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Rudolph Technologies
Sidoti Conference,
September 2018
Investor Presentation
Building a Business for Sustainable GrowthIncreasing the pace of innovation while driving operational efficiencies
2
Revenue(TTM*)
$278 million
+14% YoY
CompanyNYSE
RTEC
Cash Balance(June 2018)
$183 million
+23% YoY
Employees(Worldwide)
~600
Operating Income(TTM*)
$67 million
+34% YoY
On pace for FOURTH consecutive year of record revenue!
* Trailing Twelve Months, as of June 30, 2018Operating Income: non-GAAP
Providing Process Solutions
for High Value Problems
in High Growth Markets
Rudolph Technologies Corporate Strategy
3
Strategy and Markets Provide Growth
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
Annual Revenue
*2018 based on Wall Street estimates
Record Year
4
Growth of ~50%4 years
Relatively Flat8 years
Strategy Shift
Rudolph’s Diversified High Unit Growth MarketsProviding Components for Multiple End Markets
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Sensing
Advanced Packaging
Communications
Server Cloud
AutomotiveMobility
Source: Gartner, 2017
Internet of Things
Large & Diverse Customer Base in High Growth MarketsBroadens Opportunities For Growth, Reduces Risk!
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40%ADV. PKG.FE MEMORYRF MEMS CISOTHERFP Display
15%
16%
23%
Trailing 12 Months Revenue by Market
6%
2017 REVENUE PERCENTAGE BY ACCOUNT
Top 10 Accounts
44%All Others*
(145)56%
MEMORY IDMFOUNDRYIDMOSATPROBEOEM
*Customers > $50,000 Revenue
Strategic Market PositionsRudolph Process Control Installations (Last 18 Months Shown) Integral Solutions for Top Manufacturers in Each Growth Market
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Source: 1Gartner 2017 Market Share; 2IHS 2017; Company data shown in rank order
Installed at 5 of 6 Top Producers
Installed at 5 of 6 Top Producers Installed at 5 of 6 Top Producers
Memory1
RF Wireless1
MEMS2
Installed at 6 of 6 Top Producers
Advanced Packaging2
Installed at 6 of 6 Top Producers
Advanced Packaging2
Market GrowthKey Market Positions
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31%
11%
4%
8%
9%
16%
0% 5% 10% 15% 20% 25% 30% 35%
VCSEL
CMOS Sensors
Memory
AP/OSAT
Foundry
RF
* 2017-2022 Key Market CAGR's
Core Market Long-term Growth
New Market Opportunities
#1
#2
#3
#5
Mkt. by Rev.
* SEMI Forecast, 2018
Headwinds to GrowthKey Market Inflections (Bull/Bear Differences: SEMI v. Gartner Forecast)
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1H ‘18 Strong - 2H Headwinds into ‘19 Gartner projects down, SEMI projects up
2H AP/OSAT Sluggish Mixed signals across Apple’s iPhone
supply chain – 24/7 Wallstreet
Memory CapEx stalls NAND/DRAM oversupply and lower ASP’s
China positioned to buck this trend
Bitcoin implosion
Smartphone sales in single digits Impact across segments/supply chain
5G Roll-out R&D and infrastructure centered
Handsets/filters impact in late ‘19 / ‘20
Largest RF segment - 20% CAGR
44.0%
8.4%
-12.3% -12.1%
13.0%
2.7%
-2.0% -4.2%
2.6%
9.5%
-6.0%
3.8%
-20.0%
-10.0%
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
2017 2018 2019 2020
Gartner CapEx Projections by Mfg. Type 2Q '18
IDM Foundry SATS
20.7%
-1.0%
0.9%
-2.9%
53.5%
14.5%
-19.4% -17.4%
-3.8%
7.2%2.0% 1.7%
-30.0%
-20.0%
-10.0%
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
2017 2018 2019 2020
Gartner CapEx Projections by Device App 2Q '18
Logic (Including Mixed Signal) Memory Others (Opto, Power Discrete, Compound)
Broad Technology Portfolio, Foundation for Solutions
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INSPECTDefect Detection Silicon to Die
Dicing Process ControlInterconnect Metrology
3D/2D InspectionResidue Detection
LithographyLithography down to sub-micron
Fan-out and Cu PillarWafer and Panel
MEASUREOn Product and In-dieMulti-layer Film StacksUBM, RDL, PR, PI, DielectricsStructure CD
ANALYZEProcess AnalysisProcess ControlTool-centric and Fabwide
FRONT-END BACK-END
SILICON RUDOLPH SOLUTIONS APPLY ACROSS THE SEMICONDUCTOR VALUE CHAIN TEST
CORECOMPETENCIES
Rudolph’s Fan-out Productivity Solution
Feed Forward
Discover® Software
Firefly™ System
How to print random die shift?
JetStep® System
Additional processing induced error
Solution to Die Shift Challenges for Wafer & Panel Process
300% PRODUCTIVITY INCREASE*
Feed Forward
StepFAST™ (Feed-forward Adaptive Shot Technology)
Measure
Adaptive Print
Analyze
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“Increasing the Pace of Innovation”The third tenet of our strategy…
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“Sustainable, profitable, growth.”
“Relentless focus on operational efficiency.”
“Increasing the pace of innovation.“
0%
5%
10%
15%
20%
25%
2015 2016 2017
R&D as % of Revenue
18.6% 19.3% 18.4%
Maintaining a healthy investment in R&D while driving acceptable profit for long term sustainability.
Next Generation Stepper for HD Displays
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• First of a kind for lithography• Speed of scanner• Better resolution without stitching• Significant improvement in COO
• Dual lens system with both lenses matched and running independently
• Gen 4.5 Duo System planned for Q1
• Commercial G6 (1500mm x 1850mm)• Multiple customers engaged• Specification discussions beginning
2020 Growth Potential: High Resolution Displays Rudolph developing a lithography solution for TFT backplanes*
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Backplane required to control pixels for any display
Emitted light from display:AMOLED
Quantum DotMicroLED
TFT Backplane~$500M TAM
*TFT Backplane: Thin Film Transistors that provide power for each R-G-B pixel segment Source: Company estimate based on China display fabs planned
Long-Term Operating Financial Model
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$250MMODEL
$300MMODEL
$350MMODEL
$400MMODEL
Gross Margin 53% 54% 55% 55%
Model excludes the impact of OLED Initiative which is expected to be accretive to operating margins.
22%25%
28% 30%
Existing Operations
Operating Margin
Source: Management estimates based on a Non-GAAP model
Key Takeaways
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Diversified Markets Across Semiconductor Industry
Delivering sustained profitable growth.
Broad Synergistic Technology Portfolio
Delivering comprehensive solutions to high value problems!
Strong Financial Model
Profitable growth, fueling R&D & Cash for strategic M&A
Increasing TAM
Display market can add an estimated $500M to our TAM
