Slide 1: Earnings Presentation Q3 2021
This presentation contains nLIGHT, Inc. proprietary information. No part of it may be circulated, quoted, or reproduced for distribution without prior written approval from nLIGHT, Inc. Earnings Presentation Q3 2021 November 4, 2021
Slide 2: Forward-Looking Statements
2 Certain statements in this presentation are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. Words such as “outlook
Slide 3: Q3 21 Business Highlights
3 • Record quarterly revenues with 17% growth (year-over-year) – Growth (y-o-y) in all market segments (Microfabrication, Industrial, Aerospace and Defense) – 81% of total revenue from customers outside of China • Record products gross margin with strong profitability – 37% Products Gross Margin and
Slide 4: Quarterly Revenue – Market
4 Quarterly Revenue – Market $ Millions 19% 19% 17% 20% 18% 14% 14% 16% 18% 13% 20% 21% 22% 19% 26% 30% 39% 29% 42% 44% 40% 35% 38% 28% 35% 33% 38% 38% 40% 42% 44% 45% 49% 41% 38% 43% 44% 43% 43% 37% 43% 35% 36% 35% 36% 37% 51% 46% 50% 42% 44% 46% 45% 40% 37% 38% 39% 41% 35% 38% 30% 26% 24% 27% 23%
Slide 5: Quarterly Revenue – Geography
5 71% 59% 60% 60% 60% 57% 60% 62% 64% 54% 67% 68% 67% 62% 60% 65% 72% 59% 69% 72% 75% 73% 81% 29% 41% 40% 40% 40% 43% 40% 38% 36% 46% 33% 32% 33% 38% 40% 35% 28% 41% 31% 28% 25% 27% 19% $22 $25 $26 $29 $30 $35 $37 $37 $42 $52 $51 $46 $42 $48 $44 $43 $43 $52 $62 $66 $61 $69 $72 $0 $15 $30 $45 $60 $75
Slide 6: Financial Update
Financial Update
Slide 7: Summary Financial Results | Revenue and Gross Margin
7 Summary Financial Results | Revenue and Gross Margin Quarterly $ Millions; % of Revenue Q3 2020 Q3 2021 Total Revenue $61.7 $72.2 Products Revenue 51.1 54.4 Development Revenue 10.6 17.8 Gross Margin 27.8% 29.6% Products Margin 32.2% 37.1% Development Margin 6.5% 6.7%
Slide 8: Gross Margin | Product and Development
8 Gross Margin | Product and Development 15% 24% 22% 29% 30% 31% 34% 33% 35% 34% 35% 36% 32% 33% 30% 23% 22% 25% 28% 30% 29% 29% 30% 24% 24% 28% 32% 36% 36% 36% 37% 0% 5% 10% 15% 20% 25% 30% 35% 40% $0 $10 $20 $30 $40 $50 $60 $70 Q116 Q216 Q316 Q416 Q117 Q217 Q317 Q417 Q118 Q218 Q318 Q418 Q119 Q219
Slide 9: Operating Expenses (Non-GAAP)
9 Operating Expenses (Non-GAAP) $ Millions; % of Revenue Note: Excluding stock-based compensation expense, amortization of purchased intangibles and acquisition and integration-related costs. See Appendix for a reconciliation to GAAP operating expenses. Operating Expenses | R&D and SG&A 4.3 4.7 5.0
Slide 10: Summary Financial Results | Profitability and Cash Flow
10 * See Appendix for reconciliation to most directly comparable GAAP measure Q3 2020 Q3 2021 Net Income (Loss) ($2.1) ($6.9) Non-GAAP Net Income* 5.3 3.9 Net Income (Loss) Per Share (diluted) (0.05) (0.16) Non-GAAP Net Income Per Share (diluted)* 0.12 0.08 Adjusted EBITDA (non-GAAP)* 6.2 7.2 Cash F
Slide 11: Strong Balance Sheet and Working Capital Management
11 Strong Balance Sheet and Working Capital Management $46 $46 $49 $51 $53 $55 $59 $63 $71 128 126 128 115 105 106 117 113 119 0 15 30 45 60 75 90 105 120 135 $0 $10 $20 $30 $40 $50 $60 $70 $80 Q319 Q120 Q320 Q121 Q321 Inventory ($M) and Days of Inventory (DOI) Inventory DOI $29 $27 $27 $24 $23 $32
Slide 12: Outlook | Q4 2021
12 • Q4 2021 Revenues of $66 million to $72 million; midpoint of $69 million – Laser Products: approximately $49 million at midpoint – Advanced Development: approximately $20 million at midpoint • Q4 2021 Gross Margin of 25% to 28% – Laser Products: 34% to 36% – Advanced Development: approximately 6
Slide 13: Simply brilliant
Ve eece ee Simply brilliant
Slide 14: Appendix
Appendix
Slide 15: Supplemental Information | Revenue and Gross Margin
15 Supplemental Information | Revenue and Gross Margin nLight, Inc. (in thousands, except per share data) Q1 Q2 Q3 Q4 Totals Q1 Q2 Q3 Q4 Totals Q1 Q2 Q3 Q4 Totals Q1 Q2 Q3 Totals Revenue: Products $ 42,467 $ 51,705 $ 51,025 $ 46,162 $ 191,359 $ 41,861 $ 48,048 $ 43,814 $ 40,336 $ 174,059 $ 36,930 $
Slide 16: GAAP to Non-GAAP Reconciliation | Operating Expenses
16 GAAP to Non-GAAP Reconciliation | Operating Expenses nLight, Inc. (in thousands, except per share data) Q1 Q2 Q3 Q4 Totals Q1 Q2 Q3 Q4 Totals Q1 Q2 Q3 Q4 Totals Q1 Q2 Q3 Totals GAAP research and development ("R&D") expense $ 4,283 $ 4,898 $ 5,475 $ 6,398 $ 21,054 $ 6,422 $ 6,494 $ 6,402 $ 8,819 $
Slide 17: GAAP to Non-GAAP Reconciliation | Adjusted EBITDA, Net Income and EPS
17 (1) There is no income tax effect related to the stock-based compensation, acquisition and integration-related costs, and amortization of purchased intangibles adjustments due to the full valuation allowance in the U.S. GAAP to Non-GAAP Reconciliation | Adjusted EBITDA, Net Income and EPS nLight,
Slide 18: Supplemental Information | Key Revenue Metrics
18 Supplemental Information | Key Revenue Metrics Note: Percentages may not total to 100 due to rounding. nLight, Inc. (in thousands, except per share data) Q1 Q2 Q3 Q4 Totals Q1 Q2 Q3 Q4 Totals Q1 Q2 Q3 Q4 Totals Q1 Q2 Q3 Totals Revenues by end market Industrial $ 19,146 $ 25,251 $ 20,890 $ 17,476
Slide 19: Supplemental Information | Revenue by power level
19 Supplemental Information | Revenue by power level 2% 4% 13% 14% 17% 24% 30% 27% 24% 35% 40% 47% 49% 54% 58% 47% 54% 51% 50% 40% 41% 36% 39% 40% 45% 39% 43% 49% 44% 43% 51% 57% 48% 39% 39% 39% 35% 34% 39% 29% 32% 23% 60% 59% 64% 61% 58% 51% 49% 43% 34% 32% 27% 22% 19% 17% 20% 14% 12% 11% 9% 14% 17