Slide 1: Earnings Call Presentation Second Quarter 2022
Earnings Call Presentation Second Quarter 2022 August 2, 2022 10:00 am ET • By phone: 877-407-6184 in the US or 201-389-0877 internationally • A live webcast of the call will be available and archived on the investor relations section of the Company's website at investor.ipgphotonics.com © 2022 IPG
Slide 2: Safe Harbor Statement
Safe Harbor Statement Information and statements provided by IPG and its employees, including statements in this presentation, that relate to future plans, events or performance are forward-looking statements. These statements involve risks and uncertainties. Any statements in this presentation that
Slide 3: Q2 '22 Highlights
Q2 '22 Highlights • Increased demand in North America and Japan and higher revenue in emerging growth THE WORLD products drove Q2 results LEADER IN FIBER LASERS ◦ Total revenue increased 1% YoY, driven by higher sales in welding, cleaning and medical applications, offset by lower revenue in cutting
Slide 4: Financial Review
Financial Review • Gross margin decreased due to In millions except per share Q2 '22 Q2 '21 Y/Y Q1 '22 Q/Q increased inventory reserves, higher shipping costs and Revenue $377.0 $371.7 1% $370.0 2% tariffs, and lower absorption of manufacturing expenses, Gross Margin 45.7% 48.6% 46.4% partially offs
Slide 5: Revenue by Power
Revenue by Power • Revenue growth was driven by pulsed lasers, systems and 200 medical 180 • High power (more than 1kW) sales declined due to softer demand in cutting in China, partially offset by growth in welding 160 applications and higher cutting revenue in North America and 140 Japan; sales of
Slide 6: Revenue by Geography
Revenue by Geography 180 300 160 250 140 120 200 In millions In millions 100 150 80 60 100 40 50 20 0 0 North America Europe China Other Asia China RoW Q2 '21 Q1 '22 Q2 '22 Q2 '21 Q2 '22 • Diversification continues with non-China revenue increasing strongly and accounting for 64% of total sales • Hi
Slide 7: Balance Sheet and Cash Flow Summary
Balance Sheet and Cash Flow Summary In millions Q2 '22 • Returning capital to shareholders while maintaining a strong balance sheet Cash and Short-term Investments $1,235 • Inventories increased due to FX and safety stock of components Inventories $557 • Repurchased a record level of shares in the q
Slide 8: Balance Sheet and Cash Flow Generation
Balance Sheet and Cash Flow Generation Operating Cash Flow and Capital Allocated Exceptional Balance Sheet 300 2,000 200 1,500 100 0 In millions In millions 1,000 -100 -200 500 -300 0 -400 -500 -500 Q2 '21 Q2 '22 Q4 '21 Q2 '22 YTD Cash from operations Cash and cash equivalents YTD CapEx Short-term i
Slide 9: Financial Guidance
Financial Guidance Q3 '22 Outlook • Q2 book-to-bill was slightly below 1 Revenue $350M - $380M • FX is expected to have a negative impact on revenue in Gross Margin 44% - 46% Q3 Operating Expenses $85M - $87M EPS $1.00 - $1.30 Tax Rate ~25% Diluted common shares ~51M VERTICAL INTEGRATION PROVIDES CO
Slide 10: Vertical Integration Provides Competitive Edge
VERTICAL THE WORLD INTEGRATION LEADER IN PROVIDES FIBER LASERS COMPETITIVE EDGE EXPANDING ENABLING INTO LASER & GREATER NON-LASER AUTOMATION APPLICATIONS STRONG HIGH ELECTRICAL MARGINS, EFFICIENCY ENABLES BALANCE SHEET LOWER CUSTOMER & CASH FLOW ENERGY USE © 2022 IPG Photonics 10
Slide 11: Thank you
Thank you © 2021 IPG Photonics