Corporate Presentation - Spectra7interconnect suppliers who serve 10 major Data Center Operators....

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Corporate Presentation December 2017

Transcript of Corporate Presentation - Spectra7interconnect suppliers who serve 10 major Data Center Operators....

Page 1: Corporate Presentation - Spectra7interconnect suppliers who serve 10 major Data Center Operators. Prototype orders in Q3’17. Revenue expected to ramp in 2018. 1. Company Estimates

Corporate Presentation

December 2017

Page 2: Corporate Presentation - Spectra7interconnect suppliers who serve 10 major Data Center Operators. Prototype orders in Q3’17. Revenue expected to ramp in 2018. 1. Company Estimates

DisclaimersCertain statements contained in this presentation constitute “forward-looking statements”. All statements other than statements of

historical fact contained in this presentation, including, without limitation, those regarding the market opportunity of the Company’s

products, capabilities of the Company’s products, Company’s future financial position and results of operations, strategy, plans,

objectives, goals and targets, and any statements preceded by, followed by or that include the words “believe”, “expect”, “aim”, “intend”,

“plan”, “continue”, “will”, “may”, “would”, “anticipate”, “estimate”, “forecast”, “predict”, “project”, “seek”, “should” or similar expressions or

the negative thereof, are forward-looking statements. These statements are not historical facts but instead represent only the

Company’s expectations, estimates and projections regarding future events. These statements are not guarantees of future

performance and involve assumptions, risks and uncertainties that are difficult to predict. Therefore, actual results may differ materially

from what is expressed, implied or forecasted in such forward-looking statements. Additional factors that could cause actual results,

performance or achievements to differ materially include, but are not limited to the risk factors discussed in the Company’s annual

MD&A for the year ended December 31, 2016 which is available at www.sedar.com.

Management provides forward-looking statements because it believes they provide useful information to investors when considering

their investment objectives and cautions investors not to place undue reliance on forward-looking information. Consequently, all of the

forward-looking statements made in this presentation are qualified by these cautionary statements and other cautionary statements or

factors contained herein, and there can be no assurance that the actual results or developments will be realized or, even if substantially

realized, that they will have the expected consequences to, or effects on, the Company. These forward-looking statements are made as

of the date of this presentation and the Company assumes no obligation to update or revise them to reflect subsequent information,

events or circumstances or otherwise, except as required by law.

Cautionary Note Regarding United States Securities Laws

This presentation does not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the securities of

the Spectra7 Microsystems Inc., in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or

qualification under the securities laws of such jurisdiction. The securities of Spectra7 Microsystems Inc. have not been and will not be

registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), or any state securities laws and may

not be offered or sold within the United States or to, or for the account or benefit of, “U.S. persons, “as such term is defined in

Regulations under the U.S. Securities Act, unless an exemption from such registration is available2

Page 3: Corporate Presentation - Spectra7interconnect suppliers who serve 10 major Data Center Operators. Prototype orders in Q3’17. Revenue expected to ramp in 2018. 1. Company Estimates

Spectra7 Overview

• High performance analog semiconductor company targeting high value, high

growth markets with patented advanced signal processing technology

• Headquartered in San Jose, California.

4From

bulky data, audio,

power & video

cables.

1To

Ultra-thin and

light-weight

interconnect.

Spectra7 makes electronic products

smaller, lighter, and faster.

3

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Share Structure and Key Statistics

Share Price $ 0.41 CAD*

Market capitalization $ 66.6M CAD*

TTM revenue (00/30/17) $ 8.7 M

TTM gross margin (09/30/17) 59%

Insider ownership 4.5% Est.

Shares %

*As of 09/30/17 Market Close

See disclaimers on slide 2

Listed as SEV

Common shares issued 163 M 100

4

Page 5: Corporate Presentation - Spectra7interconnect suppliers who serve 10 major Data Center Operators. Prototype orders in Q3’17. Revenue expected to ramp in 2018. 1. Company Estimates

Investment Highlights

Focused, targeted go-to-market strategies fuelling business momentum

New transformative design win pipeline with industry leaders in AR/VR/MR

Encouraging market acceptance and testing of Data Center products

Growing presence in the Blockchain space

Operational efficiency programs supporting improved margin performance

I

II

III

IV

V

See cautionary notes on page 25

Page 6: Corporate Presentation - Spectra7interconnect suppliers who serve 10 major Data Center Operators. Prototype orders in Q3’17. Revenue expected to ramp in 2018. 1. Company Estimates

Spectra7 Team

Dr. Andrew KimCTO & VP,ENGINEERING

20 Years Experience: Samsung, Intersil

Raouf HalimCEO

CEO icClarityCEO Mindspeed Technologies

32 Years Experience

Darren MaCFO

15 Years Experience in FinanceIntel, Semtech, GigPeak

John MitchellCHIEF MARKETING OFFICER20 years of Product Marketing:

Intersil, Quellan

Antony Ng YukshingVP, OPERATIONS

23 years Semiconductor Engineering Cypress, Marvell

Ebrahim AbunasrahVP, INTERCONNECT PRODUCT

GROUP10 years Product Development

Molex

Gerald HamiltonSENIOR VP, WORLDWIDE SALES

27 Years Semiconductor Experience: Mindspeed, Conexant

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High Gross Margin / Single Sourced / Secured by over 50 Patents

The Leader in Active Copper Cable Technology

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Augmented/ Mixed Reality

Data Center & Blockchain

Virtual Reality

Spectra7 Target Markets: High Value, High Growth,

Disruptive Technologies

1-Estimated Hardware Revenue from Digi Capital(2016)

2- Gartner (2016)

$6 billion by 20201

3D gaming- Immersive Content -VR social

platforms

$4 billion market in 20192

Cloud Infrastructure - Cryptocurrency – Blockchain

processing

$42 billion by 20201

Workplace collaboration-Virtual desktop Increased

productivity- Job training

8

Page 9: Corporate Presentation - Spectra7interconnect suppliers who serve 10 major Data Center Operators. Prototype orders in Q3’17. Revenue expected to ramp in 2018. 1. Company Estimates

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Spectra7’s Target Markets

AR/VR/MR

Data Center

Blockchain

• Introducing Disruptive Technology

• Explosive Growth Potential

• High Margin Opportunity

Source: Ovum

Page 10: Corporate Presentation - Spectra7interconnect suppliers who serve 10 major Data Center Operators. Prototype orders in Q3’17. Revenue expected to ramp in 2018. 1. Company Estimates

New Design Driving Growth: DreamWeVR™

Spectra7’s 4 new chips featuring

SpectraLinear™ technology enabling

AR, VR, and MR devices to drive

resolutions of 4K / 5K with low latency

over an ultra-thin unified interconnect.

Potential Applications for Spectra7’s

ultra-thin wearable interconnects:

• UHD Video

• Data Control

• Gesture recognition

• Gyro interface

Up to 50 Gbps10

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Spectra7’s VR/MR Market Leadership Position

• $299 price point set by

Windows10 MR is driving

increased adoption

• Initial Valve and Microsoft

Games coming to Win10

for Holiday Sales and

Chinese New Year

• Record Content and

Software investments in

2H17 will drive robust

hardware sales in 2018

and beyond

Page 12: Corporate Presentation - Spectra7interconnect suppliers who serve 10 major Data Center Operators. Prototype orders in Q3’17. Revenue expected to ramp in 2018. 1. Company Estimates

Poised to Enter Data Center Market

Glo

bal D

CI R

even

ue, $M

Multi-slot Small Form Factor

Ovum,

2016

Data Center Interconnect Optical Revenue

58.5% CAGR

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Page 13: Corporate Presentation - Spectra7interconnect suppliers who serve 10 major Data Center Operators. Prototype orders in Q3’17. Revenue expected to ramp in 2018. 1. Company Estimates

Spectra7 Proposition: Design Drives Value

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Up to 10X reduction in

cable diameter

Passive cable bundle

Page 14: Corporate Presentation - Spectra7interconnect suppliers who serve 10 major Data Center Operators. Prototype orders in Q3’17. Revenue expected to ramp in 2018. 1. Company Estimates

Replacement Opportunity: Compelling Efficiency Gains

Up to 80% power reduction over fiber1

Up to 65% lower cost over fiber1

Major Recent Developments:

Collaboration with Foxconn, one of six

interconnect suppliers who serve 10 major

Data Center Operators.

Prototype orders in Q3’17.

Revenue expected to ramp in 2018.

1. Company Estimates

2. Ovum: Ovum Says it is Good to be a Data Center Interconnect Supplier (2015) 14

Page 15: Corporate Presentation - Spectra7interconnect suppliers who serve 10 major Data Center Operators. Prototype orders in Q3’17. Revenue expected to ramp in 2018. 1. Company Estimates

Data Center Architecture for Blockchain

Blockchain Architecture

Market DriversBitcoin

Crypto CurrenciesBaaS

Ethereum

Smart Contracts

Blockchain Architecture

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Page 16: Corporate Presentation - Spectra7interconnect suppliers who serve 10 major Data Center Operators. Prototype orders in Q3’17. Revenue expected to ramp in 2018. 1. Company Estimates

Spectra7 Increases Efficiency of

Blockchain Processing

- Breakthrough Low Power

Up to 80% lower power than competing solutions.

- High Performance

Scalable interconnect solutions from 25-400Gbps.

- Low Cost

Typically 50% cost of competing solutions.

QSFP-DD 200/400G QSFP28 100/200G SFP28/DD 25/50G

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Page 17: Corporate Presentation - Spectra7interconnect suppliers who serve 10 major Data Center Operators. Prototype orders in Q3’17. Revenue expected to ramp in 2018. 1. Company Estimates

Example Blockchain Operators & Customers

• Major Operators and

OEMs have Blockchain

Initiatives

• Cloud and Hyper-Scale

offer Blockchain as a

Service (BaaS)

• Spectra7 is teaming

with cable partners to

leverage it’s unique

patented active cable

technology.

Blockchain Landscape

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Page 18: Corporate Presentation - Spectra7interconnect suppliers who serve 10 major Data Center Operators. Prototype orders in Q3’17. Revenue expected to ramp in 2018. 1. Company Estimates

Investment Highlights

Focused, targeted go-to-market strategies fuelling business momentum

New transformative design win pipeline with industry leaders in AR/VR/MR

Encouraging market acceptance and testing of Data Center products

Growing presence in the Blockchain space

Operational efficiency programs supporting improved margin performance

I

II

III

IV

V

See disclaimers on slide 2 18

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