Industry Analyst Briefing - Investor Relations Solutions

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Industry Analyst Briefing March 2, 2010 David Somo Vice President, Corporate Marketing 1 • Industry Analyst Briefing – March 2010 Confidential Proprietary Safe Harbor Statement During the course of this presentation, ON Semiconductor may make projections or other forward-looking statements regarding future events or its future financial performance including our ability to increase cash flows from current levels. The words “estimate,” “intend,” “expect,” “plan,” “should” or similar expressions are intended to identify forward-looking statements. ON Semiconductor wishes to caution that forward looking statements are subject to risks and uncertainties that could cause actual events or results to differ materially from such statements. Important factors relating to our business, including factors that could cause actual results to differ from our forwardlooking statements, are described in our Form 10-K and other filings with the SEC. ON Semiconductor assumes no obligation to update forward-looking statements to reflect actual results or changed assumptions or other factors. 2 • Industry Analyst Briefing – March 2010 Confidential Proprietary Industry Analyst Briefing – March 2, 2010 David Somo ON Semiconductor Vice President Corporate Marketing 3 • Industry Analyst Briefing – March 2010 Confidential Proprietary ON Semiconductor 2009 Results Revenue = $1.769B Business Groups End Markets Geography 4 • Industry Analyst Briefing – March 2010 Confidential Proprietary Successful Acquisitions Expand Product Portfolio December 31, 2007 March 17, 2008 January 27, 2010 CPU Voltage & PC Thermal Monitoring Business 2007 2006 May 15, 2006 2008 October 10, 2008 2009 2010 November 4, 2009 Oregon Fabrication Facility ~40% of 2009 sales from sole-sourced products 5 • Industry Analyst Briefing – March 2010 Confidential Proprietary Leadership in Energy Efficient Silicon Solutions LIN, CAN Transceivers (AMIS) Engine Sensors (AMIS) ON Semiconductor SAM LED Protection (CMD) Ambient Light Sensors (AMIS) Backlight Drivers (CATS) Stronghold in Power Supplies, Computing, Consumer and Automotive • No. 1 market share in ac-dc controllers for adapters used in printers, notebooks, game consoles • SAM expansion through acquisitions • 19 LED Drivers (CATS) EEPROM (CATS) ONNN existing SAM Power Supply Controllers, Linear V-regs, Switching Regs, VRM Controllers, Rectifiers, Discretes… reference designs: • LED Backlight LCD TV • All-in-One Desktop • LED Lighting • Increased fuel efficiency in Automotive with infotainment, lighting, powertrain (engine control), and in-vehicle networking products • (ON Semiconductor SAM content projected to reach $119/car in 2012, up from $74/car in 2008.) 6 • Industry Analyst Briefing – March 2010 Confidential Proprietary Product Portfolio Evolution 40%true commodity 60% multisourced not true commodity ¾ Expanded product portfolio enables strategic customer relationships and drives increased application coverage, BOM content and SAM expansion ¾ Increased complexity supports product differentiation and customer design requirements ¾ Reusable IP library enables penetration of adjacent market applications 7 • Industry Analyst Briefing – March 2010 Confidential Proprietary Case Study: Bela Signa DSP SoC Family • #1 supplier to North America hearing aid manufacturers with SoC solution • Audio capabilities enable expansion to adjacent markets • High-density, low-power, low-cost SoC design desirable in wide array of battery-powered applications • Ultra-low-power DSP System-on-Chip for audio processing • Typical functions • 2-mic noise cancellation • Acoustic echo cancellation • Stationary noise reduction • Voice enhancement Mobile phones Laptop video conferencing 8 • Industry Analyst Briefing – March 2010 Rearview mirror hands free communication Confidential Proprietary Bluetooth headsets Conference phones Touch screen Automotive: Bumper-to-Bumper Solutions Infotainment & Connectivity Fuel economy • Audio/Video/Satellite/GPS/Telematics • In-Vehicle Networking (IVN) • Engine Control • Transmission • uHybrid-HEV Body • Lighting (LED, HID, AFS) • Door • HVAC Emission reduction Safety • • • 9 • Industry Analyst Briefing – March 2010 Park Assist Dynamic Braking Active Safety Confidential Proprietary • Engine Control • Transmission • uHybrid-HEV Automotive: Fuel Efficiency Solutions Tier 1 OEM High Efficiency Fuel Injection System ASIC #1 Full Production 2.5M/yr #2 ASICs $2.00 #15 FETs $2.50 #11 Rectifiers $2.00 Total Content $6.50 ASIC #2 Opportunity grows from $5M/yr to $16M/yr! 10 • Industry Analyst Briefing – March 2010 Confidential Proprietary SAM Expansion Computing Power Switching Solutions Notebook Why We Win • #2 position in the market • >35% market share • Core controller solutions for every computing segment Server • High efficiency solutions • Expanding market share • Lowest BOM costs Desktop • Comprehensive power switching solutions for motherboard, power supplies, adapters, HDD, displays. • #1 position in the market • >40% market share Complete Power Solutions PWM Controller PWM Controller MOSFET Driver Fully Discrete PWM Controller MOSFET Driver MOSFET Driver Integrated MOSFET Drivers 11 • Industry Analyst Briefing – March 2010 DrMOS DrMOS Confidential Proprietary PWM Controller MOSFET Driver Fully Integrated Enabling the Mobile Handset Evolution Growth Drivers Growth in smartphones and high-end feature phones • Deliver feature rich semiconductor “sub-system” solutions Increased demand for differentiation and specialization • Broad portfolio allows customer to choose the right solution Lighting & UI Power LED drivers Camera flash driver AMOLED Buck DC/DC converters Over-Voltage protection Power Management Sub-system Switching battery chargers 12 • Industry Analyst Briefing – March 2010 Audio & Video Video amplifier Class A/B amplifier Class D amplifier Audio Management Sub-system Audio processing Confidential Proprietary Connector Audio switch USB switch Interface Management Sub-system Medical Segment Macro Influences • Healthcare costs – – Payers seeking to reduce costs while providing higher quality of life Networking healthcare to improve efficiencies • Shift to home and outpatient care – – Evolving health infrastructure with portable, connected devices Non-clinical “consumer” users influencing product design From IEEE Webcast, “Tech Insider: Medical Technology Get a Shot in the Arm”, Nov 30, 2006 • New technologies & therapies – – – Continuous monitoring, remote diagnostics Disease management innovation Self-administered therapies Driving: miniaturization, higher integration and ultra-low-power 13 • Industry Analyst Briefing – March 2010 Confidential Proprietary Medical Application Solutions Imaging Personal Health Hearing Health Diagnostics, Therapy & Monitoring Applications Applications Applications Applications Glucose Monitoring Hearing Aids Pulse Oximetry Detector A/D Array (ASIC) LDO DSP DC/DC PWM FPGA (Digital Conversion) 3.3V LDO NCP698 1.8V LDO NCP663 Backlight Driver CAT4137 SoC EEPROM CAT25256 ESD uC ADC Power Mgmt. DSP AFE Amplifiers DSP SoC BelaSigna 300 I/O Controller Output Stage HEAR Coprocessor 1.5V LDO CAT6221 LED Driver FETs Wireless Display Controller ESD ESD9R AFE ESD9R (ASIC) Chg Pmp MAX1720 CT, PET/CT, MRI EEPROM 2009 – 2012 2009 – 2012 2009 – 2012 2009 – 2012 CAGR ~8% CAGR ~8% CAGR ~11% CAGR ~9% Migration to self-care makes devices personal and increases electronics content Source: Databeans 2008 Medical Semiconductor 14 • Industry Analyst Briefing – March 2010 Confidential Proprietary Expansion into Emerging Applications Growth in Lighting and Smart Grid reinforced by synergies with high efficiency Power Supplies LED Lighting Smart Grid • $2.6B LED Lighting Driver Market in 2012 (17% CAGR) • 1.3B electric meters worldwide with only ~10% automated (AMR & AMI) • Growth Drivers • LED backlighting in large LCD panels; LCD-TV and notebooks • General lighting and illumination • Automotive lighting • SAM expansion: • ASSP (PLC networking modems…) • Power Discretes in distributed power generation (Wind, Solar) • EEPROM, SRAM • Power Line Drivers 15 • Industry Analyst Briefing – March 2010 Confidential Proprietary Product Opportunities include More than the “Driver” Complete Solution with Power, Communication, Light Sensors, Protection, Filters and Thermal Management Products Discretes, MOSFETs Proximity Sensors 16 • Industry Analyst Briefing – March 2010 Confidential Proprietary Filters, Protection Ambient Light Sensors LCD TV Solutions Power Supply & LED Backlighting GreenPoint Reference Design for 46” LCD TV Power Supply Unit LED Backlight Unit 17 • Industry Analyst Briefing – March 2010 Confidential Proprietary Smart Meter Solution Smart Electric Meter I/O Protection Ethernet Euridis M-Bus RS-232 RS-485 USB I/O Interface Smart Card Interface Smart Card GPRS/GSM/CDMA RF Transceiver Infrared Receiver Infrared Remote In I/O Expander Keypad Line Driver Voltage Protection Amp Transformer L1 L2 L3 Current Sensor (Power) Power Line Modem Neutral Current Sensor (Neutral) Metering DSP Voltage Sensor Memory Input Bridge Rectification Voltage Regulation (Switching) • 1.3B electric meters worldwide with only ~10% automated (AMR & AMI) 18 • Industry Analyst Briefing – March 2010 Confidential Proprietary Output Rectification/ Sync Rect Voltage Regulation (Linear, Switching) Controller LCD Backlighting 1.2 V 1.8 V 3.3 V 5.0 V 12 V Reset Breaker Display Supervisory • SAM expansion: • ASSP (PLC networking modems…) • Power Discretes • EEPROM, SRAM • Power Line Drivers 2010: The Evolution of ON Semiconductor Continues CPU Voltage and PC Thermal Products Group Acquire Reasonably  Priced Companies Leverage Size        and Scale to  Generate Strong  Aggressive           Free Cash Flow  New Product  Development in  Existing and  Emerging Markets  Gresham, Oregon Fabrication Facility 19 • Industry Analyst Briefing – March 2010 Confidential Proprietary Q&A Session 20 • Industry Analyst Briefing – March 2010 Confidential Proprietary