Onto Innovation Inc. · NYSE:ONTO
Onto Innovation — 22nd Annual Needham Growth Conference (January 2020)
22 slides from Onto Innovation's conference presentation, Jan 15, 2020
Slide 1: Growth in Process Solutions
Growth in Process Solutions Needham Growth Conference January 15, 2020
Slide 2: Safe Harbor
The information presented herein contains forward-looking statements that relate to anticipated future operating results and performance. These statements are only predictions based on management’s current expectations and assumptions, including market size and forecasted growth, Total Available Mar
Slide 3: Introducing Onto Innovation
Introducing Onto Innovation Wafer Fab Equipment (WFE) Market Share by Revenue Greater Scope and Scale Benefitting R&D and Customer Support 4 Suppliers 65% 11 Suppliers 21% 15 Suppliers 7% ALL OTHERS (15+) 7% Source: Company Rank Order based on 2018 Share of Total WFE Revenue, Gartner Market Share Da
Slide 4: Who Is Onto Innovation? (Merger: Oct 2019)
Who Is Onto Innovation? (Merger: Oct 2019) Balanced Revenue Distribution High tech capital equipment company specializing in process solutions for semiconductor and related markets 19% Balance Sheet2 COMPANY 44% $337 Million Cash NYSE (ONTO) No Debt Gross Margin3 REVENUE1 37% $534 Million ~53% EMPLO
Slide 5: Why Invest In Onto Innovation?
Why Invest In Onto Innovation? MARKET AND PRODUCT EXPAND GROSS AND INCREASE DIVERSITY OPERATING MARGINS SHAREHOLDER VALUE EXPANDING TO $20M COST SYNERGIES STRONG CASH GENERATOR A $3B TAM IN 2020 >$120M 5
Slide 6: 5G Contributes to Virtuous Cycle
5G Contributes to Virtuous Cycle Driving Multiple Onto Innovation Markets Advanced Packaging Memory / Specialty Logic Devices Mobile: Smartphones, Tablets, Wearables 5G Massive IOT: More Complex Data 1M Devices per Km2 Devices Center Growth (data) Beyond Mobile Infrastructure: cities, vehicles, medi
Slide 7: Onto Innovation Broadly Serving Semiconductor Leaders
Onto Innovation Broadly Serving Semiconductor Leaders Si WAFER MEMORY/ S PECIALTY ADVANCED FOUNDRY MANUFACTURING LOGIC DEVICES PACKAGING 155 Customers Served* Top 10 Customers Represent 46% of Total Revenue *Proforma customer base: 12 months revenue for combined legacy companies The above logos are
Slide 8: Complementary Products, No Overlap
Complementary Products, No Overlap Leverage of core IP in optics and software strengthens entire portfolio Dragonfly® G2 NovusEdge™ System System NSX® QS/FTIR System System MetaPULSE® JetStep® System Series IMPULSE® System Control Software R&D Leverage Across Atlas® System Entire Portfolio Discover®
Slide 9: Product and Process Matrix for Onto Innovation
Product and Process Matrix for Onto Innovation Si Wafer Wafer Fab Advanced Packaging Mfg. Deposition / Etch / Bump / Etch / OQA Litho Implant Cleans CMP OQA TSV Dicing Litho Plating NovusEdge Inspection ● ● QS/FTIR Metrology ● ● Atlas III+ Metrology ● ● ● IMPULSE+ Metrology ● ● ● MetaPULSE G Metrolo
Slide 10: R&D Pipeline Supports Innovation and Growth
R&D Pipeline Supports Innovation and Growth New innovation provides increasing value to customers NEW INCREASING OUR PRODUCTS New Products: PACE OF INNOVATION >130M R&D SPEND (% of TTM REVENUE) NovusEdge System QS4300/FTIR System of System Revenue Dragonfly G2 Atlas III+ 2019 System System 1 2 Onto
Slide 11: We Deliver Differentiated Solutions
We Deliver Differentiated Solutions Extensive software portfolio enhances value of Onto Innovation products SPECIFICATIONS MEET SPECIFICATION TOOL SALE Onto Innovation Quality Data Process Adjustment SOLUTION SALE Onto Solution Adoption Process Solutions >70% Machine External Data Learning Sources 3
Slide 12: Complementary Technology Expand Our Markets
Complementary Technology Expand Our Markets PRODUCT SYNERGIES R&D INVESTMENTS $500M SAM Expansion $1B TAM Expansion $3 UNPATTERNED WAFER, INDUSTRIAL, & HD DISPLAY Process Control Software Adv. Packaging Lithography $2 Macro Inspection ($B) FILMS Optical Metrology & SOFTWARE $1 $0 SOM SAM TAM 12 Sour
Slide 13: Broad Exposure to Secular Growth Markets
Broad Exposure to Secular Growth Markets Advanced Silicon Demand Leading Edge Nodes Advanced Packaging Atlas III+ Metrology Dragonfly G2 Inspection NovusEdge Inspection | QS/ FTIR IMPULSE-EV Metrology JetStep Lithography Demand for <8nm Silicon1 WFE by Market Forecast2 FoWLP Growth1 80 2500 $60 70 $
Slide 14: Onto Innovation Expands Footprint in Silicon Wafer Manufacturers
Onto Innovation Expands Footprint in Silicon Wafer Manufacturers Laying foundation for additional growth NOVUSEDGE SYSTEM ~88% Growth in 2019 90% 3 NEW CUSTOMERS ADDED OF GLOBAL WAFER SUPPLY QS / FTIR SYSTEM 4 NEW CUSTOMERS ADDED 2018 2019 Future Inspect Measure Analyze Solutions NovusEdge System QS
Slide 15: Leading Edge Processes Require More Optical Metrology
Leading Edge Processes Require More Optical Metrology Atlas III+ Metrology selected for six new process slots in 2019 TRANSISTORS (LOGIC / DRAM) 7nm FinFet 5nm FinFet 3nm Nano-Sheet TOOL OF RECORD POSITIONS 16 6 NEW IN 2019 14 Device Generation & Node 12 1.3X 2X 3X Increases 10 INCREASING COMPLEXITY
Slide 16: Dragonfly G2 Inspection Gains Broad Adoption in 2019
Dragonfly G2 Inspection Gains Broad Adoption in 2019 Lays foundation for growth across multiple segments across the semiconductor value chain 26% Dragonfly System 37% 25 Revenue Growth CUSTOMERS OSATs 2 NEW MARKET EXPANSIONS Foundry/Logic Memory Automotive 11% Specialty 16 NEW CUSTOMERS ADDED 11% 16
Slide 17: Panel Investments Continue in 2019 with Onto Innovation Suite
Panel Investments Continue in 2019 with Onto Innovation Suite Onto Innovation product suite improves productivity and yield for panel lithography WW CAPACITY (PANELS PER MONTH) 100,000 2 NEW PANEL CUSTOMERS 80,000 6 7OUT OF 60,000 SELECTED JETSTEP STEPFAST SOLUTIONS 40,000 LITHOGRAPHY 2 TO EXISTING
Slide 18: Improving Operations and Efficiencies
Improving Operations and Efficiencies On track to deliver $20M in cost synergies in 2020 OPPORTUNITIES FOR ADDITIONAL SYNERGIES IN 2021-2022 Supply Chain Common Automation Business Rationalization $14M Supply Chain Corporate Overhead 25% $20M Gross Margin Annualized Operating Efficiencies Synergies
Slide 19: Synergies Contribute to Financial Operating Model
Synergies Contribute to Financial Operating Model OPERATING GROSS MARGIN1 MARGIN1 +1% +3% >$120M FREE CASH FLOW2 • Share Capital Requirements • Better Working Capital Mgt. • Supply Chain Synergies • Public Company Costs • Regional Support Costs • Operational Synergies SYNERGY CONTRIBUTIONS Notes: 1.
Slide 20: Pro Forma Financial Model
Pro Forma Financial Model* Annual $600M $800M $1B Revenue Model Model Model Gross Margin 54% - 55% 55% - 56% 56% - 57% Operating Profit 24% - 25% 29% - 30% 32% - 33% Earnings per Share $2.40 - $2.50 $3.85 - $4.00 $5.05 - $5.25 *Non-GAAP Long Term Financial Model: excludes amortization and merger cos
Slide 21: Key Takeaways
Key Takeaways POSITIONED FOR Technical wins in 2019 lay foundation for growth! EXPANDING TO GROWTH ACROSS A $3B TAM Expanding TAM, SAM, and market share. THE VALUE CHAIN $20M COST STRONG FINANCIAL Delivering $20M synergies ahead of plan! SYNERGIES IN MODEL FUELS 2020 PROFITABLE Improving gross and o
Slide 22: Thank You!
谢谢 | 謝謝 danke ありがとう Thank You! 감사합니다 merci obrigado info@ontoinnovation.com www.ontoinnovation.com
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