Analyst Day Agenda – February 15, 2013
7:30 AM – Breakfast
f
/ Product Demos
8:30 AM – Introduction & Corporate Strategy/Overview – Keith Jackson, President and CEO
8:50 AM – Sales & Marketing
g Overview – Bob Mahoney,
y, EVP
9:10 AM – Application Products Group – Bob Klosterboer, SVP and GM
9:30 AM – Standard Products Group – Bill Hall, SVP and GM
9:50 AM – Break
10:10 AM – SANYO Semiconductor Products Group – Mamoon Rashid, SVP and GM
10:30 AM – Operating Systems & Technology Group – Mark Goranson,
Goranson SVP
10:50 AM – Financial Overview – Bernard Gutmann, EVP and CFO
11:10 AM – Group Q&A
12:00 PM – Lunch Buffet / Wrap-up & Product Demos
1:00 PM – Golf Outing
1 • Template • Nov-12
1 • Analyst Day 2013
Confidential Proprietary
Safe Harbor Statement and
Non-GAAP Financial Measure Information
During the course of this conference call, we will make projections or other forwardlooking statements regarding future events or the future financial performance of the
company.
p y The words “believe,”
, “estimate,”
, “anticipate,”
p , “intend,”
, “expect,”
p , “plan,”
p ,
“should” or similar expressions are intended to identify forward-looking statements. We
wish to caution that such statements are subject to risks and uncertainties that could
cause actual events or results to differ materially. Important factors relating to our
business,, including
g factors that could cause actual results to differ from our forwardlooking statements, are described in our Form 10-K, Form 10-Q’s and other filings with
the Securities and Exchange Commission. Additional factors are described in our
earnings release for the fourth quarter and year ended 2012. Our estimates may
change
g and the company
p y assumes no obligation
g
to update
p
forward-looking
g statements
to reflect actual results, changed assumptions or other factors.
Some data in this presentation may include non-GAAP financial measures. You
can find reconciliations of these non
non-GAAP
GAAP financial measures to the most directly
comparable measures under generally accepted accounting principles within the
following presentation and on our website (http://www.onsemi.com) in the “Investors”
section under the category “Annual & Quarterly Results.”
2 • Template • Nov-12
2 • Analyst Day 2013
Confidential Proprietary
Financial Analyst Day 2013
Keith Jackson
President and Chief Executive Officer
3 • Analyst Day 2013
Key Themes
 Positioned to outperform
 Becoming more important to our customers
 Structured for focused growth
 Manufacturing and operational excellence
 Financial strategy to increase shareholder value
4 • Template • Nov-12
4 • Analyst Day 2013
Confidential Proprietary
2012 Company Highlights / Lowlights
Highlights:
 Maintained strong OPEX control and exceeded cost reduction plan
 Maintained strong cash flow on trough sales
 Increased design wins at focus customers in automotive and smartphone applications
 Strong execution in completing all planned manufacturing transfers on schedule
 Closed three factories on schedule
 Completed transfers on all packages planned for recovery from Thailand flood
Lowlights:
 Expected market to improve in 2H’12
2H’12, but global economy slowed and market contracted
 Japan customers hemorrhaged market share furthering a decline in SANYO
Semiconductor revenue
 Soft China housing market and resulting inventory correction slashed white goods sales
 Inventory destocking at OEMs and distributors negatively impacted bookings
5 • Template • Nov-12
5 • Analyst Day 2013
Confidential Proprietary
Diverse Segment and Regional Profile
2012 Revenue = $2,894.9M
6 • Template • Nov-12
6 • Analyst Day 2013
Confidential Proprietary
Macroeconomic and Industry Outlook
Emerging and Developing Economies
Advanced Economies
World
Annual Semiconductor Revenue Versus Hardware Revenue
Semiconductors under
under-shipped
shipped
system demand for past 2 years
Annual Percenta
age Change
7.00
6.00
5.00
4.1%
3.5%
4.00
3.00
2.00
1.00
0.00
2012
2013f
2014f
Inventory Days
100
Lean inventories after ~3
years of reductions
y
90
80
70
60
50
40
Semiconductor Foundry
Semiconductor Distributors Semiconductor Vendors EMS/CEM Vendors Expected 2013 growth catalysts: Global GDP improvement, distributor / OEM inventory
restocking, auto, smartphones / tablets and China housing recovery for white goods
Sources: IMF WEO Jan’13, Caris & Company Nov’12, Gartner Jan’13
7 • Template • Nov-12
7 • Analyst Day 2013
Confidential Proprietary
3Q12
1Q12
3Q11
1Q11
3Q10
1Q10
3Q09
1Q09
3Q08
1Q08
3Q07
1Q07
3Q06
1Q06
3Q05
1Q05
3Q04
1Q04
30
Corporate Strategy
Focus to Outperform the Market
 Aggressively investing to grow in Automotive applications
 Products and technology, manufacturing capacity, sales, FAEs, SECs
 Expanding portfolio of high power products, packages and manufacturing processes
 Launched new leadership products in high voltage IGBTs, rectifiers and MOSFETs
 Investing
g to broaden power
p
module product
p
portfolio
p
for SAM and ASP expansion
p
 Supports growth in automotive, consumer white goods and industrial HPPC end-markets
 Positioning to grow in LED general lighting
 S
SEC
Ce
expansion
pa s o a
and
d new
e FAEs
s to d
drive
e key
ey custo
customer
e pe
penetration;
et at o ; p
product
oduct po
portfolio
to oe
expansion
pa s o
 Aggressively grow at leading wireless customers
 Winning in camera modules, tunable antennae components, analog power, battery protection, ESD
protection,, EMI filters and switches
p
 Get SANYO Semiconductor growing and profitable from lower revenue base
 Reduce break-even point to $190M per quarter
 Accelerate SANYO Semiconductor cross-sell
cross sell outside of Japan and post-flood
post flood market share recovery
8 • Template • Nov-12
8 • Analyst Day 2013
Confidential Proprietary
Proven Leadership
Growth Drivers
Industrial ASIC
#1
Analog ASIC (Non Auto)
#2 Computing
PC Core Power (DCDC)
#1 Notebook Adapters (ACDC) #1
Inverter IPM
#2
Automotive
Consumer
Stop / Start Alternator
#1
Adaptive Front Lighting
#1
Automotive
High Speed Image Sensors #1
Smartphones / Tablets
Audiology DSP SoC
#1
Protection
#1
Industrial /
Medical / Mil-Aero
GP Op Amps
#2
Linear VREG
#1
Wired
Wi d & Wireless
Wi l
Comm.
Power Modules
Sources: iSuppli, IMS Research, Strategy Analytics, Fuji Chimera Research, ON Semiconductor Business Units and Corporate Marketing
9 • Template • Nov-12
9 • Analyst Day 2013
Confidential Proprietary
LED Lighting
Agenda
Presenters
Sales & Marketing
Bob Mahoney
y
Business Unit Updates
Bob Klosterboer – Application Products Group
Bill Hall – Standard Products Group
Mamoon Rashid – SANYO Semiconductor Products Group
Manufacturing and Operations
Mark Goranson
Finance
Bernard Gutmann
10 • Template • Nov-12
10 • Analyst Day 2013
Confidential Proprietary
Becoming More Important to our
Customers
Bob Mahoney
E
Executive
ti Vi
Vice P
President,
id t S
Sales
l and
dM
Marketing
k ti
11 • Analyst Day 2013
Semiconductor Outlook by Market Segment
 Smartphones and tablets drive
communications segment growth. Expect
a 12X increase in mobile data by 2015 to
drive telecom and networking investment.
Global Semiconductors
 Increasing electronics content for fuel
economy, safety and convenience
features expected to drive high single-digit
semiconductor growth on low single-digit
vehicle production growth.
g
 Global energy legislation drives growth in
high-efficiency industrial motors, power
supplies and LED general lighting.
Bubble Size = 2012 TAM*
 Power density / efficiency requirements
and high speed bus interfaces expected to
maintain analog power and discrete TAM.
Overall computing sees modest decline on
flattening units and ASP erosion.
 Adoption of high-efficiency variable speed
motors and U.S. / China housing
recoveries drive growth in consumer white
goods.
Source: iSuppli AMFT, Ericsson Dec’12 Briefing, ON Semi 2012 financial results, Corporate Marketing
*TAM excludes MPU, memory and baseband products; Industrial includes Mil-Aero and Medical; Tablets are in Communications
12 • Template • Nov-12
Confidential Proprietary
12 • Analyst Day 2013
Automotive Segment
2012 Revenue = $752M (26% of Company Revenue)
Leading Positions: Powertrain, Body, Infotainment, Power Supplies, In-Vehicle Networking
Sensors
Engine Control
•Rear / Exterior Lighting
•Xenon/LED / Halogen
Front Lighting
Audio Systems
Infotainment
Starter
Alternator
Transmission
Control
Market
$6.1B
•Advanced
Frontlighting
Systems
Design-In Activity
2012 SAM 2015 SAM CAGR
$5B
Cluster Illumination &
Interior Lighting
6.6%
Key Growth Drivers
+62%
BOM Opportunity
 ~$60
$60 iin 2012  ~$250
$250
 Fuel Economy: Start-Stop
Alternators, GDI, HEVs, Dual Clutch
 Safety and Convenience: LED
Lighting, Door Modules, Park Assist,
Cameras, Infotainment, ADAS
2012 Average BOM
 ~$9.30
 X-by-Wire: EPS, EPB, ESC,
Pumps, Fans
Source: iSuppli AMFT, Corporate Marketing
13 • Template • Nov-12
13 • Analyst Day 2013
Emergency Call Systems
Confidential Proprietary
Communications Segment
2012 Revenue = $395M (13% of Company Revenue)
Leading Positions: Optical Imaging, RF Tuning, Power Supplies, Protection, MOSFETs
Customer Premise Equipment
Tablet
Smartphone
Enterprise
Routers
Base Station
Market: Smartphone / Tablet*
2012 SAM 2015 SAM CAGR
$3.2B
$5.1B
Design-In Activity (Major OEMs)
+104%
17.0%
BOM Opportunity
 ~$3
$3.50
50 in 2012  ~$7
$7.50
50
2012 Average BOM
 ~$0.38
Source: iSuppli AMFT, Corporate Marketing
*ON Semiconductor reported Tablet revenue in its Computing Segment for 2012 and prior years.
14 • Template • Nov-12
Confidential Proprietary
14 • Analyst Day 2013
Key Growth Drivers
 High smartphone / tablet CAGR
 High resolution cameras
 3G / 4G band
b d ffragmentation
t ti
drives need for RF tuning
 Power and backlighting for high
resolution,, low power
p
displays
p y
Computing Segment
2012 Revenue = $542M (19% of Company Revenue)
Leading Positions: CPU and Graphics Power, MOSFETs, Protection, Power Supplies
Channel
Motherboard
Desktop PC
AIO Computer
Graphics Card
Market
$3.7B
Entry Level Servers
Ultrabook
Design-In Activity
2012 SAM 2015 SAM CAGR
$3.6B
Notebook
+27%
0.9%
Key Growth Drivers
 Windows 8 with touch control
 Haswell ultrabooks and
convertibles at volume price points
BOM Opportunity
 ~$11
$11.00
00
 Increasing power density and
efficiency requirements
Average BOM Captured
 ~$1.51
 High speed interfaces (USB,
Thunderbolt, HDMI)
Source: iSuppli AMFT, Corporate Marketing
15 • Template • Nov-12
15 • Analyst Day 2013
Confidential Proprietary
Consumer Segment
2012 Revenue = $663M (23% of Company Revenue)
Leading Positions: Inverter IPM, Power Supplies, Protection, Optical Imaging
Protection
Backlighting
Power
Supplies and
Inverters
Touch
Interface
Power Management
Battery Management
LCD Display
Power
Supplies
AMOLED Display
Market: White Goods
2012 SAM 2015 SAM CAGR
$1.1B
$1.4B
Motor Drive
and Control
Smart Grid
Connectivity
Design-In Activity*
+328%
10.6%
BOM Opportunity
 ~$4.50
~$4 50 up to ~$17
~$17.00
00
Average BOM Captured
 ~$1.23
Lens Control
Key Growth Drivers
 High-efficiency variable speed
motor penetration expected to
approximately double by 2015
 China
Chi and
d US h
housing
i recoveries
i
 Sales expansion into U.S. and
Europe white goods OEMs
 “Smart appliances”
Source: iSuppli AMFT, Corporate Marketing
*SANYO Semiconductor Products Group was not fully integrated with the design activity database during 2011.
16 • Template • Nov-12
Confidential Proprietary
16 • Analyst Day 2013
Power Market Segmentation
1MW
IGBTs
Thyristors
WBG
Rectifiers
IGBTs
WBG
Rectifiers
SJ MOSFETs
600V –
1200V/1700V
10kW
IGBTs
Rectifiers
MV MOSFETs
600V-1200V
1kW
MOSFETs
Rectifiers
Lvce(sat)
≤ 600/800V
Applications
Switching
S it hi
Technology
mprehensiv
ON Semiconduc
ctor - Com
ve
d modules
supplier for discretes and
2.5kV – 6.5kV
100kW
•
•
•
•
*IMS Research Power discrete & Module report
17 • Template • Nov-12
17 • Analyst Day 2013
Investing in PIM Product
Portfolio (2014/2015)
DC li k
DC-link
DC-AC
DC-DC
Power Conditioning
Releasing new discrete
IGBTs and IPMs (2012/2013)
AC/DC
Vbus
POL 1
Confidential Proprietary
V1
ON Semiconductor offers a
broad portfolio
V2
POLof
2
MOSFETs, rectifiers & IPMs
POL 3
Packages
• >10kW Motors
• HEV/EV
• UPS/Solar
• Telecom PS
AC
AC-DC
Wind Power
Traction
Utility power
Solar/UPS
Power Architecture
V3
• >1hP Motors
• UPS/Solar
• HVAC
• IH cookers
•
•
•
•
•
Vcore,, VI/O,,
Sub-systems
Lighting
SMPS
Auto sub sys
Load Type
Industrial / Medical / Mil-Aero Segment
2012 Revenue = $544M (19% of Company Revenue)
Leading Positions: Power Supplies, Sensors, Circuit Protection, Medical Devices, LED Lighting
Ingestible
Diagnostics
Blood Glucose
and Heart Rate
Monitors
Hearing Aid
SOC
LED Lighting
Market: Power Modules and
LED General
G
l Lighting
Li hti
2012 SAM 2015 SAM CAGR
$4.8B
$7.6B
Design-In Activity
(LED General
G
l Lighting)
Li hti )
+324%
16.6%
Power Module ASP Range
g
 ~$1.50 to ~$100
 Adoption of high-efficiency
variable speed motors
 High
High-efficiency
efficiency power supplies
 Global energy legislation banning
incandescent bulbs
BOM Opportunity
(LED General Lighting)
 ~$0.70
$
to ~$9.00
$
 “60W”
60W LED bulbs at <$10 and
“smart lighting” controls
Source: iSuppli AMFT, Corporate Marketing
18 • Template • Nov-12
18 • Analyst Day 2013
Key Growth Drivers
Confidential Proprietary
Global Sales Pipeline
Total Design Activity
Total Design-In Profile
47%
29%
10%
~50% above historical rate
19 • Template • Nov-12
19 • Analyst Day 2013
Confidential Proprietary
Sales and Marketing Resource Evolution
R
Rebalanced
b l
d and
d realigned
li
d resources tto
corporate strategy
 Continued to expand Solutions Engineering
C t
Centers
tto supportt customer
t
requirements
i
t
 Transforming Japan Sales organization to
expand technical resources
20 • Template • Nov-12
20 • Analyst Day 2013
Confidential Proprietary
Key Takeaways
Strategy: Win in high growth volume applications at market
market-maker
maker customers where we
have demonstrated leadership products, applications expertise and sales relationships
 Aggressively
gg
yg
grow in focus automotive applications
pp
and leading
g wireless customers
 Leverage packaging and analog power expertise to grow in power modules
 Investing to catch “tipping point” in LED general lighting
 Aggressively sell SANYO Semiconductor products outside Japan and drive postflood market share recovery
 Investing in technical field resources to design-in the complete ON Semiconductor
portfolio
21 • Template • Nov-12
21 • Analyst Day 2013
Confidential Proprietary
Structured for Focused Growth
Application
pp
Products Group
p
Robert Klosterboer
Senior Vice President and General Manager
22 • Analyst Day 2013
Application Products Group
2012 Financial Review
 APG 2012 Revenue $ 1019M
 Gross Margin 45.1%
 EBITDA 21.7%
Key 2012 Milestones





Completed organizational alignment
Li
Licensed
d RF tuning
t i IP from
f
RIM (Blackberry)
(Bl kb
)
Success in Qualcomm reference designs
Released 286 new products into production
Record new ASIC wins at strategic customers
 Continental Automotive, Hella, Valeo, Seagate,
Huawei, Boston Scientific, FLIR, Delta
 Secured “trusted foundry” status
23 • Template • Nov-12
23 • Analyst Day 2013
Confidential Proprietary
APG 2012 Revenue by Market
Value Proposition
“We
We help our customers develop
world class products by providing
high quality, innovative, solutions
that solve demanding power and
signal management challenges.
challenges ”
Change Since Last Analyst Day (2010)
APG
G
$1019M
A t
Automotive
ti
$293M
ASICs
IGBTs
Voltage Reg.
IVN
LED Lighting
Drivers
Mil/Aero &
Mil/A
Imaging
$198M
Digital
g
ASIC
Image Sensors
Hi Rel Transistor
Trusted Foundry
IPD
Light Sensors
IIndustrial
d ti l
& Timing
$131M
Medical
$100M
Industrial ASIC
Networking
ECO Switch
ECL
CMOS Clocks
Audio DSP
Surge protection
Metering
Implantable Memory
RF Tuning
Power S
P
Solutions
l ti
DC/DC
$211M
PC Power
DC/DC
Load Switches
Audio Amps
PMIC
Consolidated all Application defined products
Technology roadmap simplification
Product overlap eliminated
IP reuse across multiple applications and product lines
Margins above corporate average
Focus markets Are Mobile, Automotive, Medical, Telecom, and Industrial
Divisions and products added to APG since the 2010 Analyst Day
24 • Template • Nov-12
24 • Analyst Day 2013
Confidential Proprietary
Power Conversion
P
C
i
AC/DC
$86M
AC/DC
Drivers
PFC
LED Drivers
Proven Leadership
Emerging Opportunities
Industrial ASIC
#1
Analog ASIC (Non Auto)
#2 Computing
PC Core Power (DCDC)
#1 Power Adapters (ACDC)
#1
Consumer
LED Lighting
Stop / Start Alternator
#1
Smart Switches
Auto Linear VREG
#2
Industrial /
Medical /
Mil-Aero
Control
Multi-Band
Match
DAC
Tuner Module
Boost
Audiology DSP SoC
#1
Control
Automotive
Adaptive Front Lighting
#1
High Spd Image Sensors High
Spd Image Sensors
#1
Wired
Wi
d & Wireless
Wi l
Comm.
RF Tuning
g
Sources: iSuppli, IMS Research, Strategy Analytics, Fuji Chimera Research, ON Semiconductor Business Units and Corporate Marketing
25 • Template • Nov-12
25 • Analyst Day 2013
Confidential Proprietary
Telecom DC/DC
APG Technology Developments
80 V
G10,C9,C3
BiDC1
16(B)
ONBCD25
5
ONC25
C5
D3
L5
3.3 V
0.3
35 u 27 V
I2T100
C8
I3T25
5, I3T50, I3T8
80
5V
0.6u
u24V_PWR
12 V
PS5LV
PS5A,B
B
20 V
ACM
MOS2
Vo
oltage (Vd
ds)
40 V
VHVIC3
65 V
25V
2.5
1.8 V
1.2 V
1.0 µm
0.8-0.7
0.8
0.7 µm
0.6
0.6-0.5
0.5 µm
0.35 µm
0.25 µm
(Technology Node)
26 • Template • Nov-12
26 • Analyst Day 2013
Confidential Proprietary
0.18 µm
Released
D
Development
l
t
Planning
ONC110
100 V
ONC18MS O
O
ONC18 5/30
ONC18 / 18
ONC
C18D
I4T
T family
Ste
ellar Imaging
g
ONC18-VHV
O
700 V
700 V

Secure, Cost Effective Internal Supply
110 nm
Products
Automotive
Focus on long-term mega-trends.


Key Applications
Key Customers
Applications
ASIC + ASSP + Discrete = Solutions
27 • Template • Nov-12
27 • Analyst Day 2013
Confidential Proprietary
ON Semiconductor’s Automotive Applications Focus
POWERTRAIN
INTERIOR
Infotainment
Fuel Economy
• Engine Control
• Transmission
• uHybrid
LIGHTING
ON Expertise and Investment
• HEV
- #1 ignition IGBTs
- Start-stop alternator efficient engine
- Dual clutch transmission ASIC
- ECU interface & communication
- Integrated throttle driver
- 48V power management
- HEV/EV battery monitor
- Programmable smart sensor interface
• Lighting (LED, HID, Xenon, AFS,
Opportunity $2.75 - $22.00
Interior (Cluster, Floor, Accent))
•ON
HVAC
Expertise and Investment
•-Door
#1 HID
Body
• Audio, Telematics
• Analog and Digital Tuner
• Mech (or less) Systems
SAFETY
ON Expertise and Investment
- IVN product offering
- Ultra low Iq voltage regulator
- SMPS solution for audio/infotainment
- Hands free audio communications
- HVAC and door (pre) drivers portfolio
- Wireless charging and connectivity
- Automotive ethernet
- Imaging for occupancy/driver
verification
- Leadership in stepper motor drivers
- Front lighting LED
- Rear lighting LED
- Programmable interior lighting
- Pixel lighting
SmartFET
at
for
o halogen
a oge lighting
g t g
-S
Opportunity $0.78 - $48.00
28 • Template • Nov-12
28 • Analyst Day 2013
Safety
Opportunity $1.33 - $44.00 • Parking
Confidential Proprietary
• Braking
•EPS
ON Expertise and Investment
- Leader in ultrasonic sensor interface
- Dynamic braking (MEMs interface)
- Radars/lidar/visable light camera
- Night vision
- Collision avoidance
Opportunity $3.30 - $30.00
Hot New Automotive Products
Power LED front lighting
System-on-chip
Driver ICs for Automotive Stepper
M t
Motors
Typical Applications
Typical Applications
Front lighting
(High beam, Low beam, DRL, Position light, Turn Indicator, Fog,
Static cornering, Side marker,…)
Advanced Frontlighting Systems
Advanced front lighting systems
(Swivel, level and beam shape)
Grill shutter
HVAC air flap,
Head-up display…
Application Characteristics
Power LED’s
Medium to high total power
Up-to 125dC ambient
System
System-on-chip
on chip
Application Characteristics
Bipolar stepper driver motors
Up-to 1.6A, micro-stepping, stall detection, …
Up-to 125dC ambient
LIN,
LIN I2C and SPI interfaces
ON Semiconductor Solutions
NCV78663 highly integrated boost & dual buck/string LED driver
NCV78763 highly integrated boost & dual buck/string LED driver
29 • Template • Nov-12
29 • Analyst Day 2013
ON Semiconductor Solutions
AMIS3062x / NCV7062x LIN interface, state machine
NCV705xx SPI interface, state machine
AMIS3072x / AMIS3073x LIN interface, 8051 embedded
Confidential Proprietary
Industrial, Medical, Military/Aerospace
Product and Integration Expertise
Industrial
Medical
Military/Aerospace
Applications
Applications
Applications
Computed
Tomography
Security
Factory Automation
Building Automation
Hot New Product
2.4Ghz Radio SoC
•
•
•
•
30 • Template • Nov-12
30 • Analyst Day 2013
ARM Cortex M3
1Mb Flash
802.14.4 Radio
Zigbee, RF4CE
Portable ECG
Implantable
Therapy
Missiles & Munitions
Communications
& Control
Hearing Aid
Transdermal
Drug Delivery
Thermal Imaging
High Resolution
Imaging
Hot New Product
Audiology SoC
•
•
•
•
ARM Cortex M3
24 bit Audio DSP
Wireless Controller
CODEC
Confidential Proprietary
Hot New Product
Flight Controller
•
•
•
•
2.5M Gates
1,152 IOs
QDR2 Interface
1.5Mb SRAM
Wireless and Tablets
Rapidly Changing Products and Opportunities
Power Management
RF Signal Path
 Sub-PMIC
 Battery Charger
p
y
 Supervisory
 Load Switch
 Adapters
 Temp Sensor
 DC / DC
 Boost / Bypass
 Multiphase
M lti h
 uModules
 Capacitive Tuning
 Integrated Passives
 CMOS PA Control
Opportunity
$ 0.15 - $ 3.15
Opportunity
$ 0.25 - $ 1.00
Lighting
g
g
 Ambient Light Sensor
 Proximity Sensor
 LED Backlighting
Opportunity
$0
0.14
14 - $ 0
0.55
55
31 • Template • Nov-12
31 • Analyst Day 2013
Audio
 Audio Amps
 Noise Cancellation
Opportunity
$ 0.10 - $ 1.10
Confidential Proprietary
Hot New Wireless Products
Power Management
Control IC for
Tunable Capacitors (PTIC)
 Qualcomm reference design
Qualcomm
PM8921
GPIO
Qualcomm
MSM8960Pro
NCP6335F
DCDC
Required parameters:
 Fine Vout regulation
Fine Vout regulation
 Max Iout at high temp
 Custom DVS profiles
 Fast turn‐on
 Low quiescent
L
i
t
 VSEL & EN pin
 Low profile L‐C
 PTICs solve antenna problems that result
in dropped or missed calls, help reduce
power consumption and enable the use of
smaller antennas
 Control IC provides voltage control
Currently designed into 3 major smartphone
manufacturers and in evaluation at several
others.
Battery Management
“The NCP1851 from ON Semiconductor is a fully programmable
Lithium-Ion switching battery charger optimized for power
efficiency in smartphones, tablets, and other hand held devices.
The NCP1851 significantly reduces charge time, increases
battery life and includes advanced startup features.”
MultiM
lti
Filter
FEM
Tuner Module
Multi-Band
Match
Control
Boost
DAC
Base-Band
Processor
32 • Template • Nov-12
32 • Analyst Day 2013
Confidential Proprietary
Control
SW
SPI
control
driver
Computing
New Products and More Opportunity
Portable
Desktop
Server
#2 Notebooks
#1 Position
Emerging
Controller
+ Driver
+ FETs
Thermall / System
Th
S t
Management:
Double revenue






Portable: Continue to
grow revenue
g
•Extend sockets
beyond Vcore
•Growth with tablets
and ultrabooks
Vcore Controllers – 1, 2, 3, 4, 6, 8 phase
Drivers
HFVR Controllers
DrMOS
Thermal Management
Data Converters
2012
33 • Template • Nov-12
33 • Analyst Day 2013
Confidential Proprietary
2013
2014
2015
Desktop: Hold
revenues
•Defend leadership
position
•Grow share with
growing customers
Grow share in
•Grow
consumer desktop
Key Takeaways
Complete Customer Solutions
Industry leading products and design wins in growth applications will provide above
market growth at above corporate average margins.
ON Semiconductor
Semiconductor’s
s application products group develops complete
system solutions for targeted products and customers.
 Proprietary products ensure visibility into customer roadmaps and production plans.
 Increasing feature sets, multiple bands and power requirements will continue to drive integrated
power solutions for mobile products.
 Machine to machine communication will drive wireless content across all market segments.
ASSPs,, ASICs and standard products
p
are complimentary
p
y models
 IP development and reuse enables fast customization and reduces development cost and risk.
 Custom products for market leaders create opportunities for standard product definition and
compatibility.
 Technology roadmap alignment results in better return on R&D investment
investment.
34 • Template • Nov-12
34 • Analyst Day 2013
Confidential Proprietary
Structured for Focused Growth
Standard Products Group
p
Bill Hall
Senior Vice President and General Manager
35 • Analyst Day 2013
Standard Products Snapshot
% Rev by Mkt
Segment
% SPG Market Share 2011
$20.3B TAM*
Telecom 4%
Industrial 15%
VSH
Wireless 16%
Consumer 19%
Computing 21%
Automotive 25%
FCS
ROM
Other
46.1%
NXP
RNECF
TOSBF ONNN 5 9%
5.9%
IFX
6.5%
STM
7.2%
TXN 8.1%
* 2012 market data not available yet. Sources: iSupply, IMS
Research, WSTS, Databeans, Web-Feet Research, Prismark,
Paumanok,
P
k Annual
A
l Reports
R
t and
d 10-Ks
10 K
Positioned to Win
 4 Divisions, 70 families, 20K part numbers, ship 36BU (2013).
 Asia is 68% of total business
business. China ~ 50% total SPG revenue
revenue.
 Top 10 customers (26% of revenue): Bosch, CAS, Delphi, Apple,
Huawei (wireless & energy), Motorola, Samsung, Delta, Kinpo, Seagate.
 Market Rank: #1 Si Protection, #1 Translators, #1 SS FETs, #1 Vregs, #2
SOSM Packaging
Packaging, #2 CSP
CSP, #2 GP Op Amps
Amps, #3 Discretes
Discretes, #3 LVFET
LVFET.
36 • Template • Nov-12
36 • Analyst Day 2013
Confidential Proprietary
Change Since Last Analyst Day (2010)
Allowing for Faster Than Market Growth
TAM addressed:
SPG Revenue:
2009
$9B
$500M
2012
$17.7B*
$1.1B
SPG
$1105M
Power Discrete
$344M
MOSFETs
IGBTs
Rectifiers
Triacs
Relays
2010 Focus
Cell Phones
Digital Consumer
White Goods
Protection Solutions
$231M
Zeners
TVS
TSPDs
ESD (LC)
EMI Filters (CMF)
eFuse
Small Signal
$207M
Small Signal Diodes & Trans
Schottky Diodes
Pwr Bipolar
LowVce (Sat) Transistors
JFETs
CCR
0201 µPkg
 All standard products now in SPG. Can run to standard
products model.
model
 Major platforms developed/introduced:
 600V/1200V FS1 IGBT’s, SJ MOSFET, Gen6 LV/MV MOSFETs,
world’s smallest MOSFET, industry’s 1st Si Common Mode
Filter (CMF), lowest capacitance ESD solutions for HS
te aces, DFN/DSN
/ S 0201
0 0 µpkg,
µp g, automotive
auto ot e SMT.
S
interfaces,
Blue represents divisions and products added to SPG since the 2010 Analyst day
* 2012 market data not available. TAM constructed from annual reports and segment data.
37 • Template • Nov-12
37 • Analyst Day 2013
Confidential Proprietary
IC Division
$323M
Logic
Interface
Translators
LDO’s V Regs
LDO’s,
Linear: OA, Comparators
E2PROMs
2013 Focus
Smartphones & Tablets
Automotive
HPPC
SPG Portfolio Coverage
4
1
4
1
4
1
3
den
gen
2
3
2
2
3
2
3
2
4
3
1
3
3
1
2
3
2
3
4
1
2
3
4
4
4
4
4
4
2
1
3
4
3
2
2
3
1
1
1
1
2
2
2
2
2
3
1
1
1
1
3
1
4
4
1
1
3
3
2
2
4
1
4
Shin
n
AUK
Sem
ikro
1
3
2
4
AP E
C
4
1
3
Broad Market
2
Specialized
Top 4 Competitor
Offered But Not Top 4
Sources: iSupply, IMS Research, WSTS, Databeans, Web‐Feet Research, Prismark, Paumanok, Annual Reports and 10‐Ks
38 • Template • Nov-12
38 • Analyst Day 2013
Mi cr
ochi
p
Mi ts
ubi s
hi
Bou
r ns
Atm
el
An a
log D
evic
es
Lit te
lfuse
Max
im
KEC
AO S
Rico
h
LTC
Sem
t ech
es
Diod
Infin
eon
Vish
ay
2
Fuji
ROH
M
1
1
3
2
1
Tosh
iba
Ren
es as
IR
2
4
TI
3
Power BJT
Power
BJT
CSP
ESD
TVS
eFuse/Current Prot.
EMI
TSPDs
Load Dump Switches
Rectifier
Triacs/SCRs
IGBT
LVFET
MVFET
SSFET
HVFET
Std Logic
Std Vregs
Std LDOs
Std Op Amps
Std Interface Other Std Amps
Other Std Amps
Other Std Linear
EEPROM
FCS
NXP
SS Diodes & Trans.
STM
ON
IC
P
Power Discretes
Discrete Signal & Protecction Most relevant Standard Product portfolio in the industry
Confidential Proprietary
Indigenous
Not Offered
SPG Business Model
Business model set up for 4.5% growth/year on top of market fluctuations
LVFR
Translators
ESD1
IGBT NPT
CMF
DSN/DFN 0201
Gen6 FETs
IGBT FS1
SJ FET
Prec LDOs/OP Amp
NP Engine
ESD3
$150M
IGBT FS2
HD E2PROM
•45% GPM
Gen6 FET Variants
•Simple ROI 3X
CMF2
Gen5 MV FETs
•Large Power
IGBT FS3
Discrete investment
PIMs
GAN
0–3 years
New Products
Large, growing, high margin markets,
leverage competencies, significant ON
S i
Semiconductor
d t presence.
39 • Template • Nov-12
39 • Analyst Day 2013
EBIT Machine
$900M
•34% GPM
•14% OPEX
•20% EBIT
$100M
•EOL
•Product Roll Off
3–15 years
15–20 years
Sustaining Business
Cost down programs, capacity expansion, and
careful portfolio additions.
EOL
Dogs management.
Confidential Proprietary
Sustaining Business
Capacity & cost structure well positioned for growth during next market up cycle
Cost Management






6%-8% per year offsets ASP degradation
NDW: shrinks
shrinks, 8
8” wafers,
wafers narrow SS
Transfers / insourcing
Materials reduction
Test time reductions
Yield improvement
•Average 7% unit growth
Cost
reduce
/Grow
Cost
reduce
Revenue
Cost
reduce
/EOL
40 • Template • Nov-12
40 • Analyst Day 2013
EOL
Confidential Proprietary
Grow
Strategy
Focus investment in markets that are large, growing, utilize SPG technical competencies,
support high margins, and where ON Semiconductor has a significant presence.
Smart Phones & Tablets
• $20B TAM @ 12% CAGR
• ON Semi focus segment
segment, 3 SECs
SECs, Qualcomm ref.,
ref Samsung,
Samsung Apple,
Apple Microsoft,
Microsoft Huawei,
Huawei ZTE.
ZTE
• Leveraged competencies: µpkg, lowest cap best surge rating ESD devices, best noise
rejection/highest signal integrity EMI filters (1st to market), world’s smallest MOSFET, quick
turn specialized translators.
• Key investments: CSP, LC-ESD, Common Mode Filters, µMOSFETs.
Automotive
• $28B TAM @ 7% CAGR
• ON Semi’s largest segment (25% of total revenue), 3 SECs, CAS, BOSCH, Delphi, Valeo.
• Leveraged competencies: SMT automotive packages, back side wafer processing & thinning
for power technologies
technologies, CCR low cost LED driver
driver, MG Logic (12V)
(12V), >3000 AEC qual
qual’d
d
devices, automotive infrastructure, module technologies (IPMs).
• Key investments: specialized MV MOSFETs, FS IGBTs, GAN, PIMs, Relays, protection for
infotainment, IVN, & load dump, CCR, more AEC quals.
High Performance Power Conversion (HPPC)
• $25B TAM @ 10% CAGR
• Includes UPS, server & telecom PS, industrial motor control, alternative energy.
• Leveraged competencies: backside wafer processing, power dense packages, relationships
with leading high performance power technology customers, power module technologies.
MOSFETs SJ MOSFETs,
MOSFETs FS IGBTs,
IGBTs GAN,
GAN PIMs,
PIMs Precision OP Amps
Amps.
• Key investments: HE MOSFETs,
41 • Template • Nov-12
41 • Analyst Day 2013
Confidential Proprietary
Leadership Position in Technology
To win in the market a supplier
pp
must work on multiple
p g
generations simultaneously
y and
understand the end markets to quickly develop portfolios that address specific applications.
 Each technology has a critical objective (such as power efficiency or signal integrity) that
generations of products improve on with successive iterations.
 Each product in a portfolio is a point on the generational curve maximized for a given application.
IGBTs
Protection Products
1.8
18
FS II 2012
1.5
FS II 2013
FS I 2012
Eoff (mJ))
FS III 2013
12
1.2
Comp
A
0.9
ESDLC3
2012
12
Comp B
8
Comp
pE
2012
ESDLC1
2008
6kV
10
Comp C
Comp D
2012
Comp C
2012
8kV
14
FS I 2011
FS III 2014
FS III 2014
Comp
pB
2012
ESDLC4
2014
16
NPT 2011
Comp
pA
2012
Comp F
2012
4kV
Comp D
6
0.6
4
0.3
Comp G
2012
2kV
2
WBG
0
0
0
0.5
1
42 • Template • Nov-12
42 • Analyst Day 2013
Vce(ON)
1.5
2
2.5
Confidential Proprietary
2
4
6
8
Breakdown Voltage (V)
10
12
14
16
Advanced Packaging
ON Semiconductor SPG is a leader in CSP, Micro, and power dense packaging.
Smaller Form Factors Driving Need for CSP
Power Packages
Power Density,
W/mm2
Size, mm2
Sq. mm
4
20
SMB
TO247
Larger Displays to deliver multi-media
300
content = less space for components
10
SOT-23
3
Thinner phones = single sided boards
100
5
2
TO220/FP
SOD3
DPAK
SOD5
1
50
SOD/T 7
SOD9
0
SOT-1123
130x
290x
0201CSP
1990’s
1990
s
2000
1
SO8FL
01005CSP
8FL
0
2010
300
250
200
150
100
50
Power Dissipation (watts)
Range of Sizes
Power Packages: MOSFETs, IGBTs, Rectifiers
 Power density is key. Moving quickly to surface mount.
 ON S
Semiconductor
i
d t offers
ff
power packages
k
with
ith superior
i power d
density:
it
 SO8FL, µ8FL,PhaseFET dual MOSFET
 Thermally Enhanced SO8FL (cooling from the top and bottom)
 50% improvement over the competition.
 Moving into modules: PIMs & IPMs.
.
PIMS
43 • Template • Nov-12
43 • Analyst Day 2013
IPM
Dpak
SO8FL
DFN0201
Confidential Proprietary
Outgrowing Markets
Strategy
gy is to p
pick focus areas and leverage
g competencies
p
that allow ON Semiconductor
SPG to grow faster than the general market.
2012-2015
SAM
Focus Area/Why We Win
CAGR
Logic
0%
Wireless(Translators): first to market with next gen size/speed
combo.
6%
LDOs
4%
Wireless: best efficiency/$
8%
OP Amp
3%
Wireless(Low Power) & HPPC(High Precision): SAM expansion.
Customers looking for alternative to consolidated supplier base.
7%
ESD/EMI
4%
Wireless & Auto: lowest cap & deepest attenuation. Expand into
IVN, infotainment, consumer.
17%
TVS
0%
Automotive: SAM expansion into centralized load dump.
9%
IGBT/PIM
12%
HPPC & Auto: best efficiency/$. Alternative to a legacy supplier.
Strong
g automotive p
presence. Back side wafer p
processing.
g
17%
LV FET
-0.5%
Wireless: performance and package size.
11%
MV FET
3%
HPPC & Auto(Gen6 High Efficiency): N- channel switching
performance & RDSON cost.
18%
* 2012 market data not available yet. Sources: iSupply, IMS Research, WSTS, Databeans, Web-Feet Research, Prismark, Paumanok, Annual Reports and 10-Ks
44 • Template • Nov-12
44 • Analyst Day 2013
Confidential Proprietary
Focus
CAGR
Key Takeaways
 ON Semiconductor
S i
d t SPG iis a vital
it l player
l
i th
in
the St
Standard
d dP
Products
d t market
k t and
d
is becoming more significant through the execution of this strategy.
 SPG has a strong business model with a base business that continues to
generate 20%+ EBIT
EBIT, fueled by a new product machine that replenishes
$150M/yr.
 New product strategy is focused on Smartphones/Tablets, Automotive, and
High Performance Power Conversion (HPPC)
(HPPC).
 SPG has recently introduced significant technical platforms (IGBTs, Gen 6
FETs, SJ FETs, Common Mode EMI filters, LC-ESD solutions, industry leading
IC translators,
translators and advanced packaging),
packaging) which will feed high margin NP
revenue for years to come.
 Working on future platforms: PIM, GAN, HV FETs, Automotive Protection,
Precision Op Amps
Amps, High Density E2PROM
E2PROM.
45 • Template • Nov-12
45 • Analyst Day 2013
Confidential Proprietary
Break
20 minutes
i t
46 • Analyst Day 2013
Structured for Focused Growth
SANYO Semiconductor Products Group
p
Mamoon Rashid
Senior Vice President and General Manager
47 • Analyst Day 2013
Executive Summary
 What has gone well
ell since closing the acquisition:
acq isition
 Functional and systems integration programs on track.
 Total permanent fixed cost savings of $56M per quarter exiting 2012:
 COGS ($45M/
($45M/qtr)
t)
 OpEx ($11M/qtr)
 SANYO Semiconductor and ON Semiconductor sales organizations functioning as one;
generated $91M cross sell revenue in 2012.
 SANYO Semiconductor design activity outside Japan healthy at over $400M annual
rate.
 Challenges:
 2011 natural disasters and strong Yen continued to impact SANYO Semiconductor’s
base revenue in 2012 at Japanese OEMs.
 Additional restructuring in Q1, Q2 and Q3 2013 to reduce fixed costs and achieve
$190M per quarter break even point.
48 • Template • Nov-12
48 • Analyst Day 2013
Confidential Proprietary
Semiconductor Market in Japan
Steady growth forecasted due to the financial policy of new government and a
weakening Yen.
Semiconductor Market Trend in Japan
W/W Semiconductor Market in 2012
($B)
2012-15 CAGR: 4.2%
America
18%
Asia /
Pacific
56%
Europe
$301B
$
12%
Japan
14%
Japan Semiconductor Market Expected to
Recover 2013-15
Source: WSTS, 2012 Autumn Forecast.
49 • Template • Nov-12
49 • Analyst Day 2013
Confidential Proprietary
Aggressive Restructuring
2011-H1
2011-H2
2012-H1
Niigata
Niigata
Niigata
Gifu
Gifu
Gifu
Gunma
Gunma
Gunma
SSL
SSL
SSMP
2013-H1
2013-H2
Niigata
Niigata
Niigata
SSL
SSL
SSL
SSL
SSMP
SSMP
SSMP
SSMP
SSMP
KSS
KSS
KSS
KSS
KSS
KSS
SSV
SSV
SSV
SSV
SSV
SSV
SSTH
SSTH
SSTH
OSV
OSV
OSV
SET
SET
Wafer
Fabs
Assembly/
Test
2012-H2
* Subcon capacity transferred inside
Operational
$320M/qtr
Breakeven
50 • Template • Nov-12
50 • Analyst Day 2013
*
$230M/qtr
Confidential Proprietary
$190M/qtr
SANYO Semiconductor Profile
America
1%
Hybrid IC 14%
Analog
g LSI
40%
Europe 1%
Japan
38%
Asia
60%
Discrete
17%
by Regions
Micro/Logic/Memory
29%
by Products
Industrial 6%
Communication
C
i i
10%
Computing
16%
Consumer
Electronics
47%
Automotive
21%
by End Use
51 • Template • Nov-12
51 • Analyst Day 2013
Confidential Proprietary
SANYO Growth Drivers
White Goods
Smartphone / Tablet
AF/OIS ICs for Camera Module
Inverter Module for White Goods
 Best in class lens positioning accuracy (1um) for greater
than 8M pixel cameras
 High efficiency: 27% lower loss than competitor
 New 2-in-1 IPM allows 40% smaller area than competitor
MOSFET for Li-ion Battery
y
NPT IGBT
 Low on-resistance (below 5mΩ)
 Improved battery life
 Low power consumption : 10% lower loss than competitor
 10% lower saturation high speed switching
Back Light Driver
Fan Motor Driver
 Thin & Small package: AMOLED
 Low power consumption.
consumption
 Low consumption
Industrial
Automotive
Infotainment (Audio)
Printer Driver
 Image processer for small size LCD
 Radio tuner
 High efficiency (70% improvement)
 Reduced BOM solution
LCD Drivers for Instrument Panel
 30% BOM cost reduction with combined (LED + LCD)
driver
 Chinese character display
Igniter Module
 Leading high energy igniters for fuel efficient engines
52 • Template • Nov-12
52 • Analyst Day 2013
MOSFET for Storage Battery
 MV-SJ
MV SJ ((split
lit gate
t type
t
super junction)
j
ti )
 Industry-lowest Ron A in 100V products (45mΩmm2).
Power Inverter Module
 Low power loss
 High reliability
Confidential Proprietary
SANYO Semiconductor Today
Leading Positions
AF/OIS for
Camera
Mobile
Lighting
MOSFET for
Li-ion Battery
Haptics
for
Interface
Power Efficient
Module for
Infotainment
Motor Driver
(Audio)
Igniter
Module
LCD Drivers &
Instrument Panel
Customer Alignment
53 • Template • Nov-12
53 • Analyst Day 2013
Confidential Proprietary
Power Supplies
and Inverters
Touch
Interface
Motor Drive
and Control
Diversifying Regional Dependence
Current Design Activity ‐
g
y Global ($M)
($ )
Japan
54 • Template • Nov-12
54 • Analyst Day 2013
By Region
By Segment
Non Japan
Confidential Proprietary
Target Segment: Smartphone / Tablet
Leading Customers
AF/OIS ffor
Camera
Mobile
Lighting
MOSFET for
Li-ion Battery
Haptics for
Interface
Existing Strong Positions
BOM Opportunity:
AF/OIS IC
New Products
~$1.00
~$2.00
MOSFET
Haptic Driver
f Li
for
Li-ion
i
Battery
B tt
 8M to 13M pixels
resolution
 20% lower power
consumption OIS
controller
 Worlds smallest AF
driver with integrated Hall
element for feedback
control
55 • Template • Nov-12
55 • Analyst Day 2013
 Longer battery life
and quick charging
 Thinner battery pack
 Improved reliability
Mobile Lighting
(B kli ht Flash)
(Backlight,
Fl h)
 50% lower power
consumption
 Improved touch
feedback (quick start &
auto brake with autotune control driver)
Confidential Proprietary
 AMOLED and LED
driver with high efficiency
Target Segment: Automotive
Power Efficient
Module for
Motor Driver
Igniter Module
Leading Customers
Infotainment
(Audio)
LCD Drivers &
Instrument Panel
Existing Strong Positions
BOM Opportunity: ~$13.00
LCD Drivers &
Igniter Module
Instrument Panel
 Small Package,
best suited to plug
top ignition coils
 Targeted for fuel
efficient engines
 Reduced BOM
cost
56 • Template • Nov-12
56 • Analyst Day 2013
 Combo (LED +
LCD)) driver reduces
BOM cost by 30%
 Chinese character
displayable
New Products
~$70.00
Module for
Infotainment
(Audio)
EPS & Fan & Pump
 Small Antenna System
– ((75%
% PCB reduction))
 Hi-Sensitivity : 40%
increase in reception
radius and improved
alignment
Confidential Proprietary
 Smallest
S ll t size
i and
d
lightweight for better fuel
consumption
Target Segment: White Goods
Power Supplies
and Inverters
Leading Customers
Touch
Interface
Motor Drive
and Control
Existing Strong Positions
BOM Opportunity:
Inverter module
 High efficiency: 27%
lower loss than
competitor
 Proprietary IMST
transfer mold
technology
57 • Template • Nov-12
57 • Analyst Day 2013
New Products
~$6.00
~$13.00
Motor driver
 Zero standby current
 Silent sine wave &
high efficiency drive
with PWM speed
control
IGBT
Inverter Module
Non Punch Through type
New 2 in 1 IPM
 10%
% lower loss than
competitor
 Improved heat loss
 Integrated “Inverter +
PFC“ module reduces
PFC
customer’s design cycle
 Three phase, sensor less,
vector controlling
 10A to 30A
Confidential Proprietary
Key Takeaways
Market Leading Solutions - Restructured for Global Growth
 SANYO Semiconductor has strong engineering solutions targeted at
growth segments.
 Base business at Japanese OEMs expected to improve in 2013 driven
by domestic stimulus and depreciating Yen
Yen.
 Strong design wins in ON Semiconductor’s traditional customer base
creating revenue growth opportunities
opportunities.
 We have aggressively restructured the business to compensate for
h d i d
headwinds.
58 • Template • Nov-12
58 • Analyst Day 2013
Confidential Proprietary
Manufacturing and Operational
Excellence
Mark Goranson
S i Vice
Senior
Vi President,
P id t O
Operations
ti
59 • Analyst Day 2013
Operations - Executive Summary
 We have continued to invest and we are well positioned for the next up cycle
 Wafer fab expansions in 8in and low cost regions
 Expanded footprint in Vietnam
 Cross qualifications for additional flexibility and risk mitigation
 Factory consolidations and cost savings programs drive margin improvements





Wafer fab consolidations in high cost regions and low volume factories
g
Insourcing
BOM cost downs
Gold to copper wire conversion and Extreme High density lead frames
Internal Epi and Silicon wafer generation
 Advanced planning systems and processes assure best in class on time delivery
 We average > 95% OTD to all customers
 Corporate
C
t S
Social
i l Responsibility
R
ibilit
60 • Template • Nov-12
60 • Analyst Day 2013
Confidential Proprietary
Factory Cost Savings
Over $400M of cumulative annualized cost savings
g opportunity
pp
y from factory
yp
projects
j
and
consolidation efforts
$385 415M
$385‐415M
Cumulative Savings
$275‐305M
Factory Consolidation
$175‐195M
Factory/Other Project Savings
$75 85M
$75‐85M
2012
61 • Template • Nov-12
61 • Analyst Day 2013
2013E
2014E
2015E
Confidential Proprietary
Capital Expenditures
2013 capital
p
expenditures
p
will be down due to better utilization of 2011 and 2012 capital
p
investments
$316M
$256M
$259M
$189M
$160‐170M
SANYO
ON Legacy
2010
62 • Template • Nov-12
62 • Analyst Day 2013
2011
2012
Confidential Proprietary
2013E
Front End Capability
High
Well Positioned for the Upturn
Technology Cap
pability
8in
Gresham
Current
Future
2009 Footprint
Footprint
Footprint
Room to Grow
8in
Idaho
6in
Belgium
5,6in
6in
Japan
6in
Japan
6in
Czech
5in
Idaho
Slovakia
4in
Slov.
6i
6in
6in
Low
Phoenix
Low
L
Malaysia
Equipment
E i
t Utilization
Utili ti
* Diameter is relative scale (normalized)
63 • Template • Nov-12
63 • Analyst Day 2013
Confidential Proprietary
High
Hi h
Back End Capability
Well Positioned for the Upturn
Technical Capab
bility
High
KSS
JPN
SBN
Malaysia
LPS
China
(JV LRC)
SSL
China
OSPI
Phil
SSMP
Phil
OSV
Vietnam
Vi
SSV1/2
Vietnam
Low
SC
US
OST
Thai
Low
L
Revenue
R
(M$/yr)
(M$/ )
* Diameter is relative scale (normalized)
64 • Template • Nov-12
64 • Analyst Day 2013
Confidential Proprietary
High
Hi h
APG Technology Developments
80 V
G10,C9,C3
BiDC1
16(B)
ONBCD25
5
ONC25
C5
D3
L5
3.3 V
0.3
35 u 27 V
I2T100
C8
I3T25
5, I3T50, I3T8
80
5V
0.6u
u24V_PWR
12 V
PS5LV
PS5A,B
B
20 V
ACM
MOS2
Vo
oltage (Vd
ds)
40 V
VHVIC3
65 V
25V
2.5
1.8 V
1.2 V
1.0 µm
0.8-0.7
0.8
0.7 µm
0.6
0.6-0.5
0.5 µm
0.35 µm
0.25 µm
(Technology Node)
65 • Template • Nov-12
65 • Analyst Day 2013
Confidential Proprietary
0.18 µm
Released
D
Development
l
t
Planning
ONC110
100 V
ONC18MS O
O
ONC18 5/30
ONC18 / 18
ONC
C18D
I4T
T family
Ste
ellar Imaging
g
ONC18-VHV
O
700 V
700 V

Secure, Cost Effective Internal Supply
110 nm
Global Supply Chain
Best-in-class Planning Systems and Processes
Best-in-class OTD to our Key Accounts
Planned Dock Date delivery performance to
All Accounts ~95% (Disty and Direct)
ON Semiconductor Service
Programs
Global Service Managers
Effective B2B Architecture
Continuous improvement in
Cost-to-Serve
Service Program Analysts
Global Command Center
*AMR Research
66 • Template • Nov-12
66 • Analyst Day 2013
Confidential Proprietary
Global Distribution Centers, Regional Distribution Centers & Hubs
Located Close to the Customer Delivery Points
Singapore Global Distribution Center
Oudenaarde (Belgium)
Roznov (Czech Republic)
Pocatello, ID
(USA)
Narita (Japan)
Sunnyvale,
S
l CA
(USA)
Shanghai (China)
Taipei (Taiwan)
Los Angeles, CA
(USA)
Hong Kong (China)
Manila (Philippines)
Singapore
State-of-the-Art Facility
Currently the largest distribution
facility serving the semiconductor
Global Distribution Center (GDC)
industry located in Singapore
Hub (Hub / Cross-Dock)
Regional Distribution Center (RDC)
67 • Template • Nov-12
67 • Analyst Day 2013
Confidential Proprietary
Driving
g Shareholder Value
Bernard Gutmann
Executive Vice President and Chief Financial Officer
68 • Analyst Day 2013
Key Financial Objectives
69 • Template • Nov-12
69 • Analyst Day 2013

Grow revenue faster than
industry

Capitalize on earnings
leverage in up-cycle

Generate superior cash flow

Provide excellent return to
shareholders
Confidential Proprietary
Path to SANYO Semiconductor Breakeven
350.0 Japan EQ
March 11, 2011
Thailand Flood
October 10, 2011
300.0 250.0 200.0 150.0 100.0 50.0 0.0 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012
Revenue
70 • Template • Nov-12
70 • Analyst Day 2013
Breakeven
Confidential Proprietary
Path to Breakeven
Weakening Yen Improves EBIT
ONNN Average Quarterly Exchange Rate ‐ JPY
105
100
J
JPY per USD $
1
95
90
85
80
75
70
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Jan & 2009 2009 2009 2009 2010 2010 2010 2010 2011 2011 2011 2011 2012 2012 2012 2012 Feb 2013
71 • Template • Nov-12
71 • Analyst Day 2013
Confidential Proprietary
Optimizing Legacy ON Semiconductor
Last Two Cycles
2008 Peak vs. 2009 Trough
2008
Peak
2009
Trough
Change
Revenue
$581.5
$379.1
-34.8%
Non-GAAP
Gross Margin
41.5%
31.3%
Operating
Margin
12.7%
-1.2%
2011 Peak vs. 2012 Trough
2011
Peak
2012
Trough
Change
Revenue
$631.5
$513.5
-18.7%
-24.6%
Non-GAAP
Gross Margin
39.7%
35.7%
-10.1%
-109.6%
Operating
Margin
18.8%
13.1%
-30.4%
 Optimization of Legacy ON Semiconductor allows for better
margins even during a weak demand environment
72 • Template • Nov-12
72 • Analyst Day 2013
Confidential Proprietary
Path to Net Debt Neutral
Net Debt
1000
900
800
700
600
500
400
300
200
100
0
Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q1 008 2008
008 2008
008 2008
008 2009
009 2009
009 2009
009 2009
009 2010
0 0 2010
0 0 2010
0 0 2010
0 0 2011
0
2011
0
2011
0
2011
0
2012
0
2012
0
2012
0
2012
0
2008
*See Appendix for Reconciliation of Non-GAAP Net Debt.
73 • Template • Nov-12
73 • Analyst Day 2013
Confidential Proprietary
Outgrowing the Industry
2005‐2012 Revenue & EBITDA Change
150.0%
100.0%
50.0%
0.0%
‐50.0%
‐100.0%
‐150.0%
‐200.0%
ONNN
MXIM
LLTC
TXN
ISIL
Revenue Change
FCS
VSH
STM
NXPI
EBITDA Change
Source: Bloomberg – STM 2012 EBITDA figure and NXPI & FSL 2005 figures not available on Bloomberg, so gathered from company websites.
74 • Template • Nov-12
74 • Analyst Day 2013
Confidential Proprietary
IRF
FSL
Continuing to Increase Cash Flow
2005‐2012 Cash Flow from Operations Percentage Change
60%
40%
20%
0%
‐20%
‐40%
‐60%
‐80%
80%
‐100%
ONNN
VSH
FCS
LLTC
MXIM
NXPI
TXN
STM
*Figures based on last twelve months
Source: Thomson ONE – 2005 NXPI, 2012 STM & 2012 FSL figures not available on Thomson ONE, so gathered from company websites.
75 • Template • Nov-12
Confidential Proprietary
75 • Analyst Day 2013
FSL
ISIL
Not Getting Credit for Cash Generation
Price/Sales
i /S l
EV/EBITDA
/
50.00 8.00 45.00 7.00 40.00 6.00 35.00 5.00 30.00 4.00 25.00 20.00 3.00 15.00 2.00 10.00 1.00 5.00 ‐
‐
LLTC
MXIM
TXN
NXPI
ISIL
IRF
FCS
ONNN
FSL
IRF
VSH
ISIL
FSL
NXPI
Price/Cash Flow
120 00
120.00 100.00 80.00 60 00
60.00 40.00 20.00 ‐
ISIL
IRF
FSL
LLTC
MXIM
NXPI
*Ratios based on last fiscal year
Source: Thomson ONE as of February 9, 2013
76 • Template • Nov-12
76 • Analyst Day 2013
Confidential Proprietary
ONNN
TXN
FCS
VSH
LLTC
TXN
MXIM
ONNN
FCS
VSH
Returning Capital to Shareholders
Positioned to outpace
p
the industry
y
 Repurchased 8.8 million shares since Q3 2012
 Moving to a net debt neutral position opens the possibility of
exploring other methods of returning capital to shareholders
 Strong cash generation
 Lower capital expenditures in 2013
 Reduced cost structure
 Allocating resources to focused growth drivers
 New target
g model drives higher
g
earnings
g
77 • Template • Nov-12
77 • Analyst Day 2013
Confidential Proprietary
Target Model
Quarterly P&L (Targets)
Total Revenue:
Gross Margin:
g
R&D:
SG&A:
Oper Inc.:
Cash Flow (Targets)
$800M
41%
11-12%
11-12%
~ 17-19%
Adjusted EBITDA*:
Cap
p Ex (5-6%):
(
)
Int. Exp / Other:
Taxes:
Quarterly Free Cash Flow of $120M - $140M
Annualized EPS of $1
$1.00
00 to $1
$1.20
20
* Includes Stock Based Compensation Expense
78 • Template • Nov-12
78 • Analyst Day 2013
Confidential Proprietary
$180M - $200M
($
($45M)
)
($8M)
($5M)
Key Themes
 Positioned to outperform
 Becoming more important to our customers
 Structured for focused growth
 Manufacturing and operational excellence
 Financial strategy to increase shareholder value
79 • Template • Nov-12
79 • Analyst Day 2013
Confidential Proprietary
Questions?
80 • Template • Nov-12
80 • Analyst Day 2013
Confidential Proprietary
Appendix
pp
81 • Analyst Day 2013
Reconciliation of Non-GAAP Net Debt
Total debt
Total cash and equivalents
Total net debt
Dec 31,
2012
1,011.9
(631.7)
380.2
Sept 28,
2012
1,063.4
(643.0)
420.4
Jun 29,
2012
1,070.3
(756.4)
313.9
Mar 30,
2012
1,189.0
(892.3)
296.7
Dec 31,
2011
1,207.0
(901.5)
305.5
Sept 30,
2011
1,237.0
(837.7)
399.3
Jul 1,
2011
1,285.4
(868.8)
416.6
Apr 1,
2011
1,272.0
(766.0)
506.0
Total debt
Total cash and equivalents
Total net debt
Dec 31,
2009
933.5
(571.2)
362.3
Oct 2,
2009
895.6
(470.2)
425.4
Jul 3,
2009
904.3
(403.4)
500.9
Apr 3,
2009
930.9
(402.4)
528.5
Dec 31,
2008
1,009.8
(458.7)
551.1
Sept 26,
2008
1,220.8
(417.9)
802.9
Jun 27,
2008
1,232.1
(321.2)
910.9
Mar 28,
2008
1,026.6
(307.9)
718.7
Dec 31,
2010
888.8
(623.3)
265.5
Oct 1,
2010
786.0
(562.9)
223.1
Jul 2,
2010
753.4
(467.1)
286.3
Apr 2,
2010
934.8
(560.7)
374.1
Non-GAAP Measures
To supplement the consolidated financial results prepared under GAAP, ON Semiconductor uses non-GAAP measures which are adjusted from the most directly
comparable GAAP results to exclude items related to amortization of intangible assets, amortization of acquisition-related intangibles, expensing of appraised inventory
fair market value step-up, inventory valuation adjustments, purchased in-process research and development expenses, restructuring, asset impairments and other, net,
goodwill impairment charges, gains and losses on debt prepayment, non-cash interest expense, their related tax effects, actuarial (gains) losses on pension plans and
other pension benefits, and certain other special items, as necessary. Management does not consider these charges in evaluating the core operational activities of ON
Semiconductor Management uses these non
Semiconductor.
non-GAAP
GAAP measures internally to make strategic decisions
decisions, forecast future results and evaluate ON Semiconductor’s
Semiconductor s current
performance. Most analysts covering ON Semiconductor use the non-GAAP measures as well. Given management’s use of these non-GAAP measures, ON
Semiconductor believes these measures are important to investors in understanding ON Semiconductor’s current and future operating results as seen through the eyes
of management. In addition, management believes these non-GAAP measures are useful to investors in enabling them to better assess changes in ON Semiconductor’s
core business across different time periods. These non-GAAP measures are not in accordance with or an alternative to GAAP financial data and may be different from
non-GAAP measures used by other companies. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial
measures with other companies’ non-GAAP financial measures, even if they have similar names.
Non-GAAP gross profit and gross margin. The use of this non-GAAP financial measure allows management to evaluate the gross margin of the company’s core
businesses and trends across different reporting periods on a consistent basis, independent of non-cash items including expensing of appraised inventory fair market
value step-up and amortization of intangible assets. In addition, it is an important component of management’s internal performance measurement and reward process as
it is used to assess the current and historical financial results of the business, for strategic decision making, preparing budgets and forecasting future results.
Management presents this non-GAAP financial measure to enable investors and analysts to evaluate our revenue generation performance relative to the direct costs of
revenue of ON Semiconductor’s core businesses.
Non-GAAP net income and net income per share. The use of these non-GAAP financial measures allow management to evaluate the operating results of ON
Semiconductor’s core businesses and trends across different reporting periods on a consistent basis, independent of non-cash items including amortization of intangible
assets, amortization of acquisition-related intangibles, expensing of appraised inventory fair market value step-up, purchased in-process research and development
expenses, restructuring, asset impairments and other, net, goodwill impairment charges, gains and losses on debt prepayment, non-cash interest expense, their related
tax effects, actuarial (gains) losses on pension plans and other pension benefits, and certain other special items, as necessary. In addition, they are important
components of management’s internal performance measurement and reward process as they are used to assess the current and historical financial results of the
business,, for strategic
g decision making,
g, p
preparing
p
g budgets
g
and forecasting
g future results. Management
g
p
presents these non-GAAP financial measures to enable investors
and analysts to understand the results of operations of ON Semiconductor’s core businesses and to compare our results of operations on a more consistent basis against
that of other companies in our industry.
82 • Template • Nov-12
82 • Analyst Day 2013
Confidential Proprietary