Power Integrations, Inc. Nasdaq: POWI. June 2018

Transcription

1 Power Integrations, Inc. Nasdaq: POWI June 2018

2 Forward-Looking Statements/Non-GAAP Metrics These slides accompany an oral presentation by Power Integrations, Inc., which contains forward-looking statements. Each statement relating to events that will or may occur in the future is a forward-looking statement. The Company s actual results may differ materially from those suggested in the presentation. Information concerning factors that could cause such a difference is contained in the Company s most recent report on Form 10-K. This presentation may also contain certain non-gaap financial information. Reconciliations of non-gaap financial metrics to GAAP results are available on the investor page of the Power Integrations website, Power Integrations 2

3 Secular Growth Story in Analog Semis Leading innovator in high-voltage power conversion Clean-tech enabler Efficient appliances, LED lighting Industrial DC motor drives Renewable energy Electric transportation Expanding market opportunity Rapid charging for mobile devices Connected appliances / smart-home / IoT Battery-driven tools, e-bikes Gate drivers for high-power applications 2018 Power Integrations 3

4 Comprehensive Expertise in High-Voltage Ultra-simple power converters Fewer components Shorter design cycles Easier to manufacture Higher reliability BOM cost similar to discrete designs Highly energy-efficient 2018 Power Integrations 4

5 The Power Integrations Advantage EMI filter and bridge rectifier Isolation transformer Synchronous rectification Output current and voltage control Switching MOSFET and current sense Opto-coupler feedback Conventional Phone Charger -More than 60 Components 2018 Power Integrations 5

6 The Power Integrations Advantage InnoSwitch Switching MOSFET Current sense FluxLink replaces opto-coupler Synchronous rectification driver Output current and voltage control Phone-charger Power Supply Using InnoSwitch-CH only 24 parts 2018 Power Integrations 6

7 InnoSwitch : A New Level of Integration First IC to integrate primary and secondary sides of power supply across safety barrier Enabled by FluxLink technology Enables drastic reduction in component count, complexity Highly energy-efficient Very high efficiency Very low standby consumption Primary Secondary 2018 Power Integrations 7

8 Highly Integrated Power Converters Replace Legacy Technologies 65 W adapter with discretes: 65 W adapter with POWIInnoSwitch 3 72 components, two heatsinks, 144 cm 3 39 components, no heatsinks, 59 cm Power Integrations 8

9 Radically Simplifying Power Supplies HiperPFS, HiperLCS / HiperTFS ICs replace up to 100 components HiperPFS, HiperLCS/ HiperTFS 2018 Power Integrations 9

10 Power Everywhere A Vast Addressable Market 2018 Power Integrations 10

11 Addressable Market Now Exceeds $3B LED lighting Home/building automation Smart meters Industrial controls Battery-powered tools UPS Industrial motor drives Wind/solar inverters Electric trains/buses DC transmission Medical Desktop/server standby Desktop main Notebook adapters LCD monitors Printers Computer Industrial Consumer Comms White goods Air conditioners TV standby / TV main Small appliances Set-top boxes DVD players Game consoles Mobile phone chargers Cordless phone adapters Broadband modems VoIP phones Wireless routers High-power applications in red 2018 Power Integrations 11

12 Long-Term Secular Growth Drivers Ongoing transition to IC-based power supplies Integration saves labor and materials, improves reliability 2018 Power Integrations 12

13 Leading Transition to IC-Based Power Supplies Power Supply Unit Volume Sanken ST Micro ON Semi Infineon POWI Discretes Linear Transformers Infineon ON Semi ST Micro NXP Dialog Integrated Diodes Richtek Leadtrend OnBright Others Today 2018 Power Integrations 13

14 Long-Term Secular Growth Drivers Ongoing transition to IC-based power supplies Integration saves labor and materials, improves reliability Energy-efficient electronics & appliances Driven by standards and consumer awareness 2018 Power Integrations 14

15 Recognized Leader in Clean Technology Member of clean-tech stock indices The Cleantech Index (CTIUS) Nasdaq Clean Edge Green Energy (CELS) Ardour Global Index (AGIGL) Twice named a top 20 sustainable stock by SustainableBusiness.com ENERGY STAR award recipient Star of Energy Efficiency award recipient 2018 Power Integrations 15

16 Energy Specs Continue to Tighten U.S. Dept. of Energy tightened federal standards for external power supplies effective 2016 ENERGY STAR Most Efficient label rewards top performers SEAD competition recognizes most efficient TVs European standby power limitation tightened to 0.5 W in 2013 Traditional incandescent bulbs banned in U.S Power Integrations 16

17 Zero Series Eliminates Waste LinkZero cuts waste to 0.00 W in chargers and auxiliary power supplies CAPZero removes waste from X-cap bleed resistors SENZero disconnects sense resistors in main power supply 2018 Power Integrations 17

18 Energy Vampire vs. LinkZero 2018 Power Integrations 18

19 Long-Term Secular Growth Drivers Ongoing transition to IC-based power supplies Integration saves labor and materials, improves reliability Energy-efficient electronics & appliances Driven by standards and consumer awareness Expanding market opportunity SAM has doubled since 2010 Rapid charging for mobile-device market LED lighting Home & building automation / smart lighting and appliances / IoT Battery-powered tools, e-bikes, electric transportation SCALE-iDriver doubles SAM for high-power business to $1B 2018 Power Integrations 19

20 Rapid Charging Important Trend in Mobility More power needed to charge bigger batteries faster Demands ICs with high integration and maximum efficiency InnoSwitch + ChiPhy Interface Chip = More POWI content Conventional Charging With PI chipset 2018 Power Integrations 20

21 LYTSwitch for Solid-State Lighting Traditional light sources phasing out LEDs need efficient, reliable AC-DC drivers Integration brings reliability, efficiency, size advantage 2018 Power Integrations 21

22 Increasing IoTFootprint Connected Power Strips / U Sockets Connected smoke alarms, occupancy sensors, smart lighting 2018 Power Integrations 22

23 Gate Drivers for High-Power Market Acquired CT-Concept in 2012 Addressing applications 10 kw to 1 GW High-efficiency industrial motors, renewable energy, electric transportation, DC transmission New SCALE-iDriver expands addressable market from ~$500M to ~ $1B High-power now ~10% of POWI revenues SCALE drivers reduce component count, enhance efficiency, reliability 2018 Power Integrations 23

24 Serving the Clean-Power Ecosystem Energy Ecosystem End Markets Energy Generation Wind Turbines Solar Power Power Semiconductors Energy Transmission HVDC Transmission Driver Gate Driver Module Energy Consumption Motor Control HEV/EV Locomotive Medical Driver optimizes efficiency, operating performance and lifespan High-voltage switches arranged to increase power capability 2018 Power Integrations 24

25 SCALE-iDriver with FluxLink Introduced in 2016; key synergy of Concept acquisition FluxLink provides isolation without opto-couplers Adds ~$500M to addressable market Secondary (low-voltage) Input (PWM) IGBT1 Fault Primary (high-voltage) IGBT Power Integrations 25

26 SCALE-iDriverApplications: KW Motor Drives UPS Medical Welding / Cutting Solar Commercial Vehicles, Automotive (EV Drive Train & Chargers) 2018 Power Integrations 26

27 Expanded Power Range = Larger SAM AC/DC LED IGBT Hiper Family CAPZero /SENZero Qspeed SCALE-iDriver + SCALE -2 TOPSwitch TinySwitch / InnoSwitch 3 LinkSwitch / InnoSwitch LED Driver Products LYTSwitch 0W 2W 5W 20W 50W 100W 200W 500W 10 kw 100 kw 1 GW 2018 Power Integrations 27

28 Global Presence Headquarters in San José, California Design centers in Canada, Switzerland, UK, Germany 19 field labs worldwide PI Locations Wafer Foundry (Lapis, EPSON, X-FAB) Assembly Subcontractor 2018 Power Integrations 28

29 Target Financial Model Double-digit revenue growth 11% growth in 2017 Non-GAAP gross margin 50-55% 50.7% in 2017 Non-GAAP operating margin 20%+ 20.4% in 2017 Non-GAAP tax rate 7-8% 4.9% in 2017; increase for 2018 driven by tax legislation Note: Non-GAAP results exclude amortization of acquisition-related intangible assets and stock-based compensation expenses 2018 Power Integrations 29

30 Track Record of Growth Revenues ($M) Note: Revenues prior to 2017 do not reflect ASC 606 recast; see company website for recast financial data for Power Integrations 30

31 Well-Diversified Revenue Mix % Industrial 23% Computer 24% Consumer 43% Comms 33% Industrial 38% Consumer 24% Comms 5% Computer Higher-margin industrial & consumer markets now >70% of revenues 2018 Power Integrations 31

32 Strong Cash Flow $M % 14% 10% 16% 12% 24% 18% 20% FCF = Cash flow from operations less capital expenditures Cash flow from operations CAPEX FCF (with FCF Margin) One-time tax payment 2018 Power Integrations % 11%

33 Four-Prong Approach to Capital Management Accelerated Internal Investment Cash-rich Business Model Effective Tax Strategy Healthy Balance Sheet, Domestic Cash Resources Targeted M&A Opportunistic Buybacks Dividends 2018 Power Integrations 33

34 Strong Balance Sheet At March 31, 2018 $258M cash and investments $116M for Concept acquisition (2012) No debt Quarterly dividend of $0.16/share Share count down 6% since 2008 on stock buybacks Cash and Investments ($M) Q3'08 Q2'13 Q1' Diluted Shares Outstanding (M) 10 Q3'08 Q2'13 Q1' Power Integrations 34

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