By Harro Ten Wolde

FRANKFURT (Reuters) - German chipmaker Infineon (IFXGn.DE) slightly raised its full year outlook on Wednesday after carmakers and industrial customers increased orders, but ambitious investors took profits on its high-performance shares.

Infineon said it expects revenue growth and its core operating margin for the financial year through September to be slightly ahead of its original target ranges of between 7 and 11 percent and 11 to 14 percent, respectively.

But it stopped short of giving a detailed outlook for the next fiscal year and its shares – which have risen 15 percent so far in 2014 in a sector that is down 1 percent - fell almost 5 percent.

The Neubiberg, southern-Germany based company is riding the recovery wave in the European car industry. German premium carmakers especially are increasing spending to make their cars safer. At the same time, Infineon's industrial clients are investing to make production cheaper and more energy efficient.

Infineon's chips are used to activate airbags, enable cruise control and cut vehicle emissions. Its chips are also used in security and smart cards.

In the fiscal third quarter through June, Infineon's operating profit excluding some special items rose to 170 million euros (134.63 million pounds), up 45 percent from the previous year and in line with the average forecast of 171 million euros in a Reuters poll.

The company said its order books were filling up and it could fully benefit as it had made timely investments in extra production capacity, anticipating growth ahead.

Infineon said that demand for its chips used in cars was particularly strong in North America and China, while its industrial chips were mainly boosted by demand for use in renewable energy.

But investors fear that Infineon may have reached the top of its cycle. Infineon shares were 4.7 percent lower by 0830 GMT at the bottom of the STOXX Europe 600 Technology index (.SX8P).

"The magnitude of the beat and raise was not very big, so investors are probably guessing that Infineon is reaching the top of its demand cycle," said a London-based analyst who declined to be named.

Global spending on semiconductors is expected to rise 6.7 percent this year to $336 billion, fuelled by smartphones and tablets, according to market researcher Gartner.

That upbeat outlook is not shared by everyone in the industry.

Chip equipment makers ASML (ASML.AS) and ASM International (ASMI.AS), whose order books are seen as a barometer of the chip industry’s prospects, said earlier this month some of their customers had postponed orders in anticipation of new technology coming to the market.

Franco-Italian chipmaker STMicroelectronics (STM.PA) was also less optimistic than expected.

($1 = 0.7458 Euros)

( Story refiled to remove garble from headline )

(Reporting by Harro ten Wolde; Editing by Maria Sheahan and John Stonestreet)