Slide 1: Earnings Call Presentation First Quarter 2023
Earnings Call Presentation First Quarter 2023 May 2, 2023 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 © 2023 IPG Phot
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: Q1 '23 Highlights
Q1 '23 Highlights • Growth in welding, cleaning, solar cell and medical offset by FX and soft general THE WORLD industrial demand LEADER IN FIBER LASERS ◦ Total revenue decreased 6% YoY primarily due to currency headwinds with strong U.S. dollar negatively impacting Q1 revenue by $15 million or 4% ◦
Slide 4: Financial Review
Financial Review • Gross margin decreased due to In millions except per share Q1 '23 Q1 '22 Y/Y Q4 '22 Q/Q higher manufacturing costs, inventory reserves, shipping costs and tariffs, Revenue $347.2 $370.0 (6)% $333.5 4% partially offset by an improvement in absorption as a percentage of sales • FX t
Slide 5: Revenue by Power
Revenue by Power • High power (more than 1kW) sales declined YoY due to softer 180 demand in cutting, partially offset by growth in welding applications; sales of ultra-high power lasers (more than 6kW) 160 represented 42% of high power lasers 140 • Pulsed lasers sales declined due to lower demand i
Slide 6: Revenue by Geography
Revenue by Geography 140 300 120 250 100 200 In millions In millions 80 150 60 100 40 20 50 0 0 North America Europe China Other Asia China RoW Q1 '22 Q4 '22 Q1 '23 Q1 '22 Q1 '23 • Sales declined slightly in North America year over year, driven by the divestiture of telecom; growth in welding, clean
Slide 7: Balance Sheet and Cash Flow Summary
Balance Sheet and Cash Flow Summary In millions Q1 '23 • Inventory stabilized • Q1 cash flow from operations is typically low due to bonus Cash and Short-term Investments $1,070 and tax payments Inventories $506 • Returning capital to shareholders while maintaining a strong balance sheet Total Debt
Slide 8: Balance Sheet and Cash Flow Generation
Balance Sheet and Cash Flow Generation Operating Cash Flow and Capital Allocated Exceptional Balance Sheet 100 1,500 1,000 0 In millions In millions 500 -100 0 -200 -500 YTD 2022 YTD 2023 Dec 2022 Mar 2023 Cash from operations Cash and cash equivalents CapEx Short-term investments Buybacks Debt © 20
Slide 9: Financial Guidance
Financial Guidance Q2 '23 Outlook • Q1 book-to-bill was 1 Revenue $325M - $355M Gross Margin 41.5% - 43.5% Operating Expenses $76M - $78M EPS $1.05 - $1.35 Tax Rate ~26% Diluted common shares ~47.5M VERTICAL INTEGRATION PROVIDES COMPETITIVE EDGE © 2023 IPG Photonics 9
Slide 10: Vertical Integration Provides Competitive Edge
VERTICAL THE WORLD INTEGRATION LEADER IN PROVIDES FIBER LASERS COMPETITIVE EDGE CREATING NEW LASER ENABLING APPLICATIONS GREATER & DISPLACING AUTOMATION NON-LASER PROCESSES STRONG HIGH ELECTRICAL MARGINS, EFFICIENCY ENABLES BALANCE SHEET LOWER CUSTOMER & CASH FLOW ENERGY USE © 2023 IPG Photonics 10
Slide 11: Thank you
Thank you © 2021 IPG Photonics