1. Home
2. Supplier Database
3. Major Suppliers
4. Harman International Industries, Inc.
5. Harman International Industries, Inc. Business Report FY ended Jun. 2015

Harman International Industries, Inc. Business Report FY ended Jun. 2015

Factors
1) Net Sales
-Sales for the fiscal year ended June 30, 2015, increased by 15.1% over the previous year to USD 6,155.3 million. Excluding negative currency effects of USD 308.7 million, sales increased 22.1% from the previous year. The increase in sales was due to the expansion of recently launched platforms, increased automotive production and use of infotainment and audio products in vehicles. Other factors include the recent acquisition of various businesses and expansion of global distribution channels in non-automotive markets.

2) Operating Income
-The Company's operating income for the fiscal year ended June 30, 2015 was USD 469.6 million, an increase of 42.4% from the previous year. The increase in operating income was caused by higher net sales volumes, which consequently lead to a higher gross margin due to the greater leverage of fixed costs. This was partially offset by increased selling, general and administrative expenses from the increased sales volumes.

3) Infotainment segment sales
-During the fiscal year ended June 30, 2015, sales for the Infotainment segment increased by 10.1% from the previous year to USD 3,124.9 million. Factors for the increase include the expansion of new platforms, improved automotive production combined with higher take rates, and the acquisition of S1nn GmbH & Co. KG. These gains were partially offset by negative currency effects of USD 202.5 million.

4) Lifestyle segment sales
-The Company's Lifestyle segment had sales of USD 1,886.9 million for the fiscal year ended June 30, 2015, an increase of 13.9%. Similar to the Infotainment segment, new product introductions, recently launched automotive programs, increased automotive production, higher take rates, and the acquisition of Bang & Olufsen all contributed to the increase in sales. Negative currency effects reduced sales by USD 83.9 million.

Acquisitions

-The Company announced the completion of its acquisition of Denmark-based Bang & Olufsen Automotive car audio business. The Company acquired Bang & Olufsen's automotive audio business and licenses to use the Bang & Olufsen and B&O Play trademarks for approximately USD 165.7 million. Bang & Olufsen branded audio products are available in a wide range of Audi, Aston Martin, BMW, and Mercedes-Benz car models. The Company will add the Bang & Olufsen and B&O PLAY brands to its portfolio of car audio brands. (From a press release on May 29, 2015)

-The Company announced the acquisition of Israeli-based Red Bend Software, a provider of software management technology for connected devices, and over-the-air (OTA) software and firmware upgrading services. The transaction is valued at USD 170 million and is expected to close in third quarter of the fiscal year ending June 30, 2015. Building upon Red Bend's strength in the mobile and carrier markets, the Company will accelerate Red Bend's growth in the automotive space and position Red Bend software as the de facto standard for OTA software services for mobile devices and automotive applications. (From a press release on January 22, 2015)

-The Company announced that it has signed an agreement to acquire S1nn GmbH & Co. KG, a developer of infotainment systems, connectivity and car audio solutions. S1nn was acquired at a total purchase price of approximately USD 55.4 million. Founded in 2004 and based in Stuttgart, Germany, S1nn provides a range of technology and system integration solutions and software application services to top tier automotive companies, such as Volkswagen, Porsche, Audi, Bentley and Tesla Motors. S1nn currently has a workforce of approximately 100 employees. The S1nn team will be integrated into the Company's Infotainment division. (From a press release on December 18, 2014)

Recent Developments

-During the fiscal year ended June 30, 2015, the Company's sales to the Brazilian, Russian, Indian, and Chinese markets (BRIC) increased by USD 126.4 million to USD 1.0 billion.

-The Company announced that its Harman Connected Services Division has achieved Automotive SPICE Organizational Process Capability Level 3 certification. The certification demonstrates the Company's software development capabilities and expertise in automotive electronics and embedded systems. (From a press release on June 16, 2015)

-The Company is introducing its Road Noise Cancellation (RNC) technology to the European market. RNC minimizes unwanted low frequency broadband noise that is transmitted from road surfaces into the vehicle cabin by generating a sound wave which nullifies the transmitted noise. RNC is part of the HALOsonic technology suite of active noise management solutions. (From a press release on March 2, 2015)

-The Company announced that its new Individual Sound Zones technology will make its European debut at the 2015 Geneva Motor Show. The Company's Individual Sound Zones (ISZ) enables drivers and passengers to create sonic zones between individuals for a personalized audio experience. This solution helps reduce the clutter of different sounds in the car – from navigation commands to phone calls and music – ensuring that all occupants in the vehicle hear only what matters to them. ISZ technology can be integrated into any of the Company's in-car audio system via the amplifier. (From a press release on March 2, 2015)

Major Contracts

-During the first four months of 2015, the Company won new orders from global automakers totaling USD 3.2 billion. Orders include BMW Group for infotainment and audio solutions as well as Daimler AG and GAC Fiat for infotainment solutions. The Company also secured business for new car audio systems from Ford, Fiat Chrysler, Geely, and Hyundai. (From a press release on April 30, 2015)

-The Company announced that it has finalized a multi-year agreement with GAC Fiat to supply several new vehicle models with integrated infotainment systems. Additionally, the Company announced the commercial introduction of the Geely GC9 flagship sedan featuring its multimedia/navigation system and premium surround sound audio. In the last nine months, the Company has been awarded more than USD 300 million in new business from Chinese automakers. (From a press release on April 20, 2015)

-The Company announced that new orders from global automakers in July 2014 totaled USD 1.3 billion. In addition to a follow-on award from an existing European customer, the Company secured a competitive replacement award from automaker Subaru in July. The Company will supply base-, mid-, and high-level solutions for the next generation of Subaru infotainment systems. (From a press release on August 7, 2014)

Awards

-The Company's subsidiary, Harman International (India) Pvt. Ltd., was awarded with the 2014 Tata Motors Supplier of the Year award. Earlier this year, Tata Motors launched the Zest, an advanced mid-level sedan equipped with a next generation infotainment system designed and built by the Company. The system was developed by the Company's R&D centers in Bangalore and Pune in India, and supported by the company's global centers of competence in Shanghai and Germany. (From a press release on November 25, 2014)

Technological Alliance

-The Company and Hortonworks, a U.S.-based company which provides a framework for the processing of large data sets via the Hortonworks Data Platform (HDP), announced a joint collaboration. The collaboration's goal is to transform the automotive environment by providing the connected car ecosystem with real-time, Internet of Things (IoT) data, insights and prognostics solutions. HDP processes sensor data from the connected car gathered from real-time alerts on driver behavior, road safety or maintenance and repair notifications. The Company and Hortonworks will collaborate to seamlessly integrate HDP functionality into the Company's cloud-based offerings. (From a press release on June 3, 2015)

Product Development

Scalable embedded infotainment platform
-The Company will demonstrate its expanded scalable embedded infotainment platform at the Geneva International Motor Show. The platform can be used by the full spectrum of vehicle segments, from entry-level to luxury vehicles. The feature-rich platform leverages the latest smartphone integration technologies such as Apple CarPlay, Android Auto and MirrorLink for best-in-class connectivity. (From a press release on March 3, 2015)

Connected navigation solution based on Navigation Data Standard
-The Company plans to demonstrate the first connected navigation solution based on the Navigation Data Standard at the Geneva International Motor Show. The Company's over-the-air (OTA) map update technology parses map data to ensure that only information which requires updates are sent to the infotainment system, resulting in optimized data download requirements and faster updates. These updates take place in the background, imperceptible to the driver and without loss of infotainment system performance. (From a press release on March 3, 2015)

Aha Cloud Service offerings
-The Company will unveil three new Aha Cloud Service offerings, Aha Remote, Aha Analytics, and Aha Updates, at the Consumer Electronics Show 2015 in Las Vegas, U.S. Aha Remote provides OEMs with a smartphone application platform that their customers can use to remotely control their vehicle. Aha Analytics allows OEMs to compile data from connected cars for analysis. Finally, Aha Updates allows OEMs to provide cost-effectively over-the-air updates for vehicle applications and connected devices. (From a press release on January 6, 2015)

Road Noise Cancellation technology
-The Company is expanding its HALOsonic suite of noise management solutions, which the Company has co-developed with Lotus Engineering. The Company's Road Noise Cancellation (RNC) technology minimizes unwanted noise generated by the vehicle's tires travelling across the road. Based on the principle of "anti-noise", RNC uses accelerometers placed strategically along the path of noise transfer. These accelerometers provide a reference signal to generate an "anti-noise" sound wave that is output through the vehicle's standard audio system, creating a quieter and more comfortable cabin. RNC, which is presently ready for market implementation, enables automakers to use lighter weight materials and improve fuel economy without compromising on vehicle noise levels. (From a press release on October 22, 2014)

Patents

-As of June 30, 2015, the Company has over 3,456 patents and 2,211 pending patent applications.

Investment in U.S.

-The Company announced that it has broken ground on its new North American Automotive Headquarters. The new 188,000-square-foot building, scheduled for completion by fall 2015, will be located in Novi, Michigan, U.S. and will initially accommodate 750 employees. The Company expects to add 250 more employees in the future. The new headquarters will feature equipment and facilities such as:

• Engineering labs for a variety of advanced infotainment technologies and platforms, including driver assistance, next-generation navigation and security solutions
• Development areas focused on future connectivity solutions, including telematics, over-the-air update services, and vehicle-to-infrastructure/vehicle-to-vehicle communication
• Infotainment design studios for Company and customer co-development of advanced software applications
• An anechoic chamber for the accurate designing and testing of speakers
• A full-scale pilot factory

(From a press release on November 20, 2014)