Slide 1: Earnings Presentation Q4 and FY 2023
Earnings Presentation Q4 and FY 2023 February 22, 2024 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.
Slide 2: Safe Harbor Statement
Safe Harbor Statement Certain statements in this presentation are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. Words
Slide 3: nLIGHT 2023 Business Highlights
nLIGHT 2023 Business Highlights • 2023 Financials | growth in A&D; positive cash flow; strong backlog growth – Total revenue declined 13% to $210M due to continued weakness in Industrial and Microfabrication – A&D revenue increased 4% to $91.3M primarily from new contracts – Products gross margin im
Slide 4: Q4 Business Highlights
Q4 23 Business Highlights • Q4 revenue above top end of guidance – $51.9M of total revenue, products revenue of $37.9M and development revenue of $14.0M • Gross Margin and Adjusted EBITDA improved year-over-year and above mid-point of guidance – Transformation of manufacturing strategy and improveme
Slide 5: Revenue | 95% of total revenue from non-China customers
Revenue | 95% of total revenue from non-China customers Quarterly Revenue – Geography Geography $ Millions Q4 ‘23 vs. Q4 ‘22 Change -8% $75 $72 $69 $67 $66 $64 $62 $61 $61 $60 $60 $57 $54 $53 $52 China $52 $51 $51 $52 -34% $48 $46 $44 $43 $43 $45 $42 $42 $37 $37 $35 $29 $30 $30 81% 89% $25 $26 89% 9
Slide 6: Revenue | By end market
Revenue | By end market Quarterly Revenue – By Market Market $ Millions Q4 ‘23 vs. Q4 ‘22 Change -8% $75 $72 $69 $67 $66 $64 $62 $61 24% $61 $60 $60 20% 29% 25% $57 27% $54 $53 $52 23% Microfabrication $52 $51 25% 27% $51 $52 $48 29% 20% -10% Overall $46 24% 23% -14% Non-China $44 $43 $43 27% 20% $4
Slide 7: Financial Update
Financial Update
Slide 8: Summary Financial Results | Revenue and Gross Margin
Summary Financial Results | Revenue and Gross Margin Full Year and Q4 $ Millions; % of Revenue Q4 2022 Q4 2023 2022 2023 Total Revenue $56.7 $51.9 $242.1 $209.9 Products Revenue 45.4 37.9 192.7 156.7 Development Revenue 11.3 14.0 49.4 53.2 Gross Margin 10.2% 18.9% 21.0% 22.0% Products Margin 10.8% 2
Slide 9: Gross Margin | Product and Development
Gross Margin | Product and Development Revenue and Gross Margin – Quarterly Revenue $ Millions; % of Revenue Overall GM % $80 40% 37% Products GM % 36% 36% 36% $70 33% 33% 35% 35% 36% 32% 35% 34% 34% 30% 30% 33% 33% 32% $60 31% 28% 29% 30% 30% 29% 30% 30% 29% 29% 30% 26% 28% 24% 24% 24% $50 27% 26%
Slide 10: Operating Expenses | R&D and SG&A
Operating Expenses | R&D and SG&A Operating Expenses (Non-GAAP) $ Millions; % of Revenue $20 $19.3 $19.3 $19.5 50% SG&A $18.8 $18.1 $18.2 $17.6 $17.4 R&D $17.2 $16.6 OpEx as % of Sales $16.0 $15.1 40% $14.7 8.6 $15 $14.2 $14.3 8.4 9.0 7.8 8.1 10.1 $13.0 $12.9 $12.8 7.7 7.9 $12.5 $12.9 8.5 $12.1 7.8
Slide 11: Summary Financial Results | Profitability and Cash Flow
Summary Financial Results | Profitability and Cash Flow Full Year and Q4 $ Millions; % of Revenue Q4 2022 Q4 2023 2022 2023 Net Income (Loss) ($22.7) ($13.2) ($54.6) ($41.7) Non-GAAP Net Income (Loss)* (12.3) (6.0) (22.3) (13.6) Net Income (Loss) Per Share (diluted) (0.50) (0.28) (1.23) (0.90) Non-G
Slide 12: Strong Balance Sheet and Working Capital Management
Strong Balance Sheet and Working Capital Management Cash and Investments ($M) Accounts Receivable ($M) and Inventory ($M) and Days Sales Outstanding (DSO) Days of Inventory (DOI) 157 $90 73 75 $90 155 160 $200 70 152 141 67 $80 $81 144 $175 65 65 131 140 $175 $80 62 $80 $77 140 $166 61 119 131 113 $
Slide 13: Outlook | Q1 2024
Outlook | Q1 2024 • Q1 2024 Revenues of $42 million to $46 million; midpoint of $44 million – Laser Products: approximately $31 million at midpoint – Advanced Development: approximately $13 million at midpoint • Q1 2024 Gross Margin of 15% to 20% – Laser Products: 20% to 25% – Advanced Development:
Slide 14: Simply brilliant
Ve eeceeee Simply brilliant
Slide 15: Appendix
Appendix
Slide 16: Supplemental Information | Revenue, Gross Margin and OpEx
Supplemental Information | Revenue, Gross Margin and OpEx Revenue and Gross Margin nLight, Inc. 2019 2020 2021 2022 2023 (in thousands, except per share data) Q1 Q2 Q3 Q4 Totals Q1 Q2 Q3 Q4 Totals Q1 Q2 Q3 Q4 Totals Q1 Q2 Q3 Q4 Totals Q1 Q2 Q3 Q4 Totals Revenue: Products $ 41,861 $ 48,048 $ 43,814 $
Slide 17: GAAP to Non-GAAP Reconciliation | Adjusted EBITDA, Net Income and EPS
GAAP to Non-GAAP Reconciliation | Adjusted EBITDA, Net Income and EPS nLight, Inc. 2019 2020 2021 2022 2023 (in thousands, except per share data) Q1 Q2 Q3 Q4 Totals Q1 Q2 Q3 Q4 Totals Q1 Q2 Q3 Q4 Totals Q1 Q2 Q3 Q4 Totals Q1 Q2 Q3 Q4 Total Net income (loss) $ (1,235) $ (155) $ (778) $ (10,716) $ (12
Slide 18: Supplemental Information | Key Revenue Metrics
Supplemental Information | Key Revenue Metrics Key Metrics (unaudited, USD in thousands) nLight, Inc. 2019 2020 2021 Q 2022 Q 2023 (in thousands, except per share data) Q1 Q2 Q3 Q4 Totals Q1 Q2 Q3 Q4 Totals Q1 Q2 Q3 Q4 Totals Q1 Q2 3 Q3 Q4 Totals Q1 Q2 3 Q3 Q4 Totals Revenues by end market Industria
Slide 19: Supplemental Information | Fiber Laser Revenue by Power Level
Supplemental Information | Fiber Laser Revenue by Power Level Fiber Laser Revenue by Power – Quarterly Percent of total fiber laser sales 100% 9% Low Power 14% 12% 11% 14% 17% 17% 12% 12% 90% 22% 19% 17% 20% 19% 20% < 2kW 27% 27% 31% 30% 34% 32% 35% 80% 43% 41% 45% 51% 49% 34% 28% Medium Power 35% 3