Surge in Artificial Intelligence Fuels Growth for Merck

The Darmstadt-based technology and pharmaceutical company Merck is experiencing significant growth driven by the booming demand for artificial intelligence (AI). In the previous fiscal year, Merck reported a notable increase in revenue from semiconductor materials, which are essential components in high-performance chips designed for AI applications. This surge in demand contributed to a slight overall revenue increase of 0.8% to EUR21.1 billion, buoyed by a concurrent rise in sales of cancer treatment pharmaceuticals.

Furthermore, the company's laboratory division has seen a resurgence since the second half of the year, rebounding from a period of diminished demand that followed the COVID-19 pandemic. This positive trend marks a recovery for Merck after a challenging year, with the final quarter of the year showing particularly strong performance.

Merck has strategically invested in acquisitions within its electronics segment to expand its footprint in the semiconductor industry. The current market is witnessing high demand for materials that enhance chip performance while minimizing energy consumption.

In the past year, the company has also managed to keep its costs under control. Adjusted operating profit, excluding special items, increased by 3.3% to nearly EUR6.1 billion. However, due to higher tax obligations, the net profit for the company fell by approximately 2% to about EUR2.79 billion compared to the previous year.

CEO Belen Garijo aims to build on this upward momentum in the current year, seeking to further enhance both revenue and profit. The company is well-positioned to capitalize on global trends, particularly the increasing demand for semiconductors tailored for the AI era. To reward shareholders, Merck plans to maintain a stable dividend of EUR2.20.