MKS (MKSI) Wells Fargo 8th Annual TMT Summit Conference summary

Impact of China export restrictions

• Direct revenue loss from China export rules in 2022 was $200–$250 million; new rules have minimal additional impact.

• Current shipments to Chinese OEMs are limited, with most exposure now indirect via global OEMs.

• Ongoing monitoring of potential further impacts, but current guidance remains unchanged.

Strategic positioning and growth opportunities

• Core business is foundational in Semi CapEx, with subsystems in 85% of global fab equipment.

• Early focus on advanced packaging led to Atotech acquisition, positioning for growth beyond Moore's Law.

• Integrated in 70% of steps for package substrate manufacturing, highlighting ecosystem importance.

• Packaging and PCB technology cycles are converging, driven by AI and increased complexity.

Financial performance and capital allocation

• Maintained 47% gross margin and 16% free cash flow in Q3 despite weak NAND demand.

• Over $400 million in debt prepaid in 2024, prioritizing excess cash for debt reduction.

• CapEx remains low, with a temporary increase for Malaysia factory build.