Slide 1: Q2 2018 Conference Call
Q2 2018 Conference Call Veeco Instruments, Inc. August 2, 2018
Slide 2: Safe Harbor
Safe Harbor To the extent that this presentation discusses expectations or otherwise makes statements about the future, such statements are forward-looking and are subject to a number of risks and uncertainties that could cause actual results to differ materially from the statements made. These item
Slide 3: CEO Introduction
CEO Introduction John Peeler
Slide 4: Q2 2018 Highlights
Q2 2018 Highlights Q2 $132M $158M $11M 15¢ Results Bookings Revenue Non-GAAP Non-GAAP EPS Operating Income • All Non-GAAP P&L metrics either met or • Initiated cost reduction by eliminating exceeded guidance redundant Singapore manufacturing • Bookings declined due to LED market operations weakness
Slide 5: CFO Financial Review
CFO Financial Review Sam Maheshwari
Slide 6: Intangible Asset Impairment
Intangible Asset Impairment • Ultratech product lines have performed below prior projections • Current projections triggered an impairment of intangible assets of $252M • This non-cash charge does not affect our liquidity nor our day-to-day operations • Remain optimistic about the combined strength
Slide 7: Q2 2018 Revenue by End Market and Geography
Q2 2018 Revenue by End Market and Geography Mix by End Market Mix by Geography 17% 21% United States Scientific & Industrial 55% 45% LED Lighting, Display & China Compound Semi 12% Front-End Semi $158M 16% EMEA 18% 16% Rest of World Advanced Packaging, MEMS & RF Filters • China Blue LED was 31% of V
Slide 8: P&L Highlights
P&L Highlights GAAP Non-GAAP $ millions (except per share amounts) Q1 18 Q2 18 Q1 18 Q2 18 Revenue $158.6 $157.8 $158.6 $157.8 Gross Profit 56.7 55.4 57.8 56.5 Gross Margin 35.7% 35.1% 36.5% 35.8% R&D 24.3 24.9 23.4 23.9 SG&A & Other 26.2 24.7 23.2 21.9 Operating Income/(Loss) (11.4) (261.2) 11.3 10
Slide 9: Balance Sheet Highlights
Balance Sheet Highlights $ millions Q1 18 Q2 18 Cash & Short-Term Investments 311 261 Accounts Receivable 108 134 Inventories 131 146 Accounts Payable 58 65 Long-Term Debt 278 281 Cash Flow from Operations (12) (46) DSO (days) 61 76 DOI 118 130 DPO 52 58 Increased Working Capital Drove Down Cash Bal
Slide 10: Q3 2018 Guidance
Q3 2018 Guidance GAAP Non-GAAP Revenue $130M - $140M $130M - $140M Gross Margin 35% - 37% 36% - 38% Net Income (Loss) ($12M)-($7M) $1M-$6M Earnings Per ($0.25)-($0.15) $0.03-$0.13 Share Non-GAAP $4M-$9M Operating Income . A reconciliation of GAAP to Non-GAAP financial measures can be found in the ba
Slide 11: Business Update & Outlook
Business Update - & Outlook
Slide 12: Advanced Packaging, MEMS & RF Filters
Advanced Packaging, MEMS & RF Filters High-End Computing Driving Need for Advanced Packaging Significant Increase in Demand for FO-WLP » Artificial intelligence >6M Wafers per Year » Big data analytics » Autonomous vehicles (ADAS) » Mobile processors 1M Wafers per Year FO-WLP Demand Forecasted to In
Slide 13: LED Lighting, Display & Compound Semiconductor
LED Lighting, Display & Compound Semiconductor Mobile & TV Backlighting General Lighting Emerging Applications Waves of Compound Semiconductor Demand Driven by mega trends: • 3D Sensing/VCSEL Photonics Global leader in • Autonomous Vehicles MOCVD through • 5G RF & High Speed Data waves of demand wit
Slide 14: Front-End Semiconductor
Front-End Semiconductor Extreme Ultraviolet (EUV) Lithography is an Enabler for Leading-Edge Nodes » ASML is shipping/forecasting 50 EUV Lithography tools between 2018 and 2019* » Veeco’s Ion Beam technology is ideally positioned for producing EUV mask blanks LSA / Melt » China 28nm fabs delayed » M
Slide 15: Scientific & Industrial
Scientific & Industrial Data Storage Endures through Cycles » Megatrends drive increases in cloud storage » Thin film magnetic head (TFMH) unit volumes are increasing to support larger hard drive storage capacities » Manufacturers continue to leverage Veeco’s expertise to upgrade TFMH technology to
Slide 16: 2018 Priorities Update
2018 Priorities Update Delivering Growth – Diversifying Company 2018 anticipated to grow over 2017 in each market Continuing to Invest in Innovation Ongoing development in MOCVD, Lithography, Laser Anneal, Wet Etch Ultratech Integration Proceeding according to plan with additional manufacturing cost
Slide 17: Q&A
Q&A
Slide 18: Backup & Reconciliation Tables
Backup & Reconciliation Tables
Slide 19: Note on Reconciliation Tables
Note on Reconciliation Tables These tables include financial measures adjusted for the impact of certain items; these financial measures are therefore not calculated in accordance with U.S. generally accepted accounting principles (“GAAP”). These Non-GAAP financial measures exclude items such as: sh
Slide 20: Supplemental Information—GAAP to Non-GAAP Reconciliation
Supplemental Information—GAAP to Non-GAAP Reconciliation US$ millions Q1 18 Q2 18 US$ millions Q1 18 Q2 18 US$ millions, except per share amounts Q1 18 Q2 18 Net Sales $158.6 $157.8 GAAP Net Income (Loss) $(15.8) $(237.6) GAAP Basic EPS (0.34) (5.02) GAAP Gross Profit 56.7 55.4 Add: Share-Based Comp
Slide 21: Q2 2018 GAAP to Non-GAAP Reconciliation
Q2 2018 GAAP to Non-GAAP Reconciliation Non-GAAP Adjustments Share-Based In millions, except per share amounts GAAP Compensation Amortization Other Non-GAAP Net Sales $157.8 $157.8 Gross Profit 55.4 0.5 0.6 56.5 Gross Margin 35.1% 35.8% Research and Development 24.9 (1.1) 23.9 Selling, General, and
Slide 22: Q3 2018 Guidance GAAP to Non-GAAP Reconciliation
Q3 2018 Guidance GAAP to Non-GAAP Reconciliation Non-GAAP Adjustments Share-Based In millions, except per share amounts GAAP Compensation Amortization Other Non-GAAP Net Sales $130–$140 $130–$140 Gross Profit 45–52 1 — 1 47–54 Gross Margin 35%–37% 36%–38% Net Income (Loss) $(12)–$(7) 4 4 5 $1–$6 Inc
Slide 23: Thank You!
Thank You! Veeco Instruments, Inc. www.veeco.com Follow Us