Cohu, Inc. · NASDAQ:COHU
Cohu — Investor Day (May 2022)
51 slides from Cohu's investor day presentation, May 16, 2022
Slide 1: Cohu Analyst & Investor Conference
COHU ANALYST & INVESTOR CONFERENCE May 16, 2022
Slide 2: Cautionary Statement Regarding Forward-Looking Statements
Cautionary Statement Regarding Forward-Looking Statements Catan steams cota hs presetaton may becondered fruaraooing statements thi th mening af the US. Pate Secs Lgaton Rete Act 998, ng statements ‘eowcng a sarenbleAserevate Marte (2M estimate, re 9nd growth ce ev, mart segrers AGRE 3 growth creer
Slide 3: Agenda
AGEND. A Jeff Jones, Senior VP & CFO Welcome "Yves Hirschy, VP & General Manager Inspection & Metrology johrson, Senior VP Global CustomerGroup lan Lawee, SVP & General Manager iconductorTest Jeff Jones, Senior VP & CFO | Delivering Profitability and Shareholder Value Devin Sheridan, VP & General Ma
Slide 4: Raising the Bar, Delivering Results
RAISING THE BAR DELIVERING RESULTS MAJOR THEMES FOR TODAY Cohu isa technology-driven company committed to solving our customers’ most complex test and inspection challenges > Broad product portfolio delivering value to customers in key secular growth markets Committed to profitable growth and capita
Slide 5: Cohu at a Glance
COHU AT A GLANCE $3. 20 Our long-term vision is to move up ~ 23,500 the technology value chain FY21 Non-GAAP EPS() Equipment Installed Base 4-Cohu
Slide 6: Solving Customers' Most Complex Challenges
SOLVING CUSTOMERS’ MOST COMPLEX CHALLENGES 2 a) High performance product portfolio at lower cost-of- ownership Strong market position ineach business vertical & Diverse customers and applications expanding addressable market ~ 20% share in $4.4 billion addressable market ® {2 Itt of ge © Ament ne hn
Slide 7: Market and Technology Leadership
MARKET AND TECHNOLOGY LEADERSHIP Strong position in each business vertical SemiconductorTest® Test Interface Services Inspection & Automation ®) Metrology High fidelity measurement instruments Global footprint ‘Thermal and Vision Inspection Compact, low-power systems > Scalability Data analytics Tec
Slide 8: Driving Growth in Select End-Markets
DRIVING GROWTH IN SELECT END-MARKETS Applications hicle electrification &ADAS @-. 3 Secular tailwinds driving end-market growth (st xyarge) ~21% CAGR 3D-stacked package growth ~25% CAGR ADAS and xEV ® ‘Semi content in autos‘ ~ 43% $1,500 | SeniTet ck en sec ey (obSAM sition) ugs0 nase 56 subscriptio
Slide 9: Why We Are Winning
WHY WE ARE Delivering higher yield at lower cost-of-ownership WINNING 1% higher yield ; : Solutions approacl eaueses te faster time-to-yield ~ $5 billion Z customer value ® satisfying demand Global support greater productivity (a) Semcon nds Asacaton SI balsemcondcorndsi sks tel 556 bien 2028 u ® Pr
Slide 10: Supporting Customers Globally
SUPPORTING CUSTOMERS GLOBALLY ~ 23,500 Systems Installed Base ~ 500 Field Engineers serving customers in 20 countries Product Development /IP_ ae Manufacturing Operations les Principal Sales/Services ig i dip 72.Cohu
Slide 11: Commitment to Growth
COMMITMENT TO GROWTH Making investments to grow revenue and profitability eo £ SP SF SF (2) eo fers toctnated fst ay 002 ets bse en ctu and igi of 222 gue (3) Armour on GAAP, 0 spp fr GAAPtS on GAAP cts, anf ste ear nero ekg nn GAAP es Organic Inorganic = E st00 2 ~$414M® Xéerra sen Oxrra S400 R&D o
Slide 12: Target Model
TARGET MODEL Revenue “ $1B Gross Margin © 49% Operating Income ® 25% 9 ad Op nce ae Non-GAAP, Append te repacing we STRATEGY Expand Semiconductor Test in high-growth markets beyond RF ® Front-end ICs 3) with scalable, precision instrumentation Accelerate Interface product sales in test cells and hig
Slide 13: Semiconductor Test
| SEMICONDUCTOR TEST MAJOR THEMES FOR TODAY © Increasing test intensity with complex device applications © Differentiated platform aligned with secular market trends © Winning new customers, expanding SAM and delivering growth beyond RF XA lan Lawee SVP & General Manager 2-Cohu
Slide 14: Increasing Test Intensity Driving Growth
INCREASING TEST INTENSITY DRIVING GROWTH . eee = Focused applications Focused applications Focused applications © Automotive xEV and ADAS © Internet of Things © Data Centers, Computing & © 5G sub-6 GHz and mmWave Network Infrastructure © Battery management and sensing © WiFi 6E/7, UWB, narrow-band ©
Slide 15: Growing Beyond RF-FEM
GROWING BEYOND RF-FEM Diversification 3 0% syarch 020 2-year order CAGR Diamond, market penetration ® Doubled install base in the last 3 years [Expanding SAM in data storage analog, power management, automotive analog and RF-loT g& Extending RF leadership in Front-End Module, RF-loT, Ultra-wideband
Slide 16: Scalable Test Solutions on Diamond
SCALABLE TEST SOLUTIONS ON DIAMOND, Devices with increasing mixed signal complexity Microcontrollers Device cost down enabling ‘market expansion 1) Based uzoncstomerpronedberchmaing dota Best-in-Class Throughput Event-Link architecture suited for efficient multisite mixed signal test Air-Cooled Univ
Slide 17: Expanding Analog Content
EXPANDING ANALOG CONTENT Analog Leaders Increasing complexity with electrification, consumer wearables, mobility, industrial automation and data centers “9 T2Surers EXAMESS Gafineon 10%+ PIT. serwonse” Annual increase in test intensity” | sovsree NMP Onsemi ss $650M Qorvo. xzenesas elmos* Cohu Addre
Slide 18: Ever-Increasing Power Demand
EVER-INCREASING POWER DEMAND ower Mgmt. Leaders Rapidly changing power distribution systems for data centers, xEVs and the power grid are creating new test requirements T&S mons pase 4X — 33X Gafineon = yg Quatcomwe Voltage increase in data centers and xEVs <P onsemi ~ $275M © mes 2 Cohu Addressable
Slide 19: Portfolios IoT Leaders
PORTFOLIOS loT Leaders Large loT deployment integrating several technologies PAS ents (RF, MCU ®), Power) in cost-sensitive applications ‘nfineon & RENESAS. ‘pe © gh ~20B : =i) em My Low power loT nodes, © MR Quatcommw 5 fp B O doubling by 2025 ®? S & PB & meng OY 20S eroapcow —sxrwonte APG ~ $280M
Slide 20: Semitest
SEMITEST Cohu SAM CAGR ~6% i. ‘35008 zon 20% Target Revenue CAGR ~14% STRATEGY Expanding addressable market by ~ $300M aligned with secular market trends and increasing test intensity Delivering best-in-class throughput for a focused range of mixed signal devices Extending leadership in multi-market
Slide 21: Interface Solutions
| INTERFACE SOLUTIONS MAJOR THEMES FOR TODAY Increasing test intensity is driving growth in core markets Strength in power and thermal technologies enabling value-add solutions for xEV and ADAS applications © Expertise in mmWave RF and high-speed digital applied to deliver leading cost-of-test for 5
Slide 22: Increasing Test Intensity
INCREASING TEST INTENSITY ‘Automotive & Industrial Mobility & Consumer By “CAGR 700M Focused applications © Automotive xEV and ADAS Focused applications © Data Center & Al Focused applications © mmWave 56 © SiC higher efficiency offers >3.5x ‘© Input/Output bandwidth doubling higher power density vs
Slide 23: Leadership in Automotive Test Solutions
LEADERSHIP IN AUTOMOTIVE TEST SOLUTIONS High Current Contactor eer Sa POWER THERMAL Un S nique pin architecture and heat dissipation structure delivers =30%highercurrent capacity ~ 2x ~ 50% Lifelncrease LowerCost DataRete + Thermal Thermal Contactor CAGR Customers Se Sean x combined with Cohu test h
Slide 24: Solutions in High-Performance Applications
SOLUTIONS IN HIGH-PERFORMANCE APPLICATIONS Accelerated Growth Segment Contactor SAM“ 5G Mobility -%» CAGR | i 1 Comgnyestmetes 2) PaseanptedeMedicton Coaxial Contactor High isolation for PAMg ® RE Improved isolation delivering higher signal integrity 8 if 2x Better Isolation iene — eee mmWave Contac
Slide 25: Expanding in RF Probe Card
EXPANDING IN RF PROBE CARD ¢A) 6oGtz > Multste test at mmWave performance So] Performance . Direct attach technology =7) Timeto Yield o Tumkey solution simplifies implementation v Y cut == (V ostof Test 5 integration with Cohu's Diamond, semi tester tnabescltaton ted == lv Ramy verification and full
Slide 26: Test Interface Strategy
TEST INTERFACE STRATEGY Cohu SAM” CAGR Accelerate growth in automotive with high- power and advanced thermal contactors for ~ 5% vehicle electrification and ADAS sco Focusing on selected applications in 5G and computing with high-performance, cost-efficient interface solutions ‘51,2008 202 2024 Expa
Slide 27: Inspection & Metrology
| INSPECTION & METROLOGY <ONVv- MAJOR THEMES FOR TODAY 6 Capitalizing on the growth of system-in-package > Providing integrated test and scan solutions for high-power 2 Aligning to “beyond Moore” opportunities with advanced packaging technology Yves Hirschy VP & General Manager 2-Cohu
Slide 28: Beyond Moore Evolution Driving Value Upstream
BEYOND MOORE EVOLUTION DRIVING VALUE UPSTREAM Analog Test and Scan High-Performance Digital Focused applications © Wafer-Level Chip Scale and module inspection Focused applications © Silicon Carbide Known Good Die © Advanced packages2.5/ 3D. test and inspection inspection and metrology rowth © Mobil
Slide 29: NEON Inspection Maximizes Yield
NEON INSPECTION MAXIMIZES YIELD Customer Challenges Cohu Solution Value to Customer = Infrared (IR) NV-Core technology Small form-factor WLC: <©> enabling micro-scale defect upto 5% devices with sub- detection below the device surface Higher Inspection Yield millimeter size and exposed structure Art
Slide 30: True Known Good Die for Module Integration
TRUE KNOWN GOOD DIE FOR MODULE INTEGRATION Customer Challenges Cohu Solution Value to Customer pmodoleiald Proven high-powertesting of vp 7% losses linked to multiple 50 um thin bare die with die integration controlled contactor insertion Higher Yield g ZS assisted by NV-Core vision Yield: - Folle-s
Slide 31: Next Generation High-Performance Solution
NEXT GENERATION HIGH-PERFORMANCE SOLUTION Customer Challenges New automotive inspection & metrology quality requirements Bring advanced packages to high volume production at Cohu Solution Under development NV-Core inspection and metrology enabling smaller defect detection on large dies Unique racing
Slide 32: Inspection & Metrology
INSPECTION & METROLOGY Cohu SAM CAGR ~6% 7 008 202 2024 Target Revenue CAGR ~13% 1 Company estimates ncusngotbesable mae epansen STRATEGY Serve growing system-in-package applications in high-end mobility Develop leadership position in high-power Known Good Die for automotive xEV Expand addressable m
Slide 33: Major Themes for Today: Services
MAJOR THEMES FOR TODAY > Delivering customer value with increased uptime of the growing Cohu equipment installed-base worldwide > Mining installed-base data analytics for opportunities to minimize equipment downtime and maximize output Chris Bohrson Senior VP 2-Cohu
Slide 34: Maximizing Equipment Uptime and Output
MAXIMIZING EQUIPMENT UPTIME AND OUTPUT Data Analytics 25 Focused applications Focused applications © Drive above market growth rate in spares by increased © Grow data analytics software to maximize uptime on focus on customers’ maintenance programs large and growing fleet of Cohu systems © Grow boar
Slide 35: Data Intelligence Systems Increasing Output
DATA INTELLIGENCE SYSTEMS INCREASING OUPUT Real-time equipment monitoring and data analytics for Industry 4.0 factory automation of Cohu Equipment Pe colecreaupmert Dts INSIQNE Software Online Equipment Monitoring Track uptime, yield, and throughput with proactive notifiations for real-time correcti
Slide 36: DI-Core Data Intelligence Maximizes Output
DI-CORE DATA INTELLIGENCE MAXIMIZES OUTPUT Thermal Performance Out of Guard Band ¥ Real-time Whentesting temperature goes out of i. ‘toring 9v31d band, inthis case below the lower i monitoring [imit, early detection enables real-time so ofthermal calibration performance ~4% Increase in Productivity
Slide 37: Large Opportunity in Data Analytics
LARGE OPPORTUNITY IN DATA ANALYTICS ° Predictive Maintenance Manufacturing Industry 2022 TAM: 93.58, CAGR:-23% Predictive maintenance (PdM) increases productivity by minimizing downtime and increasing production output per machine PdM functionality for the manufacturing industry includes software, m
Slide 38: Services Strategy
SERVICES STRATEGY Cohu SAM ® CAGR High-margin value in servicing a growing fleet ~2% of Cohu equipment ai 7908 Dl-Core data analytics software provides significant value to large equipment installed- base @ S700 202 2024 Torget Revenue CAGE Large long-term expansion opportunities ~3% w copenema a 4-
Slide 39: Delivering Profitability and Shareholder Value
DELIVERING PROFITABILITY AND SHAREHOLDER VALUE MAJOR THEMES FOR TODAY Positioned to deliver on expanded target financial model © Increasing profitability with growth in higher margin markets, low-cost manufacturing and disciplined Opex spending © Driving growth in more stable recurring revenue from
Slide 40: Raising the Bar
RAISING THE BAR Increased Target = 2023 Target Model” to Actuals Model” wate Revenue $887M $abillion $1 billion Gross Margin 44% 49% Revenve [Operating Expenses ©) 23% 24% $4.00 | Non-GAAP EPS $3.20 $4.00 eps” Adjusted EBITDA 22% 26% Free Cash Flow $86M $180M (a) Nen-GAar, se Append: for GAAP toner
Slide 41: Creating Shareholder Value
CREATING SHAREHOLDER VALUE it} a Revenue Growth Increasing Profits Capital Allocation Seculartailwindsdrivingend-market Gross marginexpansion Funding organic growth through semiconductor growth F R&D investments and factory Disciplinedcost management expansion Accelerating customer wins and Faraeese
Slide 42: Revenue Growth
REVENUE GROWTH sa billion 3-Year Target _ Gal ss00 Revenue CAGR se00 ~7% to an | al | 2015 A 20720182019 m2 Target® Mosel Revenue [$M] Winning new customers and expanding SAM in growing markets Substantial revenue stream from recurring ® with attractive profit profile Bree ine tsa pte %.Cohu
Slide 43: Revenue Growth to $1 Billion
Test Interface REVENUE GROWTH TO $1 BILLION Increasing Revenue in Key Secular Growth Markets in &lea ing- edge products to F test and inspection atc 4.Cohu
Slide 44: Revenue Distribution at Target Financial Model
REVENUE DISTRIBUTION AT TARGET FINANCIAL MODEL Q1'22 TTM Actual Results Target Financial Model Improved through-cycle profitability with large recurring business ross margin expansion from growth in premium product sales
Slide 45: Track Record of Margin Expansion
TRACK RECORD OF MARGIN EXPANSION, “"2i"" “ger ge Achieved es +10 Points « of Gross Margin Expansion = ue Wis Fy FY Fie FYI FYO FYI Ex wna”? 1H22 revenue mix progressing to target model and expanding gross margin Increasing insourced manufacturing and efficiencies improves gross margin (8) ALGrots Ma
Slide 46: Effective Capital Allocation Strategy
EFFECTIVE CAPITAL ALLOCATION STRATEGY > @ $. Oi R&D Dividend Share Debt Capital Investment © Repurchase Expenditures Funding organic '$41M returned to $70M authorized Repaids26sMof Capex light ~s70M growth shareholders termloanBdebt from FYa5—FY22 Fyag _FY20 Repurchased 550K $424M invested from shar
Slide 47: Investment Thesis
INVESTMENT THESIS $1 Billion 49% 25% 18% Revenue Gross Margin”) Operating Income Annual Free Cash Flow“ ~7%° +500bps” +400bps® ~$180M° Target3-YearRevenue — Premiumproduct salesand Cost discipline driving Driven by significant CAGR stable recurringrevenue strong operating leverage margin expansion a
Slide 48: Presenters
Luis Miller President & CEO Yves Hirschy VP & General Manager, Inspection & Metrology Jeff Jones Senior VP &CFO Chris Bohrson Senior VP, Global Customer Group {lan Lawee ‘& General Manager, Semiconductor Test 8A * Sa a
Slide 49: Appendix
APPENDIX Use of Non-GAAP Fina Information: “This presentation includes non-GAAP financial measures, including non-GAAP Gross Margin/Proft, Income and Income (adjusted earings) per share, Operating Income, Operating Expense and Adjusted EBITDA that supplement the Company's Condensed Consolidated Stat
Slide 50: GAAP to Non-GAAP Reconciliation
GAAP to NON-GAAP RECONCILIATION
Slide 51: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP RECONCILIATION %Cohu —