Slide 1: Q2 2022 Investor Conference
Q2 2022 Investor Conference August 10th, 2022 Embedded Wisely, Embedded Widely Embedded Wisely, Embedded Widely
Slide 2: IPR Notice
IPR Notice All rights, titles and interests contained in this information, texts, images, figures, tables or other files herein, including, but not limited to, its ownership and the intellectual property rights, are reserved to eMemory. This information may contain privileged and confidential inform
Slide 3: Cautionary Statement
Cautionary Statement This presentation contains forward-looking statements, which are subject to risk factors associated with semiconductor and intellectual property business. It is believed that the expectations reflected in these statements are reasonable. But they may be affected by a variety of
Slide 4: Contents
Contents 1 Review of Operations 2 Future Outlook 3 Why is Random Number Generation Important in Gaming? 4 Q&A 5 Appendix Embedded EmbeddedWisely, Wisely,Embedded EmbeddedWidely Widely 4
Slide 5: Review of Operations
Review of Operations Embedded Wisely, Embedded Widely 5
Slide 6: Q2 2022 Financial Results
Q2 2022 Financial Results (thousands of NT dollars) Change Change Change Q2 2022 Q1 2022 Q2 2021 H1 2022 H1 2021 (QoQ) (YoY) (YoY) Revenue 796,292 727,107 9.5% 541,415 47.1% 1,523,399 1,138,149 33.8% Gross Margin 100% 100% - 100% - 100% 100% - Operating Expenses 336,197 313,846 7.1% 258,701 30.0% 65
Slide 7: Revenue in Different Stream
Revenue in Different Stream 22Q2 in comparison to 22Q1 Revenue Breakdown $1,000,000 22Q1 22Q2 Royalty 74.8% $500,000 $0 Licensing Licensing Royalty 25.2% Revenue NT$ Thousands Q2 2022 Q1 2022 Change (QoQ) Q2 2021 Change (YoY) H1 2022 H1 2021 Change (YoY) Licensing 200,729 191,608 4.8% 174,559 15.0%
Slide 8: Revenue by Technology
Revenue by Technology • PUF-based security revenue increased 576.4% sequentially 2,163% year-over-year and accounted for 6% of total revenue in Q2 as adopted by DPU, CPU, AI SoC, FPGA, Security MCU and Setup Box. Q2 2022 Total Revenue Licensing Revenue Royalty Revenue Technology % of % of % of Chang
Slide 9: Royalty Revenue by Wafer Size
Royalty Revenue by Wafer Size Q2 Royalty Breakdown • 8-inch wafers contributed 51.1% of royalty, up 12.1% 12-inch sequentially and 56.3% YoY due to growth in wafer 48.9% shipment and ASP from the increasing penetration rate of various applications. • 12-inch wafers contributed 48.9% of royalty, up 1
Slide 10: Future Outlook
Future Outlook Embedded Wisely, Embedded Widely 10
Slide 11: Our Perspectives
Our Perspectives Licensing & Royalty: • Strong demand for NeoFuse and PUF-based security solutions will drive licensing to grow. • 8-in Licensing and 12-in royalties will continue its growth momentum from the increasing penetration rate in various applications. & • New tape-outs from 6/7nm will al
Slide 12: Why is Random Number Generation Important in Gaming?
Why is Random Number Generation Important in Gaming? Embedded Wisely, Embedded Widely 12
Slide 13: Seven Layers of Metaverse: Gaming
Seven Layers of Metaverse: Gaming Metaverse has different levels. Today, we will be talking about the experience layer using gaming as an example. Experience Games, Social, esports, Theater, Shopping Discovery Ad Networks, Social curator, Rating, Stores, Agent Creator Design Tool, Asset Econom
Slide 14: Random Number Generation in Gaming
Random Number Generation in Gaming Random Number Generator (RNG) are algorithms that create random values. They determine random events, such as the items you pick up, whether an attack lands, etc. In other words, they introduce an element of “luck” in gaming. Embedded Wisely, Embedded Widely
Slide 15: Example: RNG in Games
Example: RNG in Games RPG games feature weapon “drops” and in-game purchases (microtransactions) for players to Dropped new item acquire the items they desire. that can be looted Microtransaction in-game purchases Embedded Wisely, Embedded Widely 17 15
Slide 16: Software vs. Hardware Random Numbers
Software vs. Hardware Random Numbers The difference between software-based and true-random hardware-based numbers lies in the input. Generating deterministic numbers that shows random behaviors Examples: 0 1 0 1 0 0 … Software 0011010110010110…1011 Seed Software (Deterministic) Random Numbers Gene
Slide 17: Software RNG is Often Criticized in Games
Software RNG is Often Criticized in Games In-game RNG are based on software and lack true randomness. Trans: The Ministry of Economic Affairs will now require game companies to disclose the odds of winning. The incident was caused by game player, Ding Tehao, throwing 1.7 million NTD into buying “b
Slide 18: Who does this Affect?
Who does this Affect? Multiple parties are affected by in-game RNG, not just players and providers, but also assets as well. Players Game Providers Digital Assets Credibility of the random numbers Verifiability of random numbers Authenticity in all in-game items provided in games Assurance that ti
Slide 19: How PUFtrng Improves Gaming
How PUFtrng Improves Gaming PUFtrng can generate random numbers in blockchain: Decentralize the process, ensuring transparency Provide the volume of random Blockchain Game Server Node numbers needed during game play Allow third-parties to verify the Blockchain Blockchain Node Node numbers sinc
Slide 20: Q&A
Q&A Embedded Wisely, Embedded Widely 20
Slide 21: Q&A: Revenue and Tape-out by Technology
Q&A: Revenue and Tape-out by Technology NTO Revenue (USD) Year NeoBit NeoFuse NeoBit NeoFuse PUF-based 2003 28 2004 39 2005 69 $4,217,380 2006 133 $6,202,270 2007 220 $9,402,479 2008 253 $12,896,211 2009 268 $11,695,587 2010 285 $15,873,331 2011 254 $15,399,098 2012 272 $19,620,768 2013 370 1 $25,43
Slide 22: Appendix
Appendix Embedded Wisely, Embedded Widely 22
Slide 23: Company Overview
Company Overview eMemory is the global leader of embedded non-volatile memory IP Revenue Trend (Unit: NT$ 1,000) 2,500,000 Royalty License/Design Revenue 2,000,000 1,500,000 1,000,000 500,000 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Founded In 2000 100
Slide 24: Quarterly Revenue Pattern
Quarterly Revenue Pattern 1st month: Receive License Fees of the month and Royalty from most foundries on previous quarter’s wafer shipments. 2nd month: Receive License Fees of the month and Royalty from other foundries. 3rd month: License Fees Only. (Unit: NT$ 1,000) 2018 2019 2020 2021 2022
Slide 25: Quarterly Number of New Tape-outs
Quarterly Number of New Tape-outs 2018 2019 2020 2021 2022 (Unit: IP Numbers) 200 177 180 158 160 148 147 150 138 134 134 140 120 113 109 109 99 97 107 103 100 91 90 87 80 60 40 20 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Embedded Wisely, Embedded Widely 25
Slide 26: Worldwide Customers
Worldwide Customers Our IP solutions are adopted by leading foundries, IDMs and fabless worldwide New Country LicensingIDM& Foundry Fabless Application & Royalty Technology Taiwan 4 1 316 Development China 9 0 1030 Korea 4 0 94 Japan 4 7 75 North 1 1 332 America Europe 2 1 204 Others 1 0 115 Embed
Slide 27: Business Model
Business Model Recurring royalty is the backbone of our business 70-75% revenue are from royalty based on wafer production More adoption = more volume shipment More advanced node wafers = higher ASP per wafer Revenue Breakdown 1-4 years 1-4 years License Fee Design License Fee Royalty Foundr
Slide 28: Technology Licenses
Technology Licenses Number of Licenses Year 2016 2017 2018 2019 2020 2021 2022 H1 License 43 20 26 18 28 32 19 Note: Terms (including number of process platforms and licensing fees) for each technology license are set contractually. Payments are made according to set milestones, and there are no par
Slide 29: New Technology Under Development
New Technology Under Development New technologies are being developed for 128 platforms by Q2 2022. 8 licensing contracts were signed. 0.11~ 0.15~ Technology 4/5nm 6/7nm 12/16nm 22/28nm 40nm 55/65nm 80/90nm >0.25um 0.13um 0.18um NeoBit - - - - - 2 1 12 12 1 NeoFuse 2 1 6 8 5 15 8 2 3 - PUF-Based
Slide 30: Technology Development
Technology Development Developments by process nodes 12" Fabs Production Development IP Type Process Type 4/5nm 0 4 OTP, PUF FF 6/7nm 4 1 OTP, PUF FF, FF+ 12/16nm 6 7 OTP, PUF FF, FF+, FFC, FFC+, LPP LP/ULP/ULL, HPC/HPC+, HV-OLED, DRAM,SOI, ReRAM, 22/28nm 43 12 OTP, PUF ,MTP MRAM 40nm 21 6 OTP, PU
Slide 31: Embedded Wisely, Embedded Widely
Embedded Wisely, Embedded Widely For more information, please visit: eMemory Website: https://www.ememory.com.tw/ PUFsecurity Website: https://www.pufsecurity.com/ Embedded Wisely, Embedded Widely 31