ams

Q3 2017 results

Alexander Everke, CEO

Michael Wachsler-Markowitsch, CFO
Moritz M. Gmeiner, Head of IR

October 2017
Sensing enables life
Sensors – an integral part of the digital transformation

Industrial IoT
Augmented reality
Personal health

Smart home & building

Autonomous
driving Human/machine interface

Infrastructure automation

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ams at a glance
Sensing is life.

Our business
• Focus on high performance sensor solutions
• Sensor solutions, sensor ICs, interfaces, related software
• Small, low power, highest sensitivity, multi-sensor integration
• Best-in-class solutions for leading OEMs

Our end markets

• Consumer & Communications (C&C) – >50% of sales
• Automotive, Industrial, Medical (AIM) – <50% of sales

By the numbers
• 1,000+ engineers
• 21 design centers, 3 manufacturing locations
• 35+ years of design and manufacturing know-how
• 9,000+ employees worldwide
• 8,000+ customers

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ams strategy

Building the global leader in sensor solutions

True leadership in Best-in-class performance per
four sensor areas sensor area and in multi-sensor
• Optical application solutions
• Imaging • Smallest, lowest cost, high
volume multi-sensor modules,
• Environmental
driving monolithic integration
• Audio
• Sensor algorithms and
sensor fusion software
• Application software for
differentiating end-user
experiences
Diversified business with Clear financial target model
balanced application and • Revenue growth target
customer portfolio (CAGR) 2016-2019 of
• Long-term target mix of more than 40%
60/40 C&C / AIM split • EBIT margin target (adj.)
• Broader customer base of 30% from 2019
across applications
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ams strategic value chain

Sensor ICs Sensor solutions Application solutions

Optical Multi-sensor
Sensor
packages &
algorithms
modules Application software
Imaging to deliver end-user
Monolithic experiences
Sensor fusion
integrated
algorithms
Environmental sensors

Ultra-low power connectivity Hardware

Audio and processing
Software and
reference designs

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Multi-sensor solutions and sensor fusion

ams focus
Optical & image Environmental & Motion
sensing audio sensing sensing
• 3D sensing • Gas/particle • Accelerometer
• Structured light/ToF • Temperature • Gyroscope
• Light analysis/proximity • Humidity • Magnetometer
• Spectral sensing • Pressure • IMU (Inertial
• Visible image • Microphone audio Measurement Unit)

Optical multi-sensing package/hub Open cavity multi-sensing package/hub Closed package multi-sensing hub

Increasing importance of hardware and software

combination to create full solutions

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ams optical sensing solutions

ams full solution capability

Combining industry-leading expertise into market-leading solutions

Optical path
Illumination Optical sensor
and package
Princeton Optronics
Heptagon expertise ams expertise
expertise

• High power VCSEL lasers • Path of light to/from • Multi-frequency spectral

• High power VCSEL arrays
• Low power VCSEL lasers
• IR LEDs / LEDs
illumination/sensor and sensors
in/out of package • Multi-diode structures
• Optical features and • SPAD diodes
elements • IR sensors
• Smallest size highly • Multi-sensor modules
integrated optical systems

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Leading expertise in optical systems / VCSEL

Optical path and optical systems

• Path of light to/from illumination/sensor and in/out of package
• Highly integrated extremely small size optical systems to create optical path
• Extensive portfolio of optical features and elements:
Leading capabilities in WLO, high quality DOE, lenses, mirrors, embossing, etc.
• Unique IP-protected integration expertise for smallest form factor and highest performance
• Supporting wide range of applications across 3D and other optical sensing
• Singular expertise in very high volume manufacturing of highly complex optical systems

VCSEL illumination
• Leading technology portfolio for high power single lasers and high count arrays
• Benchmark power efficiency and narrow beam divergence:
high beam quality for 3D applications, better long distance performance
• Smallest pitch arrays enable higher resolution in future 3D systems
• Significant longer-term opportunity in automotive 3D LIDAR already emerging
• Internal VCSEL manufacturing drives further differentiation, capacity investment starting Q4

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Unique position in 3D sensing

3D sensing: Significant new growth market for high value sensing

• Applications include face recognition, AR/VR, gesture, biometrics, End-to-end optical/
body measurement, 3D position measurement, autonomous driving 3D sensing platform
• 3D sensing in consumer devices will breed new applications and apps leverages optical
path and VCSEL
• Non-consumer to follow later but already evident: Industrial IoT (internet of things),
Automotive (3D LIDAR, driver recognition)
• 3 key technologies: Structured light, ToF (time-of-flight), stereo cameras
• Structured light: IR illumination of object, accuracy of illumination key to quality of sensing
• ToF: SPAD/dTOF (avalanche diodes) or iTOF (phase difference) sensing, dedicated illumination
• Stereo cameras: specific illumination needed for high quality sensing

ams: Leading solution expertise across 3D sensing technologies

• Optical path as key differentiator, hand-in-hand with packaging for optimum performance
• Unique VCSEL-to-sensor end-to-end platform offers performance and design advantages for multiple optical technologies
• Unique know-how to create mass-produceable devices for very high volume applications
• Structured light: high quality random dot illumination and sensing / ToF: covering both ToF technologies with high
performance solutions / stereo cameras: dedicated illumination

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Optical and image sensing
Worldwide leader in light sensing solutions
• Clear #1 in optical sensing Optical path and
• Leadership in sensors, optical path, illumination full value chain
• Optical path crucial for new sensor applications coverage as key
differentiators
• Power-efficient VCSEL technology
(single and array) for optical sensing
• True Color spectral sensing for advanced display management
• Color ALS, ultra-small proximity modules
• 3D sensing expertise addresses emerging applications
• Structured light and time-of-flight (ToF) technologies
• Spectral sensing for biosensing, color identification, medical uses
• Color and spectral sensing for Industrial IoT, smart LED lighting

High value image sensing

• High-performance global shutter CMOS image sensors for Industrial
• NanEye miniature camera technology for Medical (endoscopy) and Industrial
• Future combination of imaging and spectral sensing

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Audio sensing
ANC (active noise cancellation)
• High performance analog noise reduction Innovative ACI
• Low power budget + footprint advantages accessory interface
• Significantly better receive-path audio quality broadens
ANC portfolio
• In-phone and in-ear/headphone topologies
• Leader in accessory market, support for digital architectures
• ams innovation: ACI interface transmits power, data and audio
over 3.5mm jack microphone line
• Low-power ACI enables new battery-less ANC ear/headphone designs and
additional functions such as sensing

MEMS microphone interface ICs

• Continuing market leadership in high volume market
• Leading position in low noise solutions and tight integration
• Strong customer partnership focused on high quality segments

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Environmental (including gas) sensing
Technology leader in environmental / gas sensing
• End-to-end solution provider Emerging market
• Unique CMOS-based portfolio for low power, in HABA and
high volume, small form factor Industrial IoT, road-
• Key environmental sensing areas map for consumer
- MOX gas
- Infrared gas / presence detection
- Relative humidity, pressure, temperature
• Broad range of emerging applications in mobile, home/building automation (HABA),
Industrial IoT and other AIM markets

Uniquely positioned for multi-sensor modules and monolithic multi-sensor integration

• Combination of related environmental sensor modalities in modules
(e.g. gas + relative humidity)
• Integration roadmap to realize low-power, smallest size, low-cost consumer solutions
• Sensor algorithms and application software as value drivers

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Scalable manufacturing model
In-house capacity + manufacturing partnerships

Internal wafer manufacturing, Austria

Ongoing capacity
• 200mm, 180-190k wafers p.a.
expansion in
• CMOS / specialty analog down to 180nm Singapore, VCSEL
• High volume optical filter deposition manufacturing
invest starts Q4
Internal optical packaging + future VCSEL manufacturing,
Singapore
• Technology leader in high end optical systems
• Major capacity expansion in 2017 to support consumer ramps
• Revenue pipeline drives additional expansion investments into 2018
• Investment for internal VCSEL manufacturing capacity
• Project start Q4 2017, expected availability 2019, around EUR 100m investment

Manufacturing partnerships for scalability and flexibility

• High volume technology partners TSMC, UMC, GF
• Flexible response to end market volatility

In-house test, Austria / Philippines

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Global network
Headquarters
Design centers
Manufacturing/Test
Sales/customer
support locations

Americas Europe Asia

• 21 design centers
Austria, Switzerland (2), Italy (2), Spain, Germany (4), Belgium,
UK (2), Netherlands, Portugal, Finland, USA (3), India, Japan
• Manufacturing locations
Austria, Singapore
• Test center
Philippines
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Key figures
EURm

9M 2017 9M 2016 Q3 2017 Q3 2016

Total revenues 593.5 416.3 262.6 146.7
+42.5% +79.0%
Gross margin (adjusted) 1) 43% 56% 41% 55%
f (IFRS reported) 37% 53% 37% 53%
Result from operations (adjusted – see footnotes) 40.31) 80.62) 34.81) 28.02)
(EBIT) (IFRS reported) -24.7 86.1 10.5 49.7
Net result -13.8 89.2 20.2 55.9
-115.5% -63.9%
EPS (basic/diluted) 3) CHF -0.21 / -0.20 1.45 / 1.40 0.28 / 0.27 0.91 / 0.88
EUR -0.19 / -0.19 1.32 / 1.28 0.24 / 0.23 0.84 / 0.81

1) Excl. acquisition-related costs and share based compensation costs

2) Excl. acquisition-related costs, share based compensation costs and result from divestiture (EUR 29.7m)
3) Earnings per share in CHF were converted using the average currency exchange rate for the respective periods

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Financial results
EURm

Total revenues Total revenues by market H1 2017

700
+42.5%
600
593.5 Automotive,
500 49%
Industrial,
400 Medical
416.3 +79.0% Consumer &
300 51%
Communications
200 262.6
100 146.7
0
9M 2016 9M 2017 Q3 2016 Q3 2017

Total revenues by region Total backlog

100% 500
Consignment
80% 400 440.4 stock agreements
59% 62% Asia/Pacific approx. EUR 17-19m
60% 300

40% 5% 200
7% Americas 211.0
20% 36% 100
31% Europe (EMEA)
0% 0
9M 2016 9M 2017 Jun 30 2017 Sep 30 2017
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Financial results
EURm, % of revenues

Gross profit (IFRS), gross margin (adjusted) R&D

200 24.4% 26.1%
300 56.1%1)
42.6%1)
150
155.0
200 222.3 219.4
55.4%1) 24.9%
41.4%1) 100 20.8%
101.8
100
97.1 50
77.7 54.7
36.5
0 0
9M 2016 9M 2017 Q3 2016 Q3 2017 9M 2016 9M 2017 Q3 2016 Q3 2017

SG&A EBIT (IFRS), EBIT margin (adj.)

200 120 19.4%1)
6.8%1)

150 17.3% 80 19.1%1)

16.6% 86.1 13.3%1)

100 40 49.7
98.8 15.8% 10.5
13.1%
50 71.9 0
-24.7
23.1 34.4
0 -40
9M 2016 9M 2017 Q3 2016 Q3 2017 9M 2016 9M 2017 Q3 2016 Q3 2017

1) excl. acquisition-related and share based compensation costs © ams AG

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Financial results
EURm, % of revenues

Net result, EPS (basic/diluted) Operating cash flow

125 100 14.4%
CHF 1.45/1.40
30.8%
100 EUR 1.32/1.28 75 -6.6%
89.2 50 -12.3%
75 CHF 0.91/0.88 60.0
EUR 0.84/0.81
25
45.2
50
55.9 CHF 0.28/0.27
EUR 0.24/0.23
25 0
CHF -0.21/-0.20
EUR -0.19/-0.19 20.2 -32.4
0 -25 -39.4
-13.8
-25 -50
9M 2016 9M2017 Q3 2016 Q3 2017 9M 2016 9M 2017 Q3 2016 Q3 2017

Net cash, cash + short term investments Capital expenditures

Net cash Cash + short term invest. 500 63.4%
500
16.6%
250 431.6 400
199.5 376.4 55.1%
0 300
-250.3
-250 16.6%
200
-500
-771.4 100 144.7
-750 24.3
69.2
-1000 0
9M 2016 9M 2017 9M 2016 9M 2017 9M 2016 9M 2017 Q3 2016 Q3 2017

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ams

Sensing is life.

© ams AG 2017
Profit and loss statement
EURm

(IFRS) 9M 2017 9M 2016 Q3 2017 Q3 2016

Total revenues 593.5 416.3 262.6 146.7

• Products 553.9 379.7 250.1 131.7
• Foundry 39.5 36.6 12.5 15.0

Gross profit 219.4 222.3 97.1 77.7

• Gross margin (adjusted 1)) 42.6% 56.1% 41.4% 55.4%
• Gross margin (IFRS reported) 37.0% 53.4% 37.0% 53.0%

Research and development -155.0 -101.8 -54.7 -36.5

Selling, general and administrative -98.8 -71.9 -34.4 -23.1
Other operating income/expenses 9.7 35.9 2.5 31.6

Result from operations (EBIT) -24.7 86.1 10.5 49.7

• EBIT margin (adjusted – see footnotes) 6.8%1) 19.4%2) 13.3%1) 19.1%2)
• EBIT margin (IFRS reported) -4.2% 20.7% 4.0% 33.9%

Net financing costs 8.9 -2.8 5.3 -1.6

Result before tax -15.9 83.3 15.8 48.1

Income tax result 2.1 5.9 4.4 7.8

Net result -13.8 89.2 20.2 55.9

1) Excl. acquisition-related and share-based compensation costs

© ams AG
2) Excl. acquisition-related costs and share based compensation costs and result from divestiture (EUR 29.7m)
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Balance sheet
EURm

Sep 30, Dec 31, Sep 30, Dec 31,

Assets (IFRS) 2017 2016 Liabilities and equity 2017 2016
Cash and short term invest. 431.6 215.8 Interest-bearing debt 138.9 108.0
Trade receivables 185.3 97.2 Trade liabilities 309.9 68.2
Inventories 213.6 92.9 Tax liabilities 27.5 36.8
Other current assets 81.9 33.4 Provisions 41.4 20.1
Other liabilities 481.9 31.4

Total current assets 912.3 439.3 Total current liabilities 999.6 264.5

Fixed assets 882.1 319.3 Interest-bearing debt 1,064.0 364.1

Intangible assets 1,169.7 603.4 Employee benefits 43.8 37.0
Investments in associates 2.0 2.3 Deferred tax liabilities 75.1 54.0
Deferred tax asset 35.4 35.4 Other liabilities 57.3 36.0
Other non-current assets 34.7 23.4

Total non-current assets 2,124.0 983.7 Total non-current liabilities 1,240.2 490.9
Shareholders’ equity 796.6 667.6

Total assets 3,036.3 1,423.0 Total liabil. and equity 3,036.3 1,423.0

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Cash flow statement
EURm

(IFRS) 9M 2017 9M 2016 Q3 2017 Q3 2016

Income before tax -15.9 83.3 15.8 48.1

Depreciation 102.0 46.4 37.6 15.9

Cash flow from operations -39.4 60.0 -32.4 45.2

Capital expenditures -376.4 -69.2 -144.7 -24.3

Cash flow from investing activities -319.2 -47.0 -177.0 29.9

Proceeds from borrowings 875.4 257.2 526.9 181.9

Repayment of borrowings -140.8 -85.2 -112.2 -80.2
Dividends paid -25.0 -34.6 0.0 0.0
Changes resulting from capital increase 0.0 0.0 0.0 0.0

Cash flow from financing activities 644.9 49.7 372.7 58.8

Change in cash and cash equivalents 265.3 59.7 154.6 133.6

(incl. effects of changes in foreign exchange rates)

Cash and cash equivalents at end of period 407.7 163.3 407.7 163.3

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