Slide 1: Q3 2021 Financial Results Conference Call
Q3 2021 Financial Results Conference Call Veeco (Nasdaq: VECO) November 2, 2021
Slide 2: Safe Harbor
Safe Harbor This presentation contains “forward-looking statements”, within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, as amended, that are based on management’s expectations, estimates, projections and assumptions. Words such as “expects,
Slide 3: CEO Overview and Market Update
CEO Overview and Market Update William J. Miller, Ph.D.
Slide 4: Q3 2021 Highlights
Q3 2021 Highlights $150M $24M 40¢ Revenue Non-GAAP Diluted Operating Income Non-GAAP EPS • Top line driven by Semiconductor and Data • $30M in cashflow from operations Storage markets • Continued investment for growth • Non-GAAP gross margin of 43% • Published 2nd sustainability report • 34% year-on
Slide 5: Significant Market Opportunities
Significant Market Opportunities Market Served Primary Drivers Primary Veeco Technologies Semiconductor High Performance Computing Laser Annealing Ion Beam / AP Lithography Compound 5G / Power / Photonics / Wet Processing Semiconductor MicroLED MOCVD Data Storage Cloud / Data Center Ion Beam Scienti
Slide 6: 2021 Priorities – Building on a Profitable Growth Plan
2021 Priorities – Building on a Profitable Growth Plan Growth Phase of Transformation Maintain Resilience Focus Execute Near-Term Prepare Long-Term essential business profitability & products 2021 growth 2022 & beyond ▪ Employees ▪ Defend foundational businesses ▪ Laser Annealing ▪ Aggressively inve
Slide 7: CFO Financial Review
CFO Financial Review John P. Kiernan
Slide 8: Q3 2021 Revenue by Market & Region
Q3 2021 Revenue by Market & Region Revenue by Market Revenue by Region Scientific & Other EMEA 9% 8% China Semiconductor Rest of Data Storage 18% 40% 26% APAC $150M 51% United States 15% 33% Compound Semiconductor Revenue Trend ($M) Q3 20 Q2 21 Q3 21 Semiconductor 34 54 76 Rest of World is less than
Slide 9: Q3 Operating Results
Q3 Operating Results GAAP Non-GAAP In millions (except per share amounts) Q2 21 Q3 21 Q2 21 Q3 21 Revenue $146.3 $150.2 $146.3 $150.2 Gross Profit 60.2 63.2 60.8 63.9 Gross Margin 41.1% 42.0% 41.6% 42.6% Operating Expenses 46.9 46.8 39.6 39.6 Operating Income / (Loss) 13.3 16.4 21.3 24.3 Net Income
Slide 10: Balance Sheet and Cash Flow Highlights
Balance Sheet and Cash Flow Highlights $ millions Q2 21 Q3 21 Cash & Short-Term Investments 330 336 Accounts Receivable 108 87 Inventories 164 171 Accounts Payable 55 49 Long-Term Debt 328 332 Cash Flow from Operations 10 30 DSO (days) 67 52 DIO 167 173 DPO 58 51 Strong cash generation while investi
Slide 11: Q4 2021 Guidance
Q4 2021 Guidance GAAP Non-GAAP Revenue $140M - $160M $140M - $160M Gross Margin 41% - 43% 41% - 43% Operating Expenses $49M - $51M $41M - $43M Net Income (Loss) $1M - $11M $14M - $24M Earnings (Loss) Per Share $0.04 – $0.22 $0.27 - $0.45 Diluted Shares 54M 52M 11 Q3 2021 Financial Results Conference
Slide 12: Making a Material Difference – Q&A
MAKING A MATERIAL DIFFERENCE &A
Slide 13: Backup & Reconciliation Tables
Backup & Reconciliation Tables
Slide 14: Convertible Notes
Convertible Notes Annual Annual Initial Principal Convertible Debt Coupon Cash Non-Cash Conversion Amount Interest Interest Price Convertible Notes Due Jan 2023 $132M 2.7% $3.6M $5.6 $40.03 As of Convertible Notes Due Jan 2025 $133M 3.5% $4.6M $4.9 $24.00 September 30, 2021 Convertible Notes Due Jun
Slide 15: Historical Revenue by End-Market
Historical Revenue by End-Market $M 2019 2020 2021 Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Semiconductor 44.6 37.8 41.8 51.3 175.6 37.4 37.5 33.6 57.4 165.9 51.6 53.7 76.3 Compound Semi 15.0 16.4 26.3 28.1 85.9 18.4 17.8 26.6 45.2 107.9 24.8 24.2 23.3 Data Storage 19.6 22.7 24.1 17.6 84.1 38.9 28.3 3
Slide 16: Effect of Convertible Notes on Diluted Share Count
Effect of Convertible Notes on Diluted Share Count (Effective through 12/31/21) GAAP Approximate Non-GAAP Approximate Incremental Dilutive Shares Incremental Dilutive Shares (in thousands) (in thousands) Average Stock Price 2025 2027 2025 2027 per Common Share Notes Notes Total Notes Notes Total $15
Slide 17: Effect of New Accounting Standard for Convertible Notes on Diluted EPS
Effect of New Accounting Standard for Convertible Notes on Diluted EPS (Effective Q1 2022) Quarterly GAAP Non-GAAP* Reduction to Reduction to EPS threshold Incremental EPS threshold Incremental Interest expense Interest expense before effect of Dilutive Shares** before effect of Dilutive Shares** fo
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—GAAP to Non-GAAP Reconciliation
Supplemental Information—GAAP to Non-GAAP Reconciliation In millions Q2 21 Q3 21 In millions, except per share amounts Q2 21 Q3 21 Net Sales $146.3 $150.2 GAAP Basic weighted average shares 48.7 49.0 GAAP Gross Profit 60.2 63.2 GAAP Diluted weighted average shares 53.9 53.8 GAAP Gross Margin 41.1% 4
Slide 20: Q3 2021 Actual: GAAP to Non-GAAP Reconciliation
Q3 2021 Actual: GAAP to Non-GAAP Reconciliation Non-GAAP Adjustments Share-Based In millions, except per share amounts GAAP Compensation Amortization Other Non-GAAP Net Sales $150.2 $150.2 Gross Profit 63.2 0.6 0.2 63.9 Gross Margin 42.0% 42.6% Operating Expenses 46.8 (3.5) (3.0) (0.6) 39.6 Operatin
Slide 21: Q4 2021 Guidance: GAAP to Non-GAAP Reconciliation
Q4 2021 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 $140–$160 $140–$160 Gross Profit 58–69 1 — — 59–70 Gross Margin 41%–43% 41%–43% Operating Expenses $48–$50 (3) (3) (1) $41–
Slide 22: Thank You
MAKING A MATERIAL DIFFERENCE *