Siltronic AG — Call Transcript 2026

Hello everyone, welcome to the presentation of Siltronic's Q1 2026 results conference call. Please note that this call is being recorded and streamed on Siltronic's website. The call will also be available as an on-demand version later today. Your participation in this call implies your consent with this. At this time, I would like to turn the conference over to Stephanie Malgara, Senior Manager, Investor Relations at Siltronic. Please go ahead. Thank you, Cynthia. Welcome everybody to our Q1 2026 results presentation. This call will also be webcast live on siltronic.com. A replay of the call will be available on our website shortly after the end of the call. Our CEO, Michael Heckmeier, and our CFO, Claudia Schmitt, will give you an overview of our financials, the current market developments, and our guidance. After the presentation, we will be happy to take your questions. Please note that management comments during this call will include forward-looking statements that involve risks and uncertainties. For discussion of risk factors, I encourage you to review the Safe Harbor statement contained in today's press release and presentation. All documents relating to our Q1 2026 reporting are available on our website. I now turn the call over to Michael for his remarks. Thank you, Stephanie, and a warm welcome also from my side. Given that we released our 2025 financials only six weeks ago, today's call will be relatively compact, while of course, covering all material developments since then. Let's start with a broad overview of our development in the first three months of the year. Claudia will provide a more detailed breakdown in just a moment. As expected, Q1 was a soft start into the year. Sales came in at EUR 307 million, significantly below Q4 2025, which had benefited from delivery shifts. In line with the lower sales level, profitability decreased sequentially. The EBITDA margin was 21.2% compared to 23.3% in Q4. EBIT also decreased to EUR -52 million compared to EUR -34 million in the previous quarter. CapEx totaled EUR 48 million in the quarter, with a continued focus on our 300 mm business. At the same time, cash payments for CapEx significantly exceeded this level. Consequently, the net cash flow remained negative at EUR -89 million, and net debt increased to EUR 936 million compared to EUR 837 million at year-end 2025. Claudia will now provide a more detailed overview of the financials. Thank you, Michael. A warm welcome from my side as well. Let's get straight into the details of our Q1 2026 results. As Michael pointed out, Q1 marked a soft start to the year, and sales came in as expected at EUR 307 million. The strong quarter-on-quarter decline is less a reflection of a sudden change in underlying demand and more a matter of comparability. Q4 was not a clean baseline, as it was notably lifted by delivery pull-ins from Q3 2025 and early 2026. This phasing also influenced the quarter's product mix, which weighed on the sequential comparison. Foreign exchange, by contrast, was not a meaningful factor, with the Euro-US dollar exchange rate largely stable at 1.17 versus 1.16 in Q4. Turning to the cost side, I would like to highlight the particularly strong contribution from hedging activities in the first quarter. In total, the net FX result and gains from hedging an oil price component in electricity supply contracts amounted to EUR 11.4 million, compared with EUR 2.7 million in the prior quarter. These effects were a key factor in largely offsetting costs that are typically recorded only in the first quarter. In line with the lower sales level, EBITDA decreased to EUR 65 million, translating into an EBITDA margin of 21.2% compared with 23.3% in Q4. Correspondingly, EBIT declined to EUR -52 million in Q1. Net income amounted to EUR -67 million, following EUR -53 million in Q4 2025, which had included a write-down of deferred tax assets. Let's turn to the key developments on our balance sheet, which continues to show a solid and healthy structure. By the end of March, total assets amounted to EUR 4.7 billion, slightly below the EUR 4.8 billion reported at year-end 2025. Property, plant, and equipment remained largely stable as depreciation exceeding additions was largely offset by the appreciation of the SGD against the EUR. Working capital developed as expected. Inventories and trade receivables increased by roughly EUR 50 million in total. Cash and securities declined to EUR 448 million from EUR 534 million at year-end, also reflecting planned elevated cash outflows related to previously incurred capital expenditures. As a consequence of these CapEx-related payments, trade payables decreased by EUR 43 million. Prepayments remained almost unchanged, as did the equity ratio, which stood at a solid 42%. CapEx in Q1 2026 totaled EUR 48 million. The previously mentioned payments for investments amounted to EUR 110 million year to date, exceeding the reported CapEx level by more than EUR 60 million. For the full year, we continue to guide for CapEx in a range between EUR 180 million and EUR 220 million. As previously communicated, cash outflows for CapEx are expected to significantly exceed asset additions also for the full year. Let's take a closer look at our debt situation. As illustrated in the bridge, net financial debt stood at EUR 837 million at year-end 2025. In Q1, operating cash flow was under pressure, reflecting the expected buildup in inventories and trade receivables, and amounted to EUR 21 million. This was not sufficient to cover the planned CapEx-related cash payments. As a result, net financial debt increased noticeably to EUR 936 million, driven by temporary timing effects. We therefore expect net financial debt to improve over the course of the second half of the year. Let me briefly conclude with a comment on the composition of our financial debt. Unchanged compared with our full-year presentation, total debt stood at just under EUR 1.5 billion at the end of the first quarter, with roughly EUR 130 million remaining undrawn. The maturity profile illustrates that repayments are well spread over the coming years. For 2026, we anticipate repayments of around EUR 100 million. As already mentioned, we closed Q1 with approximately EUR 450 million in cash and securities. Together with our undrawn revolving credit facility, this provides a solid level of financial flexibility. In addition, our balance sheet includes short-term prepayments of around EUR 33 million, with around EUR 15 million scheduled for repayment within this year. With this, I will hand back to Michael. Thank you, Claudia. Let me summarize our current expectations across end markets looking into 2026. Compared to the estimates we presented in mid-March, the overall outlook remains positive, with some shifts between different application segments. First, we now expect an even higher growth rate for servers, namely 44% year-on-year. This growth is clearly driven by the strong AI momentum and continued investments in data center infrastructure. Propelled by this AI-driven demand, we see initial indications that some customers are revisiting their midterm volume commitments to enhance supply security. At this stage, these are early signals rather than a confirmed trend, but they may have implications for inventory levels. Conversely, the outlook for smartphones and PCs has further weakened. The key reason is the ongoing tight supply of memory chips. With memory availability being prioritized for AI-related server applications, unit volumes in other end markets are constrained, which is particularly weighing on smartphones and PCs. We continue to expect growth in the automotive industry, but at a reduced rate compared to last year. The industry is assumed to improve from a low base. Overall, this results in an estimated pre-inventory growth of around 7% for total wafer area consumption in 2026. Let's conclude today's presentation confirming our guidance for the full year 2026. As we mentioned a few weeks ago, we expect the business environment to remain challenging. Headwinds from FX, price pressure outside LTAs, and the ongoing weak 200 mm business weigh on our performance. Additionally, the closure of the SD line will impact the full financial year for the first time. Geopolitical uncertainties related to developments in the Middle East currently have no direct impact on our business, and end markets remain robust. That said, we continue to monitor the situation very closely, as it could affect the broader cost environment, which includes energy prices. We've taken measures to mitigate parts of these risks, including hedging where applicable, but we still anticipate potential uncertainty. In addition, we assume higher freight and logistics costs. 2026 sales are guided in the mid-single-digit percentage range below the prior year level based on a euro-USD exchange rate of 1.18. In comparison, without FX effects and without the impact from the SD closure, we expect sales to be around prior year level. Our EBITDA margin guidance is between 20% and 24%. Depreciation is expected to increase significantly in 2026 due to our investments in the 300 mm business. We guide it between EUR 490 million and EUR 520 million. Therefore, EBIT is expected to be significantly below the previous year. We're seeing CapEx to be between EUR 180 million and EUR 220 million. As cash payments for CapEx are expected to exceed this level, we expect net cash flow to be in the range of the previous year. With this, we conclude our Q1 2026 results presentation. Claudia and I are happy to take your questions. Thank you very much for your attention. Cynthia, please open the Q&A session. Thank you. If you would like to ask a question, please signal by pressing star one on your telephone keypad. If you are using a speakerphone, please make sure your mute function is turned off to allow the signal to reach our equipment. Again, press star one to ask a question. We'll pause for a moment to allow everyone the opportunity to signal for questions. The first question comes from Daniel Schafei with Citi. Please go ahead. Good morning. Thank you very much for taking my question. I just wanted to come back to your end market expectations, and it is great to see that you have adjusted them, especially for smartphones and PCs. I am just trying to understand what drove the server demand increase from the 28 in the sense that if I still see that there is some downside to smartphone projections from the re-decreasing 10% growth, is there still some upside to the server projections in your opinion? Basically, on what grounds have you increased this from 28 to 44? What was driving this? Is there room, given that it is a very dynamic target and in general, the end market is increasing quite rapidly, can we expect some further improvement there? Thank you, Daniel. I understand your question, why is AI even and server demand even stronger than, and sub stronger than initially anticipated, and could there be even more further upside? Yeah. What we see is, of course, that particularly in the memory segment, that the memory chip manufacturers prioritize, and they feed more supply into the server area. That's driven by their continued strong build of hyperscalers and by their CapEx roadmaps being confirmed or here and there even being upgraded further. Yeah. This looks very robust and very strong. Yeah. Is there further upside? Maybe there could be a small further upside. However, some of those, particularly memory chips, are limited by capacity constraints at the chip makers. Yeah. It means even though there could be an underlying stronger end market demand from the AI drive, it might be difficult to fulfill this. Yeah. Therefore, we would say, yeah, there could be further smaller upsides this year, but due to the capacity constraints, it could be limited, it could be dampened on a chip level side. Yeah. As a general remark, we also have to have in mind when we talk about smartphones that the -10% is a composition. Yeah. It's a melange of unit and content. We see maybe on the unit side, even a bit of further dampening, which is compensated by the mix effect as those smartphones that are still being built tend to be more higher level, more advanced smartphones, which also have more silicon content in there. Yeah. We always have to have in mind this mixture between unit number effect and the silicon content effect. What we show with those -10% is a composition of both. Perfect. That's very clear. Thank you very much. Just to also follow up, I mean, it's great to see that server and market demand is doing so well. Just historically, I remember that usually the Japanese peers were claiming quite strong market share within that segment, especially on this kind of more advanced wafer capabilities. In your opinion, do you see this gap narrowing from here on? Do you see kind of further share gains from your side in this segment? I would say there are no tremendous changes. Yeah, I mean, you're referencing a bit to the market share question. We see a pretty stable market share development. That means that there's no landslide shift in either direction. I can reconfirm what we discussed a couple of weeks ago, that we are well positioned, that we have a clear strategic focus on leading edge. That means on advanced logic and on the High Bandwidth Memory segments. Here we are pretty well represented. Some tiny details here and there could depend, of course, on more customer mix rather than on application mix in the sense of server versus other, it would be more the customer mix and the customer exposure that could create here and there, some, let's say, particular differences on a quarterly basis. Perfect. Thank you very much. The next question comes from Constantin Hesse with Jefferies. Please go ahead. Mr. Hesse, please check your mute button. He does have an additional connection. One moment please. Mr. Hesse, please proceed with your questions. Hi, can you hear me? Yes. Perfect. Good morning. Thanks very much for taking my questions. The first one is just quickly on pricing, 'cause the overall comment is that there's still pricing pressure. On the previous call, we had already heard that pricing in 300 mm legacy had stabilized. I just wanted to confirm that that's still the case, and that pricing pressure is coming primarily from 200 mm. That's the first question. Thank you, Constantin. We didn't say that the pricing has stabilized. We said we have a few examples of reasonable spot prices in 300 mm outside LTAs. That's a statement I could reiterate. In terms of pricing, overall pretty unchanged. Yeah, we see a stable situation in the LTA framework, which covers around 2/3 of our business. We see those positive indications, some spots getting more reasonable in 300 mm outside LTAs. We also see an ongoing pressure on 200 mm, and that's, of course, the area we also have far less LTAs. In general, unchanged to what we said six weeks ago. Great. Thank you. Michael, if I may ask, I mean, looking at the demand and the inventory situation as of today, how likely would you expect another shipment postponement, meaning another capacity utilization cut or production cut, if you will, given the current situation? Is that something that, you know, what I'm trying to figure out here is, I think it was, you know, the bottom had been reached at some point last year. The bottom continues to drag. You know, as data center demand continues to be strong, leading-edge demand continues to be strong. I'm just wondering, you know, if there's still a likelihood that we could see another production cut during 2026 from an overall perspective. Thanks, Constantin. I think in general that the short answer would be maybe we don't expect any further cuts or major kind of changes. Let me differentiate a bit by the application segments also particularly relating to inventory. I think both in memory and logic, in the meantime, we can say we are back to very normal, means healthy inventory levels. We indicated in the calls that some customers even start taking off on discussions to secure even more, let's say, midterm demand. That's, I think, the good sign and it's the good part of the coin. On the other side, there is still the power segment where we have to reconfirm that inventory levels are still pretty elevated, that's a bit the more difficult segment still. As you know, that is particularly heavy weighing on 200 mm. Overall, I think back to normal. We wouldn't expect, you know, further disruptive cuts or changes this year with a little maybe caveat around power, which is still let's say far behind inventory depletion compared to the other two segments. That's great. Thank you. The next question would be, look, given the stronger than anticipated demand for leading edge, right, which it was clearly outlined here by the server demand in your presentation, could we potentially see an anticipated or like, an earlier than expected requirement for further CapEx in Singapore because of that additional demand that is coming through? Or is everything going according to plan? Thanks. I mean, we're not only providing leading edge out of Singapore. We provide leading edge also out of both our German factories. It means in overall, in terms of overall footprint, we feel pretty well set for the time being. Of course, as we always said, we took down the ramp speed of Singapore last year and the year before compared to initial plans. We did speed that up a little bit in the meantime. We would consider further ramping Singapore, and that's what we always said according to market demand. If this is continuing, of course, we would still continue ramping what we have and in parallel then prepare for more capacity as required. Currently, we feel pretty well set with the UTs have been low for quite some time in our German footprint and with the capacity we generated already in Singapore. In that spirit, we would ramp what we have and prepare then for the next one as required. Thank you, Michael. The last question maybe over to Claudia just on the debt situation. This is a question that's really based on from today's point of view, right? If what we see today continues to be the case, it feels to me that the net debt level is basically peaking as we speak. I just want to make sure that I think you only have EUR 127 million or SGD left in that revolving credit facility in Singapore. I just want to make sure that that level is enough for any potential disruptions or any potential working capital moves during the different quarters that are still upcoming. Thank you. Good morning, Constantin. We are pretty convinced that our liquidity reserve, which includes EUR 450 million in cash that we have right now, plus EUR 130 million out of that revolving credit facility, gives us enough flexibility for any unforeseeables in the future. As we mentioned, we are convinced that the net debt level will decrease over the second half of the year. From our point of view, there's no concern. Thank you very much. The next question comes from Robert Sanders with Deutsche Bank. Please go ahead. Yeah, good morning. Thanks for taking my question. I have three questions, if it's possible. First question would just be on FabNext. Is it fair to say it's roughly 10% of revenue this year, or could it be much higher? That would be my first question. Second question would be, when can we expect FabNext to become accretive to EBITDA margin, given the sort of relatively limited scale today, but ramping? The third question would just be, I noted, obviously in the past, you've explored specialty wafers, such as silicon carbide, then you pulled out of that. I think in the past, you've worked on SOI. Given this photonics boom and you this data center boom seems to be passing you by to some degree. Is there a scenario where you could make SOI wafers without Soitec IP? I think in the past you've looked at it. GlobalWafers claims they can do that without Soitec IP. Just interested if you're exploring more specialty ways of playing into this data center. Thank you. Thank you, Rob. We are, of course, a bit reluctant to comment about details, what is the revenue contribution out of FabNext and whether it's already margin accretive. What I can say is, of course, we have a very smooth ramp in the meantime. We had around mid of last year, all major customers being qualified, so you know we have the freedom to get volumes in there and kind of preferentially load it. That's always what we said. You also hear us talking less about ramp costs, that's a clear indication that we see volumes going up, fixed costs being more reasonably diluted. That's maybe what I can say around FabNext without giving out any, let's say, competitive relevant information right now. With regards to your second question, you're absolutely right. We decided quite some time ago not to venture into silicon carbide, so no change on that one. We also have currently no considerations or even plans to go into any SOI activities. In terms of those new technology, we still have a small scale team working on gallium nitride, where we feel there could be a potential opportunity for us, but currently, we don't see the demand and the market model here. In terms of those three, gallium nitride is the only one which we're covering right now with a small R&D effort. Got it. Just one quick follow-up. The FabNext is predominantly polished wafers and a minority epi. Can you confirm that? It's actually both. Yeah. We brought the 300 mm epi technology for the first time to Singapore, and the ramp of FabNext comprises both polished and epi. Got it. Thank you. The next question comes from Florian Treisch with Kepler. Please go ahead. Yes, good morning, and thank you for taking my question. I have a question on, let's call the quarter, the sequential improvement coming over the year. The first question would be, are you or can you quantify the impact or pull in impact on the Q1 numbers into Q4 last year? Is it fair to assume that we should see sequential improvements here every coming quarter from here? Is it really a step up in demand potentially at the end of a year to meet these mid-single-digit decline? Thank you. Thank you, Florian. We do not, and I think we must not, quantify the details of those revenues that have been moved from Q4 last year, from Q1, sorry, this year into Q4 last year. I think I can just reiterate that we currently communicated our Q1 numbers. We have a very clear, full year guidance in place, and if you do some math, of course, you can estimate about a potential increase of revenue in the consecutive quarter. You will easily come to the conclusion that we do not see explosive growth from that calculation, but that it's more a smooth, further growth over the year. Great. Thank you very much. The next question comes from Gustav Froberg with Berenberg. Please go ahead. Good morning, everyone. Thank you for taking my questions as well. You talked a little bit about the indirect impact from the conflict in the Middle East, rising energy costs, et cetera. Could you maybe give us a bit more color on the evolution of costs on that side or coming from anything that may be an exogenous shock? I know as well your margin guide is obviously kept flat despite sort of you alluding to some potential cost increases. Are you able to save any costs anywhere else? That's my first question. Thank you. Hi, Gustav. Good morning. This is Claudia. Regarding the cost side, we see two corners right now where we see some cost pressure, I would say, that's in electricity costs, especially in Singapore, where we have an oil price component in our contracts, and we see some increases in freight costs. Regarding the electricity cost, as you know, we have hedging in place. In Singapore, we do some hedging using derivatives, and in Germany, a certain share of power procurement is secured up to two years in advance. Regarding electricity, we feel quite comfortable with our hedging that is in place. We see some cost increases in freight costs, on the other side, we also see that the dollar is a bit stronger right now than we anticipated. Right now it's 1.17 versus 1.18, that we assume in our forecast. This should, let's say, offset the assumed price increases, which are not too big for this year. Okay. Super. Thank you. A question on cash flow as well and your sort of balance sheet side of things essentially. Do you feel comfortable with the current rate of cash burn, assuming nothing changes in your operating environment versus sort of Q4 last year, Q1 this year? Does your plan for the balance sheet and the cash flow side of your financial envelope need to change unless there's a material pickup in H2? Please keep in mind that Q4 was impacted by a lot of special effects, also regarding the cash flow and all the developments we saw in Q1 in cash flow were expected. The increase in inventories and trade receivables was expected and also the cash outflow for the CapEx-related trade payables. This is all included in our guidance for this year. The net cash flow guidance is that we expect a net cash flow in the range of the previous year. You can assume that there are shifts between quarters, and they are planned, and they are expected. Because we do some, let's say, financial management that's very obvious, in every company, we do some financial management, but we expect the cash burn situation to improve, especially in the second half of the year. We feel very comfortable with our guidance and with the development we saw in Q1. Great. That assumes no pickup in the underlying business. Yeah. Yeah. Expect better cash flow. Of course, we assume a pickup in the underlying business, because our sales guidance, that we expect not Q1 x4, but a bit higher. The rest of the year should improve in coming from sales. With that also, we will also see an improvement in our operating cash flow. Okay. Super. Thank you very much. The next question comes from Martin Jungfleisch with BNP Paribas. Please go ahead. Yeah. Hi, good morning. I just have two quick follow-ups, the first one is really on pricing, right? Can you just talk about what part of your 300 mm contracts would potentially be eligible for price hikes over the next 12 months when the situation would allow for that? Is that kind of all contracts out of the Long-Term Agreements, which has been, I guess, like 20% or something like that? When these contracts, so 300 mm contracts expire today, are these renewed at flat pricing or is there already some leverage on your end to lift prices in these kind of contracts? Thank you, Martin, for the question. As we said, no major LTAs are expiring in the course of this year. Whenever something expires, of course, it's our freedom to conclude a new one or not to conclude a new one. We would only do so if, of course, pricing and other conditions are favorable for us. Currently, very small portion is eligible for renewal. From that perspective, it's not a huge topic. What we indicated in the speech today is that we see now customers talking about maybe more mid-term volume demands. I think we could come to a situation where this overall LTA framework can continue to be very robust and be very beneficial for us. I think I can say that's a statement for the overall wafer space. Yeah, we feel this symbiosis between customer and wafer manufacturers is working pretty well and robustly. Okay. When you would sign new LTAs, you would only do so at a higher pricing than previous contract? Is that the right assumption? It depends on the segment, yeah. In some areas there are new LTAs up for potential discussions. We currently don't see, you know, any major price discussions in new LTAs. Okay. Thank you. The other question is also follow up mainly on capacities, right? Is it possible for you to grow 300 mm wafer volumes, as output by like mid to high single digits, this and next year? Which is kind of like a market demand without you adding any capacity. Can you basically cater to market demand, this and next year, without adding any capacity? I mean, we continually, continuously add, still CapEx to Singapore. We said it very clearly. That means also still some machines coming in, which of course will have incremental benefits for capacity. Overall, we don't feel capacity is a constraint for us as we coming from, on the one side, low UTs in the German footprints, as you know. As we did build the building and the infrastructure and the gas supply and everything in Singapore already, and have a first wave of clean room and machines installed there, which gives us room to further ramp according to market demand. For the time being, we feel pretty well set. Of course, we will, as always, stated, continue the ramp according to the real market demand. Okay, great. That's helpful. Just one final question maybe on those costs. In the release you noted these hedging gains of around EUR 11 million. Were they already offsetting costs incurred in the quarter? Or are these, I guess higher costs coming now in the coming quarters and you have the gain upfront? Yeah, regarding the hedging gains, I tried to convey that in the speech. Q1 is always burdened by expenses that are more pronounced in that quarter or that only occur at the beginning of the year. They are only recorded at the beginning of the year. For example, let's say labor accruals or expense related to property. Those hedging gains and the fixed result we recorded in Q1 more or less offset those expenses. Can we expect further hedging gains in the upcoming quarters? I don't know. What I know is that those, let's say, extraordinary Q1 expenses, they won't occur in the upcoming quarters. Okay, cool. Thank you very much. The next question comes from Veysel Taze with Bankhaus Metzler. Please go ahead. Yes, good morning. Few questions. The first one would be around the first Q performance. What was the underlying growth in Q1 when we really take a year-over-year comparison, take into consideration the FX headwinds, the small diameter shortfall, and then the volumes which were put from Q1 to Q4 last year? Did you see an underlying growth in Q1? Thank you. Thank you, Veysel. I think both Q1 this year, as Claudia already explained, particularly in the cost side, and particularly Q4 last year on the top line side, were, I think very special quarters, yeah. To compare them on a like-to-like basis is very difficult and would require for us to, you know, strip and detail and a lot of effects and to become super transparent. I'm a bit reluctant to comment here. We see the underlying volume picture is a healthy one in Q1 this year, and we see that it's exactly according to plan and guidance. Clear. Thank you. Then the second one on the utilizations, alluding a little bit the previous question from my colleague. What we see right now is on the industry level for the 300 mm, the utilizations are probably hitting high 80s-low 90s. That's typically in the industry and area where customers want to discuss long-term or midterm volumes, want to make sure that they get the volumes, and that's always a good momentum for price increases going forward. I was just wondering if your 300 mm utilizations at this stage are substantially different than the industry utilizations, like the low 90s or around 90%. Look, we have indeed in the meantime, decent 300 mm loading, but we also have a way to further grow capacity very short-term, as I explained. From that perspective, yes, 300 mm loading is becoming attractive and coming to a level where, and that's what I said in the call, where first customers now are looking into midterm volume demand patterns. Yeah. That's, as you say, it's a very good indication. It's a good, let's say, atmospherical change, which we also anticipate. On the pricing side, I wouldn't go beyond the statement which we made six weeks ago. We have those first few examples of more reasonable spot prices, again, in 300 mm. That was very different some quarters ago. We have those sentiments, we have those indications. We don't see no, a major trend change already, but the atmosphere in those conversations now is a different one. That's definitely what I can say. Great. On the memory market, I mean, I understand that customers are, the memory vendors are prioritizing shipments to the higher ASP area in the AI server market or server market in general. PC and smartphone, taking into account that the second half of the year is the much stronger volume part of the year, and at the end, consumers will ask for those products, smartphone and PC, and we are seeing higher semiconductor content, DRAM, et cetera. Let's say now this demand will be, particularly on the memory side, will be served from Chinese memory vendors for maybe not the very high-end, but mid-range and phones and PCs. If the volumes come more from Chinese vendors, does that change your shipments or your volumes? Now those, smartphone and PC vendors are getting their volumes from Chinese, vendors. For us in the first glance, we are, let's say, to quite some extent, agnostic. Because we serve all major customers, and as you know, of course, we also do business in China. I think there could be indeed two effects. There could be if there's really PC and smartphone demand picking up and manifesting from end consumer side. Of course, then the prices will be paid and the memory chips might be more competitive again compared to the server demand. That could indeed happen. For us, we are, you know, agnostic to details of those, let's say, customer mix effects. As I said, we also, I think very positioned in advanced technologies. Every effect that would drive, you know, high-end PC or high-end smartphone, we would also clearly be a benefactor as we are focusing, of course, on those advanced technologies, namely leading edge and High Bandwidth Memory. Thank you. Can I squeeze one more on the 200 mm and particularly on the auto and the power part of the business? I mean, I understand inventories at auto chip vendors are still at high level. They are burning down inventories, still it's too high. I was wondering in 200 mm particularly, I always historically thought you are strong with in the power part of this, and we see a lot of demand also from AI data centers for low-end power products for servers, et cetera. I was wondering, why are you not seeing this demand in your 200 mm market? Related to that also, it gets obvious that the Chinese 200 mm wafer producers are in the main market and competitive products. Is that also related a little bit to the potential ASP pressure you're feeling? I would not say market share loss, but ASP pressure, that the issue in the 200 mm is rather from the ASP side. I think you're absolutely right. In the last two quarters or so, also the power chip manufacturers again got more positive and were highlighting particularly also their business opportunities in powering data centers. We, we also anticipate that. We have still between that, those statements and those businesses picking up and our, means the wafer side of things, there is on the one side, the usual six months delay and in addition, the elevated inventories. Therefore, we, and the wafer industry doesn't see it yet is maybe a good statement. In addition, you're right, we always said that the Chinese wafer manufacturers are, let's say that the, the technology capability and so on are stronger the lower the diameter of the wafers, yeah. Of course, in 200 mm they are more present and more advanced, and far more advanced than in 300 mm, and that could be another effect. What I want to say is it's the normal demand supply cycle here we see, which is still hanging on in power inventories. There could be an underlying, let's say China effect as well. For us, 200 mm, of course already with the 300 mm growth, already a small segment in the meantime. We still see that the demand is picking up once the manifestation of the demand from the power and AI side is driving through the power chip manufacturers to the wafer industry, then we should also see demand pick up again. Thank you very much. As a reminder, if you would like to ask a question, please press star one. The next question comes from Harry Blaiklock with UBS. Please go ahead. Morning, guys. Thanks for taking my questions. The first is just on one of your peers reported yesterday and were kind of unexpectedly quite positive on their wafer segment. And some of the commentary that they were giving was that customers are kind of rushing for inventory, wafer inventory. There are some customers asking for kind of longer and potentially higher volumes in LTAs. You've kind of mentioned about customers trying to secure medium-term demand. I wonder whether, I know you obviously can't comment on anything to do with your peers, but those conversations with customers around LTAs, lengthening them and medium-term demand, wondering whether you are also experiencing something similar or whether you can comment on that at all. Yeah. Thank you. Thank you, Harry. We're always a bit reluctant to comment on, as you highlighted already, on individual competitor statements, but I can confirm, and I think I did already, that we also feel this more positive tonality and atmosphere in conversations with customers on demand about volume scenarios and so on. We are not so vocal about it as we really would love to see it more in our books. Not only in, let's say, atmospheric and tonality indications, but definitely we see a change in atmosphere there. Maybe a more general remark, if you compare, let's say, Japanese players with us, you have to always have in mind in terms of operational development, the FX difference. Of course, we as wafer manufacturers have different customer portfolios and some product portfolio differences as well. If we take all this together, I think we pretty much in line with the sentiment from other players. We also anticipating. Got it. I just wanted to clarify on your pricing comment. I know like over the past year, you've been saying that, you know, pricing pressure is more severe in eight-inch and 12-inch has been stable in LTAs and maybe down a little bit in spot market. I know you're saying that it's in 12-inch it's now more reasonable. I just wanted to know kind of what does that mean in terms of, you know, is that just that the price declines there have stabilized? Are you seeing any price increases coming through outside of LTAs? I'm a bit reluctant to go into more details here, but your general statement is correct and unchangeably correct. Price pressure is indeed more pronounced in 200 mm, as we discussed earlier in the call. That's maybe not a surprise. In 300 mm, we came out of a phase where the non-LTA part was also under certain price pressure. Now we have, in the meantime, some first examples where that is easing and looking more reasonable. Again, I wouldn't declare a trend change or a significant uptick yet, but we have those first examples where we can look a bit more positively on outside 300 mm LTA pricing. Okay. Perfect. Maybe one last quick one. I know you say that you don't have any major LTAs coming up in negotiation this year, next year, are you able to comment on that? You're right. Nothing, nothing major is expiring this year. Our big LTAs that have all been concluded in conjunction with the FabNext, they are, let's say very long-term LTAs. We have some of them running until 2030. We have 80% of our capacity in Singapore covered with these long-term LTAs. Of course, we look at LTAs as a sort of portfolio. We always said we want to have around 2/3 of the business in those LTAs. In that context, of course, there could LTAs be expiring next year, while we also even last year concluded new LTAs. It's a kind of rolling, ongoing thing. Let me reiterate, if conditions are not good, nobody will force us to do new LTAs. It's really up to our discretion. Even if we experienced in very soft market conditions, there's always a segment or a technology where new LTAs are concluded. We have to look at this as a kind of portfolio, as a rolling thing. Again, the big ones are rock solid until 2030. With historic volume shifts which we wanted, some of those volumes even have been added to the end of the contract, which in fact would prolong some of those initial time frames. Got it. Thank you, Michael. Appreciate that. There are no further questions. At this time, I would like to turn the conference over to Stephanie Malgara. This concludes our Q&A session. Thank you for joining us today. We'll release our H1 2026 figures on the 30th of July. On this slide, you can also see our next IR events. Thank you, and have a good day. This concludes today's call. Thank you for your participation. You may now disconnect.

Speaker 9: Hello everyone, welcome to the presentation of Siltronic's Q1 2026 results conference call. Please note that this call is being recorded and streamed on Siltronic's website. The call will also be available as an on-demand version later today. Your participation in this call implies your consent with this. At this time, I would like to turn the conference over to Stephanie Malgara, Senior Manager, Investor Relations at Siltronic. Please go ahead. Hello everyone, welcome to the presentation of Siltronic's Q1 2026 results conference call. hello everyone welcome to the presentation of siltronic's q1 2026 results conference call Please note that this call is being recorded and streamed on Siltronic's website. please note that this call is being recorded and streamed on siltronic's website The call will also be available as an on-demand version later today. the call will also be available as an on-demand version later today Your participation in this call implies your consent with this. your participation in this call implies your consent with this At this time, I would like to turn the conference over to Stephanie Malgara, Senior Manager, Investor Relations at Siltronic. at this time i would like to turn the conference over to stephanie malgara senior manager investor relations at siltronic Please go ahead. please go ahead

Speaker 11: Thank you, Cynthia. Welcome everybody to our Q1 2026 results presentation. This call will also be webcast live on siltronic.com. A replay of the call will be available on our website shortly after the end of the call. Our CEO, Michael Heckmeier, and our CFO, Claudia Schmitt, will give you an overview of our financials, the current market developments, and our guidance. After the presentation, we will be happy to take your questions. Please note that management comments during this call will include forward-looking statements that involve risks and uncertainties. For discussion of risk factors, I encourage you to review the Safe Harbor statement contained in today's press release and presentation. All documents relating to our Q1 2026 reporting are available on our website. I now turn the call over to Michael for his remarks. Thank you, Cynthia. thank you cynthia Welcome everybody to our Q1 2026 results presentation. welcome everybody to our q1 2026 results presentation This call will also be webcast live on siltronic.com. this call will also be webcast live on siltronic.com A replay of the call will be available on our website shortly after the end of the call. a replay of the call will be available on our website shortly after the end of the call Our CEO, Michael Heckmeier, and our CFO, Claudia Schmitt, will give you an overview of our financials, the current market developments, and our guidance. our ceo michael heckmeier and our cfo claudia schmitt will give you an overview of our financials the current market developments and our guidance After the presentation, we will be happy to take your questions. after the presentation we will be happy to take your questions Please note that management comments during this call will include forward-looking statements that involve risks and uncertainties. please note that management comments during this call will include forward-looking statements that involve risks and uncertainties For discussion of risk factors, I encourage you to review the Safe Harbor statement contained in today's press release and presentation. for discussion of risk factors i encourage you to review the safe harbor statement contained in today's press release and presentation All documents relating to our Q1 2026 reporting are available on our website. all documents relating to our q1 2026 reporting are available on our website I now turn the call over to Michael for his remarks. i now turn the call over to michael for his remarks

Speaker 8: Thank you, Stephanie, and a warm welcome also from my side. Given that we released our 2025 financials only six weeks ago, today's call will be relatively compact, while of course, covering all material developments since then. Let's start with a broad overview of our development in the first three months of the year. Claudia will provide a more detailed breakdown in just a moment. As expected, Q1 was a soft start into the year. Sales came in at EUR 307 million, significantly below Q4 2025, which had benefited from delivery shifts. In line with the lower sales level, profitability decreased sequentially. The EBITDA margin was 21.2% compared to 23.3% in Q4. EBIT also decreased to EUR -52 million compared to EUR -34 million in the previous quarter. Thank you, Stephanie, and a warm welcome also from my side. thank you stephanie and a warm welcome also from my side Given that we released our 2025 financials only six weeks ago, today's call will be relatively compact, while of course, covering all material developments since then. given that we released our 2025 financials only six weeks ago today's call will be relatively compact while of course covering all material developments since then Let's start with a broad overview of our development in the first three months of the year. let's start with a broad overview of our development in the first three months of the year Claudia will provide a more detailed breakdown in just a moment. claudia will provide a more detailed breakdown in just a moment As expected, Q1 was a soft start into the year. as expected q1 was a soft start into the year Sales came in at EUR 307 million, significantly below Q4 2025, which had benefited from delivery shifts. sales came in at eur 307 million significantly below q4 2025 which had benefited from delivery shifts In line with the lower sales level, profitability decreased sequentially. in line with the lower sales level profitability decreased sequentially The EBITDA margin was 21.2% compared to 23.3% in Q4. the ebitda margin was 21.2% compared to 23.3% in q4 EBIT also decreased to EUR -52 million compared to EUR -34 million in the previous quarter. ebit also decreased to eur -52 million compared to eur -34 million in the previous quarter CapEx totaled EUR 48 million in the quarter, with a continued focus on our 300 mm business. At the same time, cash payments for CapEx significantly exceeded this level. Consequently, the net cash flow remained negative at EUR -89 million, and net debt increased to EUR 936 million compared to EUR 837 million at year-end 2025. Claudia will now provide a more detailed overview of the financials. CapEx totaled EUR 48 million in the quarter, with a continued focus on our 300 mm business. capex totaled eur 48 million in the quarter with a continued focus on our 300 mm business At the same time, cash payments for CapEx significantly exceeded this level. at the same time cash payments for capex significantly exceeded this level Consequently, the net cash flow remained negative at EUR -89 million, and net debt increased to EUR 936 million compared to EUR 837 million at year-end 2025. consequently the net cash flow remained negative at eur -89 million and net debt increased to eur 936 million compared to eur 837 million at year-end 2025 Claudia will now provide a more detailed overview of the financials. claudia will now provide a more detailed overview of the financials

Speaker 1: Thank you, Michael. A warm welcome from my side as well. Let's get straight into the details of our Q1 2026 results. As Michael pointed out, Q1 marked a soft start to the year, and sales came in as expected at EUR 307 million. The strong quarter-on-quarter decline is less a reflection of a sudden change in underlying demand and more a matter of comparability. Q4 was not a clean baseline, as it was notably lifted by delivery pull-ins from Q3 2025 and early 2026. This phasing also influenced the quarter's product mix, which weighed on the sequential comparison. Foreign exchange, by contrast, was not a meaningful factor, with the Euro-US dollar exchange rate largely stable at 1.17 versus 1.16 in Q4. Thank you, Michael. thank you michael A warm welcome from my side as well. a warm welcome from my side as well Let's get straight into the details of our Q1 2026 results. let's get straight into the details of our q1 2026 results As Michael pointed out, Q1 marked a soft start to the year, and sales came in as expected at EUR 307 million. as michael pointed out q1 marked a soft start to the year and sales came in as expected at eur 307 million The strong quarter-on-quarter decline is less a reflection of a sudden change in underlying demand and more a matter of comparability. the strong quarter-on-quarter decline is less a reflection of a sudden change in underlying demand and more a matter of comparability Q4 was not a clean baseline, as it was notably lifted by delivery pull-ins from Q3 2025 and early 2026. q4 was not a clean baseline as it was notably lifted by delivery pull-ins from q3 2025 and early 2026 This phasing also influenced the quarter's product mix, which weighed on the sequential comparison. this phasing also influenced the quarter's product mix which weighed on the sequential comparison Foreign exchange, by contrast, was not a meaningful factor, with the Euro-US dollar exchange rate largely stable at 1.17 versus 1.16 in Q4. foreign exchange by contrast was not a meaningful factor with the euro-us dollar exchange rate largely stable at 1.17 versus 1.16 in q4 Turning to the cost side, I would like to highlight the particularly strong contribution from hedging activities in the first quarter. In total, the net FX result and gains from hedging an oil price component in electricity supply contracts amounted to EUR 11.4 million, compared with EUR 2.7 million in the prior quarter. These effects were a key factor in largely offsetting costs that are typically recorded only in the first quarter. In line with the lower sales level, EBITDA decreased to EUR 65 million, translating into an EBITDA margin of 21.2% compared with 23.3% in Q4. Correspondingly, EBIT declined to EUR -52 million in Q1. Net income amounted to EUR -67 million, following EUR -53 million in Q4 2025, which had included a write-down of deferred tax assets. Turning to the cost side, I would like to highlight the particularly strong contribution from hedging activities in the first quarter. turning to the cost side i would like to highlight the particularly strong contribution from hedging activities in the first quarter In total, the net FX result and gains from hedging an oil price component in electricity supply contracts amounted to EUR 11.4 million, compared with EUR 2.7 million in the prior quarter. in total the net fx result and gains from hedging an oil price component in electricity supply contracts amounted to eur 11.4 million compared with eur 2.7 million in the prior quarter These effects were a key factor in largely offsetting costs that are typically recorded only in the first quarter. these effects were a key factor in largely offsetting costs that are typically recorded only in the first quarter In line with the lower sales level, EBITDA decreased to EUR 65 million, translating into an EBITDA margin of 21.2% compared with 23.3% in Q4. in line with the lower sales level ebitda decreased to eur 65 million translating into an ebitda margin of 21.2% compared with 23.3% in q4 Correspondingly, EBIT declined to EUR -52 million in Q1. correspondingly ebit declined to eur -52 million in q1 Net income amounted to EUR -67 million, following EUR -53 million in Q4 2025, which had included a write-down of deferred tax assets. net income amounted to eur -67 million following eur -53 million in q4 2025 which had included a write-down of deferred tax assets Let's turn to the key developments on our balance sheet, which continues to show a solid and healthy structure. By the end of March, total assets amounted to EUR 4.7 billion, slightly below the EUR 4.8 billion reported at year-end 2025. Property, plant, and equipment remained largely stable as depreciation exceeding additions was largely offset by the appreciation of the SGD against the EUR. Working capital developed as expected. Inventories and trade receivables increased by roughly EUR 50 million in total. Cash and securities declined to EUR 448 million from EUR 534 million at year-end, also reflecting planned elevated cash outflows related to previously incurred capital expenditures. As a consequence of these CapEx-related payments, trade payables decreased by EUR 43 million. Let's turn to the key developments on our balance sheet, which continues to show a solid and healthy structure. let's turn to the key developments on our balance sheet which continues to show a solid and healthy structure By the end of March, total assets amounted to EUR 4.7 billion, slightly below the EUR 4.8 billion reported at year-end 2025. by the end of march total assets amounted to eur 4.7 billion slightly below the eur 4.8 billion reported at year-end 2025 Property, plant, and equipment remained largely stable as depreciation exceeding additions was largely offset by the appreciation of the SGD against the EUR. property plant and equipment remained largely stable as depreciation exceeding additions was largely offset by the appreciation of the sgd against the eur Working capital developed as expected. working capital developed as expected Inventories and trade receivables increased by roughly EUR 50 million in total. inventories and trade receivables increased by roughly eur 50 million in total Cash and securities declined to EUR 448 million from EUR 534 million at year-end, also reflecting planned elevated cash outflows related to previously incurred capital expenditures. cash and securities declined to eur 448 million from eur 534 million at year-end also reflecting planned elevated cash outflows related to previously incurred capital expenditures As a consequence of these CapEx-related payments, trade payables decreased by EUR 43 million. as a consequence of these capex-related payments trade payables decreased by eur 43 million Prepayments remained almost unchanged, as did the equity ratio, which stood at a solid 42%. CapEx in Q1 2026 totaled EUR 48 million. The previously mentioned payments for investments amounted to EUR 110 million year to date, exceeding the reported CapEx level by more than EUR 60 million. For the full year, we continue to guide for CapEx in a range between EUR 180 million and EUR 220 million. As previously communicated, cash outflows for CapEx are expected to significantly exceed asset additions also for the full year. Let's take a closer look at our debt situation. As illustrated in the bridge, net financial debt stood at EUR 837 million at year-end 2025. In Q1, operating cash flow was under pressure, reflecting the expected buildup in inventories and trade receivables, and amounted to EUR 21 million. Prepayments remained almost unchanged, as did the equity ratio, which stood at a solid 42%. prepayments remained almost unchanged as did the equity ratio which stood at a solid 42% CapEx in Q1 2026 totaled EUR 48 million. capex in q1 2026 totaled eur 48 million The previously mentioned payments for investments amounted to EUR 110 million year to date, exceeding the reported CapEx level by more than EUR 60 million. the previously mentioned payments for investments amounted to eur 110 million year to date exceeding the reported capex level by more than eur 60 million For the full year, we continue to guide for CapEx in a range between EUR 180 million and EUR 220 million. for the full year we continue to guide for capex in a range between eur 180 million and eur 220 million As previously communicated, cash outflows for CapEx are expected to significantly exceed asset additions also for the full year. as previously communicated cash outflows for capex are expected to significantly exceed asset additions also for the full year Let's take a closer look at our debt situation. let's take a closer look at our debt situation As illustrated in the bridge, net financial debt stood at EUR 837 million at year-end 2025. as illustrated in the bridge net financial debt stood at eur 837 million at year-end 2025 In Q1, operating cash flow was under pressure, reflecting the expected buildup in inventories and trade receivables, and amounted to EUR 21 million. in q1 operating cash flow was under pressure reflecting the expected buildup in inventories and trade receivables and amounted to eur 21 million This was not sufficient to cover the planned CapEx-related cash payments. As a result, net financial debt increased noticeably to EUR 936 million, driven by temporary timing effects. We therefore expect net financial debt to improve over the course of the second half of the year. Let me briefly conclude with a comment on the composition of our financial debt. Unchanged compared with our full-year presentation, total debt stood at just under EUR 1.5 billion at the end of the first quarter, with roughly EUR 130 million remaining undrawn. The maturity profile illustrates that repayments are well spread over the coming years. For 2026, we anticipate repayments of around EUR 100 million. As already mentioned, we closed Q1 with approximately EUR 450 million in cash and securities. This was not sufficient to cover the planned CapEx-related cash payments. this was not sufficient to cover the planned capex-related cash payments As a result, net financial debt increased noticeably to EUR 936 million, driven by temporary timing effects. as a result net financial debt increased noticeably to eur 936 million driven by temporary timing effects We therefore expect net financial debt to improve over the course of the second half of the year. we therefore expect net financial debt to improve over the course of the second half of the year Let me briefly conclude with a comment on the composition of our financial debt. let me briefly conclude with a comment on the composition of our financial debt Unchanged compared with our full-year presentation, total debt stood at just under EUR 1.5 billion at the end of the first quarter, with roughly EUR 130 million remaining undrawn. unchanged compared with our full-year presentation total debt stood at just under eur 1.5 billion at the end of the first quarter with roughly eur 130 million remaining undrawn The maturity profile illustrates that repayments are well spread over the coming years. the maturity profile illustrates that repayments are well spread over the coming years For 2026, we anticipate repayments of around EUR 100 million. for 2026 we anticipate repayments of around eur 100 million As already mentioned, we closed Q1 with approximately EUR 450 million in cash and securities. as already mentioned we closed q1 with approximately eur 450 million in cash and securities Together with our undrawn revolving credit facility, this provides a solid level of financial flexibility. In addition, our balance sheet includes short-term prepayments of around EUR 33 million, with around EUR 15 million scheduled for repayment within this year. With this, I will hand back to Michael. Together with our undrawn revolving credit facility, this provides a solid level of financial flexibility. together with our undrawn revolving credit facility this provides a solid level of financial flexibility In addition, our balance sheet includes short-term prepayments of around EUR 33 million, with around EUR 15 million scheduled for repayment within this year. in addition our balance sheet includes short-term prepayments of around eur 33 million with around eur 15 million scheduled for repayment within this year With this, I will hand back to Michael. with this i will hand back to michael

Speaker 8: Thank you, Claudia. Let me summarize our current expectations across end markets looking into 2026. Compared to the estimates we presented in mid-March, the overall outlook remains positive, with some shifts between different application segments. First, we now expect an even higher growth rate for servers, namely 44% year-on-year. This growth is clearly driven by the strong AI momentum and continued investments in data center infrastructure. Propelled by this AI-driven demand, we see initial indications that some customers are revisiting their midterm volume commitments to enhance supply security. At this stage, these are early signals rather than a confirmed trend, but they may have implications for inventory levels. Conversely, the outlook for smartphones and PCs has further weakened. The key reason is the ongoing tight supply of memory chips. Thank you, Claudia. thank you claudia Let me summarize our current expectations across end markets looking into 2026. let me summarize our current expectations across end markets looking into 2026 Compared to the estimates we presented in mid-March, the overall outlook remains positive, with some shifts between different application segments. compared to the estimates we presented in mid-march the overall outlook remains positive with some shifts between different application segments First, we now expect an even higher growth rate for servers, namely 44% year- on- year. first we now expect an even higher growth rate for servers namely 44% year- on- year This growth is clearly driven by the strong AI momentum and continued investments in data center infrastructure. this growth is clearly driven by the strong ai momentum and continued investments in data center infrastructure Propelled by this AI-driven demand, we see initial indications that some customers are revisiting their midterm volume commitments to enhance supply security. propelled by this ai-driven demand we see initial indications that some customers are revisiting their midterm volume commitments to enhance supply security At this stage, these are early signals rather than a confirmed trend, but they may have implications for inventory levels. at this stage these are early signals rather than a confirmed trend but they may have implications for inventory levels Conversely, the outlook for smartphones and PCs has further weakened. conversely the outlook for smartphones and pcs has further weakened The key reason is the ongoing tight supply of memory chips. the key reason is the ongoing tight supply of memory chips With memory availability being prioritized for AI-related server applications, unit volumes in other end markets are constrained, which is particularly weighing on smartphones and PCs. We continue to expect growth in the automotive industry, but at a reduced rate compared to last year. The industry is assumed to improve from a low base. Overall, this results in an estimated pre-inventory growth of around 7% for total wafer area consumption in 2026. Let's conclude today's presentation confirming our guidance for the full year 2026. As we mentioned a few weeks ago, we expect the business environment to remain challenging. Headwinds from FX, price pressure outside LTAs, and the ongoing weak 200 mm business weigh on our performance. Additionally, the closure of the SD line will impact the full financial year for the first time. With memory availability being prioritized for AI-related server applications, unit volumes in other end markets are constrained, which is particularly weighing on smartphones and PCs. with memory availability being prioritized for ai-related server applications unit volumes in other end markets are constrained which is particularly weighing on smartphones and pcs We continue to expect growth in the automotive industry, but at a reduced rate compared to last year. we continue to expect growth in the automotive industry but at a reduced rate compared to last year The industry is assumed to improve from a low base. the industry is assumed to improve from a low base Overall, this results in an estimated pre-inventory growth of around 7% for total wafer area consumption in 2026. overall this results in an estimated pre-inventory growth of around 7% for total wafer area consumption in 2026 Let's conclude today's presentation confirming our guidance for the full year 2026. let's conclude today's presentation confirming our guidance for the full year 2026 As we mentioned a few weeks ago, we expect the business environment to remain challenging. as we mentioned a few weeks ago we expect the business environment to remain challenging Headwinds from FX, price pressure outside LTAs, and the ongoing weak 200 mm business weigh on our performance. headwinds from fx price pressure outside ltas and the ongoing weak 200 mm business weigh on our performance Additionally, the closure of the SD line will impact the full financial year for the first time. additionally the closure of the sd line will impact the full financial year for the first time Geopolitical uncertainties related to developments in the Middle East currently have no direct impact on our business, and end markets remain robust. That said, we continue to monitor the situation very closely, as it could affect the broader cost environment, which includes energy prices. We've taken measures to mitigate parts of these risks, including hedging where applicable, but we still anticipate potential uncertainty. In addition, we assume higher freight and logistics costs. 2026 sales are guided in the mid-single-digit percentage range below the prior year level based on a euro-USD exchange rate of 1.18. In comparison, without FX effects and without the impact from the SD closure, we expect sales to be around prior year level. Our EBITDA margin guidance is between 20% and 24%. Depreciation is expected to increase significantly in 2026 due to our investments in the 300 mm business. Geopolitical uncertainties related to developments in the Middle East currently have no direct impact on our business, and end markets remain robust. geopolitical uncertainties related to developments in the middle east currently have no direct impact on our business and end markets remain robust That said, we continue to monitor the situation very closely, as it could affect the broader cost environment, which includes energy prices. that said we continue to monitor the situation very closely as it could affect the broader cost environment which includes energy prices We've taken measures to mitigate parts of these risks, including hedging where applicable, but we still anticipate potential uncertainty. we've taken measures to mitigate parts of these risks including hedging where applicable but we still anticipate potential uncertainty In addition, we assume higher freight and logistics costs. 2026 sales are guided in the mid-single-digit percentage range below the prior year level based on a euro-USD exchange rate of 1.18. in addition we assume higher freight and logistics costs 2026 sales are guided in the mid-single-digit percentage range below the prior year level based on a euro-usd exchange rate of 1.18 In comparison, without FX effects and without the impact from the SD closure, we expect sales to be around prior year level. in comparison without fx effects and without the impact from the sd closure we expect sales to be around prior year level Our EBITDA margin guidance is between 20% and 24%. our ebitda margin guidance is between 20% and 24% Depreciation is expected to increase significantly in 2026 due to our investments in the 300 mm business. depreciation is expected to increase significantly in 2026 due to our investments in the 300 mm business We guide it between EUR 490 million and EUR 520 million. Therefore, EBIT is expected to be significantly below the previous year. We're seeing CapEx to be between EUR 180 million and EUR 220 million. As cash payments for CapEx are expected to exceed this level, we expect net cash flow to be in the range of the previous year. With this, we conclude our Q1 2026 results presentation. Claudia and I are happy to take your questions. Thank you very much for your attention. Cynthia, please open the Q&A session. We guide it between EUR 490 million and EUR 520 million. we guide it between eur 490 million and eur 520 million Therefore, EBIT is expected to be significantly below the previous year. therefore ebit is expected to be significantly below the previous year We're seeing CapEx to be between EUR 180 million and EUR 220 million. we're seeing capex to be between eur 180 million and eur 220 million As cash payments for CapEx are expected to exceed this level, we expect net cash flow to be in the range of the previous year. as cash payments for capex are expected to exceed this level we expect net cash flow to be in the range of the previous year With this, we conclude our Q1 2026 results presentation. with this we conclude our q1 2026 results presentation Claudia and I are happy to take your questions. claudia and i are happy to take your questions Thank you very much for your attention. thank you very much for your attention Cynthia, please open the Q&A session. cynthia please open the q&a session

Speaker 9: Thank you. If you would like to ask a question, please signal by pressing star one on your telephone keypad. If you are using a speakerphone, please make sure your mute function is turned off to allow the signal to reach our equipment. Again, press star one to ask a question. We'll pause for a moment to allow everyone the opportunity to signal for questions. The first question comes from Daniel Schafei with Citi. Please go ahead. Thank you. thank you If you would like to ask a question, please signal by pressing star one on your telephone keypad. if you would like to ask a question please signal by pressing star one on your telephone keypad If you are using a speakerphone, please make sure your mute function is turned off to allow the signal to reach our equipment. if you are using a speakerphone please make sure your mute function is turned off to allow the signal to reach our equipment Again, press star one to ask a question. again press star one to ask a question We'll pause for a moment to allow everyone the opportunity to signal for questions. we'll pause for a moment to allow everyone the opportunity to signal for questions The first question comes from Daniel Schafei with Citi. the first question comes from daniel schafei with citi Please go ahead. please go ahead

Speaker 3: Good morning. Thank you very much for taking my question. I just wanted to come back to your end market expectations, and it is great to see that you have adjusted them, especially for smartphones and PCs. I am just trying to understand what drove the server demand increase from the 28 in the sense that if I still see that there is some downside to smartphone projections from the re-decreasing 10% growth, is there still some upside to the server projections in your opinion? Basically, on what grounds have you increased this from 28 to 44? What was driving this? Is there room, given that it is a very dynamic target and in general, the end market is increasing quite rapidly, can we expect some further improvement there? Good morning. good morning Thank you very much for taking my question. thank you very much for taking my question I just wanted to come back to your end market expectations, and it is great to see that you have adjusted them, especially for smartphones and PCs. i just wanted to come back to your end market expectations and it is great to see that you have adjusted them especially for smartphones and pcs I am just trying to understand what drove the server demand increase from the 28 in the sense that if I still see that there is some downside to smartphone projections from the re-decreasing 10% growth, is there still some upside to the server projections in your opinion? i am just trying to understand what drove the server demand increase from the 28 in the sense that if i still see that there is some downside to smartphone projections from the re-decreasing 10% growth is there still some upside to the server projections in your opinion Basically, on what grounds have you increased this from 28 to 44? basically on what grounds have you increased this from 28 to 44 What was driving this? what was driving this Is there room, given that it is a very dynamic target and in general, the end market is increasing quite rapidly, can we expect some further improvement there? is there room given that it is a very dynamic target and in general the end market is increasing quite rapidly can we expect some further improvement there

Speaker 8: Thank you, Daniel. I understand your question, why is AI even and server demand even stronger than, and sub stronger than initially anticipated, and could there be even more further upside? Yeah. What we see is, of course, that particularly in the memory segment, that the memory chip manufacturers prioritize, and they feed more supply into the server area. That's driven by their continued strong build of hyperscalers and by their CapEx roadmaps being confirmed or here and there even being upgraded further. Yeah. This looks very robust and very strong. Yeah. Is there further upside? Maybe there could be a small further upside. However, some of those, particularly memory chips, are limited by capacity constraints at the chip makers. Yeah. Thank you, Daniel. thank you daniel I understand your question, why is AI even and server demand even stronger than, and sub stronger than initially anticipated, and could there be even more further upside? i understand your question why is ai even and server demand even stronger than and sub stronger than initially anticipated and could there be even more further upside Yeah. yeah What we see is, of course, that particularly in the memory segment, that the memory chip manufacturers prioritize, and they feed more supply into the server area. what we see is of course that particularly in the memory segment that the memory chip manufacturers prioritize and they feed more supply into the server area That's driven by their continued strong build of hyperscalers and by their CapEx roadmaps being confirmed or here and there even being upgraded further. that's driven by their continued strong build of hyperscalers and by their capex roadmaps being confirmed or here and there even being upgraded further Yeah. yeah This looks very robust and very strong. this looks very robust and very strong Yeah. yeah Is there further upside? is there further upside Maybe there could be a small further upside. maybe there could be a small further upside However, some of those, particularly memory chips, are limited by capacity constraints at the chip makers. however some of those particularly memory chips are limited by capacity constraints at the chip makers Yeah. yeah It means even though there could be an underlying stronger end market demand from the AI drive, it might be difficult to fulfill this. Yeah. Therefore, we would say, yeah, there could be further smaller upsides this year, but due to the capacity constraints, it could be limited, it could be dampened on a chip level side. Yeah. As a general remark, we also have to have in mind when we talk about smartphones that the -10% is a composition. Yeah. It's a melange of unit and content. It means even though there could be an underlying stronger end market demand from the AI drive, it might be difficult to fulfill this. it means even though there could be an underlying stronger end market demand from the ai drive it might be difficult to fulfill this Yeah. yeah Therefore, we would say, yeah, there could be further smaller upsides this year, but due to the capacity constraints, it could be limited, it could be dampened on a chip level side. therefore we would say yeah there could be further smaller upsides this year but due to the capacity constraints it could be limited it could be dampened on a chip level side Yeah. yeah As a general remark, we also have to have in mind when we talk about smartphones that the - 10% is a composition. as a general remark we also have to have in mind when we talk about smartphones that the - 10% is a composition Yeah. yeah It's a melange of unit and content. it's a melange of unit and content We see maybe on the unit side, even a bit of further dampening, which is compensated by the mix effect as those smartphones that are still being built tend to be more higher level, more advanced smartphones, which also have more silicon content in there. Yeah. We always have to have in mind this mixture between unit number effect and the silicon content effect. What we show with those -10% is a composition of both. We see maybe on the unit side, even a bit of further dampening, which is compensated by the mix effect as those smartphones that are still being built tend to be more higher level, more advanced smartphones, which also have more silicon content in there. we see maybe on the unit side even a bit of further dampening which is compensated by the mix effect as those smartphones that are still being built tend to be more higher level more advanced smartphones which also have more silicon content in there Yeah. yeah We always have to have in mind this mixture between unit number effect and the silicon content effect. we always have to have in mind this mixture between unit number effect and the silicon content effect What we show with those - 10% is a composition of both. what we show with those - 10% is a composition of both

Speaker 3: Perfect. That's very clear. Thank you very much. Just to also follow up, I mean, it's great to see that server and market demand is doing so well. Just historically, I remember that usually the Japanese peers were claiming quite strong market share within that segment, especially on this kind of more advanced wafer capabilities. In your opinion, do you see this gap narrowing from here on? Do you see kind of further share gains from your side in this segment? Perfect. perfect That's very clear. that's very clear Thank you very much. thank you very much Just to also follow up, I mean, it's great to see that server and market demand is doing so well. just to also follow up i mean it's great to see that server and market demand is doing so well Just historically, I remember that usually the Japanese peers were claiming quite strong market share within that segment, especially on this kind of more advanced wafer capabilities. just historically i remember that usually the japanese peers were claiming quite strong market share within that segment especially on this kind of more advanced wafer capabilities In your opinion, do you see this gap narrowing from here on? in your opinion do you see this gap narrowing from here on Do you see kind of further share gains from your side in this segment? do you see kind of further share gains from your side in this segment

Speaker 8: I would say there are no tremendous changes. Yeah, I mean, you're referencing a bit to the market share question. We see a pretty stable market share development. That means that there's no landslide shift in either direction. I can reconfirm what we discussed a couple of weeks ago, that we are well positioned, that we have a clear strategic focus on leading edge. That means on advanced logic and on the High Bandwidth Memory segments. Here we are pretty well represented. I would say there are no tremendous changes. i would say there are no tremendous changes Yeah, I mean, you're referencing a bit to the market share question. yeah i mean you're referencing a bit to the market share question We see a pretty stable market share development. we see a pretty stable market share development That means that there's no landslide shift in either direction. that means that there's no landslide shift in either direction I can reconfirm what we discussed a couple of weeks ago, that we are well positioned, that we have a clear strategic focus on leading edge. i can reconfirm what we discussed a couple of weeks ago that we are well positioned that we have a clear strategic focus on leading edge That means on advanced logic and on the High Bandwidth Memory segments. that means on advanced logic and on the high bandwidth memory segments Here we are pretty well represented. here we are pretty well represented Some tiny details here and there could depend, of course, on more customer mix rather than on application mix in the sense of server versus other, it would be more the customer mix and the customer exposure that could create here and there, some, let's say, particular differences on a quarterly basis. Some tiny details here and there could depend, of course, on more customer mix rather than on application mix in the sense of server versus other, it would be more the customer mix and the customer exposure that could create here and there, some, let's say, particular differences on a quarterly basis. some tiny details here and there could depend of course on more customer mix rather than on application mix in the sense of server versus other it would be more the customer mix and the customer exposure that could create here and there some let's say particular differences on a quarterly basis

Speaker 3: Perfect. Thank you very much. Perfect. perfect Thank you very much. thank you very much

Speaker 9: The next question comes from Constantin Hesse with Jefferies. Please go ahead. Mr. Hesse, please check your mute button. He does have an additional connection. One moment please. Mr. Hesse, please proceed with your questions. The next question comes from Constantin Hesse with Jefferies. the next question comes from constantin hesse with jefferies Please go ahead. Mr. please go ahead. mr Hesse, please check your mute button. hesse please check your mute button He does have an additional connection. he does have an additional connection One moment please. one moment please Mr. Hesse, please proceed with your questions. mr hesse please proceed with your questions

Speaker 2: Hi, can you hear me? Hi, can you hear me? hi can you hear me

Speaker 8: Yes. Yes. yes

Speaker 2: Perfect. Good morning. Thanks very much for taking my questions. The first one is just quickly on pricing, 'cause the overall comment is that there's still pricing pressure. On the previous call, we had already heard that pricing in 300 mm legacy had stabilized. I just wanted to confirm that that's still the case, and that pricing pressure is coming primarily from 200 mm. That's the first question. Perfect. perfect Good morning. good morning Thanks very much for taking my questions. thanks very much for taking my questions The first one is just quickly on pricing, 'cause the overall comment is that there's still pricing pressure. the first one is just quickly on pricing 'cause the overall comment is that there's still pricing pressure On the previous call, we had already heard that pricing in 300 mm legacy had stabilized. on the previous call we had already heard that pricing in 300 mm legacy had stabilized I just wanted to confirm that that's still the case, and that pricing pressure is coming primarily from 200 mm. i just wanted to confirm that that's still the case and that pricing pressure is coming primarily from 200 mm That's the first question. that's the first question

Speaker 8: Thank you, Constantin. We didn't say that the pricing has stabilized. We said we have a few examples of reasonable spot prices in 300 mm outside LTAs. That's a statement I could reiterate. In terms of pricing, overall pretty unchanged. Yeah, we see a stable situation in the LTA framework, which covers around 2/3 of our business. We see those positive indications, some spots getting more reasonable in 300 mm outside LTAs. We also see an ongoing pressure on 200 mm, and that's, of course, the area we also have far less LTAs. In general, unchanged to what we said six weeks ago. Thank you, Constantin. thank you constantin We didn't say that the pricing has stabilized. we didn't say that the pricing has stabilized We said we have a few examples of reasonable spot prices in 300 mm outside LTAs. we said we have a few examples of reasonable spot prices in 300 mm outside ltas That's a statement I could reiterate. that's a statement i could reiterate In terms of pricing, overall pretty unchanged. in terms of pricing overall pretty unchanged Yeah, we see a stable situation in the LTA framework, which covers around 2/3 of our business. yeah we see a stable situation in the lta framework which covers around 2/3 of our business We see those positive indications, some spots getting more reasonable in 300 mm outside LTAs. we see those positive indications some spots getting more reasonable in 300 mm outside ltas We also see an ongoing pressure on 200 mm, and that's, of course, the area we also have far less LTAs. we also see an ongoing pressure on 200 mm and that's of course the area we also have far less ltas In general, unchanged to what we said six weeks ago. in general unchanged to what we said six weeks ago

Speaker 2: Great. Thank you. Michael, if I may ask, I mean, looking at the demand and the inventory situation as of today, how likely would you expect another shipment postponement, meaning another capacity utilization cut or production cut, if you will, given the current situation? Is that something that, you know, what I'm trying to figure out here is, I think it was, you know, the bottom had been reached at some point last year. The bottom continues to drag. You know, as data center demand continues to be strong, leading-edge demand continues to be strong. I'm just wondering, you know, if there's still a likelihood that we could see another production cut during 2026 from an overall perspective. Great. great Thank you. thank you Michael, if I may ask, I mean, looking at the demand and the inventory situation as of today, how likely would you expect another shipment postponement, meaning another capacity utilization cut or production cut, if you will, given the current situation? michael if i may ask i mean looking at the demand and the inventory situation as of today how likely would you expect another shipment postponement meaning another capacity utilization cut or production cut if you will given the current situation Is that something that, you know, what I'm trying to figure out here is, I think it was, you know, the bottom had been reached at some point last year. is that something that you know what i'm trying to figure out here is i think it was you know the bottom had been reached at some point last year The bottom continues to drag. the bottom continues to drag You know, as data center demand continues to be strong, leading-edge demand continues to be strong. you know as data center demand continues to be strong leading-edge demand continues to be strong I'm just wondering, you know, if there's still a likelihood that we could see another production cut during 2026 from an overall perspective. i'm just wondering you know if there's still a likelihood that we could see another production cut during 2026 from an overall perspective

Speaker 8: Thanks, Constantin. I think in general that the short answer would be maybe we don't expect any further cuts or major kind of changes. Let me differentiate a bit by the application segments also particularly relating to inventory. I think both in memory and logic, in the meantime, we can say we are back to very normal, means healthy inventory levels. We indicated in the calls that some customers even start taking off on discussions to secure even more, let's say, midterm demand. That's, I think, the good sign and it's the good part of the coin. On the other side, there is still the power segment where we have to reconfirm that inventory levels are still pretty elevated, that's a bit the more difficult segment still. Thanks, Constantin. thanks constantin I think in general that the short answer would be maybe we don't expect any further cuts or major kind of changes. i think in general that the short answer would be maybe we don't expect any further cuts or major kind of changes Let me differentiate a bit by the application segments also particularly relating to inventory. let me differentiate a bit by the application segments also particularly relating to inventory I think both in memory and logic, in the meantime, we can say we are back to very normal, means healthy inventory levels. i think both in memory and logic in the meantime we can say we are back to very normal means healthy inventory levels We indicated in the calls that some customers even start taking off on discussions to secure even more, let's say, midterm demand. we indicated in the calls that some customers even start taking off on discussions to secure even more let's say midterm demand That's, I think, the good sign and it's the good part of the coin. that's i think the good sign and it's the good part of the coin On the other side, there is still the power segment where we have to reconfirm that inventory levels are still pretty elevated, that's a bit the more difficult segment still. on the other side there is still the power segment where we have to reconfirm that inventory levels are still pretty elevated that's a bit the more difficult segment still As you know, that is particularly heavy weighing on 200 mm. Overall, I think back to normal. We wouldn't expect, you know, further disruptive cuts or changes this year with a little maybe caveat around power, which is still let's say far behind inventory depletion compared to the other two segments. As you know, that is particularly heavy weighing on 200 mm. as you know that is particularly heavy weighing on 200 mm Overall, I think back to normal. overall i think back to normal We wouldn't expect, you know, further disruptive cuts or changes this year with a little maybe caveat around power, which is still let's say far behind inventory depletion compared to the other two segments. we wouldn't expect you know further disruptive cuts or changes this year with a little maybe caveat around power which is still let's say far behind inventory depletion compared to the other two segments

Speaker 2: That's great. Thank you. The next question would be, look, given the stronger than anticipated demand for leading edge, right, which it was clearly outlined here by the server demand in your presentation, could we potentially see an anticipated or like, an earlier than expected requirement for further CapEx in Singapore because of that additional demand that is coming through? Or is everything going according to plan? Thanks. That's great. that's great Thank you. thank you The next question would be, look, given the stronger than anticipated demand for leading edge, right, which it was clearly outlined here by the server demand in your presentation, could we potentially see an anticipated or like, an earlier than expected requirement for further CapEx in Singapore because of that additional demand that is coming through? the next question would be look given the stronger than anticipated demand for leading edge right which it was clearly outlined here by the server demand in your presentation could we potentially see an anticipated or like an earlier than expected requirement for further capex in singapore because of that additional demand that is coming through Or is everything going according to plan? or is everything going according to plan Thanks. thanks

Speaker 8: I mean, we're not only providing leading edge out of Singapore. We provide leading edge also out of both our German factories. It means in overall, in terms of overall footprint, we feel pretty well set for the time being. Of course, as we always said, we took down the ramp speed of Singapore last year and the year before compared to initial plans. We did speed that up a little bit in the meantime. We would consider further ramping Singapore, and that's what we always said according to market demand. If this is continuing, of course, we would still continue ramping what we have and in parallel then prepare for more capacity as required. I mean, we're not only providing leading edge out of Singapore. i mean we're not only providing leading edge out of singapore We provide leading edge also out of both our German factories. we provide leading edge also out of both our german factories It means in overall, in terms of overall footprint, we feel pretty well set for the time being. it means in overall in terms of overall footprint we feel pretty well set for the time being Of course, as we always said, we took down the ramp speed of Singapore last year and the year before compared to initial plans. of course as we always said we took down the ramp speed of singapore last year and the year before compared to initial plans We did speed that up a little bit in the meantime. we did speed that up a little bit in the meantime We would consider further ramping Singapore, and that's what we always said according to market demand. we would consider further ramping singapore and that's what we always said according to market demand If this is continuing, of course, we would still continue ramping what we have and in parallel then prepare for more capacity as required. if this is continuing of course we would still continue ramping what we have and in parallel then prepare for more capacity as required Currently, we feel pretty well set with the UTs have been low for quite some time in our German footprint and with the capacity we generated already in Singapore. In that spirit, we would ramp what we have and prepare then for the next one as required. Currently, we feel pretty well set with the UTs have been low for quite some time in our German footprint and with the capacity we generated already in Singapore. currently we feel pretty well set with the uts have been low for quite some time in our german footprint and with the capacity we generated already in singapore In that spirit, we would ramp what we have and prepare then for the next one as required. in that spirit we would ramp what we have and prepare then for the next one as required

Speaker 2: Thank you, Michael. The last question maybe over to Claudia just on the debt situation. This is a question that's really based on from today's point of view, right? If what we see today continues to be the case, it feels to me that the net debt level is basically peaking as we speak. I just want to make sure that I think you only have EUR 127 million or SGD left in that revolving credit facility in Singapore. I just want to make sure that that level is enough for any potential disruptions or any potential working capital moves during the different quarters that are still upcoming. Thank you. Thank you, Michael. thank you michael The last question maybe over to Claudia just on the debt situation. the last question maybe over to claudia just on the debt situation This is a question that's really based on from today's point of view, right? this is a question that's really based on from today's point of view right If what we see today continues to be the case, it feels to me that the net debt level is basically peaking as we speak. if what we see today continues to be the case it feels to me that the net debt level is basically peaking as we speak I just want to make sure that I think you only have EUR 127 million or SGD left in that revolving credit facility in Singapore. i just want to make sure that i think you only have eur 127 million or sgd left in that revolving credit facility in singapore I just want to make sure that that level is enough for any potential disruptions or any potential working capital moves during the different quarters that are still upcoming. i just want to make sure that that level is enough for any potential disruptions or any potential working capital moves during the different quarters that are still upcoming Thank you. thank you

Speaker 1: Good morning, Constantin. We are pretty convinced that our liquidity reserve, which includes EUR 450 million in cash that we have right now, plus EUR 130 million out of that revolving credit facility, gives us enough flexibility for any unforeseeables in the future. As we mentioned, we are convinced that the net debt level will decrease over the second half of the year. From our point of view, there's no concern. Good morning, Constantin. good morning constantin We are pretty convinced that our liquidity reserve, which includes EUR 450 million in cash that we have right now, plus EUR 130 million out of that revolving credit facility, gives us enough flexibility for any unforeseeables in the future. we are pretty convinced that our liquidity reserve which includes eur 450 million in cash that we have right now plus eur 130 million out of that revolving credit facility gives us enough flexibility for any unforeseeables in the future As we mentioned, we are convinced that the net debt level will decrease over the second half of the year. as we mentioned we are convinced that the net debt level will decrease over the second half of the year From our point of view, there's no concern. from our point of view there's no concern

Speaker 2: Thank you very much. Thank you very much. thank you very much

Speaker 9: The next question comes from Robert Sanders with Deutsche Bank. Please go ahead. The next question comes from Robert Sanders with Deutsche Bank. the next question comes from robert sanders with deutsche bank Please go ahead. please go ahead

Speaker 10: Yeah, good morning. Thanks for taking my question. I have three questions, if it's possible. First question would just be on FabNext. Is it fair to say it's roughly 10% of revenue this year, or could it be much higher? That would be my first question. Second question would be, when can we expect FabNext to become accretive to EBITDA margin, given the sort of relatively limited scale today, but ramping? The third question would just be, I noted, obviously in the past, you've explored specialty wafers, such as silicon carbide, then you pulled out of that. I think in the past, you've worked on SOI. Given this photonics boom and you this data center boom seems to be passing you by to some degree. Yeah, good morning. yeah good morning Thanks for taking my question. thanks for taking my question I have three questions, if it's possible. i have three questions if it's possible First question would just be on Fab Next. first question would just be on fab next Is it fair to say it's roughly 10% of revenue this year, or could it be much higher? is it fair to say it's roughly 10% of revenue this year or could it be much higher That would be my first question. that would be my first question Second question would be, when can we expect Fab Next to become accretive to EBITDA margin, given the sort of relatively limited scale today, but ramping? second question would be when can we expect fab next to become accretive to ebitda margin given the sort of relatively limited scale today but ramping The third question would just be, I noted, obviously in the past, you've explored specialty wafers, such as silicon carbide, then you pulled out of that. the third question would just be i noted obviously in the past you've explored specialty wafers such as silicon carbide then you pulled out of that I think in the past, you've worked on SOI. i think in the past you've worked on soi Given this photonics boom and you this data center boom seems to be passing you by to some degree. given this photonics boom and you this data center boom seems to be passing you by to some degree Is there a scenario where you could make SOI wafers without Soitec IP? I think in the past you've looked at it. GlobalWafers claims they can do that without Soitec IP. Just interested if you're exploring more specialty ways of playing into this data center. Thank you. Is there a scenario where you could make SOI wafers without Soitec IP? is there a scenario where you could make soi wafers without soitec ip I think in the past you've looked at it. i think in the past you've looked at it GlobalWafers claims they can do that without Soitec IP. globalwafers claims they can do that without soitec ip Just interested if you're exploring more specialty ways of playing into this data center. just interested if you're exploring more specialty ways of playing into this data center Thank you. thank you

Speaker 8: Thank you, Rob. We are, of course, a bit reluctant to comment about details, what is the revenue contribution out of FabNext and whether it's already margin accretive. What I can say is, of course, we have a very smooth ramp in the meantime. We had around mid of last year, all major customers being qualified, so you know we have the freedom to get volumes in there and kind of preferentially load it. That's always what we said. You also hear us talking less about ramp costs, that's a clear indication that we see volumes going up, fixed costs being more reasonably diluted. That's maybe what I can say around FabNext without giving out any, let's say, competitive relevant information right now. Thank you, Rob. thank you rob We are, of course, a bit reluctant to comment about details, what is the revenue contribution out of Fab Next and whether it's already margin accretive. we are of course a bit reluctant to comment about details what is the revenue contribution out of fab next and whether it's already margin accretive What I can say is, of course, we have a very smooth ramp in the meantime. what i can say is of course we have a very smooth ramp in the meantime We had around mid of last year, all major customers being qualified, so you know we have the freedom to get volumes in there and kind of preferentially load it. we had around mid of last year all major customers being qualified so you know we have the freedom to get volumes in there and kind of preferentially load it That's always what we said. that's always what we said You also hear us talking less about ramp costs, that's a clear indication that we see volumes going up, fixed costs being more reasonably diluted. you also hear us talking less about ramp costs that's a clear indication that we see volumes going up fixed costs being more reasonably diluted That's maybe what I can say around Fab Next without giving out any, let's say, competitive relevant information right now. that's maybe what i can say around fab next without giving out any let's say competitive relevant information right now With regards to your second question, you're absolutely right. We decided quite some time ago not to venture into silicon carbide, so no change on that one. We also have currently no considerations or even plans to go into any SOI activities. In terms of those new technology, we still have a small scale team working on gallium nitride, where we feel there could be a potential opportunity for us, but currently, we don't see the demand and the market model here. In terms of those three, gallium nitride is the only one which we're covering right now with a small R&D effort. With regards to your second question, you're absolutely right. with regards to your second question you're absolutely right We decided quite some time ago not to venture into silicon carbide, so no change on that one. we decided quite some time ago not to venture into silicon carbide so no change on that one We also have currently no considerations or even plans to go into any SOI activities. we also have currently no considerations or even plans to go into any soi activities In terms of those new technology, we still have a small scale team working on gallium nitride, where we feel there could be a potential opportunity for us, but currently, we don't see the demand and the market model here. in terms of those new technology we still have a small scale team working on gallium nitride where we feel there could be a potential opportunity for us but currently we don't see the demand and the market model here In terms of those three, gallium nitride is the only one which we're covering right now with a small R&D effort. in terms of those three gallium nitride is the only one which we're covering right now with a small r&d effort

Speaker 10: Got it. Just one quick follow-up. The FabNext is predominantly polished wafers and a minority epi. Can you confirm that? Got it. got it Just one quick follow-up. just one quick follow-up The Fab Next is predominantly polished wafers and a minority epi. the fab next is predominantly polished wafers and a minority epi Can you confirm that? can you confirm that

Speaker 8: It's actually both. Yeah. We brought the 300 mm epi technology for the first time to Singapore, and the ramp of FabNext comprises both polished and epi. It's actually both. it's actually both Yeah. yeah We brought the 300 mm epi technology for the first time to Singapore, and the ramp of Fab Next comprises both polished and epi. we brought the 300 mm epi technology for the first time to singapore and the ramp of fab next comprises both polished and epi

Speaker 10: Got it. Thank you. Got it. got it Thank you. thank you

Speaker 9: The next question comes from Florian Treisch with Kepler. Please go ahead. The next question comes from Florian Treisch with Kepler. the next question comes from florian treisch with kepler Please go ahead. please go ahead

Speaker 4: Yes, good morning, and thank you for taking my question. I have a question on, let's call the quarter, the sequential improvement coming over the year. The first question would be, are you or can you quantify the impact or pull in impact on the Q1 numbers into Q4 last year? Is it fair to assume that we should see sequential improvements here every coming quarter from here? Is it really a step up in demand potentially at the end of a year to meet these mid-single-digit decline? Thank you. Yes, good morning, and thank you for taking my question. yes good morning and thank you for taking my question I have a question on, let's call the quarter, the sequential improvement coming over the year. i have a question on let's call the quarter the sequential improvement coming over the year The first question would be, are you or can you quantify the impact or pull in impact on the Q1 numbers into Q4 last year? the first question would be are you or can you quantify the impact or pull in impact on the q1 numbers into q4 last year Is it fair to assume that we should see sequential improvements here every coming quarter from here? is it fair to assume that we should see sequential improvements here every coming quarter from here Is it really a step up in demand potentially at the end of a year to meet these mid-single-digit decline? is it really a step up in demand potentially at the end of a year to meet these mid-single-digit decline Thank you. thank you

Speaker 8: Thank you, Florian. We do not, and I think we must not, quantify the details of those revenues that have been moved from Q4 last year, from Q1, sorry, this year into Q4 last year. I think I can just reiterate that we currently communicated our Q1 numbers. We have a very clear, full year guidance in place, and if you do some math, of course, you can estimate about a potential increase of revenue in the consecutive quarter. You will easily come to the conclusion that we do not see explosive growth from that calculation, but that it's more a smooth, further growth over the year. Thank you, Florian. thank you florian We do not, and I think we must not, quantify the details of those revenues that have been moved from Q4 last year, from Q1, sorry, this year into Q4 last year. we do not and i think we must not quantify the details of those revenues that have been moved from q4 last year from q1 sorry this year into q4 last year I think I can just reiterate that we currently communicated our Q1 numbers. i think i can just reiterate that we currently communicated our q1 numbers We have a very clear, full year guidance in place, and if you do some math, of course, you can estimate about a potential increase of revenue in the consecutive quarter. we have a very clear full year guidance in place and if you do some math of course you can estimate about a potential increase of revenue in the consecutive quarter You will easily come to the conclusion that we do not see explosive growth from that calculation, but that it's more a smooth, further growth over the year. you will easily come to the conclusion that we do not see explosive growth from that calculation but that it's more a smooth further growth over the year

Speaker 4: Great. Thank you very much. Great. great Thank you very much. thank you very much

Speaker 9: The next question comes from Gustav Froberg with Berenberg. Please go ahead. The next question comes from Gustav Froberg with Berenberg. the next question comes from gustav froberg with berenberg Please go ahead. please go ahead

Speaker 5: Good morning, everyone. Thank you for taking my questions as well. You talked a little bit about the indirect impact from the conflict in the Middle East, rising energy costs, et cetera. Could you maybe give us a bit more color on the evolution of costs on that side or coming from anything that may be an exogenous shock? I know as well your margin guide is obviously kept flat despite sort of you alluding to some potential cost increases. Are you able to save any costs anywhere else? That's my first question. Thank you. Good morning, everyone. good morning everyone Thank you for taking my questions as well. thank you for taking my questions as well You talked a little bit about the indirect impact from the conflict in the Middle East, rising energy costs, et cetera. you talked a little bit about the indirect impact from the conflict in the middle east rising energy costs et cetera Could you maybe give us a bit more color on the evolution of costs on that side or coming from anything that may be an exogenous shock? could you maybe give us a bit more color on the evolution of costs on that side or coming from anything that may be an exogenous shock I know as well your margin guide is obviously kept flat despite sort of you alluding to some potential cost increases. i know as well your margin guide is obviously kept flat despite sort of you alluding to some potential cost increases Are you able to save any costs anywhere else? are you able to save any costs anywhere else That's my first question. that's my first question Thank you. thank you

Speaker 1: Hi, Gustav. Good morning. This is Claudia. Regarding the cost side, we see two corners right now where we see some cost pressure, I would say, that's in electricity costs, especially in Singapore, where we have an oil price component in our contracts, and we see some increases in freight costs. Regarding the electricity cost, as you know, we have hedging in place. In Singapore, we do some hedging using derivatives, and in Germany, a certain share of power procurement is secured up to two years in advance. Regarding electricity, we feel quite comfortable with our hedging that is in place. Hi, Gustav. hi gustav Good morning. good morning This is Claudia. this is claudia Regarding the cost side, we see two corners right now where we see some cost pressure, I would say, that's in electricity costs, especially in Singapore, where we have an oil price component in our contracts, and we see some increases in freight costs. regarding the cost side we see two corners right now where we see some cost pressure i would say that's in electricity costs especially in singapore where we have an oil price component in our contracts and we see some increases in freight costs Regarding the electricity cost, as you know, we have hedging in place. regarding the electricity cost as you know we have hedging in place In Singapore, we do some hedging using derivatives, and in Germany, a certain share of power procurement is secured up to two years in advance. in singapore we do some hedging using derivatives and in germany a certain share of power procurement is secured up to two years in advance Regarding electricity, we feel quite comfortable with our hedging that is in place. regarding electricity we feel quite comfortable with our hedging that is in place We see some cost increases in freight costs, on the other side, we also see that the dollar is a bit stronger right now than we anticipated. Right now it's 1.17 versus 1.18, that we assume in our forecast. This should, let's say, offset the assumed price increases, which are not too big for this year. We see some cost increases in freight costs, on the other side, we also see that the dollar is a bit stronger right now than we anticipated. we see some cost increases in freight costs on the other side we also see that the dollar is a bit stronger right now than we anticipated Right now it's 1.17 versus 1.18, that we assume in our forecast. right now it's 1.17 versus 1.18 that we assume in our forecast This should, let's say, offset the assumed price increases, which are not too big for this year. this should let's say offset the assumed price increases which are not too big for this year

Speaker 5: Okay. Super. Thank you. A question on cash flow as well and your sort of balance sheet side of things essentially. Do you feel comfortable with the current rate of cash burn, assuming nothing changes in your operating environment versus sort of Q4 last year, Q1 this year? Does your plan for the balance sheet and the cash flow side of your financial envelope need to change unless there's a material pickup in H2? Okay. okay Super. super Thank you. thank you A question on cash flow as well and your sort of balance sheet side of things essentially. a question on cash flow as well and your sort of balance sheet side of things essentially Do you feel comfortable with the current rate of cash burn, assuming nothing changes in your operating environment versus sort of Q4 last year, Q1 this year? do you feel comfortable with the current rate of cash burn assuming nothing changes in your operating environment versus sort of q4 last year q1 this year Does your plan for the balance sheet and the cash flow side of your financial envelope need to change unless there's a material pickup in H2? does your plan for the balance sheet and the cash flow side of your financial envelope need to change unless there's a material pickup in h2

Speaker 1: Please keep in mind that Q4 was impacted by a lot of special effects, also regarding the cash flow and all the developments we saw in Q1 in cash flow were expected. The increase in inventories and trade receivables was expected and also the cash outflow for the CapEx-related trade payables. This is all included in our guidance for this year. The net cash flow guidance is that we expect a net cash flow in the range of the previous year. You can assume that there are shifts between quarters, and they are planned, and they are expected. Please keep in mind that Q4 was impacted by a lot of special effects, also regarding the cash flow and all the developments we saw in Q1 in cash flow were expected. please keep in mind that q4 was impacted by a lot of special effects also regarding the cash flow and all the developments we saw in q1 in cash flow were expected The increase in inventories and trade receivables was expected and also the cash outflow for the CapEx-related trade payables. the increase in inventories and trade receivables was expected and also the cash outflow for the capex-related trade payables This is all included in our guidance for this year. this is all included in our guidance for this year The net cash flow guidance is that we expect a net cash flow in the range of the previous year. the net cash flow guidance is that we expect a net cash flow in the range of the previous year You can assume that there are shifts between quarters, and they are planned, and they are expected. you can assume that there are shifts between quarters and they are planned and they are expected Because we do some, let's say, financial management that's very obvious, in every company, we do some financial management, but we expect the cash burn situation to improve, especially in the second half of the year. We feel very comfortable with our guidance and with the development we saw in Q1. Because we do some, let's say, financial management that's very obvious, in every company, we do some financial management, but we expect the cash burn situation to improve, especially in the second half of the year. because we do some let's say financial management that's very obvious in every company we do some financial management but we expect the cash burn situation to improve especially in the second half of the year We feel very comfortable with our guidance and with the development we saw in Q1. we feel very comfortable with our guidance and with the development we saw in q1

Speaker 5: Great. That assumes no pickup in the underlying business. Great. great That assumes no pickup in the underlying business. that assumes no pickup in the underlying business

Speaker 1: Yeah. Yeah. Yeah. yeah Yeah. yeah

Speaker 5: Expect better cash flow. Expect better cash flow. expect better cash flow

Speaker 1: Of course, we assume a pickup in the underlying business, because our sales guidance, that we expect not Q1 x4, but a bit higher. The rest of the year should improve in coming from sales. With that also, we will also see an improvement in our operating cash flow. Of course, we assume a pickup in the underlying business, because our sales guidance, that we expect not Q1 x 4, but a bit higher. of course we assume a pickup in the underlying business because our sales guidance that we expect not q1 x 4 but a bit higher The rest of the year should improve in coming from sales. the rest of the year should improve in coming from sales With that also, we will also see an improvement in our operating cash flow. with that also we will also see an improvement in our operating cash flow

Speaker 5: Okay. Super. Thank you very much. Okay. okay Super. super Thank you very much. thank you very much

Speaker 9: The next question comes from Martin Jungfleisch with BNP Paribas. Please go ahead. The next question comes from Martin Jungfleisch with BNP Paribas. the next question comes from martin jungfleisch with bnp paribas Please go ahead. please go ahead

Speaker 7: Yeah. Hi, good morning. I just have two quick follow-ups, the first one is really on pricing, right? Can you just talk about what part of your 300 mm contracts would potentially be eligible for price hikes over the next 12 months when the situation would allow for that? Is that kind of all contracts out of the Long-Term Agreements, which has been, I guess, like 20% or something like that? When these contracts, so 300 mm contracts expire today, are these renewed at flat pricing or is there already some leverage on your end to lift prices in these kind of contracts? Yeah. yeah Hi, good morning. hi good morning I just have two quick follow-ups, the first one is really on pricing, right? i just have two quick follow-ups the first one is really on pricing right Can you just talk about what part of your 300 mm contracts would potentially be eligible for price hikes over the next 12 months when the situation would allow for that? can you just talk about what part of your 300 mm contracts would potentially be eligible for price hikes over the next 12 months when the situation would allow for that Is that kind of all contracts out of the Long-Term Agreements, which has been, I guess, like 20% or something like that? is that kind of all contracts out of the long-term agreements which has been i guess like 20% or something like that When these contracts, so 300 mm contracts expire today, are these renewed at flat pricing or is there already some leverage on your end to lift prices in these kind of contracts? when these contracts so 300 mm contracts expire today are these renewed at flat pricing or is there already some leverage on your end to lift prices in these kind of contracts

Speaker 8: Thank you, Martin, for the question. As we said, no major LTAs are expiring in the course of this year. Whenever something expires, of course, it's our freedom to conclude a new one or not to conclude a new one. We would only do so if, of course, pricing and other conditions are favorable for us. Currently, very small portion is eligible for renewal. From that perspective, it's not a huge topic. What we indicated in the speech today is that we see now customers talking about maybe more mid-term volume demands. I think we could come to a situation where this overall LTA framework can continue to be very robust and be very beneficial for us. Thank you, Martin, for the question. thank you martin for the question As we said, no major LTAs are expiring in the course of this year. as we said no major ltas are expiring in the course of this year Whenever something expires, of course, it's our freedom to conclude a new one or not to conclude a new one. whenever something expires of course it's our freedom to conclude a new one or not to conclude a new one We would only do so if, of course, pricing and other conditions are favorable for us. we would only do so if of course pricing and other conditions are favorable for us Currently, very small portion is eligible for renewal. currently very small portion is eligible for renewal From that perspective, it's not a huge topic. from that perspective it's not a huge topic What we indicated in the speech today is that we see now customers talking about maybe more mid-term volume demands. what we indicated in the speech today is that we see now customers talking about maybe more mid-term volume demands I think we could come to a situation where this overall LTA framework can continue to be very robust and be very beneficial for us. i think we could come to a situation where this overall lta framework can continue to be very robust and be very beneficial for us I think I can say that's a statement for the overall wafer space. Yeah, we feel this symbiosis between customer and wafer manufacturers is working pretty well and robustly. I think I can say that's a statement for the overall wafer space. i think i can say that's a statement for the overall wafer space Yeah, we feel this symbiosis between customer and wafer manufacturers is working pretty well and robustly. yeah we feel this symbiosis between customer and wafer manufacturers is working pretty well and robustly

Speaker 7: Okay. When you would sign new LTAs, you would only do so at a higher pricing than previous contract? Is that the right assumption? Okay. okay When you would sign new LTAs, you would only do so at a higher pricing than previous contract? when you would sign new ltas you would only do so at a higher pricing than previous contract Is that the right assumption? is that the right assumption

Speaker 8: It depends on the segment, yeah. In some areas there are new LTAs up for potential discussions. We currently don't see, you know, any major price discussions in new LTAs. It depends on the segment, yeah. it depends on the segment yeah In some areas there are new LTAs up for potential discussions. in some areas there are new ltas up for potential discussions We currently don't see, you know, any major price discussions in new LTAs. we currently don't see you know any major price discussions in new ltas

Speaker 7: Okay. Thank you. The other question is also follow up mainly on capacities, right? Is it possible for you to grow 300 mm wafer volumes, as output by like mid to high single digits, this and next year? Which is kind of like a market demand without you adding any capacity. Can you basically cater to market demand, this and next year, without adding any capacity? Okay. okay Thank you. thank you The other question is also follow up mainly on capacities, right? the other question is also follow up mainly on capacities right Is it possible for you to grow 300 mm wafer volumes, as output by like mid to high single digits, this and next year? is it possible for you to grow 300 mm wafer volumes as output by like mid to high single digits this and next year Which is kind of like a market demand without you adding any capacity. which is kind of like a market demand without you adding any capacity Can you basically cater to market demand, this and next year, without adding any capacity? can you basically cater to market demand this and next year without adding any capacity

Speaker 8: I mean, we continually, continuously add, still CapEx to Singapore. We said it very clearly. That means also still some machines coming in, which of course will have incremental benefits for capacity. Overall, we don't feel capacity is a constraint for us as we coming from, on the one side, low UTs in the German footprints, as you know. As we did build the building and the infrastructure and the gas supply and everything in Singapore already, and have a first wave of clean room and machines installed there, which gives us room to further ramp according to market demand. For the time being, we feel pretty well set. Of course, we will, as always, stated, continue the ramp according to the real market demand. I mean, we continually, continuously add, still CapEx to Singapore. i mean we continually continuously add still capex to singapore We said it very clearly. we said it very clearly That means also still some machines coming in, which of course will have incremental benefits for capacity. that means also still some machines coming in which of course will have incremental benefits for capacity Overall, we don't feel capacity is a constraint for us as we coming from, on the one side, low UTs in the German footprints, as you know. overall we don't feel capacity is a constraint for us as we coming from on the one side low uts in the german footprints as you know As we did build the building and the infrastructure and the gas supply and everything in Singapore already, and have a first wave of clean room and machines installed there, which gives us room to further ramp according to market demand. as we did build the building and the infrastructure and the gas supply and everything in singapore already and have a first wave of clean room and machines installed there which gives us room to further ramp according to market demand For the time being, we feel pretty well set. for the time being we feel pretty well set Of course, we will, as always, stated, continue the ramp according to the real market demand. of course we will as always stated continue the ramp according to the real market demand

Speaker 7: Okay, great. That's helpful. Just one final question maybe on those costs. In the release you noted these hedging gains of around EUR 11 million. Were they already offsetting costs incurred in the quarter? Or are these, I guess higher costs coming now in the coming quarters and you have the gain upfront? Okay, great. okay great That's helpful. that's helpful Just one final question maybe on those costs. just one final question maybe on those costs In the release you noted these hedging gains of around EUR 11 million. in the release you noted these hedging gains of around eur 11 million Were they already offsetting costs incurred in the quarter? were they already offsetting costs incurred in the quarter Or are these, I guess higher costs coming now in the coming quarters and you have the gain upfront? or are these i guess higher costs coming now in the coming quarters and you have the gain upfront

Speaker 1: Yeah, regarding the hedging gains, I tried to convey that in the speech. Q1 is always burdened by expenses that are more pronounced in that quarter or that only occur at the beginning of the year. They are only recorded at the beginning of the year. For example, let's say labor accruals or expense related to property. Those hedging gains and the fixed result we recorded in Q1 more or less offset those expenses. Can we expect further hedging gains in the upcoming quarters? I don't know. What I know is that those, let's say, extraordinary Q1 expenses, they won't occur in the upcoming quarters. Yeah, regarding the hedging gains, I tried to convey that in the speech. yeah regarding the hedging gains i tried to convey that in the speech Q1 is always burdened by expenses that are more pronounced in that quarter or that only occur at the beginning of the year. q1 is always burdened by expenses that are more pronounced in that quarter or that only occur at the beginning of the year They are only recorded at the beginning of the year. they are only recorded at the beginning of the year For example, let's say labor accruals or expense related to property. for example let's say labor accruals or expense related to property Those hedging gains and the fixed result we recorded in Q1 more or less offset those expenses. those hedging gains and the fixed result we recorded in q1 more or less offset those expenses Can we expect further hedging gains in the upcoming quarters? can we expect further hedging gains in the upcoming quarters I don't know. i don't know What I know is that those, let's say, extraordinary Q1 expenses, they won't occur in the upcoming quarters. what i know is that those let's say extraordinary q1 expenses they won't occur in the upcoming quarters

Speaker 7: Okay, cool. Thank you very much. Okay, cool. okay cool Thank you very much. thank you very much

Speaker 9: The next question comes from Veysel Taze with Bankhaus Metzler. Please go ahead. The next question comes from Veysel Taze with Bankhaus Metzler. the next question comes from veysel taze with bankhaus metzler Please go ahead. please go ahead

Speaker 12: Yes, good morning. Few questions. The first one would be around the first Q performance. What was the underlying growth in Q1 when we really take a year-over-year comparison, take into consideration the FX headwinds, the small diameter shortfall, and then the volumes which were put from Q1 to Q4 last year? Did you see an underlying growth in Q1? Yes, good morning. yes good morning Few questions. few questions The first one would be around the first Q performance. the first one would be around the first q performance What was the underlying growth in Q1 when we really take a year-over-year comparison, take into consideration the FX headwinds, the small diameter shortfall, and then the volumes which were put from Q1 to Q4 last year? what was the underlying growth in q1 when we really take a year-over-year comparison take into consideration the fx headwinds the small diameter shortfall and then the volumes which were put from q1 to q4 last year Did you see an underlying growth in Q1? did you see an underlying growth in q1

Speaker 8: Thank you. Thank you, Veysel. I think both Q1 this year, as Claudia already explained, particularly in the cost side, and particularly Q4 last year on the top line side, were, I think very special quarters, yeah. To compare them on a like-to-like basis is very difficult and would require for us to, you know, strip and detail and a lot of effects and to become super transparent. I'm a bit reluctant to comment here. We see the underlying volume picture is a healthy one in Q1 this year, and we see that it's exactly according to plan and guidance. Thank you. thank you Thank you, Veysel. thank you veysel I think both Q1 this year, as Claudia already explained, particularly in the cost side, and particularly Q4 last year on the top line side, were, I think very special quarters, yeah. i think both q1 this year as claudia already explained particularly in the cost side and particularly q4 last year on the top line side were i think very special quarters yeah To compare them on a like-to-like basis is very difficult and would require for us to, you know, strip and detail and a lot of effects and to become super transparent. to compare them on a like-to-like basis is very difficult and would require for us to you know strip and detail and a lot of effects and to become super transparent I'm a bit reluctant to comment here. i'm a bit reluctant to comment here We see the underlying volume picture is a healthy one in Q1 this year, and we see that it's exactly according to plan and guidance. we see the underlying volume picture is a healthy one in q1 this year and we see that it's exactly according to plan and guidance

Speaker 12: Clear. Thank you. Then the second one on the utilizations, alluding a little bit the previous question from my colleague. What we see right now is on the industry level for the 300 mm, the utilizations are probably hitting high 80s-low 90s. That's typically in the industry and area where customers want to discuss long-term or midterm volumes, want to make sure that they get the volumes, and that's always a good momentum for price increases going forward. I was just wondering if your 300 mm utilizations at this stage are substantially different than the industry utilizations, like the low 90s or around 90%. Clear. clear Thank you. thank you Then the second one on the utilizations, alluding a little bit the previous question from my colleague. then the second one on the utilizations alluding a little bit the previous question from my colleague What we see right now is on the industry level for the 300 mm, the utilizations are probably hitting high 80s-low 90s. what we see right now is on the industry level for the 300 mm the utilizations are probably hitting high 80s-low 90s That's typically in the industry and area where customers want to discuss long-term or midterm volumes, want to make sure that they get the volumes, and that's always a good momentum for price increases going forward. that's typically in the industry and area where customers want to discuss long-term or midterm volumes want to make sure that they get the volumes and that's always a good momentum for price increases going forward I was just wondering if your 300 mm utilizations at this stage are substantially different than the industry utilizations, like the low 90s or around 90%. i was just wondering if your 300 mm utilizations at this stage are substantially different than the industry utilizations like the low 90s or around 90%

Speaker 8: Look, we have indeed in the meantime, decent 300 mm loading, but we also have a way to further grow capacity very short-term, as I explained. From that perspective, yes, 300 mm loading is becoming attractive and coming to a level where, and that's what I said in the call, where first customers now are looking into midterm volume demand patterns. Yeah. That's, as you say, it's a very good indication. It's a good, let's say, atmospherical change, which we also anticipate. On the pricing side, I wouldn't go beyond the statement which we made six weeks ago. We have those first few examples of more reasonable spot prices, again, in 300 mm. That was very different some quarters ago. We have those sentiments, we have those indications. Look, we have indeed in the meantime, decent 300 mm loading, but we also have a way to further grow capacity very short-term, as I explained. look we have indeed in the meantime decent 300 mm loading but we also have a way to further grow capacity very short-term as i explained From that perspective, yes, 300 mm loading is becoming attractive and coming to a level where, and that's what I said in the call, where first customers now are looking into midterm volume demand patterns. from that perspective yes 300 mm loading is becoming attractive and coming to a level where and that's what i said in the call where first customers now are looking into midterm volume demand patterns Yeah. yeah That's, as you say, it's a very good indication. that's as you say it's a very good indication It's a good, let's say, atmospherical change, which we also anticipate. it's a good let's say atmospherical change which we also anticipate On the pricing side, I wouldn't go beyond the statement which we made six weeks ago. on the pricing side i wouldn't go beyond the statement which we made six weeks ago We have those first few examples of more reasonable spot prices, again, in 300 mm. we have those first few examples of more reasonable spot prices again in 300 mm That was very different some quarters ago. that was very different some quarters ago We have those sentiments, we have those indications. we have those sentiments we have those indications We don't see no, a major trend change already, but the atmosphere in those conversations now is a different one. That's definitely what I can say. We don't see no, a major trend change already, but the atmosphere in those conversations now is a different one. we don't see no a major trend change already but the atmosphere in those conversations now is a different one That's definitely what I can say. that's definitely what i can say

Speaker 12: Great. On the memory market, I mean, I understand that customers are, the memory vendors are prioritizing shipments to the higher ASP area in the AI server market or server market in general. PC and smartphone, taking into account that the second half of the year is the much stronger volume part of the year, and at the end, consumers will ask for those products, smartphone and PC, and we are seeing higher semiconductor content, DRAM, et cetera. Let's say now this demand will be, particularly on the memory side, will be served from Chinese memory vendors for maybe not the very high-end, but mid-range and phones and PCs. Great. great On the memory market, I mean, I understand that customers are, the memory vendors are prioritizing shipments to the higher ASP area in the AI server market or server market in general. on the memory market i mean i understand that customers are the memory vendors are prioritizing shipments to the higher asp area in the ai server market or server market in general PC and smartphone, taking into account that the second half of the year is the much stronger volume part of the year, and at the end, consumers will ask for those products, smartphone and PC, and we are seeing higher semiconductor content, DRAM, et cetera. pc and smartphone taking into account that the second half of the year is the much stronger volume part of the year and at the end consumers will ask for those products smartphone and pc and we are seeing higher semiconductor content dram et cetera Let's say now this demand will be, particularly on the memory side, will be served from Chinese memory vendors for maybe not the very high-end, but mid-range and phones and PCs. let's say now this demand will be particularly on the memory side will be served from chinese memory vendors for maybe not the very high-end but mid-range and phones and pcs If the volumes come more from Chinese vendors, does that change your shipments or your volumes? Now those, smartphone and PC vendors are getting their volumes from Chinese, vendors. If the volumes come more from Chinese vendors, does that change your shipments or your volumes? if the volumes come more from chinese vendors does that change your shipments or your volumes Now those, smartphone and PC vendors are getting their volumes from Chinese, vendors. now those smartphone and pc vendors are getting their volumes from chinese vendors

Speaker 8: For us in the first glance, we are, let's say, to quite some extent, agnostic. Because we serve all major customers, and as you know, of course, we also do business in China. I think there could be indeed two effects. There could be if there's really PC and smartphone demand picking up and manifesting from end consumer side. Of course, then the prices will be paid and the memory chips might be more competitive again compared to the server demand. That could indeed happen. For us, we are, you know, agnostic to details of those, let's say, customer mix effects. As I said, we also, I think very positioned in advanced technologies. For us in the first glance, we are, let's say, to quite some extent, agnostic. for us in the first glance we are let's say to quite some extent agnostic Because we serve all major customers, and as you know, of course, we also do business in China. because we serve all major customers and as you know of course we also do business in china I think there could be indeed two effects. i think there could be indeed two effects There could be if there's really PC and smartphone demand picking up and manifesting from end consumer side. there could be if there's really pc and smartphone demand picking up and manifesting from end consumer side Of course, then the prices will be paid and the memory chips might be more competitive again compared to the server demand. of course then the prices will be paid and the memory chips might be more competitive again compared to the server demand That could indeed happen. that could indeed happen For us, we are, you know, agnostic to details of those, let's say, customer mix effects. for us we are you know agnostic to details of those let's say customer mix effects As I said, we also, I think very positioned in advanced technologies. as i said we also i think very positioned in advanced technologies Every effect that would drive, you know, high-end PC or high-end smartphone, we would also clearly be a benefactor as we are focusing, of course, on those advanced technologies, namely leading edge and High Bandwidth Memory. Every effect that would drive, you know, high-end PC or high-end smartphone, we would also clearly be a benefactor as we are focusing, of course, on those advanced technologies, namely leading edge and High Bandwidth Memory. every effect that would drive you know high-end pc or high-end smartphone we would also clearly be a benefactor as we are focusing of course on those advanced technologies namely leading edge and high bandwidth memory

Speaker 12: Thank you. Can I squeeze one more on the 200 mm and particularly on the auto and the power part of the business? I mean, I understand inventories at auto chip vendors are still at high level. They are burning down inventories, still it's too high. I was wondering in 200 mm particularly, I always historically thought you are strong with in the power part of this, and we see a lot of demand also from AI data centers for low-end power products for servers, et cetera. I was wondering, why are you not seeing this demand in your 200 mm market? Related to that also, it gets obvious that the Chinese 200 mm wafer producers are in the main market and competitive products. Thank you. thank you Can I squeeze one more on the 200 mm and particularly on the auto and the power part of the business? can i squeeze one more on the 200 mm and particularly on the auto and the power part of the business I mean, I understand inventories at auto chip vendors are still at high level. i mean i understand inventories at auto chip vendors are still at high level They are burning down inventories, still it's too high. they are burning down inventories still it's too high I was wondering in 200 mm particularly, I always historically thought you are strong with in the power part of this, and we see a lot of demand also from AI data centers for low-end power products for servers, et cetera. i was wondering in 200 mm particularly i always historically thought you are strong with in the power part of this and we see a lot of demand also from ai data centers for low-end power products for servers et cetera I was wondering, why are you not seeing this demand in your 200 mm market? i was wondering why are you not seeing this demand in your 200 mm market Related to that also, it gets obvious that the Chinese 200 mm wafer producers are in the main market and competitive products. related to that also it gets obvious that the chinese 200 mm wafer producers are in the main market and competitive products Is that also related a little bit to the potential ASP pressure you're feeling? I would not say market share loss, but ASP pressure, that the issue in the 200 mm is rather from the ASP side. Is that also related a little bit to the potential ASP pressure you're feeling? is that also related a little bit to the potential asp pressure you're feeling I would not say market share loss, but ASP pressure, that the issue in the 200 mm is rather from the ASP side. i would not say market share loss but asp pressure that the issue in the 200 mm is rather from the asp side

Speaker 8: I think you're absolutely right. In the last two quarters or so, also the power chip manufacturers again got more positive and were highlighting particularly also their business opportunities in powering data centers. We, we also anticipate that. We have still between that, those statements and those businesses picking up and our, means the wafer side of things, there is on the one side, the usual six months delay and in addition, the elevated inventories. Therefore, we, and the wafer industry doesn't see it yet is maybe a good statement. In addition, you're right, we always said that the Chinese wafer manufacturers are, let's say that the, the technology capability and so on are stronger the lower the diameter of the wafers, yeah. I think you're absolutely right. i think you're absolutely right In the last two quarters or so, also the power chip manufacturers again got more positive and were highlighting particularly also their business opportunities in powering data centers. in the last two quarters or so also the power chip manufacturers again got more positive and were highlighting particularly also their business opportunities in powering data centers We, we also anticipate that. we we also anticipate that We have still between that, those statements and those businesses picking up and our, means the wafer side of things, there is on the one side, the usual six months delay and in addition, the elevated inventories. we have still between that those statements and those businesses picking up and our means the wafer side of things there is on the one side the usual six months delay and in addition the elevated inventories Therefore, we, and the wafer industry doesn't see it yet is maybe a good statement. therefore we and the wafer industry doesn't see it yet is maybe a good statement In addition, you're right, we always said that the Chinese wafer manufacturers are, let's say that the, the technology capability and so on are stronger the lower the diameter of the wafers, yeah. in addition you're right we always said that the chinese wafer manufacturers are let's say that the the technology capability and so on are stronger the lower the diameter of the wafers yeah Of course, in 200 mm they are more present and more advanced, and far more advanced than in 300 mm, and that could be another effect. What I want to say is it's the normal demand supply cycle here we see, which is still hanging on in power inventories. There could be an underlying, let's say China effect as well. For us, 200 mm, of course already with the 300 mm growth, already a small segment in the meantime. We still see that the demand is picking up once the manifestation of the demand from the power and AI side is driving through the power chip manufacturers to the wafer industry, then we should also see demand pick up again. Of course, in 200 mm they are more present and more advanced, and far more advanced than in 300 mm, and that could be another effect. of course in 200 mm they are more present and more advanced and far more advanced than in 300 mm and that could be another effect What I want to say is it's the normal demand supply cycle here we see, which is still hanging on in power inventories. what i want to say is it's the normal demand supply cycle here we see which is still hanging on in power inventories There could be an underlying, let's say China effect as well. there could be an underlying let's say china effect as well For us, 200 mm, of course already with the 300 mm growth, already a small segment in the meantime. for us 200 mm of course already with the 300 mm growth already a small segment in the meantime We still see that the demand is picking up once the manifestation of the demand from the power and AI side is driving through the power chip manufacturers to the wafer industry, then we should also see demand pick up again. we still see that the demand is picking up once the manifestation of the demand from the power and ai side is driving through the power chip manufacturers to the wafer industry then we should also see demand pick up again

Speaker 12: Thank you very much. Thank you very much. thank you very much

Speaker 9: As a reminder, if you would like to ask a question, please press star one. The next question comes from Harry Blaiklock with UBS. Please go ahead. As a reminder, if you would like to ask a question, please press star one. as a reminder if you would like to ask a question please press star one The next question comes from Harry Blaiklock with UBS. the next question comes from harry blaiklock with ubs Please go ahead. please go ahead

Speaker 6: Morning, guys. Thanks for taking my questions. The first is just on one of your peers reported yesterday and were kind of unexpectedly quite positive on their wafer segment. And some of the commentary that they were giving was that customers are kind of rushing for inventory, wafer inventory. There are some customers asking for kind of longer and potentially higher volumes in LTAs. You've kind of mentioned about customers trying to secure medium-term demand. I wonder whether, I know you obviously can't comment on anything to do with your peers, but those conversations with customers around LTAs, lengthening them and medium-term demand, wondering whether you are also experiencing something similar or whether you can comment on that at all. Morning, guys. morning guys Thanks for taking my questions. thanks for taking my questions The first is just on one of your peers reported yesterday and were kind of unexpectedly quite positive on their wafer segment. the first is just on one of your peers reported yesterday and were kind of unexpectedly quite positive on their wafer segment And some of the commentary that they were giving was that customers are kind of rushing for inventory, wafer inventory. and some of the commentary that they were giving was that customers are kind of rushing for inventory wafer inventory There are some customers asking for kind of longer and potentially higher volumes in LTAs. there are some customers asking for kind of longer and potentially higher volumes in ltas You've kind of mentioned about customers trying to secure medium-term demand. you've kind of mentioned about customers trying to secure medium-term demand I wonder whether, I know you obviously can't comment on anything to do with your peers, but those conversations with customers around LTAs, lengthening them and medium-term demand, wondering whether you are also experiencing something similar or whether you can comment on that at all. i wonder whether i know you obviously can't comment on anything to do with your peers but those conversations with customers around ltas lengthening them and medium-term demand wondering whether you are also experiencing something similar or whether you can comment on that at all

Speaker 8: Yeah. Thank you. Thank you, Harry. We're always a bit reluctant to comment on, as you highlighted already, on individual competitor statements, but I can confirm, and I think I did already, that we also feel this more positive tonality and atmosphere in conversations with customers on demand about volume scenarios and so on. We are not so vocal about it as we really would love to see it more in our books. Not only in, let's say, atmospheric and tonality indications, but definitely we see a change in atmosphere there. Maybe a more general remark, if you compare, let's say, Japanese players with us, you have to always have in mind in terms of operational development, the FX difference. Yeah. yeah Thank you. thank you Thank you, Harry. thank you harry We're always a bit reluctant to comment on, as you highlighted already, on individual competitor statements, but I can confirm, and I think I did already, that we also feel this more positive tonality and atmosphere in conversations with customers on demand about volume scenarios and so on. we're always a bit reluctant to comment on as you highlighted already on individual competitor statements but i can confirm and i think i did already that we also feel this more positive tonality and atmosphere in conversations with customers on demand about volume scenarios and so on We are not so vocal about it as we really would love to see it more in our books. we are not so vocal about it as we really would love to see it more in our books Not only in, let's say, atmospheric and tonality indications, but definitely we see a change in atmosphere there. not only in let's say atmospheric and tonality indications but definitely we see a change in atmosphere there Maybe a more general remark, if you compare, let's say, Japanese players with us, you have to always have in mind in terms of operational development, the FX difference. maybe a more general remark if you compare let's say japanese players with us you have to always have in mind in terms of operational development the fx difference Of course, we as wafer manufacturers have different customer portfolios and some product portfolio differences as well. If we take all this together, I think we pretty much in line with the sentiment from other players. We also anticipating. Of course, we as wafer manufacturers have different customer portfolios and some product portfolio differences as well. of course we as wafer manufacturers have different customer portfolios and some product portfolio differences as well If we take all this together, I think we pretty much in line with the sentiment from other players. if we take all this together i think we pretty much in line with the sentiment from other players We also anticipating. we also anticipating

Speaker 6: Got it. I just wanted to clarify on your pricing comment. I know like over the past year, you've been saying that, you know, pricing pressure is more severe in eight-inch and 12-inch has been stable in LTAs and maybe down a little bit in spot market. I know you're saying that it's in 12-inch it's now more reasonable. I just wanted to know kind of what does that mean in terms of, you know, is that just that the price declines there have stabilized? Are you seeing any price increases coming through outside of LTAs? Got it. got it I just wanted to clarify on your pricing comment. i just wanted to clarify on your pricing comment I know like over the past year, you've been saying that, you know, pricing pressure is more severe in eight-inch and 12-inch has been stable in LTAs and maybe down a little bit in spot market. i know like over the past year you've been saying that you know pricing pressure is more severe in eight-inch and 12-inch has been stable in ltas and maybe down a little bit in spot market I know you're saying that it's in 12-inch it's now more reasonable. i know you're saying that it's in 12-inch it's now more reasonable I just wanted to know kind of what does that mean in terms of, you know, is that just that the price declines there have stabilized? i just wanted to know kind of what does that mean in terms of you know is that just that the price declines there have stabilized Are you seeing any price increases coming through outside of LTAs? are you seeing any price increases coming through outside of ltas

Speaker 8: I'm a bit reluctant to go into more details here, but your general statement is correct and unchangeably correct. Price pressure is indeed more pronounced in 200 mm, as we discussed earlier in the call. That's maybe not a surprise. In 300 mm, we came out of a phase where the non-LTA part was also under certain price pressure. Now we have, in the meantime, some first examples where that is easing and looking more reasonable. Again, I wouldn't declare a trend change or a significant uptick yet, but we have those first examples where we can look a bit more positively on outside 300 mm LTA pricing. I'm a bit reluctant to go into more details here, but your general statement is correct and unchangeably correct. i'm a bit reluctant to go into more details here but your general statement is correct and unchangeably correct Price pressure is indeed more pronounced in 200 mm, as we discussed earlier in the call. price pressure is indeed more pronounced in 200 mm as we discussed earlier in the call That's maybe not a surprise. that's maybe not a surprise In 300 mm, we came out of a phase where the non-LTA part was also under certain price pressure. in 300 mm we came out of a phase where the non-lta part was also under certain price pressure Now we have, in the meantime, some first examples where that is easing and looking more reasonable. now we have in the meantime some first examples where that is easing and looking more reasonable Again, I wouldn't declare a trend change or a significant uptick yet, but we have those first examples where we can look a bit more positively on outside 300 mm LTA pricing. again i wouldn't declare a trend change or a significant uptick yet but we have those first examples where we can look a bit more positively on outside 300 mm lta pricing

Speaker 6: Okay. Perfect. Maybe one last quick one. I know you say that you don't have any major LTAs coming up in negotiation this year, next year, are you able to comment on that? Okay. okay Perfect. perfect Maybe one last quick one. maybe one last quick one I know you say that you don't have any major LTAs coming up in negotiation this year, next year, are you able to comment on that? i know you say that you don't have any major ltas coming up in negotiation this year next year are you able to comment on that

Speaker 8: You're right. Nothing, nothing major is expiring this year. Our big LTAs that have all been concluded in conjunction with the FabNext, they are, let's say very long-term LTAs. We have some of them running until 2030. We have 80% of our capacity in Singapore covered with these long-term LTAs. Of course, we look at LTAs as a sort of portfolio. We always said we want to have around 2/3 of the business in those LTAs. In that context, of course, there could LTAs be expiring next year, while we also even last year concluded new LTAs. It's a kind of rolling, ongoing thing. Let me reiterate, if conditions are not good, nobody will force us to do new LTAs. You're right. you're right Nothing, nothing major is expiring this year. nothing nothing major is expiring this year Our big LTAs that have all been concluded in conjunction with the Fab Next, they are, let's say very long-term LTAs. our big ltas that have all been concluded in conjunction with the fab next they are let's say very long-term ltas We have some of them running until 2030. we have some of them running until 2030 We have 80% of our capacity in Singapore covered with these long-term LTAs. we have 80% of our capacity in singapore covered with these long-term ltas Of course, we look at LTAs as a sort of portfolio. of course we look at ltas as a sort of portfolio We always said we want to have around 2/3 of the business in those LTAs. we always said we want to have around 2/3 of the business in those ltas In that context, of course, there could LTAs be expiring next year, while we also even last year concluded new LTAs. in that context of course there could ltas be expiring next year while we also even last year concluded new ltas It's a kind of rolling, ongoing thing. it's a kind of rolling ongoing thing Let me reiterate, if conditions are not good, nobody will force us to do new LTAs. let me reiterate if conditions are not good nobody will force us to do new ltas It's really up to our discretion. Even if we experienced in very soft market conditions, there's always a segment or a technology where new LTAs are concluded. We have to look at this as a kind of portfolio, as a rolling thing. Again, the big ones are rock solid until 2030. With historic volume shifts which we wanted, some of those volumes even have been added to the end of the contract, which in fact would prolong some of those initial time frames. It's really up to our discretion. it's really up to our discretion Even if we experienced in very soft market conditions, there's always a segment or a technology where new LTAs are concluded. even if we experienced in very soft market conditions there's always a segment or a technology where new ltas are concluded We have to look at this as a kind of portfolio, as a rolling thing. we have to look at this as a kind of portfolio as a rolling thing Again, the big ones are rock solid until 2030. again the big ones are rock solid until 2030 With historic volume shifts which we wanted, some of those volumes even have been added to the end of the contract, which in fact would prolong some of those initial time frames. with historic volume shifts which we wanted some of those volumes even have been added to the end of the contract which in fact would prolong some of those initial time frames

Speaker 6: Got it. Thank you, Michael. Appreciate that. Got it. got it Thank you, Michael. thank you michael Appreciate that. appreciate that

Speaker 9: There are no further questions. At this time, I would like to turn the conference over to Stephanie Malgara. There are no further questions. there are no further questions At this time, I would like to turn the conference over to Stephanie Malgara. at this time i would like to turn the conference over to stephanie malgara

Speaker 11: This concludes our Q&A session. Thank you for joining us today. We'll release our H1 2026 figures on the 30th of July. On this slide, you can also see our next IR events. Thank you, and have a good day. This concludes our Q&A session. this concludes our q&a session Thank you for joining us today. thank you for joining us today We'll release our H1 2026 figures on the 30th of July. we'll release our h1 2026 figures on the 30th of july On this slide, you can also see our next IR events. on this slide you can also see our next ir events Thank you, and have a good day. thank you and have a good day

Speaker 9: This concludes today's call. Thank you for your participation. You may now disconnect. This concludes today's call. this concludes today's call Thank you for your participation. thank you for your participation You may now disconnect. you may now disconnect