Macronix — Earnings Release 2021

Sep 8, 2021

Macronix International Co., Ltd. Second Quarter 2021 Results July 27, 2021

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Safe Harbor Statement

The presentation and discussion contain certain forward-looking statements with respect to the results of operation, financial condition and current expectation. The forward-looking statements are subject to known and unknown uncertainties and risks that could cause actual results to differ materially from those expressed or implied by such statements.

Such risks and uncertainties include but are not limited to the impact of competitive products and pricing, timely design acceptance by our customers, timely introduction of new technologies, ability to ramp new products into volume, industry wide shifts in supply and demand for semiconductor products, industry overcapacity, availability of manufacturing capacity, financial stability in end markets, and other risks.

The forward-looking statements in this release reflect the current belief of Macronix as of the date of this release and Macronix undertakes no obligation to update these forward-looking statements for events or circumstances that occur subsequent to such date.

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Agenda

Welcome

Welcome C.Y. Lu 2021Q2 Financial Results Paul Yeh Business Update C.Y. Lu Remarks and Q&A C.Y. Lu

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2Q21 Record High Sales Driven by Strong Demands Across the Board

2021Q2 2021Q1 2020Q2 Reviewed Reviewed Reviewed Revenue NT$ 11.4 NT$ 9.6 NT$ 9.3 (billion NT$) Gross 39.1% 34.3% 35.0% margin % Operating 20.2% 12.1% 15.0% margin %

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Agenda

Welcome C.Y. Lu 2021Q2 Financial Results Paul Yeh Business Update C.Y. Lu Remarks and Q&A C.Y. Lu

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Margin Expansion with Solid EBITDA Driven by Improved Product Mix

Unit：NTD Million (except EPS) 2021/Q2 Reviewed 2021/Q1 Reviewed 2020/Q2 Reviewed Net Sales 11,426 9,627 9,271 Gross Profit 4,466 3,301 3,243 Gross Margin% 39.1% 34.3% 35.0% Operating Expenses (2,160) (2,133) (1,850) Operating Income 2,305 1,168 1,393 Operating Margin% 20.2% 12.1% 15.0% Net Non-Operating Income (Loss) (131) (177) 8 Income Before Taxes 2,174 991 1,400 Income Taxes Expense (248) (75) (71) Net Income 1,925 916 1,330 Basic EPS (NT$) 1.04 0.50 0.72 EBITDA 3,289 2,097 2,394 Weighted avg outstanding million shares 1,844 1,844 1,838	2021/Q2 Reviewed 2021/Q1 Reviewed 2020/Q2 Reviewed	QoQ Change YoY Change 19% 23% 35% 38% 4.8ppt 4.1ppt 1% 17% 97% 66% 8.1ppt 5.2ppt 119% 55% 110% 45%
	11,426 9,627 9,271 4,466 3,301 3,243 39.1% 34.3% 35.0% (2,160) (2,133) (1,850) 2,305 1,168 1,393 20.2% 12.1% 15.0% (131) (177) 8 2,174 991 1,400 (248) (75) (71) 1,925 916 1,330

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1H21 Revs. Up 13% Y/Y with 380 Bps Margin Expansion

Unit：NTD Million (except EPS) 2021/H1 Reviewed 2020/H1 Reviewed Net Sales 21,054 18,686 Gross Profit 7,766 6,188 Gross Margin% 36.9% 33.1% Operating Expenses (4,293) (3,629) Operating Income 3,473 2,559 Operating Margin% 16.5% 13.7% Net Non-Operating Income (Loss) (308) 68 Income Before Taxes 3,165 2,627 Income Taxes Expense (323) (75) Net Income 2,842 2,552 Basic EPS (NT$) 1.54 1.39	2021/H1 Reviewed 2020/H1 Reviewed	YoY Change 13% 25% 3.8ppt 18% 36% 2.8ppt 20% 11%
	21,054 18,686 7,766 6,188 36.9% 33.1% (4,293) (3,629) 3,473 2,559 16.5% 13.7% (308) 68 3,165 2,627 (323) (75) 2,842 2,552

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Robust Sales Momentum

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2018 2019 2020
Sales 36,953M 34,995M 39,801M
NTD M Margin%
11,906
12,000 11,426 60%
10,957
10,030 10,158
10,000 9,581 9,415 9,627 50%
9,271
9,061 8,880 8,981
45%
8,000 7,479 40%
42%
39%
6,029 36%
35% 35%
6,000 34% 30%
32%
31%
30%
28%
27%
26%
25%
4,000 20%
2,000 10%
0 0%
18Q1 Q2 Q3 Q4 19Q1 Q2 Q3 Q4 20Q1 Q2 Q3 Q4 21Q1 Q2
Net Sales Gross Margin%
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Compelling Valuation

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2021Q2 2020Q2
Basic EPS -- NT$ 1.04 0.72
Book Value -- NT$ 21.20 17.78
Basic EPS Book Value
NTD 2.90 NTD
1.04
22.0
21.20
1.0
0.88
20.18
0.67
0.72 19.52
0.63
0.50 18.71
18.07
17.78
0.0 16.0
20Q1 Q2 Q3 Q4 21Q1 Q2
20Q1 Q2 Q3 Q4 21Q1 Q2
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Strong Balance Sheet with a Healthy Cash Position

Unit: NTD Million (except BV)	2021/06/30 Reviewed	2021/03/31 Reviewed	2020/06/30 Reviewed
Cash	11,796	10,370	9,890
Inventory(Net)	14,009	13,238	11,518
Property, Plant and Equipment	30,428	30,838	29,639
Total Assets	66,883	64,634	60,893
Interest bearing debt - short term	4,847	5,565	3,711
Interest bearing debt - long term	8,059	8,110	9,584
Total Liabilities	27,571	27,212	27,918
Debt Ratio (%)	41.2%	42.1%	45.8%
Shareholders' Equity	39,311	37,422	32,975
Book Value -- NT$	21.20	20.18	17.78

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Growing FcF

Unit: NTD Million	2021/Q2 Reviewed	2021/Q1 Reviewed	2020/Q2 Reviewed
Cash Flow from Operating	2,851	2,005	2,255
Depreciation & Amortization	1,056	1,036	935
Cash Flow from Investing	(453)	(594)	(873)
Capital Expenditures	(520)	(531)	(894)
Cash Flow from Financing	(875)	(2,592)	(501)
Net Change*	1,426	(1,510)	831
EndingBalance	11,796	10,370	9,890
Free Cash Flow**	2,332	1,474	1,361

*Net change includes the effect of exchange rate changes

**Free Cash Flow=Cash Flow from Operating - Capital Expenditures

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Quarterly Sales Breakdown by Products (Parent Company)

Unit: NTD Million

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12,000
16%
9,000 12%
11%
QoQ YoY
50%
48% Change Change
6,000 52%
NAND +57% +82%
NOR +16% +32%
ROM +20% -4%
3,000
34% FBG -15% +33%
26% 27%
FBG (foundry business group)
10% 7%
7%
0
2020Q2 2021Q1 2021Q2
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Agenda

Welcome C.Y. Lu 2021Q2 Financial Results Paul Yeh Business Update C.Y. Lu Remarks and Q&A C.Y. Lu

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Business update - ROM

 ROM business

• 2Q21 density shipments surged 32% Q/Q, despite the typical season low

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500
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Density shipment index: 2017Q1 =100 421
314
285
276
269
250 214 224 217
189 198
165
153
136
121
100
81
77
45
0
17Q1 Q2 Q3 Q4 18Q1 Q2 Q3 Q4 19Q1 Q2 Q3 Q4 20Q1 Q2 Q3 Q4 21Q1 Q2
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Business update - NOR

 NOR business

• 2Q21 density shipments continued to remain record high

• 55nm represented 50% of density shipment in 2021Q2

• Enhancement version for 55nm NOR has been sampled with an additional 16% output

• ASP hikes are expected due to strong demand

200

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Density shipment index: 2017Q1 =100 ≧75 nm 165
55 nm
155
132
123 124 121
118
113
109 107
100 [106]
100 94
89
84
80
79 78
0
17Q1 Q2 Q3 Q4 18Q1 Q2 Q3 Q4 19Q1 Q2 Q3 Q4 20Q1 Q2 Q3 Q4 21Q1 Q2
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Business update – NOR breakdown (Parent Company)

 NOR business

• High-density NOR, the key growth driver

NTD %

NOR breakdown b densit y y

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14%
22%
31%
36% 35%
40%
High
49%
45%
40%
38% 39% 34% Mid
(32Mb~128Mb)
37%
33%
29%
26% 26% 26%
Low
2017 2018 2019 2020 2021Q1 2021Q2
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Business update – high density NOR (Parent Company)

 High density NOR business

• Robust demands driven by Server, Data Center, 5G, and Automotive

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Density shipment index: 2018Q1 =100
397
400
327
283 283
257
256
207
201
200
169
149
137
127 126
100
0
18Q1 Q2 Q3 Q4 19Q1 Q2 Q3 Q4 20Q1 Q2 Q3 Q4 21Q1 Q2
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Business update NOR – Well Positioned in IMA and Auto Spaces

2021Q1 NOR revenue breakdown 2021Q2 NOR revenue breakdown

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Consumer,
Comm,
17%
28%
Computer, Auto,
26% I.M.A., 13%
16%
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Consumer, Comm,
17% 27%
Computer,
Auto,
28% I.M.A.,
13%
15%
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*** Comm:** including handsets

• I (Industrial), M (Medical), A (Aerospace-defense)

2021Q2 NOR revenue comparison

Computer +24% QoQ +57% YoY

Consumer Communication Automotive I.M.A +14% QoQ +12% QoQ +14% QoQ +11% QoQ +77% YoY -5% YoY +51% YoY +40% YoY

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Business update – SLC NAND (Parent Company)

 SLC NAND business

• 19nm represented 47% of density shipment in 2021Q2

• Strong demands mainly on STB, TV, Server, and Surveillance

Density shipment index: 2019Q1 =100 ≧36 nm 19 nm

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209
200 185 174
157 158
131 128
100 [111 ] 101
100
0
19Q1 Q2 Q3 Q4 20Q1 Q2 Q3 Q4 21Q1 Q2
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Capex Plan

• Capex plan & technology migration

• NTD 41.5B investment for Fab5(12”) for capacity expansion for new 3D

NAND and advanced NOR

• Advanced NOR will lead paradigm shift to more high density and high quality, driven by more advanced applications

• Increasing to maximum capacity

• Disciplined Capex plans will be implemented in multiple phases based on new technology and new products availability

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Agenda

Welcome 2021Q2 Financial Results Business Update Remarks and Q&A

C.Y. Lu Paul Yeh C.Y. Lu C.Y. Lu

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Copyright © Macronix International Co., Ltd. 20
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For more information regarding Macronix http://www.macronix.com

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For all inquiries, suggestions and comments ir@mxic.com.tw