Silicon Labs Investor Presentation 25 A P R I L 2018

Transcription

1 Silicon Labs Investor Presentation 25 A P R I L 2018

2 Private Securities Litigation Reform Act of 1995 This presentation contains forward-looking statements based on Silicon Labs current expectations. These forward-looking statements involve risks and uncertainties. A number of important factors could cause actual results to differ materially from those in the forward-looking statements. Silicon Labs believes that it is important to communicate the company s future expectations to investors. However, there may be events in the future that Silicon Labs is not able to accurately predict or control. For a discussion of these and other factors which could impact Silicon Labs financial results and cause actual results to differ materially from those in the forward-looking statements, please refer to Silicon Labs recent filings with the SEC. Unless otherwise required by law, Silicon Labs expressly disclaims any obligation to release publicly any updates or revisions to any forward-looking statements to reflect any result or change in expectations. 2

3 Silicon Labs A track record of multiple industry firsts, transforming and disrupting large markets FOUNDED IN 1996 LISTED SLAB 621 REVENUE ($M) Core competencies in mixed-signal and RF CMOS silicon architectures, software, and systems Focus on high-quality, diversified markets Well positioned for sustainable growth ~35, 000 CUSTOMERS >1, 600 PATENTS 2015, 2016 & 2017 MOST RESPECTED SEMICONDUCTOR COMPANY 3

4 A Global Company HEADQUARTERED IN AUSTIN >1400 EMPLOYEES WORLDWIDE INTERNATIONAL HQ SINGAPORE Design Centers Sales Offices 4

5 A Diversified Product Portfolio I N T E R N E T O F T H I N G S I N F R A S T R U C T U R E B R O A D C A S T A C C E S S MCU Wireless Sensors Timing Isolation Automotive Radio TV Tuners Modems SLICs PoE ~50% REVENUE ~20% REVENUE ~20% REVENUE ~10% REVENUE H I G H G R O W T H M A T U R E 5

6 Driving High-Quality Growth REVENUE ($M) % 33% 17% 34% 769 9% 20% 20% 51% IoT Execute platform strategy Infrastructure Extend leadership in high-performance timing, grow isolation Broadcast Maintain TV tuner share (~2/3), grow automotive Access Maintain share in legacy markets IoT Infrastructure Broadcast Access 6

7 Broad-based Business Model with Growing Channel REVENUE BY END MARKET GROWING CHANNEL & DIVERSIFICATION 100% 75% 40% 90% 80% 70% 35% 70% 60% 30% 50% 65% 40% 25% 30% 60% 20% 20% 10% 0% % % Distribution % Top 10 Customers 15% Industrial Communications Consumer Automotive Computing 50% % 7

8 IoT Opportunity Communication Automotive Computing 27B INSTALLED BASE B INSTALLED BASE 2025e Consumer Industrial Source: Q317 IHS reports and Silicon Labs estimates. Communication estimate includes handsets. Computing estimate includes PCs. 8

9 IoT: A Leader in Silicon, Software and Solutions Achieve #1 position in target market Lever wireless leadership to gain share Diverse range of applications and customers STRATEGIC GROWTH TARGET 20% Common hardware and software platform Win strategic tier 1s, support broad base MCUs Wireless Sensors Secure wireless stacks Embedded OS Device Management Modules Reference designs Simplicity Studio 9

10 IoT: Diverse Market & Technology Portfolio IoT MARKET SAM ($B) CAGR: 10% IoT TECHNOLOGY SAM ($B) e e Smart Home Smart Industrial Smart City Other MCU Wireless Sensors Source: Q317 IHS reports and Silicon Labs estimates. 10

11 IoT: Executing a Platform Strategy C U S T O M E R R E Q U I R E M E N T S High performance, reliable, maintainable Easy to develop and deploy Long life solution W H Y W E W I N Best connectivity RF SoCs and modules Robust SW framework simplifies development Upgradeable, cloud connected 11

12 Platform-based Edge Node Architecture Home Automation & Control Lighting Industrial Automation Smart Metering Retail & Commercial Host Environment Toolchains Other Developer Tools Energy Profiler Hardware Config App Builder IAR Sample Applications Precertification MISRA, Static Analysis Network Analyzer Radio Config Secure Programming GCC Mobile Apps Large Network Testing Documentation Application Notes SEMICONDUCTOR PROVIDED CUSTOMER IMPLEMENTED Other Connectivity Software Coexistence BR / Gateway RADIO ABSTRACTION LAYER Multiprotocol Test Harness RTOS Core Platform Drivers Security Utilities Middleware Platform Software KAL Micrium Kernel Sleep IPC Memory Timers Events System Micrium POSIX EmLib Security Libraries Secure Element C-Lib, Diag, Stats, Error Codes, Assert FS, IO NCP, CLI Cap Sense Bootloader NVM Graphics Lib Chips Modules Development Boards Hardware Secure MCU Multi-protocol radio Secure Element Antenna Match Certifications Starter Kits Reference Designs eflash/ram I/O, Interfaces Power/Energy Management PCB, SiP Shield Radio/Expansion Cards Evaluation Boards 12

13 Infrastructure: Leading in Performance Targeting #1 position in Timing & Isolation Breakthrough architectures leading industry STRATEGIC GROWTH TARGET 10% Capturing share in high performance market Low touch, easy to design-in Long life, highly profitable revenue Timing and Isolation Performance and flexibility Easy device configuration 13

14 Infrastructure: Diverse Markets & Technology Portfolio INFRASTRUCTURE MARKET SAM ($B) CAGR: 11% 2.3 INFRASTRUCTURE TECHNOLOGY SAM ($B) e e Industrial Telecom Wireless Data Center Electric Vehicle Power Supply Other Timing Isolation Source: 2017 Dell Oro, 2017 Infonetics, IHS Technology, Optoelectronic Components 2016 and internal estimates 14

15 Timing: Bandwidth Requirements Driving Infrastructure Expansion BANDWIDTH REQUIREMENTS EXPLODING 278EB NETWORKS UPGRADING FOR HIGHER BANDWIDTH Wireless 4G LTE-ADVANCED, 5G 96EB CAGR: 24% Global IP Traffic Exabytes/Mo Metro/Core Data Center G 100G 400G 40G 100G Source: Cisco VNI Forecast and Methodology,

16 Timing: Performance Wins C U S T O M E R R E Q U I R E M E N T S Faster data rates require higher performance More features in a smaller form factor W H Y W E W I N Industry leading performance and flexibility Provide complete clock solutions with highest level of integration 16

17 Isolation: Global Trends Driving Growth G R E E N E N E R G Y E F F I C I E N C Y R E G U L A T I O N Electric & hybridelectric vehicles Server, storage, networking power supplies Governments issuing efficiency standards Solar inverters & wind turbines 300M industrial electric motors installed Reduction in greenhouse emissions 17

18 Isolation: Leading in Performance and Integration C U S T O M E R R E Q U I R E M E N T S Improve efficiency Robust operation in noisy environments Smaller PCB footprints W H Y W E W I N Delivers faster switching times Best-in-class noise immunity Higher density and more integrated features 18

19 Target Financial Model Q118 Q117 Model Revenue $205 $ % growth Gross Margin 60.6% 59.0% 58-60% R&D 21.6% 23.4% 20-22% SG&A 18.1% 18.3% 17-18% Solid year-on-year progress 15% growth in revenue Achieved model performance 6 of the past 7 qtrs: Product revenue growth Gross margins R&D and total opex Operating income Total Operating Expenses 39.7% 41.7% 37-40% Non-GAAP Operating Income 20.9% 17.3% 20-25% Gross margin, R&D, SG&A, total operating expenses, operating income and EPS are non-gaap and exclude stock compensation expense, amortization of intangible assets, non-cash interest expense on convertible notes, and certain other adjustments. 19

20 Healthy Cash Generation OPERATING CASH FLOW ($M) ~$1.2B in cumulative operating cash flow over the past decade Record $190M 2017 $1.7B of capital deployed over the past decade ~$0.7B strategic M&A ~$1B share repurchases $100M in BoD authorized share repurchase programs for fiscal year 2018 Opportunistic buyer as we return cash to shareholders Software ZigBee SoC 2013 Low-power 32-bit MCUs 2014 Low-power Analog 2015 BT Smart Modules 2015 ZigBee/Thread Modules 2016 Software RTOS 2017 Cloud Connected Wi-Fi 2018 Smart Home Protocol 20

21 Key Take Aways Well positioned for leadership in IoT Large, growing and diverse market Leading hardware and software platform Control of integration path High quality Infrastructure opportunity Addressing trends in data and green energy Focus on industrial and communications markets Expanding SAM and portfolio Delivering to target financial model Accelerating growth and profitability EPS growth y-y Investing to win 21

22 Thank you! S I L A B S. C O M