Enphase Energy, Inc. · NASDAQ:ENPH
Enphase Energy — Investor Presentation (March 2018)
21 slides from Enphase Energy's investor presentation, March 2018
Slide 1: Enphase Energy, Inc. Investor Presentation
Enphase Energy, Inc. Investor Presentation March 2018
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, as amended, including statements related to Enphase Energy’s: market assumptions; path and strategies for achieving its ta
Slide 3: Enphase Global Footprint
Enphase Global Footprint Enphase in approximately 739,000 systems in 110+ countries 1 2 1 1 3 3 | © 2018 Enphase Energy, Inc. | CONFIDENTIAL Market Position
Slide 4: The Enphase Home: Complete Energy Solution
The Enphase Home: Complete Energy Solution ENERGY MANAGEMENT Enphase Enphase GENERATION Enlighten IQ Microinverter Enphase Consumption CT Enphase Envoy Enphase AC Battery ENERGY USE CONTROL STORAGE 4 | © 2017 Enphase Energy, Inc. | CONFIDENTIAL
Slide 5: Enphase Target Operating Model: 30-20-10
Enphase Target Operating Model: 30-20-10 Target Model Profitable ▪ Increase market share with IQ, ACM, ACB Revenue ▪ World class quality and reliability Growth ▪ Enter new geographies with IQ7 Gross ▪ Better cost management – cost reduction initiatives 30% ▪ Continued innovation – IQ7, IQ8 Margin ▪
Slide 6: Key Levers to Achieve 30% Gross Margin
3 Key Levers to Achieve 30% Gross Margin Path to Target Gross Margin ▪ Cost Management: A % Gross Margin (Non-GAAP) – Clear supplier strategies 30% – Better understanding of 30 commodity landscape 1-2% 25 24.2% 2-3% – Overhead reduction 20 3-4% B New Products: 15 – Microinverter innovation – New IQ
Slide 7: Cost Management
A Cost Management Transformation Via Procurement Excellence and Overhead Management 2016 2017 Preliminary Results ▪ Single supplier ▪ Multiple sourcing strategy ▪ Achieved 30% reduction in some key electrical components ▪ Unstructured supplier ▪ Clear supplier strategies and ▪ Achieved 30% lower sel
Slide 8: New Products: Every Generation Is Better
B New Products Every Generation Is Better 2014 Q1’17 Q1’18 158mm M250 IQ6/6+ IQ7 iPhone 7+ 4th Generation Product Advanced Grid Functions Single Worldwide SKU Integrated Grounding 2-Wire AC Cabling Lower Component Count Rapid Shut Down AC Module Support 8 | © 2018 Enphase Energy, Inc. | CONFIDENTIAL
Slide 9: ASIC Roadmap Delivers More Integration, Leveraging Moore's Law
B New Products ASIC Roadmap Delivers More Integration, Leveraging Moore’s Law $X Heron 2 – IQ6 (Today) PCU algorithm improvements 2.8 Million Gates Swift – IQ8 Ensemble Support ASIC 5.0 Million Gates Cost Heron 1 – S280 Advanced grid functions Reactive power control Heron 3 – IQ7 $0.2X Die shrink Sw
Slide 10: Cost Reduction While Adding Functionality and Value
B New Products Cost Reduction While Adding Functionality and Value M250 IQ6 – Q1’17 IQ7 – Q1’18 IQ8 – 2019 Part count 396 364 338 < 250 ASIC gates (millions) 1.8 2.8 3.8 5 Max DC Power (W) 350 400 420 440 Weight (kg) 1.66 1.38 1.15 1.0 Rapid Shut Advanced Grid Single Key Feature Ensemble Down Functi
Slide 11: The IQ AC Module Enhances Our Value Proposition
B New Products The IQ AC Module Enhances Our Value Proposition ▪ Provides significant value for installers and homeowners: – Easy Installation Pre-assembled inverter and module saves time for installers – Streamlined Logistics Less components means less space and less trips for installers – Higher P
Slide 12: OPEX Management: We have cut expenses by 38%
OPEX Management: We have cut expenses by 38%* Operating Expense ▪ Single worldwide SKU on IQ7 will help in $M USD (Non-GAAP) R&D spend ▪ Outsourcing of non-core functions 35 ▪ Continuous review and optimization of 31 30 R&D portfolio 30 28 28 29 27 28 25 24 20 20 18 17 18 18 15 10 Q2’17 Q3’17 Q4’17
Slide 13: Financial Results
Financial Results P&L - Non GAAP Q1'16 Q2'16 Q3'16 Q4'16 FY16 Q1'17 Q2'17 Q3'17 Q4'17 FY17 Q1'18 ($ in MUSD) Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual MID Revenues $ 64.1 $ 79.2 $ 88.7 $ 90.6 $ 322.6 $ 54.8 $ 74.7 $ 77.0 $ 79.7 $ 286.2 $ 67.5 Gross Margin % 18.8% 18.2% 18
Slide 14: Commitment: Sustained Profitability & Positive Cash Flow
Commitment: Sustained Profitability & Positive Cash Flow We are at an Inflection Point • Next-Gen Microinverters (IQ6 & IQ7) • Competitive Pricing & Product Differentiation (ACM & ACB) • Share Growth (ACM) & SAM Expansion (IQ7X NA, IQ7 ROW) Revenue • Improved Bankability • Transition to IQ6, IQ7 & I
Slide 15: The Future of Solar: IQ8
The Future of Solar IQ8 Powered by Ensemble™ technology 15 | © 2018 Enphase Energy, Inc. | CONFIDENTIAL
Slide 16: Enphase is Transforming Solar 1.0 into Solar 2.0
Enphase is Transforming Solar 1.0 into Solar 2.0 Solar 1.0 – Grid tied or off-grid Solar 2.0 – Grid independent Grid tied Distributed ▪ Requires constant ▪ Simple and reliable grid connection ▪ Modular and scalable ▪ Provides bill optimization for homeowners ▪ Seamless transition OR between Off-grid
Slide 17: We Cracked the Code for Solar 2.0 with Ensemble
We Cracked the Code for Solar 2.0 with Ensemble™ Ensemble™ provides a true power plant in a microinverter Requirements ▪ High speed digital control system which is mathematically intensive Software-defined ▪ Very high speed power train inverter ▪ Digital ▪ Closed-form control solutions architecture
Slide 18: IQ8 Provides the Best of All Worlds
IQ8 Provides the Best of All Worlds ▪ Next-generation microinverter capable of working seamlessly Seamless in grid tied or off-grid mode ▪ Modular solution: Plug and play with AC Module & AC Battery Simple ▪ Very simple to design, install and maintain ▪ No limitation on system size Scalable ▪ Same m
Slide 19: Business Impact of IQ8
Business Impact of IQ8 [ 1 ] Increases TAM by developing new markets [2] Expands Enphase into energy access and microgrid markets [3] Increases Enphase market share and improves gross margin [4] Forecasting IQ8 shipments in 2019 19 | © 2018 Enphase Energy, Inc. | CONFIDENTIAL
Slide 20: Enphase Target Operating Model: 30-20-10
Enphase Target Operating Model: 30-20-10 Target Model Profitable ▪ Increase market share with IQ, ACM, ACB Revenue ▪ World class quality and reliability Growth ▪ Enter new geographies with IQ7 Gross ▪ Better cost management – cost reduction initiatives 30% ▪ Continued innovation – IQ7, IQ8 Margin ▪
Slide 21: Enphase
S ENPHASE.