Oplink Corporate Overview

Transcription

1 Oplink Corporate Overview 8/19/14 Joe Liu Chairman & CEO Shirley Yin EVP & CFO

2 Safe Harbor Statements This presentation contains forward-looking statements that involve risks and uncertainties that may cause Oplink s actual results to differ substantially from expectations. You are encouraged to refer to the Risk Factors sections of Oplink s annual and quarterly reports filed with the Securities and Exchange Commission for details regarding such risks and uncertainties. Except as set forth in the paragraph immediately below regarding financial guidance, the forward-looking statements made during this presentation represent Oplink s outlook only as of the date of this presentation, and Oplink undertakes no obligation to update or revise any forward-looking statements, whether as a result of new developments or otherwise. Oplink s outlook regarding g its expected results for the quarter ending September 28, 2014 was provided in its press release issued on August 7, 2014 and during the earnings conference call held on that date. Nothing in this presentation is intended to, nor shall it be deemed to, confirm, revise or in any way update that outlook. 1

3 About Oplink A leading optical communications solution provider offering components, modules & subsystems to Telecom, Datacom, CATV system & internet companies Actives Passives (Components & Modules) Subsystems (Circuit Packs & Subsystems) 2

4 Top Tier Customers US & Canada Asia Europe 3

5 Broad Optical Networking Infrastructure Offerings Transmission (Actives) Bandwidth Creation Amplification Bandwidth Management Interconnect 100G Metro DWDM 4x28G CFP 100G 4x25 LR4 CFP2 10G xwdm XFP and SFP+ 10GbE SFP+/XFP GbE/2.5G/4G xwdm TDM SFP 2.5G/6G/10G BiDi SFP Video SDI SFP Analog TX, RF RX Thermal AWG Athermal AWG 50G DWDM 100G DWDM 200G DWDM Fixed OADM CWDM Compact CWDM Band WDM Interleavers PLC splitter Wavelength Locker EDFA EDFA array Gain block Raman module Mini single channel EDFA for 100G TPDR CATV high power EDFA Complete suite of Amp passive components: isolators, fused comps, PM, GFF, depolarizer, VOA, PD, hybrid ROADM linecard RayDirector WSS: 1x2/1x4/1x9 MxN Multicast Switch OCM: flexible grid, multiport Tunable filter Switches, 1xN Circulators VOA, VMUX Power monitor PBS for coherent detection Connectors & adapters: LC, SC, FC, MU, MPO; lockable SC/LC adapter Fixed attenuators: LC, SC, FC, MU Air blown fiber Jumpers and fanouts Patch panels: high density, 1RU/2RU, termination box, ODF 4

6 Oplink s Value Proposition Components Proven superior performance and quality Modules Compact Plug-n-Play solutions offering more features, performance and value Subsystems OMS Vertically integrated total design and manufacturing solutions (HW & SW) add intelligence and reduce customer OpEx and CapEx 5

7 Oplink s Global Presence Fremont, CA; Headquarters Zhuhai FTZ, China; Head Office, R&D, Mfg. Wuhan, China; OMS, TRx R&D, and IoT Shanghai, h China; Optical Coating Lab Taipei, Taiwan; Emit Office/R&D/Pilot Fremont, CA (HQ) Wuhan (R&D, IoT) Zhuhai (Mfg, R&D, S&M) Shanghai (Coating) Taipei (Emit) Hsinchu (R&D) 6

8 Market Opportunities ROADM $4.5B global l revenue for WDM ROADM optical equipment in 2013, 13% CAGR thru 2018, fastestgrowing segment of optical transport CDC ROADM rollout provides a near-term boost Long Haul & Metro 100G $2B worldwide spending in 2013, 3x Y/Y, 20% of all WDM spending $4B Metro 100G by 2018, <$500M in 2014, inflection point in G/LTE Upgrade in China $12B CapEx on 4G/LTE, 500,000 base stations, by China Mobile in 2014; followed by China Unicom and China Telecom Data center expansion continues to soar; leading players spent $27B in 2013 $1.6B GbE/10/40/100G transceivers in 2014, 10% Data Center $ / / /, CAGR for Source: Infonetics. LightCourting and company research 7

9 Technology Highlights Well-positioned for developing the next-generation colorless directionless and contentionless (CDC) ROADM and Edge ROADM with essential building blocks RayXpress Wavelength Selective Cross-connect (WSX) RayDirector Wavelength Selective Switch (WSS) EDFA array Raman module Twin multicast switch Optical channel monitor OSC transceiver Fiber shuffle Coherent detection PM components Focused on developing high-growth g 4G wireless and data center transceivers Best-in-class wide-temperature range performance for 4G/LTE wireless applications First-to-market t t 4x28G DWDM CFP with direct detection ti and digital signal processing 8

10 Investment Thesis A leading provider of comprehensive passive components, modules and subsystems A focused player in 10/40/100G CWDM/DWDM transceivers addressing Telecom Transport, Switch, 4G Wireless Back Haul & Data Center markets A leading circuit pack design & manufacturing supplier serving the fastest-growing Metro 100G transport, switching (ROADM) and amplification market Participating on fast Web 2.0 datacenter expansion Vertically integrated R&D, manufacturing, service and logistics to provide cost & margin advantages Solid Financials with 5+ Consecutive Years of Non-GAAP Profitability Stable Management Team 9

11 Financial Results (Non-GAAP) ($Millions) $55.0 $45.0 $43.7 $43.4 $43.3 $44.0 $44.2 $44.9 $45.1 $44.1 $54.8 $50.4 $49.3 $48.1 $51.5 $35.0 $25.0 $ % 34% 31% 31% 35% 37% 37% 36% 36% 33% 32% 29% 30% $5.0 ($5.0) $5.9 $5.0 $3.8 $4.6 $3.4 $4.7 $4.0 $3.1 $2.0 $2.5 $2.4 $1.8 $0.3 Jun. Sept. Dec. Mar. Jun. Sep. Dec. Mar. Jun. Sep. Dec. Mar. Jun Revenue Gross Margin Net Income 10

12 Cash Flow ($Million's) Q1'13 13 Q2'13 Q3'13 Q4'13 Q1'14 14 Q2'14 Q3'14 Q4'14 9/30/12 12/30/12 3/31/13 6/30/13 9/29/13 12/29/13 3/30/14 6/29/14 Cash flows from operating activities: Net income (loss) $ 3.4 $ 3.5 $ 2.0 $ 4.5 $ 2.2 $ 1.3 $ (0.5) $ (4.2) Depreciation Amortization of intangible and other assets Stock compensation expense Net (Gain) loss on sale/disposal of assets - - (0.3) (3.2) (0.3) (0.3) Deferred income tax - - (0.2) 1.3 (0.1) (0.1) (0.3) (0.4) Others Changes in assets and liabilities: 0.4 (4.2) 1.9 (3.8) (2.2) (0.1) (4.0) (2.3) Net cash provided by operating activities (1.2) (3.1) Cash flows from investing activities: Net (purchase) sales of investments (13.6) (2.2) (4.1) (1.6) (8.3) Net (purchase) sales of property and equipment (1.4) (6.9) 4.1 (3.3) (5.5) (4.4) 0.1 (0.6) Acquisition of business, net of cash acquired - (1.1) Net cash provided by (used in) investing activities (15.0) (10.2) (0.0) 0) (4.9) (13.8) (4.0) Cash flows from financing activities: Proceeds from issuance of common stock Excess tax benefits from stock-based compensations (0.2) (0.2) Repurchase of common stock (3.7) (5.6) - - (1.1) (0.5) (15.5) (17.7) Net cash provided by (used in) financing activities (2.4) (4.6) (0.1) 1.1 (0.5) 0.4 (15.1) (16.5) Effect of exchange rate changes on cash and cash equiva (0.1) Net increase (decrease) in cash and cash equivalents (9.6) (12.3) 6.8 (1.1) (9.8) 1.1 (1.8) (12.7) Cash and cash equivalents, beginning of period Cash and cash equivalents, end of period $ 71.6 $ 59.3 $ 66.1 $ 65.0 $ 55.2 $ 56.3 $ 54.5 $

13 Solid Balance Sheet ($Million's) Q1'13 13 Q2'13 Q3'13 Q4'13 Q1'14 14 Q2'14 Q3'14 Q4'14 Sep.'12 Dec.'12 Mar.'13 Jun.'13 Sep.'13 Dec.'13 Mar.'14 Jun.'14 ASSETS Current assets Cash and cash equivalents $ 71.5 $ 59.3 $ 66.1 $ 65.0 $ 55.2 $ 56.3 $ 54.5 $ 41.8 Short-term investments Accounts receivable, net Inventories Prepaid expenses and other current assets Deferred tax assets Total current assets Long-term investments Property and equipment Goodwill and intangibles, net Deferred tax assets Other assets Total assets $ $ $ $ $ $ $ $ LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable Accrued liabilities and other current liabilities Total current liabilities Non-current liabilities Total liabilities Stockholders' equity Total liabilities & stockholders' equity $ $ $ $ $ $ $ $

14 Reconciliation of GAAP to Non-GAAP Financial Measures ($Million's) Reconciliation of GAAP net income (loss) to Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 non-gaap net income: Sep.'12 Dec.'12 Mar.'13 Jun.'13 Sep.'13 Dec.'13 Mar.'14 Jun.'14 Net Income (loss), GAAP $ 3.4 $ 3.5 $ 2.0 $ 4.5 $ 2.2 $ 1.3 $ (0.5) $ (4.2) Stock-based compensation expense Amortization of intangible assets Gain on sale of equity investments (1.8) - - (0.3) (0.6) Reserve for excess inventory related to Oplink Connected Tax effects on non-gaap adjustments (0.5) (0.1) (0.1) 0.5 (0.4) (0.2) (0.2) 0.3 Total Adjustments Non-GAAP net income $ 5.0 $ 4.6 $ 3.4 $ 4.7 $ 4.0 $ 2.4 $ 0.3 $ 1.8 Reconciliation of GAAP gross profit Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 to non-gaap gross profit: Sep.'12 Dec.'12 Mar.'13 Jun.'13 Sep.'13 Dec.'13 Mar.'14 Jun.'14 GAAP gross profit $ 16.6 $ 16.5 $ 15.7 $ 17.5 $ 17.7 $ 15.9 $ 14.0 $ 10.4 Stock-based compensation expense included Reserve for excess inventory related to Oplink Connected Amortization of intangible and other assets Non-GAAP gross profit $ 16.8 $ 16.6 $ 15.8 $ 17.6 $ 17.8 $ 16.0 $ 14.1 $ 15.4 GAAP gross margin rate 37.1% 36.7% 35.5% 35.5% 32.3% 31.6% 29.2% 20.1% Non-GAAP gross margin rate 37.4% 36.8% 35.7% 35.8% 32.6% 31.8% 29.4% 29.9% 9% 13

15 OPLINK Thank You Oplink Communications, Inc Landing Parkway, Fremont, California T: (510)