Nordic Semiconductor ASA · OSL:NOD

Nordic Semiconductor ASA — Q1 2021 Earnings Presentation

29 slides from Nordic Semiconductor ASA's earnings presentation, Apr 20, 2021

  1. Slide 1: Quarterly Presentation Q1 2021

    Quarterly Presentation Q1 2021 April 20, 2021

  2. Slide 2: Disclaimer

    © Nordic Semiconductor Disclaimer The following presentation is being made only to, and is only directed at, persons to whom such presentation may lawfully be communicated (“relevant persons”). Any person who is not a relevant person should not act or rely on this presentation or any of its contents

  3. Slide 3: Continued strong revenue growth

    © Nordic Semiconductor Continued strong revenue growth Solid demand in all end-user markets  Bluetooth revenue passing the USD Revenue Gross margin 100m milestone at USD 119.8m (+134%)  Proprietary revenue remaining solid at USDm USD 20.9m (+36%) 143.2m 50.2 %  Cellular IoT revenue at USD 1.2m (+

  4. Slide 4: Order backlog keeps increasing

    © Nordic Semiconductor Order backlog keeps increasing Backlog (USDm) 900  Order backlog of USD 803m, +551% y-o-y 803 800  Driven by increased volume from both tier- 700 1 customers and the broad-market 600  Bluetooth Low Energy and multiprotocol 492 500 solutions account for 88 % 400  Timing of

  5. Slide 5: High-volume customers driving growth

    © Nordic Semiconductor High-volume customers driving growth  Platform companies and tier-1s defining the features Etc… and specs for new ecosystems  Nordic leverages on strong relations built over years  Strong demand also in the broad market  Digitization shift in the Consumer Wearables Buildin

  6. Slide 6: Steady and high certification market share

    © Nordic Semiconductor Steady and high certification market share Significantly increasing value per design Bluetooth Low Energy end-product certifications, last 12 months 1500 End-product certifications, 1200 Nordic Q1 21 Other 46% Qualcomm 42% 43% 900 41% Infineon 39% Dialog 134 TI 42 % mkt share

  7. Slide 7: Strong growth across all verticals

    © Nordic Semiconductor Strong growth across all verticals Driven by both consumer and industrial/retail customers  Consumer electronics Short-range revenue by end-user markets, last 12 months (USD) 500 remains the largest area 450 Others  Healthcare and 400 Healthcare Building/Retail show 350 Buil

  8. Slide 8: New product launches in Q1

    © Nordic Semiconductor New product launches in Q1 AppSens React Mobile Decatur QPAD Safecility Smart Heart Sensor nRF52811/nRF9160 nRF9160 nRF52840/nRF52833 nRF9160 nRF52832 Gaming Mouse ECG heart monitor to Hotel employee panic Battery-powered NB- Asset Tracking with GPS identify risk of stroke but

  9. Slide 9: Fast pick-up of the new generation nRF5340

    © Nordic Semiconductor Fast pick-up of the new generation nRF5340 Into volume production in Q4 2020  Now available on 17 different module variants from 6 different module partners  Received first >USD 1 million order from customer within the advanced wearable segment  First order received from au

  10. Slide 10: AI and machine learning – the future of IoT

    © Nordic Semiconductor AI and machine learning – the future of IoT  Nordic’s partnership with TinyML company - Edge Impulse, makes AI and machine learning accessible on resource-constrained wireless IoT chips for the very first time  Edge Impulse solutions and Nordic’s nRF9160 cellular SIP and nRF

  11. Slide 11: Cellular IoT progressing

    © Nordic Semiconductor Cellular IoT progressing Regulatory certifications overview for nRF9160:  Continuing to expand certification for global coverage  Approved by the Brazilian regulatory authority  Certified by the Canadian telecom carrier TELUS  Volume ramp-up delayed due to supply issues 

  12. Slide 12: Financials

    Financials Pål Elstad, CFO

  13. Slide 13: Revenue growth of 104%

    © Nordic Semiconductor Revenue growth of 104% Quarterly revenue (USDm) 150 143  Y/Y growth across all technologies 127 125 119  Bluetooth +134% to USD 119.8 million 100 89  Proprietary +36% to USD 20.9 million 70 75  Cellular IoT +10% to USD 1.2 million 50 25 0 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1

  14. Slide 14: Revenue growth in all markets

    © Nordic Semiconductor Revenue growth in all markets Consumer Building/ Group Electronics Wearables Retail Healthcare Others USDm USDm USDm USDm USDm USDm 143.2 51.2 19.9 35.4 16.3 17.9 +104% +13% +109% -5% +75% +10% +169% +31% +197% +54% +48% +32% y-o-y q-o-q y-o-y q-o-q y-o-y q-o-q y-o-y q-o-q y-o

  15. Slide 15: Gross margin within the guidance range

    © Nordic Semiconductor Gross margin within the guidance range Gross margin (%) 56% Gross margin at 50.2% 54.1%  Higher share of lower margin SoCs 54% 52.7% 51.9% 51.9% in the Q1 deliveries, as guided in Q4 52% 50.2%  Revenue driven by high-volume tier-1 50% customers 48%  Gross margin expected at

  16. Slide 16: Operating model performance Q1 2021

    © Nordic Semiconductor Operating model performance Q1 2021 Gross margin 50.2% Q1 2021 Q1 2020 Revenue USD 143.2m USD 70.2m +104.1% Growth in all technologies and markets R&D short-range 14.2% 50.2% 51.9% Gross margin -1.7pp Change in customer mix USD 71.9m USD 36.4m 14.2% 17.3% R&D cellular IoT R&D

  17. Slide 17: Cash operating expenses

    © Nordic Semiconductor Cash operating expenses  Cash cost increase mainly due to Cash OPEX* (USDm) increased number of employees, acquisition and FX. Salary:  Number of employees increased by 29% to 1 029 over the past last 12 months 36.0 29.9  Wi-Fi acquisition added 81 employees 24.1 26.9 21.8

  18. Slide 18: Sharp year-on-year EBITDA improvement

    © Nordic Semiconductor Sharp year-on-year EBITDA improvement EBITDA (USDm) and margin (%), Quarterly EBITDA (USDm) and margin (%), Last 12 months 35 35% 125 35% 30.9 % 29.0 % 30 30% 27.9 % 30% 26.8 % 26.0 % 25.7 % 100 25.3 % 24.0 % 25 25% 22.5 % 25% 21.1 % 21.3 % 18.9 % 20.2 % 18.1 % 75 20 16.9 % 17

  19. Slide 19: Capex development

    © Nordic Semiconductor Capex development Capex (USDm)  Capex of USD 5.4 million in Q1 6.0  Expecting capex intensity in 2021 at the 5.0 same level as 2020, at around 4% of 4.0 revenue 5.7 % 5.4 %  Investing is test capacity 3.0 4.2 % 3.8 % 2.0 1.9 % 1.0 0.0 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021

  20. Slide 20: Continued strong cash position

    © Nordic Semiconductor Continued strong cash position Cash position and Cash Flow Q1 2021 (USDm) Operating cash flow of USD -26.7m Increasing net working capital due to accounts receivable  NWC/Revenue LTM at 26.9%, up from low level at 19.4% at the end of 2020 Continued disciplined cash strategy S

  21. Slide 21: Summary and Outlook

    Summary and Outlook Svenn-Tore Larsen, CEO

  22. Slide 22: Nordic is on a long-lasting growth journey

    © Nordic Semiconductor Nordic is on a long-lasting growth journey 500 Innovation unlocking new Widespread IoT adoption → market waves 400 Emerging IoT markets → 300 Revenue, USDm Wearables → 200 PC peripherals → 100 Game controllers → 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 201

  23. Slide 23: Bluetooth shows accelerating growth

    © Nordic Semiconductor Bluetooth shows accelerating growth Short-range revenue by technology, last 12 months (USDm) 500 Bluetooth 5Y CAGR +28% +64% Proprietary 5Y CAGR +2% 400 Total Revenue 5Y CAGR +20% 300 200 100 0 Q1 2016 Q1 2017 Q1 2018 Q1 2019 Q1 2020 Q1 2021 23

  24. Slide 24: Cellular IoT will drive digitalization of society

    © Nordic Semiconductor Cellular IoT will drive digitalization of society Nordic has invested early in a huge market opportunity  LTE-M and NB-IoT open new 5 billion IoT devices by 2025 - via cellular access technologies markets in ‘Massive IoT’  Nordic has been an early mover  Invested >USD 130 m

  25. Slide 25: IoT plays an important role to reach UN goals

    © Nordic Semiconductor IoT plays an important role to reach UN goals Product Product Product Pictures pictures pictures v vv Smart Lightning 25

  26. Slide 26: Backlog supports long-term growth plan

    © Nordic Semiconductor Backlog supports long-term growth plan Backlog (USDm) Solid market position 1,000  Market leader in Bluetooth 900 803 800  Positioned to take lead in cellular IoT 700  Complementing portfolio with Wi-Fi 600 Accelerating demand growth 500 400 Medium- and long-term drivers in

  27. Slide 27: Wafer supplies limit capacity in 2021

    © Nordic Semiconductor Wafer supplies limit capacity in 2021  Wafer allocations continue to support January 2021: minimum 25% increase in production volumes in 2021  Nordic has managed to pull-in additional wafer volumes to serve customers in Q2, allowing for Q2 2021 April 2021: revenue guiding of

  28. Slide 28: Expect strong Q2 in challenging supply environment

    © Nordic Semiconductor Expect strong Q2 in challenging supply environment  Working 24/7 to support our customers Q2 2021 guidance  Risks and uncertainties remain + Fast technology adoption continues to Revenue Gross margin strengthen long-term growth potential USDm – Supply capacity temporarily cu

  29. Slide 29: Q&A

    Q&A NORDIC SEMICONDUCTOR

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