Diodes Incorporated · NASDAQ:DIOD
Diodes — Diodes Inc /Del/ — 22nd Annual Needham Growth Conference (January 2020)
40 slides from Diodes's conference presentation, Jan 14, 2020
Slide 1: 22nd Annual Needham Growth Conference
22nd Annual Needham Growth Conference New York, NY January 14th, 2020 Exhibit 99.1
Slide 2: Safe Harbor Statement
Page Safe Harbor Statement Any statements set forth herein that are not historical facts are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Such forward-looking statements include, but
Slide 3: Management Representative
Page Management Representative Dr. Keh-Shew Lu President and CEO Diodes IncorporatedSince 2005 Texas Instruments 27 years Experience: Senior Vice President of TI Worldwide Analog and Logic President of Texas Instruments – Asia Education: Master's Degree and Doctorate in Electrical Engineering Texas
Slide 4: Company Representative
Page Company Representative Laura Mehrl （冯蓉媞） Company spokesperson, Director of Investor Relations Since May 2010 Experience: Director of Investor Relations, Diodes Incorporated, Plano, Texas Senior Business Development Manager, STMicroelectronics, Carrollton, Texas Sales Director for Analog Devices
Slide 5: About Diodes Incorporated
Page A leading global manufacturer and supplier of high-quality application specific, standard products within the broad discrete, logic, analog and mixed-signal markets, serving the Automotive, Industrial, Consumer, Communications, and Computing segments. About Diodes Incorporated
Slide 6: Company Overview
Company Overview NASDAQ: DIOD Founded in 1959 Headquartered in Plano, TX; 21 locations globally Manufacturing in UK, Germany, China, and Taiwan ISO9001:2008 Certified / TS16949:2009 Certified ISO14001 Certified Key acquisitions: Anachip Corporation, Taiwan Jan. 2006 Advanced Power Devices Nov. 2006
Slide 7: Global Organization - TS16949 Manufacturing
Global Organization - TS16949 Manufacturing Page Legend Headquarters Wafer Fab Assembly/Test/Packaging Design & Sales/Marketing
Slide 8: Record Annual Revenue in 2018; Projected New Record in 2019
Page Record Annual Revenue in 2018; Projected to Achieve New Record in 2019 Track Record of Consistent Growth *YTD’19 based on mid-point of 4Q19 guidance as provided on November 4, 2019 CAGR: 14.24% (2005-2018) (In millions)
Slide 9: Vision: Create Shareholder Value
Vision: Create Shareholder Value Page Goal 1: $1B Market Cap Goal 2: $1B Annual Revenue Goal 3: $1B Gross Profit Goal 4: $1B Profit Before Tax $1B Market Cap $1B Revenue $1B Gross Profit $1B PBT 2010 2017
Slide 10: Shifting Gears to Profitability Growth
Shifting Gears to Profitability Growth Page Mission: Profitability growth to expand shareholder value Strategy: Grow Revenue to $2.5B at 40% Gross Margin Goal: $1B Gross Profit by 2025
Slide 11: Business Model
Business Model Page Implied 20182025 CAGR Revenue $1.2B à 2.5B 10.9% Gross Margin 35% à40% Gross Profit $435M à $1B 12.6% R&D% 5% à 7% SG&A%15% à13% Op. Profit15% à20%
Slide 12: Gross Profit Target of $1B in 2025
Page Gross Profit Target of $1B in 2025 Driving Profitability Growth & Operating Leverage (In millions) Implied CAGR: 12.6% CAGR: 20.5% Solid Operating Leverage: Managing OpEx to target model of 20% of revenue CapEx remains within target model of 5-9% of revenue Generating record earnings and cash f
Slide 13: Targeted Market Segment Distribution
Targeted Market Segment Distribution Automotive Connected driving, comfort/style/safety, electrification/powertrain Industrial Embedded systems and precision controls Consumer IoT: wearables, home automation, smart infrastructure Communications Smartphones: advanced protocols and charging Computing
Slide 14: Automotive Applications Driving Growth
Automotive Applications Driving Growth Connected Driving ADAS (Advanced Driver Assistance Systems) Telematics Infotainment Systems Comfort, Style and Safety Lighting Migration to LED and intelligent illumination BLDC motor control Migration from Brushed to Brushless DC Motors Electrification/Powertr
Slide 15: Automotive Opportunity
Automotive Opportunity Potential Revenue in Automotive $ / Car Brushless DC (BLDC) Motors $37.25 Connected Driving $25.82 Powertrain and Battery Management $14.72 Lighting – Moving to LED $7.53 Total $85.32 Normalized to 2013 Infotainment & Telematics Body Control Electronics Power Train Seat Contro
Slide 16: Industrial Growth
Industrial Growth Increasing IC content in embedded systems Switching and signal path for networked systems and automation Signal conditioning and timing for precision controls Motor controls, sensors and power management for smart meters 13.4% 2013 - 2018 CAGR: 14.6% 2.5% 8.4% 21.6% 29.2% For the 1
Slide 17: IoT – Machine to Machine (M2M)
IoT – Machine to Machine (M2M) Growth Opportunities: Power XTAL and clock Packet switch M2M – Dominated by short range technology 73% are short range, mostly Wi-Fi 2017: connections @ 750 million 2023: connections @ 2600 million M2M – By Product IoT and M2M Modems Routers POS Wireless beacons Diodes
Slide 18: Consumer: IoT Driving Power & Connectivity Requirements
Consumer: IoT Driving Power & Connectivity Requirements Diodes Key Products $ / Box Analog >$0.20 Power Management >$1.30 MOS/BJT >$10.00 Diodes and Rectifiers >$5.00 Timing and Connectivity $3.50 Total $20.00 Enterprise Smart Infrastructure Wearables Consumer & Home Asset Tracking Security & Survei
Slide 19: Sensor IoT Segment: Smart Home
Sensor IoT Segment: Smart Home Smart Home – up to 477Mu Safety and Security Climate Control Consumer Electronics Lighting control 400 100 200 300 Host Controller X1 PCIe2 100MHz HCSL Clk SSD X1 PCIe2 (or SATA controller) 25MHz Xtal PCIe CG PI6C557-05 PCIe Packet SW PI7C9X2G304SL Wireless Controller
Slide 20: Smartphone: Efficiency, Functionality and Control
Smartphone: Efficiency, Functionality and Control Driving Smartphone Growth Smart speaker/IoT rising AR / VR Foldable screens 5G Smartwatches Growth Opportunities Type-C MUX MOSFET LDO, OVP LDSW, Audio, DCDC, LED/OLED Driver, ACDC Diodes Key Products $ / Phone Analog $0.55 Power Management $1.50 MOS
Slide 21: Networking Segment
Networking Segment WW enterprise and service provider router market grew 4% in 2017 to $12.5B Continues to exhibit healthy growth, driven by network refreshes and investments in the fast-growing campus and datacenter segments Diodes Key Products $ / Router Analog $0.20 Power Management $0.30 MOS/BJT
Slide 22: Cloud Computing Accelerating Enterprise Market
Cloud Computing Accelerating Enterprise Market Page ReDriver support for USB connectivity Wide range of signal protocols: PCIe, SAS, SATA, GbE, USB MUX products for high capacity solid state storage Crystal oscillators for increasing clocking speeds
Slide 23: Computing Platform: Server/Storage Solution
Computing Platform: Server/Storage Solution Source: IDC, Diodes Marketing Server Platform Solution Total unit shipment Growth (CAGR) = 3.82% Almost all of Server vendors are our existing customers ODM direct has the highest volume – mainly in TW Diodes products are well positioned in this segment Co
Slide 24: USB Type-C Applications Driving Growth
USB Type-C Applications Driving Growth Focus Applications Smartphone, Tablet NB/DT/WS/AIO, PC, Server CE Appliance PC Peripheral/Monitor Inflight Entertainment Automotive - Infotainment Robotics Chargers Data speed, flexibility, and simplicity of use are key drivers Vbus Tx/Rx Tx/Rx Tx/Rx Tx/Rx D+/D
Slide 25: USB Type-C Potential
USB Type-C Potential Normalized to 2016 USB-C adoption to grow from 300M (2016) to 5B units (2021) - IHS Dec 2017 Diodes Key Products $ / System Connectivity, Signal Integrity and Timing $3.25 Analog (DCDC, LDO, Sleep Mode Charger etc) $0.89 Power Management Switch $0.40 MOSFET/BJT $0.25 Diodes, Rec
Slide 26: 5G Applications Driving Growth
5G Applications Driving Growth Focus Applications: Cloud Computing Data Center Server Gateway Internet Gateway Fiber network Core Network, Cell Stations Small Cells Base Station Edge Computing Server Smart antenna Fiber network End Products Portables: Smartphone, Tablet Smart Car Consumer: VR/AR, Dr
Slide 27: 5G Ecosystem Growth Potential
5G Ecosystem Growth Potential Normalized to 2019 Diodes Key Products $ / System Precision Timing & Connectivity $5.00 ~ $10.00 Discrete $2.03 ~ $2.50 Analog $9.00 ~ $11.28 Total $16.03 ~ $23.78
Slide 28: 5G System Opportunities
PON Power Clock PCIe Mux TVS Mobile Phone Power Clock Sensor BATMAN MIPI SW ReDriver T-Box Power Packet Switch Clock FCP OTN: CWDM DWDM Remote Radio Unit Power Mgmt Clock Level Shifter Logic Baseband Unit Power Mgmt Clock Level Shifter IO Expander Server/Storage Power Mgmt Clock Gen IO Expander I2C
Slide 29: Solution Provider Industrial Controls
Solution Provider Industrial Controls Page
Slide 30: Complete Platform Solutions: Notebooks
Complete Platform Solutions: Notebooks Page DCDC Converter CPU PCH MOSFET LED Driver USB 2.0 Switch A/V Codec DDR Regulator LDO Analog Switch TVS USB 3.0 ReDriver Crossbar Switch Vcore DCDC Controller Sleep / Charge Detect Video Switch MCU USB3 / DP Switch LSP Con LCD Panel TVS DP-to-VGA Converter V
Slide 31: Technology Focus
Technology Focus Page Products 20Gbps ReDrivers and Switches Automotive Packet Switch for Telematics / ADAS Complete USB Type-CTM Signal Switching High speed clocking for cloud computing Ultra low power and low noise LDOs for IoT Low Cj TVS for signal integrity Lowest rDS(on) LDMOS for battery effic
Slide 32: Key Differentiator – Packaging Design
Key Differentiator – Packaging Design Page Focus: Miniaturization and Power Efficiency ~ 2018 PowerDI5060-8L PD3333-8L DFN0808-4 DFN0806-3 SOP-8/14/16L-EP MSOP-8/EP TO252-2/3/4/5L SOD123(F)/923 SOD523/323 TO220-5L TO262AA/AB QFN5050-32 DFN0604-3 2019 ~ ITO220AC-S DFN0806-6 DFN0603-2 TO220-2/3L Power
Slide 33: Miniaturization and Multi-Chip Packaging
Page Advanced Packaging Multi-Chip Packaging Miniaturization DDFN0402 the smallest discrete semiconductor package Dual-Flat No-Lead (DFN) DDFN (Encapsulated CSP) Chip-Scale Package (CSP) HS IntelliFET: ZXMS3001 Miniaturization and Multi-Chip Packaging
Slide 34: Efficient Manufacturing + Superior Processes
Page Shanghai-based packaging with capacity over 34 billion units Chengdu facility has potential capacity 3X of Shanghai Additional facilities in Neuhaus, Germany and Chengdu, China Two fabs in Shanghai (6” and 8”), one fab in Greenock, UK (8”), one discrete fab in Oldham, UK (6”) Bipolar, BiCMOS, C
Slide 35: Third Quarter 2019 Financial Performance
Third Quarter 2019 Financial Performance Page In millions, except per share 3Q18 2Q19 3Q19 YoY Revenue $320.9 $322.0 $323.7 0.8% Gross Profit (GAAP) $115.2 $122.0 $122.0 5.9% Gross Profit Margin % (GAAP) 35.9% 37.9% 37.7% +180bp Net Income (GAAP) $30.9 $36.3 $38.1 Net Income (non-GAAP) $34.5 $40.0 $
Slide 36: Balance Sheet
Balance Sheet Page In millions Dec 31, 2017 Dec 31, 2018 Sept 30, 2019 Cash $204 $241 $218.4 Short-term Investments $5 $7.5 $7.9 Inventory $217 $215 $231 Current Assets $662 $735 $763 Total Assets $1489 $1526 $1610 Long-term Debt (including the current portion) $247 $213.8 $119.0 Total Liabilities $
Slide 37: Revenue Profile as of 3Q 2019
Revenue Profile as of 3Q 2019 By End Market Page 16% 28% 24% 22% 10% Industrial Communications Consumer Automotive Computing By Channel By Region 9% 74% 17% Asia Pacific North America 66% 34% Distribution OEM / EMS Europe
Slide 38: Fourth Quarter 2019 Business Outlook
Page Revenue to be approximately $300 million, +/- 2.0%, which at the mid-point represents annual growth of 2.8 percent even in the overall weak market environment and continued outperformance of our served market GAAP gross margin to be 36.5%, +/- 1% Non-GAAP operating expenses, which are GAAP oper
Slide 39: Summary
Summary Vision: Expand shareholder value Mission: Profitability growth to drive 20% operating profit Next Strategic Goal: $1B gross profit Tactics: Increased focus on high-margin Automotive, Industrial and Pericom products Investment for technology leadership in target products, fab processes, and a
Slide 40: Thank you
Diodes Inc /Del/ — 22nd Annual Needham Growth Conference (January 2020) on 6ix