The Mega Trend of Embedded Computing · The World/EMEA Market for Embedded Boards & Modules (IMS Research, 2010) 68% Top 1 Single Board Computers Worldwide Market Size: US $ 1664M

The Mega Trend ofEmbedded Computing

Howard Lin

Managing Director

November 9th , 2010

Advantech Business and Strategy Update

Market Insight

The Mega Trends in IT and Automation Industry

Embedded Technology Trends & Solutions

Advantech Embedded Core Service

Advantech Design & Manufacture Services

Agenda

Fact Sheet

Leading Industrial Computing Platform & Services Company Worldwide

Established in: May 1983

Public Listed in: December 1999

Bloomberg Ticker : 2395 TT MSCI composite

Market Cap : US$ 1,111M

CEO: K.C. Liu

Worldwide Employees: 4,056 ( 1,306 in Taiwan)

Worldwide PresenceTruly Global & Truly Local – in 18 countries and 39 cities

RMA center for Europe / Russia

0

100

200

300

400

500

600

700

800

900

1000

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

282

334373

452 482523

444

Year

Reven

ue in

mil

lion

s,

US

D

1Billion

636

763

915

2013

$1 Billion MilestoneAdvantech@30

Advantech is market leader

• Worldwide : 17% (USD $1914.5M)

• EMEA : 11% (USD $ 866M)

• China : 49.3% (USD $ 692.7M)

• America : 22% (USD $ 412.1M)

Rackmount IPC

37.1%EMEA Market Size: USD $694M

Embedded Box IPC

8.9%EMEA Market Size: USD $ 172M

IPC Market Share (IMS Research, 2009)

The World/EMEA Market for Embedded Boards & Modules

(IMS Research, 2010)

68%

Top 1

Single Board Computers

Worldwide

Market Size: US $ 1664M

Standalone Board: ATX, MicroATX, Mini-ITX, Nano-ITX,EPIC, Pico-ITX, EBX, 3.5”/5.25” SBC

68%

Top 1

Single Board Computers

EMEA

Market Size: US $ 582 M

12%

Top 2

Standalone Boards

Worldwide

Market Size: US $ 290M

16%

Top 2

Computer On Modules

EMEA

Market Size: US $ 137 M

1950

Computer

1965

Mainframe

1980

Personal Computer

1995

Internet &

WWW

2010

IOT & Cloud

Computing

The 15-year PC Cycle

Source: IBM Louis V. Gerstner, Jr.

The Mega Trends in Technology

Cloud Computing

Internet of Things

Smart Planet

The Convergence of 3 “I”

• SOC, Embedded Computing

• RFID, MEMS, WSN

• Intelligent S/W

Instrumented

• 2 billon mobile user，2.5 billion

Internet Users, 15 billion Connected Device

• Wireless: Wi-Fi, Wi-Max, 3G, LTE

• IPV6, M2M

Interconnected

• Cloud Computing

• Super Computer

• Artificial Intelligence

• Innovation

Intelligent

Smarter

TransportationSmarter Grid

A New Intelligence for a Smarter Planet

Source: IBM

Smarter

Supply ChainSmarter

Cities

Smarter

HealthcareSmarter

Food

Smarter

Oilfields

Smarter

Retail

Smarter Water

Management

Smarter

ManufacturingSmarter

Weather

Smarter

Regional

Development

A Winning Strategic Ecosystem Alliance

Embedded Technology Trends

Compact

Low Power

Wireless

Extended Temperature

Security

COM-Ultra

2.76” x 2.76”

4 – 6 Watts

Microsoft

Distribution

,

Design & Manufacturing Services

Board

Design

System

Design

Thermal

Design

SW/FW

Design

EMI Test

Vibration Test

Temperature & Humidity Test

ESD Test

Thermal chamber with without

air flow

Safety Test

Conducted Tester

Design Testing Lab

Design & Manufacturing Services

QE & DTER&DQC

IQC IPQC FQCCustomer AE & RMA

•NPI period

•ECOP/ECOM

•PN approval

•Testing period

•Verification

•Certification

•MTBF prediction

•Bug report

•Incoming material

inspection

•Material quality control

•In process quality

inspection

•RWK quality control

•Finished goods inspection

•Production quality control

•Quality information

•Feedback

•Questionnaire

•PR/QDR

•Service period & policies

•Quality issue handling

•Customer feedback handling

•DOA & RMA rate/trend analytics

•Top return product analytics

DQA MQA CQA

Closed Loop QA Process

Design & Manufacturing Services

Product Development Revenue & Expenditures

Time to Profit

Break-even

Point

Cash

Flow

+

-

Proposal Plan Testing Production MP Life Cycle

Total Cost

+ + + +Market

Survey Cost

Proposal

Design

Prototyping

Validation

R & D

Purchasing

Production

Quality

Production

Order

Distribution

Pricing

Selling

Feedback-

Handling

RMA

After Services

Advantech Supports Customers to Improve Profitability thru

Streamlined Design-In Services

Enabling an Intelligent Planet with

Embedded Design-In Services