powi investor presentation july 2014

Download Powi investor presentation july 2014

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  • 1. Power Integrations, Inc. Nasdaq: POWI July 2014

2. Copyright 2014 Power Integrations 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 Companys actual results may differ materially from those suggested in the presentation. Information concerning factors that could cause such a difference is contained in the Companys most recent reports on Form 10-K and 10-Q. This presentation may also contain certain non-GAAP financial information. Reconciliations of non-GAAP financial metrics to GAAP results are available at the end of this presentation and/or on the investor page of the Power Integrations website, http://investors.powerint.com (see Historical Financials data file). 3. Copyright 2014 Power Integrations 3 Secular Growth Story in Analog Semis Leader in energy-efficient high-voltage power conversion Clean-tech enabler: efficient appliances, LED lighting, DC motor drives, renewable energy, electric transportation Expanding market opportunity with higher-power products, rapid-charging for mobile devices Double-digit revenue CAGR since 2001 4. Copyright 2014 Power Integrations 4 Ultra-simple power converters Fewer components Shorter design cycles Easier to manufacture Higher reliability BOM cost similar to discrete designs Highly energy-efficient Comprehensive Expertise in High-Voltage 5. Copyright 2014 Power Integrations 5 Highly Integrated Power Converters Replacing Legacy Technologies Discrete power supply: 70 components Equivalent power supply with POWI: 36 components, smaller board Linear transformer: weighs 12 oz. Adapter with POWI: weighs 2 oz. 6. Copyright 2014 Power Integrations 6 0 100 200 300 400 500 600 700 U.S.PatentsGranted Relentless Innovation 609 U.S. Patents 492 Non-U.S. Patents at 12/31/2013 7. Copyright 2014 Power Integrations 7 Vast Addressable Market Power Conversion Is Needed Everywhere 8. Copyright 2014 Power Integrations 8 Long-Term Secular Growth Drivers 1. Ongoing transition to IC-based power supplies Integration saves labor and materials, improves reliability 9. Copyright 2014 Power Integrations 9 Leading Transition to IC-Based Power Supplies Linear Transformers 1970 1994 Discretes 1994 Today1970 Integrated Fairchild Sanken ST Micro ON Semi Infineon POWI iWatt/Dialog BCD/Diodes Active Leadtrend OnBright Fairchild Infineon ON Semi ST Micro NXP PowerSupplyUnitVolume 10. Copyright 2014 Power Integrations 10 Long-Term Secular Growth Drivers 1. Ongoing transition to IC-based power supplies Integration saves labor and materials, improves reliability 2. Energy-efficient electronics & appliances Driven by standards and consumer awareness 11. Copyright 2014 Power Integrations 11 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 12. Copyright 2014 Power Integrations 12 Energy Specs Continue to Tighten U.S. Dept. of Energy tightens federal standards for external power supplies ENERGY STAR Most Efficient label rewards top performers New battery-charger standards in California in 2013 European standby power limitation tightened to 0.5 W in 2013 Traditional 40 W and 60 W light bulbs banned in U.S. as of 2014 13. Copyright 2014 Power Integrations 13 Zero Series Zeroes Out Standby Waste CAPZero eliminates waste from X-cap bleed resistors SENZero disconnects sense resistors in main power supply LinkZero cuts waste to 0.00 W in chargers and auxiliary power supplies 14. Copyright 2014 Power Integrations 14 Energy Vampire vs. LinkZero 15. Copyright 2014 Power Integrations 15 Long-Term Secular Growth Drivers 1. Ongoing transition to IC-based power supplies Integration saves labor and materials, improves reliability 2. Energy-efficient electronics & appliances Driven by standards and consumer awareness 3. LED lighting Requires low-cost, efficient, reliable power supplies 16. Copyright 2014 Power Integrations 16 Well-Positioned in LED Lighting Traditional bulbs phasing out LEDs need efficient, reliable drivers Integration brings reliability, efficiency, size advantage 2007 2008 2009 2010 2011 2012 2013 LED Lighting Revenue >20% Growth in 2013 17. Copyright 2014 Power Integrations 17 Long-Term Secular Growth Drivers 1. Ongoing transition to IC-based power supplies Integration saves labor and materials, improves reliability 2. Energy-efficient electronics & appliances Driven by standards and consumer awareness 3. LED lighting Requires low-cost, efficient, reliable power supplies 4. Expanding market opportunity Rapid charging for mobile-device market Higher-power products add ~$1B to addressable market 18. Copyright 2014 Power Integrations 18 Rapid Charging: Emerging Trend in Mobility Larger batteries causing extended downtime for charging Qualcomm Quick Charge 2.0 cuts charge time up to 75% POWI is lead strategic partner on the charger side Higher dollar content than a standard charger Conventional Charging Quick Charge 2.0 Quick Charge 2.0 PMIC Charger Interface Chip + Power Conversion Chip 19. Copyright 2014 Power Integrations 19 Expanding Market with Mid-Power Products 0W 500W5W 50W2W 20W 200W CAPZero/SENZero/Qspeed Hiper Family TOPSwitch TinySwitch LinkSwitch / LinkZero LinkSwitch-PL/PH / LYTSwitch LED Products LOW-POWER MID-POWER 20. Copyright 2014 Power Integrations 20 Radically Simplifying Mid-Power Converters HiperPFS and HiperTFS replace up to 100 components HiperTFS + HiperPFS 21. Copyright 2014 Power Integrations 21 More Silicon Content at Higher Power Levels EMI Filter PFC Stage Main and Standby Stage Main & Standby Controller Boost Inductor PFC Controller EMI Filter Standby Output AC Gate Drive SR Main Output TNY Before: Single IC for standby power supply 22. Copyright 2014 Power Integrations 22 More Silicon Content at Higher Power Levels EMI Filter PFC Stage Main and Standby Stage Main & Standby Controller Boost Inductor PFC Controller EMI Filter Standby Output AC HiperPFS HiperTFS CpZ Gate Drive SnZ QSpeed SR Main Output HiperTFS main + standbyCapZero HiperPFS SenZero Qspeed Now: Up to five components, potential dollar content >5x higher 23. Copyright 2014 Power Integrations 23 Acquisition Extends Power Range Further CONCEPT drivers reduce component count, enhance efficiency, reliability Acquired CT-Concept in 2012 IGBT drivers for industrial motors, renewable energy, locomotives, DC transmission Addressable market ~$500M; now >10% of POWI revenue Broadens POWI opportunity in clean-power applications 24. Copyright 2014 Power Integrations 24 Spanning the Clean-Power Ecosystem Energy Ecosystem Energy Generation Energy Transmission Energy Consumption Wind Turbines Solar Power HVDC Transmission Motor Control Hybrid Vehicles Locomotive Medical End Markets Power Semiconductors IGBT module: Transistors arranged in parallel to increase switching capacity at very high currents and high voltages Driver optimizes efficiency, operating performance and lifespan of the IGBT module IGBT ModuleDriver 25. Copyright 2014 Power Integrations 25 Higher-Power Products Expand SAM to $2.5B Mobile phone chargers Cordless phone adapters Broadband modems VoIP phones Wireless routers Desktop/server standby Desktop main Notebook adapters LCD monitors Printers White goods Air conditioners TV standby / TV main Small appliances Set-top boxes DVD players Game consoles LED general lighting LED street lights Smart meters Industrial control UPS Industrial motor drives Wind/solar inverters Electric trains/cars DC transmission Consumer Comms Computer Industrial Mid-power applications in orange High-power applications in green 26. Copyright 2014 Power Integrations 26 Consistent Track Record of Growth 0 50 100 150 200 250 300 350 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Revenues ($M) 27. Copyright 2014 Power Integrations 27 Outperforming the Peer Group -10% 0% 10% 20% 30% 40% 2007 2008 2009 2010 2011 2012 2013 CAGR Annual Revenue Growth POWI Analog Semis (SIA) 28. Copyright 2014 Power Integrations 28 Well-Diversified Revenue Mix 25% Consumer 23% Computer 43% Comms 2002 2013 21% Comms 35% Consumer 34% Industrial 10% Computer Higher-margin industrial & consumer markets now >2/3 of revenues; cellphone chargers down from 40% to ~10% 29. Copyright 2014 Power Integrations 29 Growing Cash Flow 0 10 20 30 40 50 60 70 80 90 100 2008 2009 2010 2011 2012 2013 Cash Flow from Operations ($M) One-time tax payment 30. Copyright 2014 Power Integrations 30 Strong Balance Sheet $212M cash and investments Used $116M for Concept acquisition No debt Quarterly dividend of $0.12/share $286M of repurchases since 2004 $26M in Q2 2014 (avg. price