Digital Bytes into BoardLevel Power Market

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Digital Bytes into Board-Level Power Market

• Telecosm 2005 The Singularity is Here
• Steve Goldman,
• CEO Chairman, Power-One, Inc.

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Communications Infrastructure is Powered by Our
Power Conversion Products
DC/DC Power
Recently Announced Digital
Power Management Controls Power on Printed
Circuit Board
AC/DC Power Powers Telecom, Networking
Industrial Equipment Controls Power at the
System Cabinet
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Power-One Today

• Strong Balance Sheet (80M in cash- no debt)
• Revenues of 280M in 2004
• Started Investment in Digital Power in 2001

• Profitability in Q305 is On Track
• AC/DC front-end Business is Strong
• Successfully Penetrated The Storage Market
• Telecom System Business Gaining Strength
• Several New Networks Being Rolled Out, Wi-FI
  Max..
• Z-one Digital Power Management Is Gaining
  Momentum
• Z-alliance Advancing, In Active Negotiations With
  Additional Partners
• CD Technology (worlds 3rd largest DC/DC
  supplier)
• Atmel (world-class semiconductor company)

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A Digital Power Revolution
Changing the Shape of Power
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Quick, Whats the Acronym DVD Stand for?

• Of course Digital Versatile Disc, but we knew
  that, right?
• And just like the world of analog VHS changed
  dramatically to DVD, the power world is starting
  to feel the effects of the digital revolution.
• Who today has an analog cell phone? Yet just a
  few years ago, they were ALL analog. Now, digital
  phones connect with the internet, take pictures,
  etc. all functions that digital technology makes
  possible at very low cost .
• So Do we really think power will be different
  than every other kind of electronics HDTV,
  digital cameras, TIVO, music, or entertainment?
• And just like the examples mentioned, the
  functionality is incredibly expanded at a lower
  cost than thought possible.
• So where will the industry go. For new designs,
  when the cost is less, for greater functionality
  will they be digital or analog?

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Why this digital revolution in power you ask?
Well, if you lived in California (or almost any
city)
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You know that for the real estate market, its
all aboutLocation, Location, Location

• For the electronics market its now all about
• Cost, Cost, Cost

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As Technology Matures Everything Revolves Around
Cost!

• TTM (time to market) cost
• Board space cost
• Component cost
• Production cost
• Test cost
• RD cost
• Increased Functionality At Lower Cost Digital Is
  Less Costly Than Analog For Medium To Complex
  Systems!

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RD Costs An Example

• With digital technology, engineers can design
  power module applications in
• 10 of the time with 90 fewer components with
  the Z-One digital power system, versus
  traditional analog
• Add that digital can save approximately 50 of
  PCB real estate and changes are easy to make
  (programmable)
• Board-level analog solutions become increasingly
  more difficult costly with increasing power
  management requirements, such as lower voltages,
  turn on/off sequencing, monitoring, measuring
  controlling
• Digital power management and conversion can save
  significant costs for mid/high-level systems

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Less Engineers More Work

• What makes digital power even more practical is
  that there are fewer analog and power engineers.
  Engineering schools today emphasize digital
  subjects.
• With digital power, even non-power design
  engineers can set up and configure their system
  relatively easy GUI interfaces and programming
  make it easy and cost-effective.
• Customers system engineers can now handle more
  workload with fewer, but more efficient engineers

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Analog or
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Digital You Choose
A Digital Power Revolution
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Customers Benefit With Lower Costs

• Customers, too, are quickly discovering the cost
  and system benefits of digital power
• They can design AND emulate their systems without
  costly and time-consuming re-engineering,
  re-layout and re-testing of PCBs,
• With a truly digital power system, if changes are
  needed, the real-time monitoring of all voltages,
  currents, and even temperatures, offers total
  control of the power delivery to the system
• Digital power is an elegantly simple solution for
  many medium to complex systems..added
  functionality at a lower cost

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Why Are We Even Discussing Digital
Power?Customers Want MORE!

• Power Management
• Fault Management
• Thermal Management
• Optimization
• Measure/Control

Higher Currents
More/Lower Voltages
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Digital Versus Analog (Board-Level Products)
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We Are NOT Saying Analog Is Dead

• Many applications exist and will continue to
  exist for analog devices, for example
• Consumer
• Automotive
• Hand-held products
• Battery chargers
• Linear/switching regulators
• Single voltage applications
• Low-level power management

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Detailed Functionality Comparison (BLP)
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Analog Gloomy Reality of a System Designers
Life

• No complete power system solutions
• Multiple 3rd-party components are required to
  design a system
• Separate Components Required for Power
  Conversion, Management, Monitoring, Protection,
  etc.
• Proliferation of DC/DC converters due to high
  number of voltages on system circuit boards
• Number of components in a power system has
  increased significantly
• PCB real estate occupied by power conversion and
  management
• System reliability
• Off-The-Shelf converters need to be tailored to
  system needs
• Overall cost increases with each function needed
  for analog power management

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Digital Bright Future of a System Designers
Life!

• K.I.S.S. with digital
• Analog is hard-wired, Digital is soft-wired
• Easily portable to other designs easily
  changed
• Only 2 unique parts required to build a complete
  board-level system
• Reduced board space and system cost
• Can eliminate ALL external components
• Improved system performance
• Fine-tune parameters to optimize performance of
  semis and system
• Increased reliability of end equipment
• Fewer components (both on converter and on PCB)
• Early fault detection, adaptive protection
  schemes
• Reduced design and troubleshooting time
• No hardware changes to redesign or tweak the
  entire power system
• Increased functionality Virtually any and all
  power management features at same cost

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Digital Power Management Capabilities ... from
A to Z for Board-level Solutions

• Simple power management requirements can use the
  No-bus Z with pin-strapping, where most
  functions are included at no additional cost
• More complex power management functions can use
  the fully-featured Z-One digital power system
  that has been in production for over a year.
• And many customers want inter-POL communications,
  which we already provide and there are even
  more enhancements coming.

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Choices in Cost and Functions
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Conclusion Innovation Cant Be
Stopped..Digital Will Byte Into The Power
Market

• Power-Ones diZruptive technology helped start
  the change and we have licensed products to our
  Z-Alliance partners. Others are joining the world
  of digital power.
• From the Gilder Technology Report in September,
  2005
• Power-One understood the trend early on and has
  become the first power-supply company to take
  full advantage of the Moores law advances to
  develop what today remains the only complete
  digital power system, including both the control
  and management functions.
• the competition, which amid brash dismissals of
  the technology, is engaged in a panicky drive to
  duplicate it.
• The question is not whether Moores law advances
  will accelerate digital power into a revolution,
  but when crucial in light of the headwinds now
  resisting Z-OnePower-One is already there to
  meet it. You should be there with them.

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Thank You!
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Disclaimer Forward Looking Statements
This presentation includes forward-looking
statements within the meaning of the Safe Harbor
provisions of the Private Securities Litigation
Reform Act of 1995 that can be identified by the
use of forward-looking words such as will or
estimate or comparable words. These statements
are subject to a number of factors, risks and
uncertainties that could cause actual results to
differ materially from those projected. Risks
and uncertainties include, but are not
necessarily limited to the Companys success in
securing customer acceptance and adoption of the
Companys products and technologies the size and
pace of growth and improvement in target and
potential markets the Companys success in
establishing and maintaining adequate and
qualified manufacturing sources for supply of
products constraints and limitations in the
supply chain(s) for critical components contained
in Company products the Companys ability to
achieve and sustain gross margins at levels
anticipated and noted as comparable to
silicon-based companies the Companys ability
to continue spending at prior or desired levels
for research and development related to the
products and technologies discussed in this
presentation competitor advances and successes
in comparable, alternative or competing
technologies the Companys success in securing
protection for intellectual property incorporated
into the Companys products and/or enforcing such
intellectual property against use of same by
competitors intellectual property claims or
rights of third parties which are unknown to the
Company, and/or which are asserted in the future
against the Company. In addition, we refer you
to the Companys most recent SEC financial
filings, to include the Companys report on Form
10-K filed with the SEC on March 18, 2005, and
report on Form 10-Q filed with the SEC on August
11, 2005.