Advanced Energy Industries (AEIS) BofA Securities 2024 Global Technology Conference summary

Company overview and market positioning

• Leading provider of precision power conversion systems with a $1.7B business, serving semiconductor, industrial, medical, data center, and telecom markets.

• Holds a dominant position in semiconductor process power, especially in etch and deposition applications.

• Expanded into broader markets, with a $10.5B total addressable market and 70% of business self-sourced through long design-in cycles.

• Diversification into multiple end markets has provided resilience and outperformance versus peers during downturns.

• Exposure to trailing edge logic and record years in industrial, medical, and telecom helped offset semiconductor market declines.

Recent performance and outlook

• Q1 was the lowest quarter since 2020, with all markets at trough levels; semiconductor performed slightly better than expected, while industrial and medical lagged due to inventory digestion.

• Data center and computing markets are leading a recovery, with Q2 expected to be meaningfully higher than Q1.

• 2024 is anticipated to be a transition year, with overall business flat versus 2023 and growth weighted to the second half.

• Long-term growth is expected to outpace the wafer fab equipment (WFE) market, driven by share gains and new product introductions.

Growth drivers and product innovation

• New products in remote plasma source and sensing solutions are expanding the addressable market and increasing share in underpenetrated segments.

• eVerest RF generator platform offers twice the response time and advanced pulsing, enabling greater process control and yield.

• eVoS bias product uses novel high voltage technology for improved power efficiency and wafer yield.

• Modular product design allows for faster customizations and broader application coverage.