Onto Innovation Inc. · NYSE:ONTO
Onto Innovation — Morgan Stanley Technology, Media & Telecom Conference 2022
23 slides from Onto Innovation's conference presentation, Mar 9, 2022
Slide 1: Onto Innovation Investor Presentation
Onto Innovation Investor Presentation MARCH 2022
Slide 2: Safe Harbor
• The information presented herein contains forward-looking statements that relate to anticipated future operating results and performance. These statements are only predictions based on management’s current expectations and assumptions, including market size and forecasted growth, Total Available M
Slide 3: Onto Innovation Snapshot
Onto Innovation Snapshot Top WFE High tech capital equipment company specializing Strategic Supplier Tier1 in optical process solutions for semiconductor and related markets Annual Revenue Growth $556M to $789M NOVEMBER 2019: RTEC-NANO MERGER 2020 Gross Margin2 2021 Gross Margin2 52% 55% $789 Millio
Slide 4: Revenue Distribution Across the Value Chain
Revenue Distribution Across the Value Chain SOFTWARE AND SERVICE CUSTOMERS ADVANCED NODES SPECIALTY & ADVANCED PACKAGING CUSTOMERS Balanced 2021 Revenue CUSTOMERS Distribution across the Wafer Bare Wafer Specialty Devices & Semiconductor Fabrication Manufacturing Advanced Packaging Value Chain 20% 3
Slide 5: New Product Innovations Set Foundations for Stronger Future
New Product Innovations Set Foundations for Stronger Future From: 2020 to 2021 +8 +49% +$40M +$680M NEW NEW SYSTEM REVENUE SAM in PRODUCTS REVENUE1 SYNERGIES1 2022 FRESHWATER RENEWABLE LANDFILL USAGE ENERGY WASTE Note 1: 2021 ONTO YoY Results 5
Slide 6: New SAM Contributes to Market Outperformance
New SAM Contributes to Market Outperformance New products open new growth markets for Onto Innovation Panel Packaging $650M2 SAM Common Films Specialty1 >$100M Expansion REVENUE PROJECTED FROM NEW SAM IN 2022 2020 2022 Note 1: Specialty includes CMOS Image Sensors + overlay for compound semiconducto
Slide 7: Semiconductor Market Transitioning From Cyclical to Growth
Semiconductor Market Transitioning From Cyclical to Growth DRIVEN BY MULTIPLE Broadening SECULAR GROWTH DRIVERS Demand $100 Improving Manufacturing Efficiency Cloud AI Computing Transition 300MM, $80 Industry consolidation, WFE $ (Billions) Rise of foundry $60 ALL GROWING >25% CAGR $40 $20 Virtual R
Slide 8: Innovation Across the Value Chain for Semiconductors
Onto Innovation Across the Value Chain for Semiconductors More complex devices generate more data, monetized in the cloud, creating demand for more devices…. Image Sensors, Power, New 5G Packaging Compute & 2.5D Memory 3D Data More Complex Data Center Data Generation Devices Monetization 8
Slide 9: Growth Driver: High Performance Logic Devices
Onto Growth Driver: High Performance Logic Devices ONTO QUALIFIED OR COLLABORATING GROWING DEMAND INCREASE IN PROCESS CONTROL AT ALL GAA CUSTOMERS Advanced Logic Wafer Starts Optical Metrology Sampling Rates Measuring additional features requires more unique signals ONTO PATENTED SE TECHNOLOGY NO. O
Slide 10: Growth Driver: Panel / Substrate Packaging
Onto Growth Driver: Panel / Substrate Packaging High performance compute, intelligent edge, AI, mobility Comprehensive Solutions PANEL MARKET GROWTH STEPFAST SURGING DEMAND FOR ONTO Lithography – PROPRIETARY Inspection - Control SOLUTION FOR PANELS SOLUTIONS $100 18,000 FIREFLY ® INSPECTION DISCOVER
Slide 11: New JetStep X500 Adds Process Tool to Onto Portfolio
New JetStep X500 Adds Process Tool to Onto Portfolio Tool Margin with Connected Solution and Support Contracts Result: Above Corporate Average GM% TOOL & PANEL SOLUTION GROSS MARGIN IMPROVEMENTS Support1 CORPORATE AVERAGE GM% IN LTOM Firefly Above Corporate GM% Inspection + Software GROSS MARGIN % L
Slide 12: Growth Driver: Advanced Packaging (Wafer Drivers)
Onto Growth Driver: Advanced Packaging (Wafer Drivers) High Performance Compute, Intelligent Edge, AI, Mobility INTERCONNECTS SHRINK IN SIZE SCALING DRIVEN BY IDM ADVANCED PACKAGING AND INCREASE IN DENSITY >200M TOP 5 IDMS INSPECTION MARKET SHARE BUMPS PER WAFER 250 20 AP Technology Scaling 18 200 1
Slide 13: Growth Driver: Memory
Onto Growth Driver: Memory UNIQUE HYBRID DRAM Evolution METROLOGY SUITE Roadmap COMPLEX GEOMETRIES MEASURED WITH HIGHER ACCURACY 50 Add text labels 40 >5X Residual films 30 accuracy 20 10 HORIZONTAL VERTICAL 3D STACKING TRANSISTOR TRANSISTOR TRANSISTORS 0 Baseline Orbit Hybrid Metrology NAND Evoluti
Slide 14: Growth Driver: Compound Semiconductor
Onto Growth Driver: Compound Semiconductor GROWING DEMAND ONTO REVENUE GROWTH IN COMPREHENSIVE SOLUTION TO COMPOUND SEMICONDUCTORS HIGHER YIELD, FASTER RAMP SUBSTRATE Security $100M QUALITY SUBSTRATE QUALITY INCREASE ONTO REVENUE 2021-2026 Robotics DISCOVER® 19% CAGR YIELD FAB PROCESS MANAGEMENT CON
Slide 15: Revenue Growth History and Expectation
Revenue Growth History and Expectation 8 Quarters of History as Onto Innovation with Strong 2022 Outlook QUARTERLY REVENUE + 1H2022 CONSENSUS 61% $240 QUARTERLY GROWTH First 8 Quarters of ONTO $220 P&L $200 (From $139.9M to $225.6M) $ MILLIONS $180 30% $160 1H22 OVER 1H21 $140 EXPECTED 1H22 Analyst
Slide 16: Operating Highlights: First 8 Quarters of Onto Innovation
Operating Highlights: First 8 Quarters of Onto Innovation QUARTERLY OPERATING MARGIN QUARTERLY EARNINGS PER SHARE 30% $1.20 25% $0.80 20% $0.40 15% 10% $0.00 Quarterly OM Increased 87% from 16% to 31% Quarterly EPS Increased 215% from $0.39 to $1.23 16
Slide 17: Balance Sheet Highlights: First Quarters of Operation
Balance Sheet Highlights: First 8 Quarters of Operation CASH, CASH EQUIVALENTS, SECURITIES $500 $400 $ MILLIONS $300 $200 Quarterly Cash Increased 75% from $292 to $511 Million 17
Slide 18: 2022: Expected to Grow
2022: Expected to Grow (Revenue 22% and EPS 25%) 2022 Analyst Expectations: Revenue Tailwinds with Material Costs Limiting Gross & Op. Margins 2021 2022 Estimate Ranges & Consensus Actual Low Consensus High Revenue $789 Million $940 M $959 M $971 M Gross Margin 55% 50% 53% 55% Operating Margin 28% 2
Slide 19: New Long-term Operating Model
Organic Growth Resulting from Share Gains & Potential to Enter New Addressable Markets Annual Revenue $1B Model $1.2B Model $1.4B Model Gross Margin 56% - 57% 57% - 58% 58% - 59% Operating Profit 31% - 32% 33% - 34% 35% - 36% Earnings per Share $5.20 - $5.35 $6.08 - $7.00 $8.10 - $8.35 New Long-term
Slide 20: Why Invest in Onto Innovation?
Why Invest in Onto Innovation? TEAM Culture of innovation and collaboration TECHNOLOGY Outperforming in multiple high growth segments FINANCIAL Long term financial model with >$8 per share earnings power PERFORMANCE BALANCE SHEET >$510 M cash, no debt, provides fuel for strategic M&A 20
Slide 21: Thank You
Thank You Onto Higher Yields Onto Higher Margins Onto Higher Productivity Onto Innovation info@ontoinnovation.com www.ontoinnovation.com
Slide 22: Appendix
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Slide 23: Onto Innovation's Major Products
Onto Innovation’s Major Products Atlas® V Element™ JetStep® Standalone thin film and FTIR metrology Litho for Advanced Packaging and FPD OCD metrology Aspect® AWX™ FSI Discover® Software OCD metrology for 3D NAND and Unpatterned frontside inspection Inline yield and defect management high aspect rat
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