Nordic Semiconductor ASA · OSL:NOD
Nordic Semiconductor ASA — Jefferies Summit 2023
37 slides from Nordic Semiconductor ASA's conference presentation, August 2023
Slide 1: Jefferies Summit - Nordic Semiconductor
Slide 2: A globally leading IoT enabler
A globally leading loT enabler Simplifying lives through all things connected = Fabless semiconductor company specialized in low power wireless connectivity and embedded processing for loT Market leader in Bluetooth Low Energy Early adopter of Thread (802.15.4) and support for Zigbee Launched Wi-Fi
Slide 3: Nordic is on a long-lasting growth journey
lordic Semiconductor Nordic is on a long-lasting growth journey 800 750 Innovation unlocking 700 market waves 650 600 550 500 450 400 350 Emerging loT markets > 300 250 Wearables 200 150 100 Widespread loT adoption > Revenue, USDm PC peripherals > Game controllers 50 io} 2000 2001 2002 2003 2004 200
Slide 4: Steady and high certification market share
© Nordic Semiconductor Steady and high certification market share Significantly increasing value per design Bluetooth Low Energy end-product certifications, last 12 months 1500 1200 43% = soo i % 43% 41% 41% 35% i 600 — | |_| |_| = | i [] 30 ard 49] 546 585 549 51g [i ) Q216 LTM Q216 LTM Q218LTM Q21
Slide 5: Investing to significantly broadening market space
© Nordic Semiconductor Investing to significantly broadening market space Addressable markets, 2026 by technology Other technologies | Other Power Healthcare mi met Industrial Consumer Technology expansion § ————————_____» cloT & Services Source: Nordic management estimates.
Slide 6: Delivering on our customers' needs
© Nordic Semiconductor Delivering on our customers’ needs Customer investment in product development oe = Nordic is providing 90% . 20% solutions to our 70% customers reaching 60% beyond ICs _ = Investments in 40% 30% Software, Cloud, Al 20% and Security is 10% essential for the next 0% Prehistory Y
Slide 7: Expansion within target operating model
Expansion within target operating model Target operating model = Gross margin depending on technology and customer mix = Lower gross margins expected in cellular loT Module business Gross margin * Higher gross margin opportunities in other new technologies and service offering * Overall goal to main
Slide 8: Enabling IoT for the future
Slide 9: IoT - Connect, Compute, Analyze and Act
© Nordic Semiconductor lol - Connect, Compute, Analyze and Act loT starts with connecting things Bridging the physical and digital worlds requires: advanced connectivity solutions powerful low power compute accurate sensing capability Real-world data fl» = Gateways Cloud | computing = Sensors Physic
Slide 10: Sustainability thrives on IoT, big data & cloud
Sustainability thrives on loT, big data & cloud loT is crucial to deliver on UN SDGs Environment Being Nordic is making ‘things’ more Be cos PROMS Yany> capable and efficient by: = Lowering power consumption Things with connected sensors ow Z EQ N = Increasing computational capability = Adding AI/ML
Slide 11: Expanding our technology leadership position
© Nordic Semiconductor Expanding our technology leadership position — fo <P Cloud Services ) il Sound investment criteria across technologies, products, services and verticals Sizeable markets Growth above industry average Opportunity for healthy gross-margins Opportunity to grow market share Feasib
Slide 12: New level of always-on AI/ML capabilities
▪ ▪ ▪ ▪ ▪ ▪ “This brings a new level of always-on AI/ML capabilities ▪ and technologies that will strengthen our core business” ▪ Kjetil Holstad, EVP Strategy and Product ▪ Management The transaction is dependent on regulatory approval, and completion of the transaction is expected by the end of 202
Slide 13: Bringing on-board a world class SRAM design team
▪ ▪ ▪ ▪ “We are very excited to bring on-board this world class team, recognized as an industry leader in optimized, low voltage embedded SRAM designs. A team we know ▪ intimately from years of working together.” Svein-Egil Nielsen CTO/EVP R&D and Strategy ▪
Slide 14: Latest PMIC from Nordic - nPM1300
Latest PMIC from Nordic - nPM1S00 The most intelligent PMIC on the market Ultra-high efficiency + 2 + oh Accurate, ultra-low-power fuel gauge replacing: Unique system management features - Charger IC - 2xBuck DC/IC - 2xLoad Switch - Fuel gauge - External watchdog - Hard reset IC Adding features that
Slide 15: ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪
▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪
Slide 16: Welcome to the Future
Slide 17: Quarter presentation
Q? 2025 Quarter presenation
Slide 18: Disclaimer
Nordic Semiconductor Disclaimer The following presentation is being made only to, and is only directed at, persons to whom such presentation may lawfully be communicated (“relevant persons”). Any person who is not a relevant person should not act or rely on this presentation or any of its contents.
Slide 19: Solid revenue in challenging market
© Nordic Semiconductor Solid revenue in challenging market Q2 2023: = Revenue of USD 154m (-23% wy, +6% a/a) Quarterly revenue development (USDm) 191 200 202 = Bluetooth USD 143m (-15% y/y, +9% a/q) = Gross margin 53% and EBITDA margin of 18% 1s 154 Outlook: = Guiding for revenue of USD 145-165 mill
Slide 20: Tier-1s revenue share continue to increase
© Nordic Semiconductor Tier-Is revenue share continue to increase Bluetooth revenue composition (USDm) 700 63% 60% 600 8% 50% 500 400 = voy 2a " Top-10 accounted for ~50% of 500 Bluetooth revenue LTM 200 100 io} 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 LTM Q2'23 = Top 10 (%) Ml Other B
Slide 21: Steady and high certification market share
© Nordic Semiconductor Steady and high certification market share Significantly increasing value per design Bluetooth Low Energy end-product certifications, last 12 months 1500 1200 43% = soo i % 43% 41% 41% 35% i 600 — | |_| |_| = | i [] 30 ard 49] 546 585 549 51g [i ) Q216 LTM Q216 LTM Q218LTM Q21
Slide 22: N Nn
N Nn
Slide 23: Cellular IoT
© Nordic Semiconductor Cellular loT Cellular loT revenue last 12 months (USDm) = Solid and healthy inflow of projects into pipeline, no signs of slowdown in design activity " Good conversion rate through the pipeline, large base of ~370 commercial projects = Lifetime value of designs is increasing =
Slide 24: Launching significant uplift of cellular offering
© Nordic Semiconductor Launching significant uplift of cellular offering Full product + services solution from device to cloud Saving our customers from dealing with today’s fragmented cellular loT supply chains More devices... World's first devices supporting both cellular and DECT NR+ NRF9I161 SIP
Slide 25: Wide launch of the nPM1300
Wide launch of the nPM1S00 The most intelligent PMIC on the market Ultra-high efficiency + 2 + oh Accurate, ultra-low-power fuel gauge replacing: Unique system management features - Charger IC - 2xBuck DC/IC - 2xLoad Switch - Fuel gauge - External watchdog - Hard reset IC Nordic takes care of energy
Slide 26: Nordic one of Europe's Climate Leaders 2023
© Nordic Semiconductor Nordic one of Europe's Climate Leaders 2023 Compiled by Financial Times and Statista = Nordic ranked number 26, making it the highest-ranked Norwegian company on the prestigious list of 500 companies = The methodology for this list was tightened to reflect on companies’ enviro
Slide 27: Financials
Slide 28: Bluetooth driving the q-o-q upturn
© Nordic Semiconductor Bluetooth driving the g-o-q upturn Bluetooth revenue (USDm) Proprietary revenue (USDm) Cellular loT revenue (USDm) Quarterly Quarterly Quarterly 200 ves 2 172 150 143 150 50 131 50 40 40 100 30 25 26 30 20 20 50 13 12 8 9 10 6 wo 7 5 5 5 coe foes ° te) ° a@2 @ a a @ ai @2 G3 a
Slide 29: Revenue by markets
Nordic Semiconductor Revenue by markets Industrial UsDm USDm 154.2 29.9 -23% +6% -33% +21% -38% -34% yoy g-0-q yoy q-0-g yoy qo-g 50 Others 2% 125 126 126 109 100 84 os 70 50 25 ° @z22 322 @4'22 QI23 a223 S282 “8 45 l | [| lJ : @222 322 Q422 GI23 G228 Revenue for the individual markets excludes ASIC
Slide 30: Gross margin
© Nordic Semiconductor Gross margin 70% = Stable and solid q-o-q margin 60% 57.3% 55.4% development on Nem ss = Expecting gross margin >52% B0% ween nnn nnn nnn ec cence for Q3 2023 = Reiterating long-term ambition to 40% maintain gross margin >50% 30% Q2 2022 = Q32022 @Q42022 Q12023 = Q22023 30
Slide 31: Operating model performance Q2
Operating model performance Q2 2024 Gross margin 53.0% Q2 2023 Q2 2022 A USD USD Revenue -23.0% Demand slowdown in 2023 R&D 154.2m 200.2m short-range “ % 55.4% Gross margin 53.0% oe -2.4pp Stable adjusted for price increase effects in 2022 USD 81.7m USD 110.8m, R&D 12.3% 12.2% +0.1pp short-range USD
Slide 32: Balancing investments and cost awareness
Balancing investments and cost awareness Cash OPEX* (USDm) Flat cash costs vs. Q2’22 Salary +2.1%: = Employees increased by 17% y-o-y to 1,520 = Currency reduced payroll cost in Q2'23 by USD ~2m compared to Q2’22 rates Continuing work to adjust cost base to protect margins Q2 2022 Q3 2022 Q4 2022 QI
Slide 33: Capex intensity remains low
© Nordic Semiconductor Capex intensity remains low Capex (USDm) =" Capex of USD 4.8 million in Q2 = Overall capex intensity 3.7 % LTM Q2 2022 Q3 2022 Q4 2022 QI 2023 Q2 2023 mmm Capex —=O=Capex/Revenue 33
Slide 34: Strong cash position
© Nordic Semiconductor Strong cash position Cash position and Cash Flow Q2 2023 (USDm) 22 1 8 252 . ; 233 = " Cash flow from operations adjusted for capitalized development expenses of USD 25 million =" q-o-q decrease of NWC = NWC/Revenue LTM of 29.0% = Other items mainly impacted by increased refun
Slide 35: Summary and Outlook
Slide 36: Expecting Q3 revenue in line with Q2
© Nordic Semiconductor Expecting QS revenue In line with Q2 Q3 2023 guidance expected from Q2 to Q3 UsDm : 145-165m >52% : = Clear growth opportunities but cautious customers | -28% to-18% — -6% to +7% i oo. . yoy aro-a = Low visibility and wide range of outcomes for revenue beyond the current quart
Slide 37: Nordic Semiconductor
— ~ eo. NORDIC SEMICONDUCTOR