Impinj, Inc. · NASDAQ:PI
Impinj — Investor Day (June 2023)
56 slides from Impinj's investor day presentation, Jun 13, 2023
Slide 1: Investor Day
Leeks INVESTOR DAY *°”°
Slide 2: Andy Cobb
Andy Cobb Vice President, Strategic Finance
Slide 3: Forward Looking Statement & Non-GAAP Financial Measures
Forward Looking Statement & Non-GAAP Financial Measures This presentation and the accompanying oral data, estimates and forecasts that are based on income tax benefit (expense); and acquisition commentary contain forward-looking statements within independent industry publications or reports or other
Slide 4: Agenda
Agenda 1:30 – 3:00pm Presentations Chris Diorio, Chief Executive Officer Jeff Dossett, Chief Revenue Officer Hussein Mecklai, Chief Operating Officer Cary Baker, Chief Financial Officer 3:00 – 3:30pm Q&A 3:30 – 5:30pm RAIN Experience Center Tour + Happy Hour © 2023 4
Slide 5: Cary Baker
Cary Baker Chief Financial Officer
Slide 6: Chris Diorio
Chris Diorio Chief Executive Officer and Co-Founder
Slide 7: Vision
Vision Manufacturer Shipper Seller Person Archive Digital Twins Own | Store | Explore Connect Every Thing Physical Items Discover | Engage | Protect Manufacture Transport Sell Use Recycle © 2023 7
Slide 8: Company
Company Corporate Foundation Success Strategy 1 Our market-leading IoT products 1 Develop whole-platform solutions for lighthouse enterprises 2 Enterprise preference for the solutions we and our partners create from those products 2 Win the endpoint IC opportunity at those enterprises 3 The talent a
Slide 9: Success Strategy
Success Strategy Solutions drive Impinj endpoint ICs • Create enterprise solutions; step-and- repeat with solutions partners • Win endpoint IC opportunity Systems drive Impinj endpoint ICs • Enable channel partners to win remaining opportunities with Impinj systems • Win majority endpoint IC share ©
Slide 10: Market Focus
Market Focus Retail General Supply Chain Merchandise & Logistics Platform Leverage Enterprise Platform Leading RAIN Solutions Preference Products Services Engage lighthouse enterprises Build platform capabilities Best performance, reliability Cloud services support to drive solutions opportunities a
Slide 11: Platform Preference
Platform Preference Platform Capabilities Corporate Trust 1 Performance 1 Principles 2 Capabilities 2 Expertise 3 Protection 3 Dependability Key-generation Item-authentication service service Global Fortune 500 executive Partner Registration Lookup “We work with Impinj because you are the best of th
Slide 12: Delivering Delightful Experiences
Delivering Delightful Experiences Enterprises buy solutions that deliver delightful experiences for people Impinj Partner Enterprise Person Systems Integration Systems Integration Procedures, Installation & Procedures, Installation & training & training & configuration configuration support support
Slide 13: Driving Recurring Revenue
Driving Recurring Revenue Drive recurring endpoint IC and cloud-services revenue to create financial success Systems Integration Procedures, Installation & training & configuration support HW, SW & Services Platform Solutions Our platform is our leverage to deliver Enterprise solutions drive long-te
Slide 14: Why Impinj
Why Impinj Opportunity Platform Solutions Team © 2023 14
Slide 15: Jeff Dossett
Jeff Dossett Chief Revenue Officer
Slide 16: Massive Market Opportunity
Massive Market Opportunity Other Everyday Items 3Tn Food & Drink Packaging 600Bn Auto Parts 400Bn Parcels & Postal RAIN enabled connectivity 325Bn General Merchandise (1) for >34Bn items in 2022 80Bn Beauty and Personal Care We estimate this represents 80Bn Apparel only ~0.3% of connectable items Tr
Slide 17: RAIN Endpoint IC Growth
RAIN Endpoint IC Growth Market Growth(1) 34.0 Impinj Yearly endpoint ICs in billions shipped 28.9 85+ billion(2) 29% endpoint ICs CAGR 21.3 18.5 15.4 12.5 10.3 6.0 3.0 3.8 1.6 2.0 2.4 (1) 2010 & 2011: Based on VDC Research “Strategic Insights 2013: RFID, Contactless & RTLS Technology“; 2012: Based o
Slide 18: Retail Today
Retail Today Category expansion with manual reading Apparel General Merchandise © 2023 18
Slide 19: Retail Transformation
Retail Transformation Manual reading Autonomous reading © 2023 19
Slide 20: Retail Growth
Retail Growth Manual reading Autonomous reading Autonomous reading across the enterprise SALES FLOOR REPLENISHMENT SHIPMENT VERIFICATION INVENTORY MANAGEMENT AUTOMATED CHECKOUT LOSS OMNICHANNEL PREVENTION FULFILLMENT © 2023 20
Slide 21: Walmart customer quote
We look forward to expanding the use of RAIN RFID into more categories to further improve inventory accuracy across the business, provide a better in-store shopping experience for customers, and drive more online and pick-up-in-store capabilities. Matt Alexander Walmart Senior Director II Operations
Slide 22: Fast Retailing customer quote
All Fast Retailing brands began embedding RAIN RFID chips into price tags so we could track individual items from our factories to warehouses and inside stores. That data is critical in improving the accuracy of inventory in stores, adjusting production based on demand, and getting more visibility i
Slide 23: Supply Chain & Logistics Today
Supply Chain & Logistics Today Category expansion with manual reading Pallets & Cases Parcels © 2023 23
Slide 24: Supply Chain & Logistics Transformation
Supply Chain & Logistics Transformation Manual reading Autonomous reading © 2023 24
Slide 25: Supply Chain & Logistics Growth
Supply Chain & Logistics Growth Manual reading Autonomous reading Autonomous reading across the enterprise ASSET MANAGEMENT SHIPMENT VERIFICATION INVENTORY LOCATION CONTENT VERIFICATION PALLET BUILD VERIFICATION © 2023 25
Slide 26: UPS CEO quote on RFID technology
As it relates to the RFID technology… It will eliminate all the manual scans done by our pre-loaders. If that doesn't drive productivity, I don't know what will… Carol B. Tomé UPS CEO UPS plans to eliminate To save manual barcode non-operating 20M scans every day $500M costs this year © 2023 26
Slide 27: Win with Enterprise Solutions
Win with Enterprise Solutions Engage lighthouse enterprises Create whole-platform solutions Solve unmet need Scale with partners Win endpoint IC opportunity © 2023 27
Slide 28: Win with Partners
Win with Partners Leverage enterprise learnings Advance Impinj platform Deliver solution engines Enable partner solutions 2,000+ 100+ Drive recurring revenue Partners Countries Win majority endpoint IC share © 2023 28
Slide 29: Win with Recurring Revenue
Win with Recurring Revenue Impinj Authenticity Solution Engine Ensure products are genuine Easily deploy across supply chain Key-generation service Item-authentication service Utilizes whole Impinj platform Partner Registration Lookup Monetize endpoint IC and authentication service Partner label Cus
Slide 30: Why Impinj
Why Impinj Opportunity Platform Solutions Team © 2023 30
Slide 31: Hussein Mecklai
Hussein Mecklai Chief Operating Officer
Slide 32: Impinj Platform Products
Impinj Platform Products © 2023 32
Slide 33: Retail Today
Retail Today Category expansion with manual reading Apparel General Merchandise © 2023 33
Slide 34: Evolution of RAIN RFID Adoption
Evolution of RAIN RFID Adoption Manual Autonomous © 2023 34
Slide 35: Readability
Readability Right Tag, Right Place, Right Time © 2023 35
Slide 36: Ease of Use
Ease of Use Loss Prevention Self-Configuration Speed Detection False Alarm Optimize with Machine Learning © 2023 36
Slide 37: Massive Technology Opportunity
Massive Technology Opportunity Supply Chain & Logistics Retail ASSET SALES FLOOR MANAGEMENT REPLENISHMENT SHIPMENT SHIPMENT VERIFICATION VERIFICATION INVENTORY INVENTORY LOCATION MANAGEMENT AUTOMATED CHECKOUT CONTENT VERIFICATION LOSS OMNICHANNEL PALLET BUILD PREVENTION FULFILLMENT VERIFICATION © 20
Slide 38: Authenticity
Authenticity Key-generation Item-authentication service service Partner Registration Lookup Partner label © 2023 38
Slide 39: Industry-Leading Innovation – Systems
Industry-Leading Innovation – Systems R700 E-Series Photo of E-series 4X performance(1) 2X performance in half the footprint and power consumption(1) (1) As compared to prior generation Impinj products. © 2023 39
Slide 40: Industry-Leading Innovation – Endpoint ICs
Industry-Leading Innovation – Endpoint ICs 180/152nm 65nm © 2023 40
Slide 41: Industry-Leading Innovation – Endpoint ICs
Industry-Leading Innovation – Endpoint ICs Significant 2nd generation 25% more die performance Impinj platform per wafer improvement capabilities than M700 Enhanced quality, reliability and manufacturability © 2023 41
Slide 42: Operations as an Asset
Operations as an Asset Quality • Enhanced industrialization • Reference build recipes • Reference designs • Shorten customer time to market Supply Assurance • Qualified in multiple fabs • Geographic diversity • OSAT diversity • Strategic inventory © 2023 42
Slide 43: Why Impinj
Why Impinj Opportunity Platform Solutions Team © 2023 43
Slide 44: Cary Baker
Cary Baker Chief Financial Officer
Slide 45: Financial Priorities
Financial Priorities Revenue Margin FCF Growth Expansion Generation © 2023 45
Slide 46: Revenue Growth
Revenue Growth Annual Revenue (M) $258 Long-term focus on 20% revenue CAGR $190 growth $153 $139 $125 $123 $112 $78 $64 $55 $43 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 © 2023 46
Slide 47: Revenue Growth – 5-year CAGR
Revenue Growth – 5-year CAGR $258 Annual Revenue (M) Revenue CAGR Systems $66 Endpoint ICs 23% Endpoint ICs $190 Systems 15% $153 $51 $139 TOTAL 20% $123 $55 $37 $38 $192 $139 $98 $102 $85 2018 2019 2020 2021 2022 © 2023 47
Slide 48: Financial Execution
Financial Execution Non-GAAP Gross Margin (adjusted)(1) Adjusted EBITDA Margin(2) 11.2% 55.5% 52.7% 4.8% 51.2% (8.3%) 2020 2021 2022 2020 2021 2022 M700 expanded gross margin Disciplined focus on profitability (1) Excludes depreciation, stock-based compensation, excess and obsolescence charges and t
Slide 49: Inventory Strategy
Inventory Strategy Forward Days Inventory Outstanding (DIO)(1) • Enterprises relying on Impinj 171 • Long product lifecycles • Rapidly growing market • Target: 180 forward DIO 75 76 2020 2021 2022 (1) Forward DIO calculated on a 6-month basis. 2022 estimated using the mid point of 2Q23 revenue guide
Slide 50: Long-Term Model
Long-Term Model 2022 Target Revenue (M) $257.8 $500 $750 Win endpoint IC opportunity via enterprise solutions Non-GAAP Gross Margin 55.5% 55-56% 56-57% Win majority of endpoint IC Adjusted share via platform preference EBITDA 11.2% 19-21% 23-25% Capital Intensity 4.7% 5% 5% 2022 Non-GAAP Gross Margi
Slide 51: Why Impinj
Why Impinj Opportunity Platform Solutions Team © 2023 51
Slide 52: Q&A
Q&A © 2023 52
Slide 53: Appendix
Appendix © 2023 53
Slide 54: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation(1) 2020 2021 2022 GAAP Gross Margin 46.9% 52.0% 53.5% Adjustments: Depreciation 1.4% 1.2% 1.4% Stock-based compensation 0.7% 1.0% 0.6% Non-GAAP Gross Margin 49.0% 54.2% 55.5% Adjustments: Excess and obsolescence charges 2.2% -- -- Sale of fully reserved inventory -- (
Slide 55: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation(1) 2020 2021 2022 GAAP Net Loss (51.9) (51.3) (24.3) Adjustments: Depreciation 4.5 4.6 6.0 Induced conversion expense -- 11.3 2.2 Stock-based compensation 25.7 40.5 42.4 Restructuring costs -- 1.7 (0.1) Settlement and related costs 5.4 (0.5) -- Other Income, net (0.7)
Slide 56: Investor Day
Leeks INVESTOR DAY *°”°