Investor Presentation...Semiconductor Compound Semiconductor Data Storage Ion Beam Deposition & Etch...

January 2021

Investor

Presentation

Investor Presentation | © 2021 Veeco Instruments Inc.

Safe Harbor

2

This presentation contains “forward-looking statements”, within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, as amended, that are based on management’s expectations, estimates, projections andassumptions. Words such as “expects,” “anticipates,” “plans,” “believes,” “scheduled,” “estimates” and variations of these wordsand similar expressions are intended to identify forward-looking statements. Forward-looking statements include, but are not limited to, those regarding anticipated growth and trends in our businesses and markets, industry outlooks and demand drivers, our investment and growth strategies, our development of new products and technologies, our business outlook for current and future periods, the impact of the COVID-19 pandemic, our ongoing transformation initiative and the effects thereof on our operations and financial results; and other statements that are not historical facts. These statements and their underlying assumptions are subject to risks and uncertainties and are not guarantees of future performance. Factors that could cause actualresults to differ materially from those expressed or implied by such statements include, without limitation: the level of demand for our products; global economic and industry conditions; the effects of regional or global health epidemics, including the effects of the COVID-19 pandemic on the Company’s operations and on those of our customers and suppliers; global trade issues, including the ongoing trade disputes between the U.S. and China, and changes in trade and export license policies; our dependency on third-party outsourcing partners; the timing of customer orders; our ability to develop, deliver and support new products and technologies; our ability to expand our current markets, increase market share and develop new markets; the concentrated nature of our customer base; our ability to obtain and protect intellectual property rights in key technologies; our ability to achieve the objectives of operational and strategic initiatives and attract, motivate and retain key employees; the variability of results among products and segments, and our ability to accurately forecast future results, market conditions, and customer requirements; the impact of our indebtedness, including our convertible senior notes and our capped call transactions; and other risks and uncertainties described in our SEC filings on Forms 10-K, 10-Q and 8-K. All forward-looking statements speak only to management’s expectations, estimates, projections and assumptions as of the date of this presentation. The Company does not undertake any obligation to update or publicly revise any forward-looking statements to reflect events, circumstances or changesin expectations after the date of this presentation.

Investor Presentation | © 2021 Veeco Instruments Inc.3

Who is Veeco

950+

Employees

>500

Patents

$435M -$450M

Forecasted

2020 Revenue*

Global provider of semiconductor capital equipment that addresses complex materials challenges

Differentiated portfolio of high-value technology that has evolved with market trends

Leading positions across four key end markets, with opportunities for expansion into adjacent markets and applications

Financial strength and flexibility supported by extended maturities

* Based off Q1 to Q3 actuals and Q4 guidance range


Strong Performance Amidst COVID-19 Pandemic

Maintaining Business Resiliency Well Positioned for 2021

Active management oversight and execution through COVID-19 has prioritized health and safety while enabling progress on our transformation

▪ “Essential Status” – all facilities are operational

▪ Maintaining customer service levels and providing remote support where possible

▪ Proactively identifying supply gaps and alternate sourcing where required

▪ Virtual factory acceptances

▪ Maintaining flexibility

▪ Taking health and safety measures to protect employees

▪ Sufficient liquidity

▪ Extended debt maturities out to 2023-27

▪ 2018 to 2020 annual Opex reductions

▪ Healthy backlog

▪ Veeco team is experienced managing through cycles


LEDGaN MOCVD for LCD backlighting

& general lighting applications

Ultratech AcquisitionLeader in Laser Annealing and

Advanced Packaging Lithography

Two-Phase TransformationTargeting improved

profitability and growth in:

▪ Semiconductor

▪ Compound Semiconductor

Data StorageIon Beam Deposition & Etch of

magnetic material for HDD heads

1990s & 2000s

Track record of innovation to address changing market dynamics and capitalize on emerging market trends

5

Evolution Aligned with Market Opportunities

2010-2011 Transformation

Exited Commodity

LED BusinessFoundation to transform

business toward higher-

margin growth opportunities

2017 2018

HDD – Hard Disk Drive

LED – Light Emitting Diode

GaN – Gallium Nitride

MOCVD – Metal Organic Chemical Vapor Deposition

LCD – Liquid Crystal Display


Phase 1: Return to Profitability (Q4 ’18 – Q2 ’20)

▪ Shifted MOCVD market focus to higher value Compound Semiconductor

▪ Executed company reorganization and expense reduction

o Moved to functional structure and delayered leadership

o Removed more than $30M from Opex

o Right-sized manufacturing footprint

▪ Divested non-strategic product line

Phase 1: Executed

6

Continued Momentum Executing Transformation

Phase 2: Drive Growth Strategy (Q2 ’19 – 2022 and beyond)

▪ Front-End Semi with Laser Annealing

▪ 5G RF with Wet Processing

▪ Data Storage with Ion Beam

▪ Significant investments in evaluations, R&D and service infrastructure to drive growth in:

o Semiconductor

o Compound Semiconductor

~10% growth in 2021 (backlog supported) Grow in 2022 & beyond

Phase 2: Progressing as planned

5G – Fifth Generation Wireless Technology

RF – Radio Frequency


Our Customers Drive the Trends

7

IDMs and Foundries

OSATs, MEMS and RF Filters

Compound Semiconductor

Scientific & Industrial

Veeco is a long-term partner of industry leaders driving today’s megatrends in each of our markets


Significant Market Opportunities

High Performance Computing

AI / High Performance

Computing / 5G

Power / 5G / Photonics /

MicroLED

Cloud / Data Storage

* Compound Semi includes LED, Lighting & Display

AI – Artificial Intelligence

AP – Advanced Packaging

MEMS – Micro-Electromechanical Systems

Front End Semi

Advanced Packaging,

MEMS & RF Filters

Compound

Semi*

Scientific &

Industrial Ion Beam

Laser Annealing

Ion Beam

MOCVD

Wet Processing

AP Lithography

Wet Processing

Market Served Drivers Veeco Technologies

Well positioned to drive near and longer-term growth


Front-End Semiconductor Solutions with Laser Annealing

PTOR – Process Tool of Record

Market Drivers The Veeco Difference

▪ Artificial Intelligence

▪ High Performance Computing

▪ Graphical Processing Units

Veeco’s Laser Annealing systems allow customers to perform their annealing steps with great accuracy

▪ Very high temperatures over

precise geometries

▪ Extremely short durations

▪ Minimal wafer defects

Current status:

▪ PTOR at ≤7nm with 2 customers

▪ Making progress with:o Additional application with existing

customer

o Next nodes at existing customers

o An additional logic customer

o Early-stage engagement with

memory customer

Enabling Advanced Nodes


EUV Mask Blank for Front-End Semiconductor

*Source: Semiconductor Engineering

EUV – Extreme Ultraviolet



▪ High Performance Computing

▪ Autonomous Driving

▪ Primarily logic and early interest

from memory end customers

Veeco supplies best-in-class Ion Beam Deposition systems to the EUV Lithography mask blank suppliers for the semiconductor industry

28nm 14nm 10nm 7nm 5nm

Multi Patterning

Single Patterning

EUV Lithography

EUV Adopters*

Incre

asin

g T

ran

sis

tor

De

nsit

y

Enabling Advanced Nodes


Compound Semi Solutions with MOCVD

Veeco’s New Lumina™ Platform for

VCSELs, EELs and mini / MicroLEDs

LiDAR – Light Detection and Ranging AsP – Arsenide Phosphide

GaAs – Gallium Arsenide InP – Indium Phosphide

EEL – Edge Emitting Laser VCSEL – Vertical Cavity Surface Emitting Laser


PhotonicsAsP based devices with consumer, automotive and industrial

applications such as world facing sensors in mobile devices,

LiDAR for autonomous vehicles and Data / Telecom.

GaN RF Devices (5G)GaN based RF devices are more efficient than silicon based

power amplifiers. Potential in mm-wave base station and

mobile device applications.

MicroLEDSunlight readability, power efficiency & high brightness are the

advantages of this next generation display technology.

▪ Multi-Wafer or Single Wafer

GaN – GaAs – InP – AsP

Proprietary TurboDisc® advantages:

▪ Excellent uniformity

▪ Maximum up-time

▪ Highest productivity

▪ Lowest cost of ownership

GaN Power DevicesGaN based power devices are more efficient than silicon

based power devices. This enables higher power density and

lower system cost in consumer applications such as wired and

wireless charging.

Veeco’s Propel™ Platform for GaN based

power devices, RF devices and MicroLED


Data Storage Solutions with Ion Beam Technology

▪ Data Center / Cloud

▪ Edge Computing

o Artificial Intelligence

o Internet of Things

o 5G RF

Digital/ Information Revolution

Market Drivers

Decades of investment have driven deep customer partnerships

The Veeco Difference

▪ Enterprise HDDs have a ~10X cost

advantage over flash memory1

▪ HDD growth driven by long-term 35%

CAGR in Exabyte demand for cloud

storage2

▪ Average number of heads per drive is

increasing, leading to a forecasted

increase in magnetic heads shipped

▪ Heads are increasing in complexity

(HAMR/MAMR) to enable

improvements in areal density,

driving increased steps per head and

capacity requirements for our

customersSource: Coughlin Associates Feb. 2020, Internal analysis

1 Coughlin Associates

2 Gartner

HAMR – Heat Assisted Magnetic Recording

MAMR – Microwave Assisted Magnetic Recording

Heads & Steps per Head

Projected to Increase


Advanced Packaging Solutions with Lithography



▪ Automotive

▪ Mobility

▪ Graphical Processing Units

Veeco’s Advanced Packaging Lithography is the process of choice:

▪ Fan-out wafer level packaging at

top foundries and OSATs

▪ Copper Pillar applications in high

bandwidth memory

Updated Product Platform:

▪ Highly automated

▪ Improved performance

▪ Cost effective

Enabling Better System Performance

OSAT – Outsourced Assembly and Test Provider

Financial Update


Improving Financial Trends (2018 – 2021) (Non-GAAP)

175 156

32%

37%

2018 2019 2020* 2021**

OPEX ($m, %)

140 - 142

~32%

542

419

2018 2019 2020* 2021**

Revenue ($m)

435 - 450

37%

39%

2018 2019 2020* 2021**

Gross Margin (%)

43% - 44%

0.30

(0.03)

2018 2019 2020* 2021**

EPS($)

0.78 – 0.93

Improving financials demonstrate our transformation progress,

with expectations for continued growth in 2021

* Based on Q4 20 Guidance

** 2021 revenue expectations were announced and expected to be ~10% increase over 2020

A reconciliation of GAAP to Non-GAAP financial measures can be found in the backup section of this presentation.

2021 is expected

to grow ~10% over

2020

Reduced Opex by

more than $30M

We expect Opex as

a percentage of

revenue to further

decline

Gross

Margins are

expected to

remain in the

low-to-mid

40% range

Company

profitability is

expected to

further improve

~10%

Impact

of

LED


Balance Sheet and Cash Flow Highlights

16Amounts may not calculate precisely due to rounding. A reconciliation of GAAP to Non-GAAP financial measures can be found in the backup section of this presentation.

$ millions Q2 ‘20 Q3 ‘20

Cash & Short-Term Investments 301 310

Accounts Receivable 67 80

Inventories 137 143

Accounts Payable 26 34

Long-Term Debt 317 321

Cash Flow from Operations 20 10

DSO (days) 61 64

DOI 211 200

DPO 42 49


2020 Capital Restructuring

17

Convertible DebtPrincipal

AmountCoupon

Annual

Cash

Interest

Initial

Conversion

Price

As of December 31, 2019 Convertible Notes Due 2023 $345M 2.7% $9.3M $40.03

Total Convertible Debt $345M 2.7% $9.3M

Pro-Forma3

As of Sept. 30, 2020

Convertible Notes Due 2023 $132M 2.7% $3.6M $40.03



Total Convertible Debt $389M 3.3%2 $12.9M

(1) Conversion price for 2027 Convertible Notes includes the effect of the Capped Call transaction

(2) Weighted average

(3) Reflects November 2020 exchange as of September 30, 2020

Amounts may not calculate precisely due to rounding.

May 2020

▪ Veeco issued $125M convertible notes due 2027

▪ Retired $88M 2023 convertible notes

▪ Added ~$30M cash to balance sheet

November 2020

▪ Veeco entered a privately negotiated exchange agreement extending the maturity of a portion of the January 2023 notes by 2 years to January 2025

▪ Debt maturities are now staggered more evenly over 7 years

▪ Cash balance improved from $245M ending 2019 to $310M as of September 30, 2020


2020 Highlights – A Year of Progress

18

▪ Completed Functional Reorganization

o Functional Structure, New CFO and Head of Sales & Service

o Allocated R&D Investments at Corporate Level

▪ Divested Non-core Product Line

▪ Improved Liquidity and Capital Structure Extending Debt Maturity Profile

▪ Expanded Operating Performance (GM%, Opex%, Op Inc.%)

▪ Enhanced Board & Corporate Governance

o Appointed independent Chair

o Second female board member, appointed in 2019, assigned to Audit Committee

▪ Published Inaugural Sustainability Report

▪ Bolstered Veeco United Culture

▪ Positioned for ~10% 2021 Revenue Growth

o Strong Backlog

o Laser Annealing, 5G RF, Data Storage

▪ Solidified Multi-Year Growth Strategy and Prepared for Growth in 2022 and Beyond

o Invested in Evaluation Systems, service capability, R&D for growth in:

o Semiconductor and Compound Semiconductor Markets

Significant progress on transformation plan designed and being executed by current management

Outlook


Near-term Industry Outlook (2021)

20

MarketNear-Term Incremental

OpportunitiesProof Point

Semi

(Foundry Logic)

Front end laser annealing New Street Research (December 2020) is forecasting Logic and Foundry WFE to remain high at ~$32B in 2021

Stifel (December 2020) – “We believe strength in foundry/logic spending will continue from 2020, driven by both leading-edge and additional trailing-edge capacity needed for select markets.”

Compound

Semi (5G)

Filters and power amplifiers with

wet processing

Deutsche Bank (December 2020) – “Among all end markets, we have the highest conviction that 5G mobility will see continued strength in 2021 with potential for more upside... 2020 has been a key year in the adoption of 5G technology, but we are still in the early innings of the 5G transition, especially on the millimeter wave (mm-wave) side. Sub-6GHz 5G smartphone adoption should more than double next year according to Gartner, while mm-wave units should more than triple.”

Data Storage

Ion beam systems for thin film

magnetic head manufacturing

According to Coughlin Associates and internal Veeco estimates, as hard disk

drive capacities increase, the number of heads shipped is forecasted to

increase by ~8.5% CAGR through 2025. Additionally, as manufacturers

introduce energy assisted magnetic recording (HAMR/MAMR) the number of

manufacturing steps per head is forecasted to increase by ~8.5% CAGR

through 2025.

WFE – Wafer Fab Equipment Spending

Significant opportunities to drive top line growth


Long-term Growth Opportunities (2022 and Beyond)

1 TrendForce estimate

Traditional MicroLED approach – Red, green and blue MicroLEDs are produced to make up a single display pixel

Disruptive MicroLED approach – MicroLEDs are grown in place on silicon wafers similar to a semiconductor process

Investments for Growth Semiconductor Markets

▪ Research and Developmento Annealing

o GaN & AsP MicroLED

o Other core Veeco technologies

▪ Evaluation Agreementso Laser Annealing for Logic and

Memory

o MOCVD Systems for early stage

MicroLED

▪ Service Capabilityo Enhancements to support multiple

product evaluations

Veeco’s Laser Annealing solutions are ideally suited for our customers’ challenges at advanced nodes.

We seek to expand our market opportunity and increase share by:

▪ Achieving PTOR status at next

nodes with our existing customers

▪ Achieving PTOR status at an

additional logic customer

▪ Expanding annealing into memory

applications

Compound Semiconductor Markets

MOCVD for MicroLED display has the potential to be a significant growth driver in 2022 and beyond.

Veeco is active in traditional and disruptive MicroLED approaches

Investments delivering early traction toward longer-term growth in 2022 and beyond

MicroLED wafer production is

expected to increase from

74,000 wafers in 2021 to

over 5 million wafers in 20241


Execute Near-Term

2021 growth

Prepare Long-Term

2022 & beyond

Focus

profitability & products

Maintain Resilience

essential business

▪ Laser Annealing

▪ 5G RF

▪ Data Storage

▪ Employees

▪ Service

▪ Supply Chain

▪ Manufacturing

▪ Aggressively invest in

evaluation systems

▪ Expand service capability

▪ Selectively increase R&D

investments

▪ Defend foundational businesses

▪ Deliver strong operating results

▪ Evaluate product portfolio

Improved company performance today while investing for long-term, profitable growth

22

2021 Priorities – Building on a Profitable Growth PlanGrowth Phase of Transformation

Thank you

Backup &

Financial Tables


Q3 2020 Revenue by Market & Region

Revenue by Market Revenue by Region

Revenue Trend ($m) Q3 19 Q4 19 Q1 20 Q2 20 Q3 20

Front-End Semiconductor 34 39 31 18 21

LED Lighting, Display & Compound Semi 24 26 15 16 20

Scientific & Industrial 40 32 49 43 52

Advanced Packaging, MEMS & RF Filters 11 16 9 22 19

Total 109 113 105 99 112


ROW includes Japan, Taiwan, Korea and South East Asia.

18%

18%

17%

47%

Scientific & Industrial

Front-End Semiconductor

LED Lighting, Display & Compound Semiconductor

Advanced Packaging, MEMS & RF Filters

42%

36%

9%

13%

EMEA

China

United States

ROW

$112M


Q4 2020 Guidance

26

GAAP Non-GAAP

Revenue $120M - $135M $120M - $135M

Gross Margin 42% - 44% 42% - 44%

Operating Expenses $43M - $45M $36M - $38M

Net Income / (Loss) $1M - $9M $11M - $19M

Earnings/(Loss) Per Share $0.02 - $0.17 $0.22 - $0.37

A reconciliation of GAAP to Non-GAAP financial measures can be found in the backup section of this presentation.


Market Segmentation Update

Front-End Semiconductor

Scientific & Industrial (includes Data Storage)

LED Lighting, Display &

Compound Semiconductor

Advanced Packaging,

MEMS & RF Filters

Semiconductor (includes Advanced Packaging)

Scientific & Other

Compound Semiconductor (includes RF Filters and MEMS)

Data Storage

Future Market SegmentsCurrent Market Segments

New market segmentation aligns with Veeco’s strategic focus


Historical Revenue by Market and Geography

28

Revenue by Market ($M) FY 2018 FY 2019

Front-End Semi 63 120

Advanced Packaging, MEMS

& RF Filters91 67


Compound Semi250 73

Scientific & Industrial 139 160

Total 542 419

Revenue by Market (%) FY 2018 FY 2019

Front-End Semi 12% 29%

Advanced Packaging, MEMS

& RF Filters17% 16%


Compound Semi46% 17%

Scientific & Industrial 25% 38%

Total 100% 100%

Revenue by Geography ($M) FY 2018 FY 2019

USA 126 126

EMEA 89 57

China 194 71

ROW 133 165

Total 542 419

Revenue by Geography (%) FY 2018 FY 2019

USA 23% 30%

EMEA 16% 14%

China 36% 17%

ROW 25% 39%

Total 100% 100%

Amounts may not calculate precisely due to rounding. A reconciliation of GAAP to Non-GAAP financial measures can be found in the backup section of this presentation.


Note on Reconciliation Tables

29

These tables include financial measures adjusted for the impact of certain items; these financial measures are therefore not calculated in accordance with U.S. generally accepted accounting principles (“GAAP”). These Non-GAAP financial measures exclude items such as: share-based compensation expense; charges relating to restructuring initiatives; non-cash asset impairments; certain other non-operating gains and losses; and acquisition-related items such as transaction costs, non-cash amortization of acquired intangible assets, incremental transaction-related compensation, and certain integration costs.

These Non-GAAP financial measures may be different from Non-GAAP financial measures used by other companies. Non-GAAP financial measures should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. By excluding these items, Non-GAAP financial measures are intended to facilitate meaningful comparisons to historical operating results, competitors' operating results, and estimates made by securities analysts. Management is evaluated on key performance metrics including Non-GAAP Operating Income, which is used to determine management incentive compensation as well as to forecast future periods.

These Non-GAAP financial measures may be useful to investors in allowing for greater transparency of supplemental information used by management in its financial and operational decision-making. In addition, similar Non-GAAP financial measures have historically been reported to investors; the inclusion of comparable numbers provides consistency in financial reporting. Investors are encouraged to review the reconciliation of the Non-GAAP financial measures used in this news release to their most directly comparable GAAP financial measures.


Supplemental Information—GAAP to Non-GAAP Reconciliation


US$ millions 2018 2019 Q1 20 Q2 20 Q3 20

Net Sales $542.1 $419.3 104.5 98.6 112.1

GAAP Gross Profit 193.7 158.2 46.4 41.9 49.1

GAAP Gross Margin 35.7% 37.7% 44.4% 42.5% 43.8%

Add: Release of inventory fair value step-up for purchase

accounting2.5 1.3 - - 0.3

Add: Share-Based Comp 1.9 1.9 0.5 0.5 0.4

Add: Depreciation of PP&E fair value step-up for purchase

accounting0.3 0.2 - - -

Non-GAAP Gross Profit $198.5 $161.6 $47.0 $42.4 $49.8

Non-GAAP Gross Margin 36.6% 38.5% 44.9% 43.0% 44.5%

US$ millions 2018 2019 Q1 20 Q2 20 Q3 20

GAAP Net Income (Loss) $(407.1) $(78.7) $(0.6) $(8.3) $0.6


Add: Amortization 32.4 17.1 3.8 3.8 3.8

Add: Restructuring 7.4 6.0 0.6 0.5 -

Add: Release of inventory fair value step-up for purchase

accounting2.5 1.3 - - 0.3

Add: Depreciation of PP&E fair value step-up for purchase

accounting1.0 0.6 0.1 0.1 -

Add; Accelerated Depreciation 1.2 0.4

Add: Acquisition related 3.0 - -

Add: Loss on extinguishment of debt - - - 3.0 -

Add: Asset Impairment 375.2 4.0 - 0.3 -

Add: Interest Expense 18.3 17.4 4.9 5.6 6.2

Add: Impairment of equity investment - 21.0 - - -

Add: Tax expense (benefit) (26.7) 0.8 0.3 0.1 0.2

Non-GAAP Operating Income (Loss) $23.2 $5.1 $12.7 $8.0 $14.1

US$ millions, except per share amounts 2018 2019 Q1 20 Q2 20 Q3 20

GAAP Basic EPS (8.63) (1.66) (0.01) (0.17) 0.01

GAAP Diluted EPS (8.63) (1.66) (0.01) (0.17) 0.01

GAAP Net Income (Loss) (407.1) (78.7) (0.6) (8.3) 0.6


Add: Amortization 32.4 17.1 3.8 3.8 3.8

Add: Restructuring 7.4 6.0 0.6 0.5 -

Add: Acquisition related 3.0 - - - -

Add: Release of inventory fair value step-up for purchase accounting 2.5 1.3 - - 0.3

Add: Depreciation of PP&E fair value step-up for purchase accounting 1.0 0.6 0.1 0.1 -

Add: Accelerated Depreciation 1.2 0.4 - - -

Add: Loss on extinguishment of debt - - - 3.0 -

Add: Asset Impairment 375.2 4.0 - 0.3 -

Add: Non-Cash Interest Expense 11.8 12.7 3.3 3.5 3.5

Add: Impairment of equity investment - 21.0 - - -

Add: Tax Adjustment from GAAP to Non-GAAP (29.1) (0.8) (0.1) (0.3) (0.2)

Non-GAAP Net Income (Loss) 14.2 (1.3) 10.9 5.5 11.0

Non-GAAP Basic EPS 0.30 (0.03) 0.23 0.11 0.23

Non-GAAP Diluted EPS 0.30 (0.03) 0.22 0.11 0.22

US$ millions 2018 2019 Q1 20 Q2 20 Q3 20

GAAP Operating Expenses $609.2 $197.8 $41.9 $41.5 $42.2

Share-Based Compensation (14.2) (13.4) (3.1) (2.5) (2.6)

Amortization (32.4) (17.1) (3.8) (3.8) (3.8)

Asset Impairment (375.2) (4.0) - (0.3) -

Other (12.1) (6.8) (0.7) (0.5) -

Non-GAAP Operating Expenses $175.3 $156.5 34.2 34.4 35.7


Q3 2020 Actual: GAAP to Non-GAAP Reconciliation


Non-GAAP Adjustments

In millions, except per share amounts GAAP

Share-Based

Compensation Amortization Other Non-GAAP

Net Sales $112.1 $112.1

Gross Profit 49.1 0.4 0.3 49.8

Gross Margin 43.8% 44.5%

Operating Expenses 42.2 (2.6) (3.8) 35.8

Operating Income (Loss) 7.0 2.9 3.8 0.3 14.1

Net Income (Loss) $0.6 2.9 3.8 3.7 $11.0

Income (Loss) Per Common Share:

Basic $0.01 $0.23

Diluted 0.01 0.22

Weighted Average Number of Shares:

Basic 48.3 48.3

Diluted 49.2 49.2

Other Non-GAAP Adjustments

Release of inventory fair value step-up associated with

the Ultratech purchase accounting 0.3

Subtotal 0.3

Non-Cash Interest Expense 3.5

Non-GAAP Tax Adjustment (0.2)

Total Other 3.7


Q4 2020 Guidance: GAAP to Non-GAAP Reconciliation


Non-GAAP Adjustments

In millions, except per share amounts GAAP

Share-Based

Compensation Amortization Other Non-GAAP

Net Sales $120–$135 $120–$136

Gross Profit 50–60 — — — 50–60

Gross Margin 42%–44% 42%–44%

Operating Expenses $43–$45 (3) (4) — $36–$38

Operating Income (Loss) $7–$15 3 4 — $14–$22

Net Income (Loss) $1–$9 3 4 3 $11–$19

Income (Loss) per Diluted Share $0.02–$0.17 $0.22–$0.37

GAAP Net Income (Loss) $1–$9

Share-Based Compensation 3

Amortization 4

Interest Expense, Net 6

Non-GAAP Operating Income (Loss) $14–$22

Investor Presentation...Semiconductor Compound Semiconductor Data Storage Ion Beam Deposition & Etch...

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