Data I/o Corporation · NASDAQ:DAIO
Data I/o — Investor Presentation (June 2022)
35 slides from Data I/o's investor presentation, June 2022
Slide 1: Bringing Devices to Life
Bringing Devices to Life Nasdaq: DAIO Anthony Ambrose June 2022
Slide 2: Safe Harbor
Safe Harbor Statements in this presentation concerning economic outlook, expected revenue, expected margins, expected savings, expected results, orders, deliveries, backlog and financial positions, semiconductor chip shortages, supply chain expectations, as well as any other statement that may be co
Slide 3: Data I/O at a Glance
Data I/O at a Glance Founded in Patents ISO 9001:2015 Global Service 1972 Certifications & Support What We Do • Silicon Device Programming Equipment • Security Deployment as-a-Service Solutions We deliver the most secure and efficient systems to deploy firmware, data and secrets into IoT and automot
Slide 4: Company Snapshot
Company Snapshot Recent Achievements and Trends Company Snapshot (1)(2) • Strong growth in 2021 with bookings at highest level since 2018. Consumable NASDAQ: DAIO sales highest in 4 years but silicon shortages impacted equipment demand. Headquarters: Redmond, WA • Strong momentum in Automotive for l
Slide 5: Investment in DAIO
Investment in DAIO • Publicly traded pure play targeting the rapidly growing automotive electronics market • Strong cash generator, high operating leverage and no debt -- $1.42 per share in cash • Optionality with SentriX security deployment; multiple ways of software monetization targeting all clou
Slide 6: Supporting the Secure Digital World
Data I/O’s programming systems are used by the Supporting the Secure Digital World world’s leading manufacturers, programming centers, and contract manufacturers, to securely program integrated circuits and bring their devices to life. Semi Supplier OEM Programming Center Final Assembly Post Product
Slide 7: Serving Customers Globally in Growing Markets
Serving Customers Globally in Growing Markets • The largest programming company in the world, 2-3 times larger than the next programming company • Trusted supplier to 8 out of the top 9 and 18 of the top 20 automotive electronics suppliers • Providing mission critical medical applications for Class
Slide 8: Market Leading Technology
Market Leading Technology Industry Leading Products History of Innovation Over 35 Industry Awards Data I/O’s products are viewed as the Automated Handlers “gold standard” for advanced Service Excellence Award programming equipment, IP for World-Class Device management and security solutions Programm
Slide 9: How Data I/O Markets Grow
How Data I/O Markets Grow Market Forces Programming Impact IoT and Automotive Growth Unit Growth • More Semiconductor Content • Devices Get Smaller • Move Towards Automation Products will increase their code size as Bit Growth customers want more features Products will be more secure, creating Added
Slide 10: Market Outlook
Bringin g De vices to Life Market Outlook
Slide 11: Analysts Predict Strong Growth in Automotive Semiconductor Content
Analysts Predict Strong Growth in Automotive Semiconductor Content, Led by Electrification Growth in Global Semiconductor Market Total Automotive Semiconductor Forecast Value by Vertical Market ($ millions) ($ billions) Source: McKinsey & Company report, April 2022 CONFIDENTIAL 11
Slide 12: Automotive Electronics Growth Areas
Automotive Electronics Growth Areas Infotainment/ Electrification ADAS/Autonomous Connectivity Security IVI Driving 2D map / application New powertrain Sensors Vehicle Ridesharing Heads-up display Charging High performance Infrastructure Car sharing infrastructure computing Digital Cluster Cloud Fle
Slide 13: Storage Demands in Future Automotive System
Storage Demands in Future Automotive System Along with the development of IVI, ADAS and autonomous driving, demands for storage devices will dramatically increase. Autonomous car needs over 1.5TB storage device in vehicle in 2025. Distributed Architecture (2020) Centralized Architecture (2025) DC SS
Slide 14: Automotive Electronics Primary Market Catalysts
Automotive Electronics Primary Market Catalysts Autonomous Driving Electrification of Vehicles (EVs) New Systems Deployed Massive Code Increase Autonomous Driving graphic credit: Synopsis EV graphic credit: KPMG Automotive Semiconductor Market Model CONFIDENTIAL 14
Slide 15: IoT Growth Across a Number of Markets
IoT Growth Across a Number of Markets CONFIDENTIAL 15
Slide 16: IoT Device Security by SentriX
IoT Device Security by SentriX® Based on Data I/O's award-winning PSV family of products, the SentriX security deployment platform supports hardware-based security for mass-market IoT edge devices and enables OEMs to protect revenue generating business models and secure their supply chain. OEMs requ
Slide 17: IoT Device Security in Mass Production
IoT Device Security in Mass Production Commercial Benefits Easy to Use Robust Security Low upfront cost Preconfigured security use cases Pre-manufacturing assembly security deployment No minimum order quantities Intuitive collaboration tool Authenticates parts Per part as-a-Service model Low or high
Slide 18: Security Deployment as-a-Service
Security Deployment as-a-Service Security Deployment in Hardware Shipping & Ship to Factory Software Load & Test Secure Facility Assembly Distribution SentriX Security Deployment as- a-Service Per part fee, no MOQ OEM Software Development Reduced attack surface Traditional Security Deployment
Slide 19: OEMs Using Our Technology
OEMs Using Our Technology Smart Lock Company Water Meter OEM Smart locks and the brands of Heated and chilled water the OEMs manufacturing them metering is being mandated in depend on robust security and Germany and requires strong low power consumption found security to protect revenue and in hardw
Slide 20: New Partnerships for Growth
New Partnerships for Growth SentriX Deployments Silicon Partners Technology Partners CONFIDENTIAL 20
Slide 21: Billions of Security Enabled Devices
Billions of Security Enabled Devices 2023 Security Market: “Secure” MCUs with 3-4 Billion Units Embedded Secure Elements Standalone Secure Elements AICs, ESEs, TPMs “Traditional” MCUs Smart Card MCUs Total Market: >25 Billion Units Source: ABI Research, Company Estimates CONFIDENTIAL 21
Slide 22: Our Opportunity with SentriX
Our Opportunity with SentriX • The Internet of Things is a huge growth market, with security of supply chain and protection of firmware top of mind • Data I/O and SentriX partners provide a scalable, easy to develop and deploy service for customers of all sizes. Initial applications are the ‘tip of
Slide 23: Financial Overview
Bringin g De vices to Life Financial Overview
Slide 24: Financial Overview First Quarter 2022 Highlights
Financial Overview First Quarter 2022 Highlights • Net sales of $5.0 million; bookings of $6.2 million • Quarter-end backlog of $4.1 million • Gross margin as a percentage of sales of 46.4% • Net loss of ($1.8) million or ($0.21) per share • Adjusted EBITDA* of ($932,000) • Cash & Equivalents of $12
Slide 25: Balance Sheet and Capital Structure Overview
Balance Sheet and Capital Structure Overview Balance Sheet Highlights Balance Sheet Strategy At March 31, 2022: • Important to maintain strong balance sheet in a • $12.3 million in cash and cash equivalents cyclical industry, with about 60% of revenues from • No debt capital equipment sales • $16.9
Slide 26: Growing Recurring Revenue Mix
Growing Recurring Revenue Mix Capital Equipment Adapters Software, SentriX, Service • Approx. 58% of 2021 sales • Approx. 30% of 2021 sales • Approx. 12% of 2021 sales • Off-line and in-line programming systems • Usually last 3-24 months • Annual Software/Service Contracts • Automated systems cost $
Slide 27: China Operations Update
China Operations Update Data I/O Shanghai Operations partially re-opened in May and fully re-opened June 1. We are now shipping systems and adapters from Shanghai. Logistics and supply chains within China also resumed, but are not operating at 100% yet. We expect to be fully operational in July. Dat
Slide 28: Investment Merits: Positioned for Long-Term Growth
Investment Merits: Positioned for Long-Term Growth End market expansion Strong global brand in automotive and with industry-leading Internet of Things products Strong balance sheet and operating leverage NASDAQ: DAIO Experienced management Growth in Global sales, support security deployment and infr
Slide 29: Thank You!
Thank You! NASDAQ: DAIO For more information, please go to https://www.dataio.com/Company/Investor-Relations/Data-I-O-Profile NASDAQ: DAIO CONFIDENTIAL 29
Slide 30: Appendix
30 Management Team & Backup Financial Reconciliation Bringin g De vices to Life Appendix
Slide 31: An Experienced Team of Technology Leaders
An Experienced Team of Technology Leaders Anthony Ambrose - President and CEO Anthony Ambrose joined Data I/O in October 2012 as President, CEO and a Board Member. With a passion for product development and new technology, he led product divisions and global engineering teams at Intel and Radisys fo
Slide 32: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation NON-GAAP FINANCIAL MEASURE RECONCILIATION Three Months Ended March 31, 2022 2021 (in thousands) Net Income (loss) ($1,820) ($333) Interest (income) (1) (3) Taxes 458 32 Depreciation and amortization 140 199 EBITDA earnings (loss) ($1,223) ($105) Equity compensation 291
Slide 33: Adjusted EBITDA Reconciliation – 2014-2021
Adjusted EBITDA Reconciliation – 2014-2021 NON-GAAP FINANCIAL MEASURE RECONCILIATION Twelve Months Ended December 31, (in thousands) 2021 2020 2019 2018 2017 2016 2015 2014 Net Income (loss) ($555) ($3,964) ($1,187) $1,606 $5,449 $1,656 $927 $1,099 Interest (income) expense ($11) ($14) ($53) ($37) (
Slide 34: Income Statement
Income Statement CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share amounts) (UNAUDITED) Three Months Ended March 31, 2022 2021 Net Sales $4,965 $6,015 Cost of goods sold 2,662 2,677 Gross margin 2,303 3,338 Operating expenses: Research and development 1,616 1,606 Selling, general
Slide 35: Balance Sheet
Balance Sheet CONSOLIDATED BALANCE SHEETS (in thousands, except per share data) (UNAUDITED) March 31, December 31, 2022 2021 ASSETS CURRENT ASSETS: Cash and cash equivalents $12,296 $14,190 Trade accounts receivable, net of allowance for doubtful accounts of $73 and $89, respectively 3,055 3,995 Inv