Silicon for Mobile Information

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Silicon for Mobile Information
Silicon Motion Technology Corporation

• Investor Presentation
• July 29, 2005

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Safe Harbor Statement

• This presentation does not constitute or form
  part of any offer for sale or subscription of or
  solicitation or invitation of any offer to buy or
  subscribe for any securities, nor shall it or any
  part of it form the basis of or be relied on in
  connection with any contract or commitment
  whatsoever. Specifically, this presentation does
  not constitute a prospectus within the meaning
  of the Securities Act of 1933, as amended.
• This presentation contains forward-looking
  statements within the meaning of Section 27A of
  the Securities Act of 1933, as amended, and
  Section 21E of the Securities Exchange Act of
  1934, as amended. These statements include
  descriptions regarding the intent, belief or
  current expectations of the Company or its
  officers with respect to the consolidated results
  of operations and financial condition of the
  Company. These statements can be recognized by
  the use of words such as expects, plans,
  will, estimates, projects, or words of
  similar meaning. Such forward-looking statements
  are not guarantees of future performance and
  involve risks and uncertainties, and actual
  results may differ from those in the
  forward-looking statements as a result of various
  factors and assumptions. The Company does not
  undertake to revise forward-looking statements to
  reflect future events or circumstances.

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Agenda
Our Company
Our Strategy
Our Financials
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Investment Highlights

• Provider of universally compatible, high
  performance, low power portable digital media
  devices
• A leader in the NAND flash controller market
• Highly defensible technology backed by patent
  protection
• Strategically located to the Asia-based
  electronics supply chain
• US-styled gross margins and Asian operating
  expenses

One of a Kind Company with Ability to Deliver
Superior Performance
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Our Company
Our Strategy
Our Financials
6
Our Company
Mission
Overview
Silicon Motion is a leading fabless semiconductor
company that provides universally compatible,
high-performance, low-power semiconductor
solutions for the multimedia consumer electronics
markets
Key milestones
Financial highlights

• Launched CF controllers (1st in Asia)

• First million CF controllers shipped in 2-years

2004 1H05 Net Sales (USm) 68.9 33.9 Gross
margin 41 45 Operating margin 18 20 Net
margin 12 20

• 1M CF controllers shipped

• Launched MMC and SD controllers with 1M of each
  shipped

• Launched USB 2.0 controllers with
• 7M USB 2.0 controllers shipped
• 7M MMC controllers shipped
• 20M SD controllers shipped

• Wallace Kou, CEO, elected a Director of MMCA and
  the Chairman of MMCA Compliance committee
• Launched MP3 player controllers
• NASDAQ IPO on June 30, 2005

2005
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Our Team
Name Position Experience
Wallace Kou

• Western Digital, VP and Chief Architect of
  Multimedia Products
• 20-years industry experience
• M.S. in Electrical Computer Engineering, UCSB
• B.S. in Electrical Control Engineering, NCTU

President CEO

• Experienced CFO of a US-listed semiconductor
  company
• Research Analyst, Lehman Brothers Morgan
  Stanley
• MBA, Cornell University
• B.S. in Computer Science, MIT

Richard Wei
CFO

• Robust RD team of 110 engineers
• 93 engineers with Masters degrees or PhDs
• Engineering managers avg. gt10 yrs experience

• The Team
• Experienced senior management team
• 15 VPs and directors avg. 15 yrs experience
• Extensive international work experience

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Our Products and End Markets
Product Mix 2004
Wide-Ranging End Markets
Our Controllers and Processors
Flash memory controllers
Compact Flash (CF)
Multimedia Card (MMC)
Secure Digital (SD)
xD-Picture
Universal Serial Bus (USB) 2.0 controllers
Product Mix 1H05
USB 2.0 Flash Disk (UFD)
Card reader
Portable audio SoCs
MP3 Controller
Multimedia display processors
Graphics
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A Driver of Growth in Our End-Markets Digital
Cameras
No. of Digital Photo Exposures
Digital Camera Sales
CAGR 23.3
Growth accelerated since 2004
Source IC Insights

• Larger digital camera base
• Increased picture resolution
• Improved convenience with camera phone

Driving Increased Use of Flash Memory Cards
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A Driver of Growth in Our End-markets Mobile
Phones
Camera Phones
MP3 Phones
CAGR 52.5
CAGR 64.6
Increased functionalities
Need for memory
Smartphones
3G Phones
CAGR 35.8
CAGR 52.3
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Flash Memory Card Storage Options
Secured Digital (SD)
MultiMedia Card (MMC)

• 2005-08 CAGR 65
• Fastest transfer speed - v4.0 available in x1,
  x4, x8 bit, up to 52MHz
• Capacity ranges from 8MB to 2GB
• Dual voltage support for v4.0

• 2005-08 CAGR 30
• Unique encryption feature ideal for applications
  requiring IP protection
• Capacity ranges from 4MB to 2GB
• Up to x4 bit, 50MHz
• Popular due to small size and low power

2005 Shipment
xD-Picture (xD) /SmartMedia (SM)
Compact Flash (CF)

• 2005-08 CAGR 4
• SM has large form factor and low density of up to
  128MB
• xD will replace SM
• xD v1.2 contains a controller as well as memory
• xD available with capacity of up to 1GB

• 2005-08 CAGR 1
• High capacity of up to 4GB
• x8 bit, up to 25MHz
• Single voltage
• Large form factor suitable for high resolution
  digital camera

219.1 million
Note SD includes miniSD MMC includes
RS-MMC Source IDC
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Our Role in a Flash Memory Card

• Functions
• Controls data flow between host device and NAND
  flash
• Determines read/write speed

Item
ASP
Flash memory controller
NAND Flash memory

• Functions
• Stores data

NAND Flash Memory
World-class Flash Memory Controller
Functionalities
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Our Company
Our Strategy
Our Financials
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Past and Future Growth Drivers
Mobile Graphics
Flash Controller (CF)
Flash Controller (MMC and SD)
USB 2.0 Controller
Portable Audio SoC
Image Processor and Video Codec
01
03
04
05
06 07
02
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Flash Memory Card and USB Flash Drive Controllers
Flash Memory Card Controller(1)
USB 2.0 Flash Drive Controller(1)
CAGR 39.7
CAGR 38.2
Silicon Motion Market Share
Silicon Motion Market Share
(1) Assumes 1 controller per flash memory card
Source IDC
(1) Assumes 1 controller per USB flash drive
Source IDC
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Portable Audio SoC and Embedded Graphics
Portable Audio SoC
Embedded Graphics
Portable audio player controller(1)
Embedded graphics controller(1)
CAGR 8.2
CAGR 34.8
Market participants
Market participants
(1) Includes only car navigation and handheld
computers Assumes 1 controller per unit Source
Gartner
(1) Assumes 1 controller per portable audio
player Source IDC
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Our Competitive Advantage in Flash and USB Flash
Drive Controllers
Pricing floor forcaptives
Learning curve
HIGH
Cost Structure
Necessary Learning Curve
LOW
HIGH

Emerging Asiancompetition
LOW
Pricing ceiling forAsia competitors
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Our Customer Base
2004 Customer Concentration
Multimedia SoCs
Mobile Storage Products
1H05 Customer Concentration
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Our Company
Our Strategy
Our Financials
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Our Sales Trend
2Q05 7 Sequentially 37 Year-Over-Year
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Sales By Product
Mobile Storage Products include flash card
controllers and USB 2.0 controllers. Multimedia
System-on-Chip Products include multimedia
display processors and portable audio SoCs.
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Unit Shipments
Mobile Storage Products include flash card
controllers and USB 2.0 controllers. Multimedia
System-on-Chip Products include multimedia
display processors and portable audio SoCs.
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Our Margin Trend
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Our Net Income Trend
2Q05 21 Sequentially 3,734 Year-Over-Year
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Our Balance Sheet
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Our Financial Ratios
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Investment Highlights

• Provider of universally compatible, high
  performance, low power portable digital media
  devices
• A leader in the NAND flash controller market
• Highly defensible technology backed by patent
  protection
• Strategically located to the Asia-based
  electronics supply chain
• US-styled gross margins and Asian operating
  expenses

One of a Kind Company with Ability to Deliver
Superior Performance