Melexis 2Q25 release confirming its continued momentum in China and Europe

We updated our model after 2Q25 showed quarter-on-quarter improvement in both sales and margins. Sales reached € 211.6m, outperforming our estimate of € 200.3m and CSS's forecast of €201.9m. Customers continued to reduce their inventories during the quarter, and Melexis successfully fulfilled the resulting uptick in short-term orders. Melexis noted that 2Q25 sales exceeded expectations, driven by sequential growth in China and EMEA. From an application standpoint, strong performances were recorded in automotive powertrain and interior lighting, as well as in cooling fans for consumer appliances and data centers.


We view this release as a relief (Accumulate rating and € 78 Target Price maintained), especially in light of recent concerns surrounding other automotive chipmakers—such as Infineon, NXP, and STMicroelectronics—who were expected to face softer demand in China. This was driven by speculation that carmakers might adopt more cautious shipment targets amid potential regulatory efforts to rationalize the industry. We are encouraged by Melexis' update that design wins in 2Q25 confirm its continued momentum in China and Europe. Among the top 10 design wins, four were in powertrain—equally split between internal combustion and electric motors—while the remaining six spanned applications such as braking and lighting. Additionally, Melexis sees significant long-term potential in the robotics market over the next 5 to 10 years.


We fine-tuned our model taking into account Melexis indicated they expect sales in 3Q25 to be in the range of € 210 to € 215m (KBCSe from € 210.7m to € 213m). For FY25, Melexis now expects sales to be in the range of € 835m to € 845m (KBCSe from € 835m to € 839m, CSS was at € 832.6m), with a gross profit margin around 39% (KBCSe from 40.5% to 39.5%) and FY25E EBIT-margin around 16% (KBCSe from 17.6% to 16.8%), all taking into account a EUR/USD exchange rate of 1.17 for the remainder of the year. FY25 Capex is expected to be around € 40m (previously around € 50m).