Moving From Restructuring to Growth

Renesas Electronics Group adopted a “Reform Plan” in October 2013 with the two key themes of “growing revenue through selection and concentration of businesses” and “improving profitability through structural reforms”.

Implementation of the Reform Plan came to an successful conclusion on March 31, 2016.

Going forward the Group will build on the results gained by carrying out the Reform Plan, making strategic and continuous investments to focus domains with an aim to quickly bringing the company on a growth track.

image: Moving From Restructuring to Growth

Capital Allocation

As shown in the below figure which indicates products vertically and applications horizontally, the Group aims to pursue an organic growth through leveraging existing resources and an in-organic growth through partnership or acquisition of other companies.

The Group will specify the approaches to become the world’s number one position in each focus market and will strategically allocate capital.

For example in analog & mixed signals, the Group will acquire a US-based semiconductor vendor, Intersil Corporation to enhance product lineups and solution offerings.

image: Capital Allocation

Renesas Financial Target

The Group updated financial targets as the mid-term growth strategy in November 2016.

The Group intends to grow its semiconductor sales at least twice the market growth rate of its SAM (Served Available Market) after 2020 by allocating management resources on focus domains of Automotive and Industrial / Broad-based businesses.

Following the sales increase, the Group also aims to achieve 50% gross margin and 20% operating margin which is double compared to the past target.

image: Renesas Financial Target

(Note 1) Market growth rate indicates growth rate of Renesas’ SAM (served available market) excluding memory, etc.

(Note 2) Non-GAAP indicates recurring operating performance excluding non-recurring and other items from financial accounting figures (GAAP).

Automotive Business

Renesas Electronics Group aims to grow the business further through investing in green vehicle and autonomous driving with massive growth potential, leveraging the strong position in microcontrollers and SoCs.

An example of focus domains: The world’s leading microcontrollers for next-generation cars

image: Automotive Business

Industrial / Broad-based Businesses

The Group positions Smart Home, Smart Factory, and Smart Infrastructure as focus domains and aims to expand the current position by supporting Smart Society with leading semiconductor technologies including e-AI (embedded Artificial Intelligence).

An example of focus domains: Smart Home, Smart Factory, Smart Infrastructure

Smart Home

image: Smart Home
chart: Smart Home
  • Using e-AI to integrate “Smart Appliances”, “Healthcare”, and “HEMS (Note 1) “ by leveraging on 41% share held by consumer electronics
  • Attain the global top market share to address market expansion followed by introducing energy-saving regulations in emerging countries

Smart Factory

image: Smart Factory
chart: Smart Factory
  • Significantly contribute to advancement of Industry 4.0 through “Real-time” and “Safety” with the global top market share “R-IN”
  • Expand market share by leveraging current position in core businesses

Smart Infrastructure

image: Smart Infrastructure
chart: Smart Infrastructure
  • Intelligent solution offering to enable supply or highly-efficient information and energy
  • Attain leading market share in core businesses including MCUs for power meter in India, promoting global standardization activities

(Note 1) Home Energy Management System