“There was an increased headwind from our markets in the past quarter. In particular, the automotive cycle has deteriorated significantly. But demand has also declined in the mobile devices and general lighting sectors,” said Olaf Berlien, CEO of OSRAM Licht AG. “We have taken a number of measures to improve revenue and returns.”
Political adversities such as international trade disputes, weakened demand for general lighting and the after-effects of the emission test procedure WLTP also drove customer uncertainty. In addition, Osram’s customers reduced their inventories towards the end of 2018. On a comparable basis, quarterly revenue decreased by approximately 15% year-on-year to €828 million. EBITDA, before special items, was also down compared to last year at €93 million. The adjusted EBITDA margin reached 11.3%.
The market weakness is reflected in all three of Osram’s business segments. The Opto Semiconductors division, for example, recorded a decline in revenue of approximately 17% on a comparable basis in the first quarter. Revenue in the automotive segment was 11% lower than in the same period of the previous year. In the Digital segment, revenue fell by around 17% mostly due to weak market development in the general lighting segment.
As announced, Osram will in the future hone its focus on photonics and optical technologies beyond lighting. This is reflected in the new organizational structures that the company initiated at the start of the new fiscal year. Osram is further sharpening its profile and focusing on high-growth markets, including optical semiconductors, automotive and digital applications. With this, Osram is moving even closer to its markets and therefore will be able to balance its portfolio more effectively.