AMS Osram - comment

AMS Osram delivered a decent Q1 print, but the more important takeaway was management’s commentary on improving order momentum and clearer signs that the semiconductor downcycle has reached a trough. Our projections exclude the assets held for sale from revenue and EBITDA, whereas AMS Osram included them. Adjusting for this treatment, revenue came in slightly ahead of our projections, while stronger cost savings drove better EBITDA margins. Against this backdrop, we are somewhat surprised that the Company did not raise full-year guidance, although we remain mindful of sunk costs and additional restructuring expenses following completion of the remaining asset sales. Management also reinforced its focus on deleveraging, with asset sales and free cash flow generation remaining central to the 2027 refinancing plan.

The bonds remain call-constrained, so we expect these results to have only a muted impact. The Company remains on track to refinance the capital structure in 2027.