B. Riley & Co. 16 th Annual Investor Conference. Jeffrey Andreson, CFO

Transcription

1 B. Riley & Co. 16 th Annual Investor Conference Jeffrey Andreson, CFO May 2015

2 Forward-Looking Statements This communication contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including, but not limited to statements regarding Nanometrics ( us our or the Company ) future financial results, including, but not limited to our market share, industry demand and growth. These statements are not guarantees of future performance, involve certain risks, uncertainties and assumptions that are difficult to predict, and are based upon assumptions as to future events that may not prove accurate. Therefore, actual outcomes and results may differ materially from what is expressed herein. In any forward-looking statement in which Nanometrics expresses an expectation or belief as to future results, such expectation or belief is expressed in good faith and believed to have a reasonable basis, but there can be no assurance that the result will be achieved. The risks and uncertainties include, but are not limited to: our ability to achieve desired product mix and pricing; our ability to achieve desired market position; growth in target industries; levels and timing of capital expenditures in our target industries; customer adoption of certain technologies; market acceptance and timing of acceptance of our new products; interruptions or changes to supply chain; our ability to identify, complete and integrate acquisitions; and other economic, business, competitive and/or regulatory factors affecting Nanometrics businesses generally, including those set forth in Nanometrics filings with the SEC, including its Annual Report on Form 10-K for its most recent fiscal year, its most recent Quarterly Reports on Form 10-Q and its Current Reports on Form 8-K. All forward-looking statements included in this communication are based on information available to Nanometrics on the date hereof. We disclaim any intent or obligation to update publicly any forward-looking statements, whether in response to new information, future events, or otherwise. 2

3 NANO: Leading Solutions for In-Line Process Control Comprehensive Suite of Highly- Differentiated Systems and Solutions Atlas / Lynx IMPULSE NanoCD UniFire Utilizing High-Speed, In-Line Technologies Ellipsometry Scatterometry Interferometry Photoluminescence Inspection Technology Inflection Points Expanding Our Market, Footprint and Share FinFET 3D NAND Advanced 3D Packaging 3

4 Highlights and Achievements Entering 2015 Expanded Position to Every FinFET Device Fab Multiple Share Gains and Leading Position in 3D NAND Continued Leadership and Growth in Advanced 3D Packaging Significant Competitive Wins in Pure-Play Foundries Atlas and NanoDiffract OCD solutions expanded to every leading fab for FinFET logic devices. Incremental market share wins, expanded customer footprint and tool of record positions for both Atlas automated systems and IMPULSE integrated metrology at every one of the four leading memory customers for 3D NAND process control. Establishment of the UniFire as tool of record at every leading fab for the most advanced 3D packaging technologies, including TSV, micro-bump and micro-pillar process control, while also delivering a record revenue year with follow-on shipments for advanced logic, foundry and DRAM applications. Exited the year with the strongest foundry position in the company s history, and record pure-play foundry revenues for 2014 and the first quarter of

5 OCD Leadership and Market Outperformance 40% 30% 2014 YoY Growth 32% 20% 10% 12% 4% 8% 3% 0% -10% -7% -20% -17% WFE Market Process Control Market Metrology Market KLAC Metrology Product Revenues RTEC Metrology Product Revenues NVMI Metrology NANO Metrology Product Revenues Product Revenues * 2014 Results 2014 YoY Growth WFE Market $32B +12% Process Control Market $4B +4% Metrology Market $1.7B +8% KLAC Metrology Product Revenues $459M -17% RTEC Metrology Product Revenues $27M -7% NVMI Metrology Product Revenues $89M +3% NANO Metrology Product Revenues * Total Automated and Integrated Metrology Sales $124M +32% Source: Industry Spending and Market Sizes Gartner and other industry analyst estimates. Revenues from SEC filings. 5

6 Recent Results and Guidance Q1 15 Guidance Revenue $47 - $51M Q1 15 Results $50.4M +27% QoQ Q2 15 Guidance $45 50M Gross Margin * 46.0% % 47.7% 47.0% % Operating Expenses * $ $21.7M $21.0M $ $21.4M EPS * $ $0.09 $0.14 $ $0.12 Incremental Margin vs Q4 14: Q1 15: 56% Gross / 51% Operating Q2 15: 60-66% Gross / 56-57% Operating * Reflects the company s non-gaap financial model, which excludes the impact of amortization of acquired intangible assets and certain other charges. A reconciliation between GAAP operating results and non-gaap operating results is provided on slide 24. 6

7 OCD Growth Opportunity: Market Expansion and Share Gains Increasing Role of Optical Metrology NANO Market Share Gains Critical Dimension Market Market Size $475M $600M ~ $700M 100% 100% Share of Optical CD Market 80% 60% 86% 67% 33% 80% 60% 60% 55% 50% 40% 20% 0% 67% 33% 14% Future 40% 20% 0% 40% 45% 50% Est. Optical CD CD-SEM NANO Competitors Optical Critical Dimension Metrology is Well-Positioned to Address Half of Remaining CD-SEM Market - Total CD CAGR 3-4% - OCD CAGR of 10-20% Steadily Gaining Share Through Competitive Wins for Next- Generation Devices - Enables Future Outperformance Source: Gartner and Company Estimates 7

8 DRAM (3D Packaging) NANO IR Pres [May-2015] 3D NAND FinFET Confluence of Timing in 3D Device Capital Investments PILOT PILOT PILOT PILOT PILOT PILOT PILOT PILOT PILOT PILOT PILOT Logos indicate year 3D plans were publicly announced. Pilot / initiation years are customer announcements or Company estimates. 8

9 3D Wafer Starts on Rapid Growth Trajectory 800 WSPM by Year End for 3D Devices (Wafer Starts Per Month, In Thousands) Majority of Incremental Capital Investments Taking Place for 3D Structures DRAM 3D Pkgs 3D NAND FinFET Source: Analyst and Company Estimates 9

10 IMPULSE NANO IR Pres [May-2015] ATLAS Multiple Recent Market Share Gains Driving Growth in 2015 Q2 12 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 2Xnm DRAM Top Tier Memory Co. 3D-NAND Leading Semi Manufacturer in Asia. 2Y/1X Flash Top Tier Memory Co. 1Xnm FF Global Pure-Play Foundry. 1Xnm FF Leading Pure-Play Foundry. 3D-NAND #2 Memory Co. 1Xnm FF Add l Pure-Play Foundry. 3D-NAND Leading NAND Mfr. 2Ynm Logic & 1Xnm FF Etch Leading Pure-Play Foundry. 3D NAND CMP Leading Semi Manufacturer in Asia. 3D-NAND CMP #2 Memory Co. FF = FinFET Logic 10

11 Resulting Expansion of NANO Customer Footprint Tool-of-Record Positions with Largest Industry Spenders Memory Logic Foundry Broadening our Customer Exposure to Every Major Spender on Capital Equipment Cycle Cycle Cycle 11

12 New Technology Nodes Increase OCD Opportunity Device Type Node Sampling Steps/ Parameters Relative Intensity Segment Opportunity/ 10K wspm NAND 1X/1Y 10/5 1.0 $4M - $6M 3D NAND pair 12/5 1.1 $5M - $7M 3D NAND pair 12/5 1.2 $5M - $8M DRAM 3X/2X 20/5 1.2 $5M - $8M DRAM 2Y/2Z 20/8 1.4 $6M - $9M FOUNDRY 2X/2Y 20/ $6M - $10M FOUNDRY 1X/1Y 25/ $8M - $12M LOGIC 2Y/1X 30/ $10M - $15M Source: Company Estimates wspm: wafer starts per month capacity 12

13 Production OCD Recipes NANO OCD Recipes by Technology Node Increasing Dependence on OCD at Each Subsequent Technology Node - 4X nm 3X nm 2X nm 1X nm YE 2009 YE 2010 YE 2011 YE 2012 YE 2013 YE 2014 YE2015 Est 13

14 Leading Position in Advanced 3D Packaging µbump Interposer TSV (2.5D) Copper Pillar 3D TSV Tool of Record Positions for µbump, Cu-Pillar, Through Silicon Via with Multiple Systems Installed: Multiple top tier memory for 3D TSV DRAM Multiple top tier logic & foundry for µbump, Cu-Pillar, 2.5D/3D TSV 14

15 Customer Implementation of Advanced Process Control (APC) Adoption of In-line, In-Situ and Integrated ATLAS Profile Control Wet-Etch feed-back IM Deposition & CMP CVD Integrated feed-forward to CMP IMPULSE Etch Pre-Etch feed-forward Fill feed-forward Integrated CMP feed-back 2X 2Y 2X 1X 1Y R&D 1X 1Y 1Z R&D 2X 2Y 1X 1Y 1Z R&D 1Z R&D DRAM LOGIC NAND DRAM NAND 3D NAND 2X 1X R&D FOUNDRY 1Y R&D 15

16 Genesis of an OCD Recipe Customer Process Control Issue Nanometrics Final Recipe Specific to: - Device and Process Flow - Layer and Process Step - NANO Tool, Model & Algorithm Device Structure and Control Parameters Build NanoDiffract Model Wafers & Structures (Design of Experiments) Measure TEM Reference Data Analysis Customer Production Recipe Release Compare Optimization 16

17 CapEx in $Billions Strong Multi-Year Cycle Driven by Top Spenders Semiconductor CapEx by Top Industry Spenders $14.0 $13.0 $12.0 $11.0 $10.0 $9.0 $8.0 $7.0 $6.0 $5.0 $4.0 $3.0 $2.0 $1.0 $- Samsung Intel TSMC Global Foundries SK Hynix Micron Alliance Toshiba / SanDisk Est. Source: Capex by company obtained from press releases, SEC filings and conference call transcripts. Total Capex for each period is an average from at least 10 industry analysts as of April

18 Rapid Consolidation of Semiconductor Capital Spending 100% 90% 26% 18% All Others 80% 70% 68% 40% 6% 6% 5% 6% 8% Toshiba/Sandisk Micron Alliance 60% 50% 40% 9% 11% 5% 7% 12% 7% 16% SK Hynix Global Foundries 10% 30% 20% 3% 2% 3% 3% 6% 4% 4% 9% 18% 17% TSMC Intel 10% 11% 14% 19% 22% Samsung 0% 4% Source: Capex by company obtained from press releases, SEC filings and conference call transcripts. Total Capex for each period is an average from at least 10 industry analysts as of April

19 % Contribution to NANO Total Revenues Significantly Expanding our Customer Base 80% NANO 10% Customers 70% 60% 50% 11% 16% 18% 10% 12% 22% PurePlay Fndry Cust. TSMC 40% 30% 17% 22% 30% 13% 13% Micron SK Hynix Intel Samsung 20% 10% 30% 28% 14% 27% 30% 0% FY'11 FY'12 FY'13 FY'14 Q1'15 19

20 Strengthening Our Financial Model Revenue Range / Qtr Near-Term Model $50-$60M Gross Margin * >50% Operating Expenses % * 36%-40% Initiatives to Improve 3D Device Proliferation Benefits of Market Share Gains Service Revenue Growth Improved Factory Absorption Manufacturing and Service Efficiencies Materials Cost Reductions Investment Focused on R&D and Applications Leverage SG&A Infrastructure Longer-Term Model $65M+ >52% <34% Operating Margin * 10%-15% 18%-20%+ High-Leverage Operating Model Incremental Gross Margin of 50% - 60% Incremental Operating Margin of 45% - 50% * Reflects the company s non-gaap financial model, which excludes the impact of amortization of acquired intangible assets and certain other charges. A reconciliation between GAAP operating results and non-gaap operating results is provided on slide

21 Positioned for Continued Outperformance Executing on Key Initiatives and Gaining Market Share Leading Technology Solution for High-Growth Markets Growing SAM, Expanding Footprint, Broadening Customer Base Driving Operational Leverage and Improved Financial Model 21

22 Thank You

23 Q1 15 Revenue Segmentation Reflects Concentration of Spending Total Revenues by Geography Total Revenues by Product/Svc Product Revenues by End Market 0% 24% 29% 29% 18% 6% 24% 9% 61% 39% 6% 4% 14% 37% South Korea N. America Taiwan ROW Automated Integrated Mat. Char. Service DRAM Flash Logic/IDM Foundry LED/Discrete/Si FY % 25% 6% 20% 21% 9% 25% 17% 12% 23% 9% 65% 12% 33% South Korea N. America Taiwan China ROW Automated Integrated Mat. Char. Service Mat. Char. = Materials Characterization Metrology Systems DRAM Flash Logic/IDM Foundry LED/Discrete/Si 23

24 24 NANO IR Pres [May-2015]