The World Leader in High Performance Signal Processing Solutions Analog Devices, Inc.

Transcription

1 The World Leader in High Performance Signal Processing Solutions Analog Devices, Inc. 1 May 2013

2 2 Forward-Looking Statements This presentation may be deemed to contain forward-looking statements intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of These forward-looking statements include, among other things, our statements regarding expected financial results, tax rate and shareholder returns, expected production and inventory levels, expected market trends, growth opportunities and business strategy, and expected customer demand for our products, that are based on our current expectations, beliefs, assumptions, estimates, forecasts, and projections about the industry and markets in which Analog Devices operates. The statements contained in this presentation are not guarantees of future performance, are inherently uncertain, involve certain risks, uncertainties, and assumptions that are difficult to predict, and do not give effect to the potential impact of any mergers, acquisitions, divestitures, or business combinations that may be announced or closed after the date hereof. Therefore, actual outcomes and results may differ materially from what is expressed in such forward-looking statements, and such statements should not be relied upon as representing Analog Devices expectations or beliefs as of any date subsequent to the date of this presentation. We do not undertake any obligation to update forwardlooking statements made by us. Important factors that may affect actual outcomes and results include: sovereign debt issues globally, any faltering in global economic conditions or the stability of credit and financial markets, erosion of consumer confidence and declines in customer spending, unavailability of raw materials, services, supplies or manufacturing capacity, changes in geographic, product or customer mix, adverse results in litigation matters, and other risk factors described in our most recent filings with the Securities and Exchange Commission. Our results of operations for the periods presented in this presentation are not necessarily indicative of our operating results for future periods. Any projections in this presentation are based on limited information currently available to Analog Devices, which is subject to change. Although any such projections and the factors influencing them will likely change, we will not necessarily update the information, as we will only provide guidance at certain points during the year. Such information speaks only as of the original issuance date of the presentation. During this presentation, we may refer to non-gaap financial measures that have been adjusted for one-time items in order to provide investors with useful information regarding our results of operations and business trends. Reconciliations of these non-gaap measures to their most directly comparable GAAP measures can be found in our earnings releases which are posted on our IR website.

3 What makes ADI unique? Signal path vs. power management Significant market share in data converters and high performance amplifiers Long lifecycle products >10k products and no single product comprises more than a few percent of sales >60k customers and largest customer represented only 3% of sales in FY12 Small order sizes + small piece of customer BOM + high quality + brand recognition = STABLE ASPs Wide technological moat and high barriers to entry engineering talent Unique financial model = Low capital intensity and high cash generation 3

4 ADI Focuses on Signal Processing While Competitors Focus on Power Management Analog Devices 91% Signal Processing WW Market Analog, DSP, and MEMS 47% Power Management Converters Converters Amplifiers/RF Power Management Amplifiers Power Mgmt DSP Other Analog and MEMS DSP Sensors Interface 4 Source: ADI 2012 Financial Reports Source: WSTS, 2012

5 2012 Converter Market Share Converter Market Share: % 60% 40% 30% 20% 10% 0% Percent of Market Share 50% 40% 30% 20% 10% 0% ADI TXN Maxim LTC 5 Source: Databeans, Inc., May 2013

6 ADI s Share of the 2012 High Performance Amplifier Market High Performance Amp Market Share: % 50% ADI 48% Percent of Market Share 40% 30% 20% 10% 0% TXN LTC Maxim 6 Source: Databeans, Inc., May High performance includes high speed, high precision, and instrumentation amplifiers.

7 Long Product Lifecycles ADI Analog Products 7

8 Diluted EPS from Continuing Operations ($) Cash Dividend per Share ($) $3.00 $2.79 $1.20 $1.15 $2.50 $2.33 $1.10 $2.13 $2.00 $1.50 $1.51 $1.77 $1.00 $0.90 $0.94 $0.84 $1.00 $0.85 $0.80 $0.76 $0.80 $0.50 $0.70 $0.70 $0.00 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 $0.60 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 8

9 Product Revenue from Continuing Operations ($M) $3,500 $3,000 $2,500 $2,430 $2,583 $2,762 $2,993 $2,701 $2,000 $1,500 $1,000 74% 74% $2,015 75% 78% 81% 83% $500 $0 26% 26% 25% 22% 19% 17% FY2007 FY2008 FY2009 FY2010 FY2011 FY Industrial, Automotive, Communications Infrastructure Pro/Consumer A/V, Imaging, Smartphone, Tablet

10 FY2012 Revenue by End Market Industrial 46% Instrumentation Automation Defense/Aero Energy Healthcare Automotive 17% Safety Powertrain Infotainment Communications 20% Wireless Base Stations Wired Infrastructure FY 12 Total Revenue: $2.7 Billion Consumer 17% Imaging Smartphones and Tablets Home/Pro A/V 10

11 Growth Trends by End Market Industrial Improving macroeconomic indicators Robotics, factory automation, power efficiency, communication, sensing and testing (R)evolution Communications Infrastructure Data explosion and networks are strained 75% of world s population is still on 2G (Source: Ericsson) 4G and LTE deployments in the U.S. and China Radio count expected to go from 11M to 55M by mid-decade Automotive Electrification of vehicles leading to semiconductor content growth More complex safety systems and increased fuel efficiency needs Increasing demand for differentiation by car manufacturers Government mandates Consumer 11 Product differentiation strategy

12 The Industrial Enterprise Proliferation of Sensors and Actuators Is Driving Signal Processing Content Growth Instrumentation and Robotics Defense/Aerospace Energy Management Healthcare 12

13 Automotive Capitalizing on the Electrification of the driving experience via increasing semiconductor content $500 $450 $400 $350 $300 $250 $200 $150 FY2008 FY2009 FY2010 FY2011 FY2012 Predictive, Preventive, Protective Safety Systems Infotainment Powertrain 13 Automotive Revenue

14 Communications Infrastructure Carrier Capacity, Coverage, and Efficiency Driving Innovation Today Mid- Decade Millions of Radios Source: Infonetics 14

15 Consumer Selective Engagement with the Market Leaders Imaging Smartphones Tablets Consumer Home/Pro A/V 15

16 16 Financial Information

17 Gross Margins as a % of Revenue from Continuing Operations 75% 70% 65% 65.2% 66.4% 64.5% 61.1% 60% 55.5% 55% 50% FY2008 FY2009 FY2010 FY2011 FY

18 Operating Cash Flow $ Millions % of Revenue 50% $1,000 $800 36% 40% $600 $400 26% $669 21% $991 30% 30% $901 $815 30% 20% $200 $432 10% $0 FY2008 FY2009 FY2010 FY2011 FY2012 Operating Cash Flow ($ Millions) Operating Cash Flow as a % of Revenue 0% 18

19 Free Cash Flow $M $1,000 $880 $800 $778 $682 $600 $512 32% $400 $376 26% 25% 20% 19% $200 $0 FY2008 FY2009 FY2010 FY2011 FY

20 More than $6 Billion Returned to Shareholders over 9 years $ Millions $7,000 $6,000 $5,000 $4,000 $624 $846 $1,079 $1,329 $1,611 $1,956 $3,000 $2,000 $1,000 $395 $2,487 $3,335 $3,905 $3,908 $3,948 $4,278 $4,439 $0 FY04-06 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 Cumulative Dividends Cumulative Share Repurchases 20

21 Comparative Stock Performance $160 $ $ $100 $80 $ $40 $20 $0 11/3/07 11/1/08 10/31/09 10/30/10 10/29/11 11/3/12 Analog Devices, Inc. S&P 500 S&P Semiconductors 21