Slide 1: 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 2: CEO Introduction
CEO Introduction John Peeler
Slide 3: Q3 2016 Performance Summary
Q3 2016 Performance Summary $85M Revenue ($M) Bookings ($M) Adjusted EBITDA ($M) $118M $75M $2.9 ($2.8) $68M Bookings $118M Revenue $85M Adjusted EBITDA $2.9M Solid operational performance with improving business conditions Swing positive, exceeded expectations Slightly above top end of our guidance
Slide 4: Focused on Improving Through Cycle Profitability
Focused on Improving Through Cycle Profitability $78M Reducing cost structure by ~$30M Executing restructuring plans Lowering ALD investments Creating a platform for consistent adjusted EBITDA profitability ~$20M ~$10M ~8M ~$30M ~22M COGS OPEX Efforts are progressing to plan Consolidate 3 manufactur
Slide 5: CFO Financial Review
CFO Financial Review Sam Maheshwari
Slide 6: Revenue Breakdown by Market and Geography
14% Advanced Packaging, MEMS & RF Revenue Breakdown by Market and Geography Note: Amounts may not calculate precisely due to rounding 58% Lighting, Display & Power Electronics 16% Scientific & Industrial 12% Data Storage Q3 2016 Revenue by End Market $85M 25% China 30% Rest of the World 23% EMEA 22%
Slide 7: P&L Highlights
P&L Highlights ($M) Q2 16 Q3 16 Q2 16 Q3 16 Revenue $75.3 $85.5 $75.3 $85.5 Gross Profit 31.4 33.5 31.9 34.4 % 41.7% 39.1% 42.4% 40.3% R&D 21.5 19.9 20.6 18.9 SG&A & Other 20.2 19.2 17.5 15.7 Net Income (32.1) (69.6) (7.6) (1.8) EPS ($0.82) ($1.78) ($0.19) ($0.05) Adjusted EBITDA (2.8) 2.9 % -3.7% 3
Slide 8: Financial Highlights: Cash, Receivables, Inventories
($M) Q2 16 Q3 16 Cash & Short-term Investments 331 337 Accounts Receivable 42 50 Inventories 91 87 Accounts Payable 35 27 Cash Flow from Operations (12) 7 Financial Highlights DSO 50 53 DOI 189 163 DPO 72 48 Note: Amounts may not calculate precisely due to rounding Grew cash balance by ~$6M Generate
Slide 9: Q4 2016 Guidance
Q4 2016 Guidance Revenue $85M–$100M $85M–$100M Gross Margins 37%–39% 38%–40% Net Income (Loss) ($13M)–($7M) ($3M)–$3M Earnings Per Share ($0.34)–($0.19) ($0.07)–$0.07 Adjusted EBITDA $0M–$6M Non-GAAP GAAP Note: A reconciliation of GAAP to Non-GAAP financial measures is contained in the Back Up & Rec
Slide 10: Q4 2016 Guidance
Q4 2016 Guidance Le GAAP Revenue $85M-$100M $85M-$100M Gross Margins 37%-39% 38%—-40% Net Income (Loss) ($13M)-($7M) ($3M)-$3M Earnings Per Shae ($0.34)-{$0.19) _ ($0.07)-$0.07 Adjusted EBITDA $OM-$6M Nate: A reconciiation of GAAP to Non-GAAP financial measures is contained nthe Back Up & Reconliato
Slide 11: LED Industry Recovery is Underway
LED lighting trends support ~15% unit CAGR Government initiatives spurring demand in the near-term Commercial replacement market is starting to take hold Display backlighting demand is stabilizing Display panel fundamentals improving; better than expected Q2 16 demand Multiple factors supporting con
Slide 12: Veeco MOCVD – A Winning Value Proposition
Veeco MOCVD – A Winning Value Proposition Delivering value through our differentiated technology Leveraging our winning technology to capture breadth of LED opportunities Recognized MOCVD leader in lighting/display LEDs Industry benchmark for Cost of Ownership EPIK 700 GaN System “We have achieved s
Slide 13: Veeco PSP – Market Trends
RF Filter demand is growing Advanced Packaging density increasing Veeco PSP – Market Trends Playing to our Strengths Tighter dimensions require resist films which are more challenging to remove Veeco offers COO advantage over batch tools Fan-out Packaging Leader in single-wafer solvent solutions wit
Slide 14: Strengthening Our Foundational Business
Strengthening Our Foundational Business Leader in advanced materials research Winning incremental production opportunities #1 in Molecular Beam Epitaxy (MBE) Wireless (4G/5G) Industrial Lasers for Materials Processing pHEMTS IR Detectors Defense #1 in Ion Beam Deposition & Etch Leader in hard-disk d
Slide 15: Summary
Summary Leverage technology expertise and leadership to win organic growth opportunities Continue actively exploring M&A opportunities Drive operational leverage to enhance shareholder value Focus on positioning Veeco for profitable growth
Slide 16: Summary
Summary Leverage technology expertise and leadership to win organic growth opportunities Continue actively exploring M&A opportunities Drive operational leverage to enhance shareholder value Focus on positioning Veeco for profitable growth
Slide 17: Back Up & Reconciliation Tables
Back Up & Reconciliation Tables
Slide 18: 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 19: Supplemental Information—Reconciliation
Supplemental Information—GAAP to Non-GAAP Reconciliation US$ millions Q2 16 Q3 16 Net Sales $75.3 $85.5 GAAP Gross Profit 31.4 33.5 GAAP Gross Margin 41.7% 39.1% Add: Share-Based Comp 0.5 0.6 Add: Accelerated Depreciation — 0.4 Non-GAAP Gross Profit $31.9 $34.4 Non-GAAP Gross Margin 42.4% 40.3% US$
Slide 20: Q3 2016 Reconciliation
Q3 2016 GAAP to Non-GAAP Reconciliation Non-GAAP Adjustments In millions, except per share data GAAP Share-Based Compensation Amortization Other Non-GAAP Net Sales $85.5 $85.5 Gross Profit 33.5 0.6 0.4 34.4 Gross Margin 39.1% 40.3% Research and Development 19.9 (1.0) 18.9 Selling, General, and Admin
Slide 21: Q4 2016 Guidance Reconciliation
Q4 2016 Guidance GAAP to Non-GAAP Reconciliation Non-GAAP Adjustments In millions, except per share data GAAP Share-Based Compensation Amortization Other Non-GAAP Net Sales $85–$100 $85–$100 Gross Profit 31–39 1 — — 32–40 Gross Margin 37%–39% 38%–40% Net Income (Loss) ($13)–($7) 5 4 1 ($3)–$3 Income
Slide 22: Q4 2016 Guidance Reconciliation
Q4 2016 Guidance GAAP to Non-GAAP Reconciliation 2 invallona, exept per shore ata GAAP __Compansaton Amortization Other Non-GAAP Net Sales $85-$100 $85-$100 Gross Profit 31-39 1 = - 32-40 Gross Margin 37%-39% 38% 40% Net Income (Loss) (S13}4187) 5 4 1 ($383, Income (Loss) per Diluted Share ($0.34)-(