Slide 1: Calendar Second Quarter 2017 Earnings summary
Calendar Second Quarter 2017 Earnings summary August 02nd, 2017
Slide 2: Safe Harbor
SAFE HARBOR Use of Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward looking statements include information, among other things, concerning: our possible or assumed future results
Slide 3: Key Operating Metrics
KEY OPERATING METRICS $$ 1,774K optimizers 75K inverters 563 Megawatts $136.1M revenues shipped shipped shipped
Slide 4: Second Quarter Highlights
SECOND QUARTER HIGHLIGHTS Financial highlights for quarter Record revenue of $136.1 million, up 18% QoQ GAAP gross margin of 34.6% GAAP operating income of $19.1 million GAAP net income of $22.5 million Record Non-GAAP net income of $25.8 million Record cash flow from operation - $31.6M Business hig
Slide 5: Highlights
HIGHLIGHTS Record revenues generated from outside the United States (46% of total revenues), with particularly significant growth in Germany and the Netherlands Commercial sales continue to increase, reaching record high Announced new products developments: next generation power optimizer large capa
Slide 6: Noteworthy
NOTEWORTHY A combination of high demand, component allocation and rapid growth require increase in air shipments and increased lead time Still no signs of change in competitive landscape Stable ASP environment
Slide 7: GAAP Financial Results
GAAP FINANCIAL RESULTS *USD in millions CQ2'17 CQ1'17 CQ2'16 Revenues 136.1 115.1 124.8 Gross margin 34.6% 33.6% 31.4% Operating expenses 28.0 26.7 21.2 Operating income 19.1 12.0 17.9 Net income 22.5 14.2 17.3 Net diluted earnings per share 0.50 0.32 0.39 *with the exception of gross margin and per
Slide 8: Non-GAAP Financial Results
NON-GAAP FINANCIAL RESULTS *USD in millions CQ2'17 CQ1'17 CQ2'16 Revenues 136.1 115.1 124.8 Gross margin 35.0% 34.0% 31.6% Operating expenses 24.4 23.6 19.1 Operating income 23.1 15.6 20.3 Net income 25.8 16.5 19.9 Net diluted earnings per share 0.55 0.36 0.44 *with the exception of gross margin and
Slide 9: Quarterly Revenues
QUARTERLY REVENUES USD millions $140.0 $120.0 $100.0 $80.0 $60.0 $40.0 $20.0 $ caz'ieé = caz'16. ss cadi6 = cQ'17,—CQ2'17 solar
Slide 10: Units Shipped
UNITS SHIPPED Optimizers shipped Inverters shipped Units
Slide 11: Gross Margin
GROSS MARGIN * *CQ4’ 16 margin included one time benefit of approximately 2%
Slide 12: Operating Expenses
OPERATING EXPENSES * 21.4% 18.4% 15.5% 16.8% *CQ1’ 17 margin includes accrual of doubtful debt representing 1% of revenues
Slide 13: GAAP Operating Income
GAAP OPERATING INCOME USD thousands
Slide 14: Non-GAAP Operating Income
NON- GAAP OPERATING INCOME USD thousands
Slide 15: GAAP Net Income
GAAP NET INCOME USD thousands
Slide 16: Non-GAAP Net Income
NON-GAAP NET INCOME USD thousands
Slide 17: Balance Sheet & Cash Flow
BALANCE SHEET & CASH FLOW USD in millions CQ2'17 CQ1'17 CQ2'16 Cash and investments 274.7 247.6 186.6 Inventory 56.2 60.9 81.6 Capital Expenditures 5.7 1.9 4.1 Total Debt 0.0 0.0 0.0 Cash Flow From Operations 31.6 25.7 18.0
Slide 18: Third Quarter Outlook
THIRD QUARTER OUTLOOK Revenues expected to be within the range of $155 million to $165 million Gross margin expected to be within the range of 33% to 35%
Slide 19: Appendix
solarzehre solarze{e-" Appendix
Slide 20: Reconciliation of GAAP to Non-GAAP
RECONCILIATION OF GAAP TO NON-GAAP Reconciliation of GAAP to Non-GAAP Gross Profit Three months ended 6 months ended June 30, 2017 March 31, 2017 June 30,2016 June 30, 2017 June 30,2016 Gross profit (GAAP) 47,066 38,676 39,113 85,742 79,847 Stock-based compensation 517 493 310 1,010 556 Gross profit
Slide 21: Reconciliation of GAAP to Non-GAAP
RECONCILIATION OF GAAP TO NON-GAAP Reconciliation of GAAP to Non-GAAP Operating expenses Three months ended 6 months ended June 30, 2017 March 31, 2017 June 30,2016 June 30, 2017 June 30,2016 Operating expenses (GAAP) 27,951 26,672 21,229 54,623 42,224 Stock-based compensation R&D 1,280 1,205 747 2,
Slide 22: Reconciliation of GAAP to Non-GAAP
RECONCILIATION OF GAAP TO NON-GAAP Reconciliation of GAAP to Non-GAAP Tax on income (Tax benefit) Three months ended 6 months ended June 30, 2017 March 31, 2017 June 30,2016 June 30, 2017 June 30,2016 Tax on income (Tax benefit) (GAAP) 186 (761) 84 (575) 1,053 Deferred tax asset (realized) 773 1,332
Slide 23: Reconciliation of GAAP to Non-GAAP
RECONCILIATION OF GAAP TO NON-GAAP Reconciliation of GAAP to Non-GAAP Net basic EPS Three months ended 6 months ended June 30, 2017 March 31, 2017 June 30,2016 June 30, 2017 June 30,2016 Net basic earnings per share (GAAP) 0.54 0.34 0.42 0.88 0.94 Stock-based compensation 0.10 0.09 0.06 0.19 0.12 De
Slide 24: NASDAQ | SEDG
solarzehre solarze{e-" NASDAQ | SEDG