assets less cash and cash equivalents, financial investments and assets held for sale less short-term liabilities excluding short-term debt and current maturities of long-term debt and liabilities classified as held for sale.

TECHNOLOGY GLOSSARY

300-Millimeter Technology • Comprehensive term for the manufacture and processing of wafers with a diameter of 300-millimeters.

65-Nanometer Technology • Production technology that enables structures measuring 65 nanometers in width to be represented on the chip. The smaller the structures, e.g. conductors and pitches, the smaller the chip and the cheaper its production. The previous technology permitted features of 90 nanometers and the next generation has attained features of about 40 nanometers.

ABS • The anti-lock braking system is an electronic vehicle safety feature that prevents the wheels from locking during heavy braking. 

Analog/Mixed-Signal • “Mixed signal” is a generic term for integrated circuits that operate simultaneously with analog and digital signals. Owing to similar requirements in terms of development and manufacturing processes, they are generally grouped together with integrated circuits operating exclusively with analog signals, hence giving rise to the combination “analog/mixed signal”.

ASIC • Application-Specific Integrated Circuit. Logic IC specially constructed for a specific application and customer; implemented on an integrated circuit.

ASSP • Application-Specific Standard Product. Standard product designed for a specific use that can be used by many customers; implemented on an integrated circuit.

Back-End Manufacturing • The part of the semiconductor manufacturing process that happens after the wafer has left the cleanroom (Front-end manufacturing). This includes testing the chips at wafer level, repairing the chips if necessary, dicing the wafers and packaging the individual chips. There is a growing trend among semiconductor manufacturers to outsource the assembly, and sometimes even the testing, to independent assembly companies. Much of the assembly capacity is based in the Pacific Rim countries.

BCD Process • A special process for manufacturing high-voltage low power ICs. The abbreviation BCD stands for “bipolar CMOS with DMOS”.

Bipolar • A power bipolar transistor is a specialized version of a bipolar transistor that is optimized for conducting and blocking large electric currents (up to several hundred amperes) and very high voltages (up to several 1,000 volts). In industry, the power bipolar transistor – like the power MOSFET (see MOSFET) often used as an alternative – constitutes an important industrial semiconductor component for influencing electric current.

Bit • Information unit; can take one of two values “true”/“false” or “0”/“1”.

Byte • Unit of information in data processing components. One byte is equivalent to eight bits.

Chip Card • Plastic card with built-in memory chip or microprocessor, which can be combined with a personal Identification Number (PIN).

Cloud Computing • Cloud computing is the provision of processing capacity, data storage, network capacity and ready-to-use software via a network with supply matched dynamically to demand. The IT infrastructure functions accessed appear remote and opaque from the user’s perspective, as if enveloped in a cloud. The remote systems of the cloud are accessed via a network, usually the internet, using a terminal such as a netbook or tablet PC (see netbook, see tablet computer).

CMOS • Complementary Metal Oxide Substrate. Standard semiconductor manufacturing technology used to produce microchips with low power usage and a high level of integration.

Converter • Control unit that can convert AC voltages of various rates and frequencies. This is achieved by means of power electronics. Converters are used in wind turbines, for example, in order to feed fluctuating wind energy into the power network with a voltage of constant frequency. In electric drive technology, for example in engine controllers and trains, a converter is used to generate an output voltage of variable, load-dependent frequency from a mains supply of constant frequency.

CooLMOS ^TM • High-voltage power transistor for voltages from 300 to 1,200 V.

E-Bike, E-Scooter • The term “e-bike” is used in a general sense to refer to all types of bicycle or bicycle-like machines that have an electric motor fitted. Some jurisdictions impose a narrower legal definition of what constitutes an e-bike, which may include speed limits for travel under motor power only and with a combination of motor power and pedaling. An e-bike has a twist-grip throttle like a scooter and its motor can operate without the rider pedaling. Some jurisdictions require e-bikes to drive on the road. An e-scooter is an electric bike with no pedals (see pedelec).

Embedded Flash • A nonvolatile memory that is integrated on a chip together with a microcontroller processor core. The nonvolatile memory contains the program code.

ESP • Electronic Stability Program. A vehicular technology system that uses sensors and computers to brake individual wheels in order to prevent skidding.

Front-End Manufacturing • Front-end process is the designation for all process steps in cleanrooms that the entire wafer must complete. These are lithography, diffusion, ion implantation and application of circuitry levels. Some stations must be completed a number of times. At the end of the Front-end process, the wafer may have been through as many as 500 individual process steps.

Gallium Nitride • Gallium nitride (abbreviated to GaN) is a compound semiconductor material made from gallium (chemical symbol Ga) and nitrogen (chemical symbol N). GaN is used for components including high-frequency power MOSFETs (see MOSFET) on account of the material’s special properties (such as good thermal conductivity and high electron mobility).

Giga • 2 ³⁰, in information technology, e.g. Gigabit (Gbit), Gigabyte (GByte).

GMR • Giant Magneto-Resistance. The GMR effect is utilized in sensors for the purpose of measuring magnetic fields. GMR sensors are employed in a range of applications, e.g. as steering angle sensors in automobiles.

GPS • Global Positioning System. Satellite-based location identification and positioning system based on the transittime differences of received signals.

Hall Sensor • A sensor based on the hall principle, used for measuring magnetic fields, named for US physicist Edwin Herbert Hall (1855 – 1938). Hall sensors are used in automobiles, for example, for detecting pedal positions or for measuring the speed at which shafts rotate.

Hertz • Hertz (Hz) is the unit for frequency, and is named after the german physicist Heinrich Rudolf Hertz (1857 – 1894). The Hertz determines the number of oscillations per second, or more generally speaking, the number of repetitive processes per second. Frequently used units are kilohertz (one thousand oscillations per second), megahertz (one million oscillations per second) and gigahertz (one billion oscillations per second).

HEV/EV • Hybrid electric vehicle/electric vehicle: collective terms for vehicles powered partly or entirely by an electric motor (see hybrid vehicle).

HVDC • High-voltage direct-current transmission. HVDC transmission is a method of transmitting electrical energy at high direct-current voltages of up to 800,000 volts over distances of more than 1,000 kilometers. HVDC transmission is also used for connecting offshore wind farms to the electricity grid on the mainland.

Hybrid Car • A hybrid car is usually understood to be a motor vehicle that is driven by at least one electric motor, as well as a combustion engine. The hybrid drive is used in standard car construction to enhance efficiency, reduce consumption of fossil fuels or increase performance at lower engine speeds. In full hybrid cars the vehicle can be driven solely by the electric motor. In mild hybrid cars, the electric motor is simply used to support the combustion engine, for example when accelerating.

Hybrid Technology • The word “hybrid” comes from the Greek for “mixed” or “originating from two different sources”. It has come to be used to denote the heart of a new drive technology in the automotive industry: hybrid vehicles operate with a combination of a diesel or gas engine and an electric motor.

IC • Integrated Circuit. Electronic Component parts composed of semiconductor materials such as silicon; numerous components, including transistors, resistors, capacitors and diodes can be integrated into ICs and interconnected.

IGBT Module • Insulated Gate Bipolar Transistor Module. IGBTs are semiconductor components used increasingly in power electronics due to their robustness, high blocking voltage, and their ability to be triggered with negligible power. Modules are formed using several IGBTs in parallel within a single casing. These modules are used to drive electric motors both in automotive and industrial applications. Motor speed and torque can be regulated along a gradual scale. Trains such as Germany’s ICE and France’s TGV use IGBT modules for an efficient and rapid electrical drive control.

Inverter • An inverter, also called a DC/AC converter, is an electrical device for converting DC voltage into AC voltage, or direct current into alternating current. Inverters are used in solar power plants, for example, for converting the DC voltage generated in the solar modules into AC voltage, which is then fed into the electricity network.

Kilo •  2 ¹⁰, in information technology, e.g. Kilobit (Kbit), Kilobyte (Kbyte).

Mega • 2 ²⁰, in information technology, e.g. Megabit (Mbit), Megabyte (Mbyte).

Microcontroller • A microprocessor integrated into a single IC combined with memory and interfaces, which functions as an embedded system. Logic circuits of the highest complexity can be designed in a microcontroller and controlled by software.

Micron (Micrometer) • Metric linear measure, corresponding to the millionth part of a meter (10 ^-6). Symbol: μm. As an example, the diameter of a single human hair is 0.1 millimeters, or 100 μm.

MOSFET • Metal-Oxide Substrate Field-Effect Transistor. MOSFET is currently the most widely used transistor architecture. MOSFETs are used both in highly integrated circuits and in power electronics as special power MOSFETs.

Nanometer • Metric unit of length. Corresponds to the billionth part of a meter (10 ^-9); the symbol is nm. The diameter of deoxyribonucleic acid (DNA) is roughly 2 nanometers. Fabrication features in the semiconductor industry are now measured in nanometers (see 65-nanometer technology).

Netbook • A netbook is a type of computer smaller, less expensive and with less processing power than a conventional notebook. Netbooks are used primarily as portable internet access devices and consequently usually have an integral WLAN interface. Models bundled with a mobile network contract sometimes also include an integral UMTS mobile communication modem.

NFC • Near field communication, an international communication standard for contactless data exchange over short distances. The initial drafts of the communication standard appeared several years ago, but the technology did not break through until 2011 when it was included in the first smartphones. NFC can be used as an access key to content on terminals and for services such as cashless payment and paperless ticketing.

OptiMOS™ •  Infineon’s brand name for low-voltage power transistors for voltages between 20 and 300V.

Pedelec • Contracted form of “pedal electric cycle”, a bike in which the pedal drive system is assisted by an electric motor. Pedelecs are distinct from e-bikes, which similarly have an electric drive system but can also operate like a scooter without the rider having to pedal. The latter are also known as electric scooters. The speed or power of Pedelec drives is limited in some jurisdictions and some require riders of more powerful models to have insurance.

Power Semiconductor • Over the last 30 years power semiconductors have mostly replaced electromechanical solutions in the areas of drive technology as well as power management and supply, due to their ability to form high energy flows almost at will. The advantage of these components is their ability to switch extremely rapidly (typically within a fraction of a second) between the “open” and the “closed” state. With the fast sequences of on/off pulses, almost any form of energy flow can be created, e.g. a sinus wave.

Power Transistor • Power transistor is a term used in electronics to refer to a transistor for switching or controlling large voltages, currents and outputs. There is no standard method of differentiating between transistors for signal processing and power transistors. Power transistors are mainly produced in packages that enable installation on heat sinks, as it is otherwise impossible to handle the dissipation loss of several kilowatts that occurs with some types and applications (see power semiconductor).

Repowering • Repowering in a renewables context generally refers to the replacement of old wind turbines with newer, more powerful and more efficient models. This is done in order to make better use of the available locations and increase the installed capacity while simultaneously reducing the number of turbines.

Schottky Diode • A special diode that has a metal-semiconductor junction rather than a semiconductor-semiconductor junction. The most frequently used semiconductor material up to 250 Volts is silicon. Silicon carbide (SiC) is used for voltages in excess of 300 Volts. SiC schottky diodes offer a number of advantages over conventional diodes in power electronics. When used together with IGBT transistors, it is possible to dramatically reduce switching losses in the diode itself, as well as in the transistor. The name derives from german physicist Walter Schottky (1886 – 1976) (see silicon carbide).

Semiconductor • Crystalline material; its electrical conductivity can be changed as desired by the application of doping materials (most often boron or phosphorus). Semiconductors include silicon or germanium. The term is also applied to ICs made of these materials.

Shrink • A shrink in the context of semiconductor manufacturing is the process of scaling production down from an existing feature size to the next smaller feature size. The move to smaller structures generally involves shrinking all semiconductor circuit elements equally, although there are some exceptions. Chip function is unchanged, but since the chips are smaller, more can be squeezed onto each wafer and manufacturing costs fall.

Silicon • A chemical element with semiconducting characteristics. Silicon is the most important raw material in the semiconductor industry.

Silicon Carbide • Compound semiconductor made from silicon (chemical symbol Si) and carbon (chemical symbol C). The abbreviation is SiC. Because of its special material properties (e.g. good thermal conductivity), SiC is used for Schottky diodes, as well as elsewhere (see Schottky diode).

SIM Cards • Subscriber Identity Module cards. Chip cards that are inserted into mobile phones in order to identify the user within the network. They are used by mobile phone networks to provide connections to their customers.

Smart Grid • The term Smart Grid is understood to mean the upgrading of the existing power supply networks to include communication and measurement functions, so as to make the flow of energy between increasingly decentralized power generation – for example by means of wind farms or block-type thermal power stations – and consumers more efficient.

Smartphone • A smartphone is an internet-ready mobile telephone that provides more computer functionality and connectivity than a modern conventional mobile telephone. Current smartphones generally allow users to upgrade their device with new functions by installing additional programs known as apps.

Switching Power Supply • A switching power supply is an electronic module that transforms an AC voltage into a DC voltage. Switching power supplies are more efficient than mains transformers and can be more compact and lighter than conventional power supplies containing a heavy transformer with a ferrous core. Switching power supplies are mainly used in PCs, notebooks and servers. However, they also achieve a very high level of efficiency even at low power, so they are increasingly found in plug-in power supply units, for example as chargers for mobile phones.

Tablet Computer • A portable computer that can be used in a number of ways including as a note pad. The tablet is operated by applying a stylus or, increasingly, finger contact directly onto a touch-sensitive screen. Recently tablets have come to be used primarily for internet access and hence as a terminal for cloud computing (see cloud computing).

Thin Wafer • A wafer (see Wafer) is typically around 350 microns (μm; see Micron) thick when sawn into individual chips. A thin wafer is one that has been polished down to less than 200 microns thick (a human hair or a sheet of paper, by comparison, is about 60 microns thick). Thin wafer technology offers benefits: Thinner chips mean losses can be reduced and the heat generated can be dissipated more effectively. Another advantage is that electrically active patterns can be produced on the backside as well, enabling the chip to provide completely new functions. Thin wafer chips also allow more compact packages.

TPM • Trusted Platform Module, a chip that adds elementary security functions such as license and data protection to a computer or similar device. TPMs can be integrated into tablet computers, smartphones and consumer electronics as well as PCs and notebooks. A trusted computing platform (see Trusted Computing) can be created by combining a specially configured operating system and appropriate software with a device containing a TPM.

Transistor • A transistor is an electronic component for switching and amplifying electrical signals. Transistors are used in fields including telecommunications, computer systems and power electronics both as discrete components and by the million in integrated circuits.

Trusted Computing • Trusted Computing means that the hardware and software used in PCs, as well as other computer-controlled systems, such as mobile phones, can be controlled. This is achieved by means of an additional chip, the Trusted Platform Module (TPM), which can use cryptography to measure the integrity of the hardware and of the software data structures, while also saving these values in a verifiable way.

VSD • Variable Speed Drive. Electronic controller for controlling the speed (rounds per minute) of electric motors.

Wafer • Thin slice of semiconductor material (mostly silicon, but germanium or gallium arsenide also common) from which the actual chip is produced. Typical diameters for wafers currently are 200-millimeters and 300-millimeters.