Advancing Technology
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17075 Thornmint Court San Diego, CA 92127 United States Tel +1.858.385.7300 Cymer, Fax +1.858.385.7100 www.cymer.com Inc.: Advancing Technology This is a Greener Annual Report. Cymer is committed to reducing its impact on the environment. By producing our report this way, we lessened the impact on the environment in the following ways: Realized Savings: Advancing Technology 2 TREES PRESERVED 5 LBS. WATERBORNE FOR THE FUTURE WASTE NOT CREATED 86 LBS. SOLID 170 LBS. WASTE NOT GENERATED GREENHOUSE GASES PREVENTED 2008 781 GAL. WASTEWATER 1,301,562 BTUS OF FLOW SAVED ENERGY NOT CONSUMED Annual Environmental impact estimates for savings pertaining to the use of post consumer recycled fiber share the same common refer- ence data as the Environmental Defense Fund paper calculator, Report which is based on research done by the Paper Task Force, a peer-reviewed study of the lifecycle environmental impacts of paper production and disposal. 2008 Annual Report 491765.Merrill.Cov.cs3.indd 1 3/30/3/30/0909 4:43:44 PM Offices To Our Shareholders, Headquarters Cymer, Inc. Significant Advancement in EUV: Commercializing the 17075 Thornmint Court San Diego, CA 92127 DUV and EUV Light Source Next Generation of Light United States Tel: +1.858.385.7300 Leadership Source Technology Fax: +1.858.385.7100 2008 was a pivotal year for Cymer—a year that we are Scalable light source, wavelength and power are nec- www.cymer.com proud of. Even as the unprecedented economic slow- essary for the future of semiconductor manufacturing. Cymer B.V. European Headquarters down continued to unfold, we made significant progress Cymer’s laser produced plasma EUV source develop- Planetenbaan 16-BG ment and innovation places us in a strong competitive 3606 AK Maarssen advancing our global light source leadership position. The Netherlands position. During 2008 we made significant progress, Tel: +31.346.58.2000 In partnership with scanner manufacturers and chip- Fax: +31.346.58.2002 achieving new energy and duration milestones. We [email protected] makers, the talented team at Cymer further strength- produced one mega-joule of EUV energy over 24 Cymer Japan, Inc. ened our market position on multiple fronts. We believe hours, while keeping the reflective collector clean of Cosmos Motoyawata Bldg. the XLR was established as the semiconductor indus- 4-17-8, Minamiyawata debris—a critical step toward delivering a commercial Ichikawa-shi try’s advanced immersion light source of choice. product. As part of our multi-year multi-unit agreement Chiba 272-0023 Japan Tel: +81.47.393.5668 Cymer achieved breakthrough energy and duration with ASML, Cymer plans to ship the world’s first pro- Fax: +81.47.393.5672 [email protected] milestones in EUV. Chipmaker customers increased duction-ready EUV sources during 2009. Directors Officers Additional Robert P. Akins Robert P. Akins Cymer Korea, Inc. Information throughput and lowered cost of operations with our Chairman and Chairman and Eoyeon-Hansan Independent Registered Installed Base Products: Chief Executive Officer, Chief Executive Officer Industrial Park Public Accounting Firm Installed Base Products led by OnPulse. Cymer, Inc. Supporting Customer Needs 833-1 Hansan-Ri, KPMG LLP Edward J. Brown, Jr. CheongBook-Myeon San Diego, CA President and Our Installed Base Products help customers maximize Pyungtaek, KyungKi-Do Charles J. Abbe XLR: A Superior Light Former President and Chief Operating Officer Korea 451-833 Counsel light source productivity and reduce their cost of opera- Chief Operating Officer, Source Tel: +82.31.680.1500 Cooley Godward Kronish LLP JDS Uniphase Corporation Paul B. Bowman tions during these financially challenging times. In sup- Fax: +82.31.680.1510 San Diego, CA The XL series of products have quickly become the Interim Chief Financial Officer, [email protected] Edward H. Braun Treasurer, Secretary and VP of port of chipmakers’ need to reduce system downtime Transfer Agent industry standard for advanced immersion and dry Chairman, Investor Relations Cymer Semiconductor and Registrar and lower cost of operations, we introduced in 2008 Veeco Instruments, Inc. applications. The XLR 500i has been selected by Equipment (Shanghai) American Stock Transfer Richard L. Sandstrom, long-life modules and tool enhancements. Our second- Co., Ltd. and Trust Company Michael R. Gaulke Ph.D. leading chipmakers in all three sectors for applications King Tower 806 59 Maiden Lane Chairman and Senior Vice President and generation Gas Lifetime eXtension (GLX2) control sys- No. 28, Xinjinqiao Rd. New York, NY 10038 Chief Executive Officer, Chief Technical Advisor at 45 nm and beyond. The XLR 600i, our second- Pudong, Shanghai 201206 Tel: +1.800.937.5449 tem allows chipmakers in high-utilization fabs to achieve Exponent, Inc. China generation XLR series product and the industry’s first William Partlo, Ph.D. a positive return on their investment. Chipmakers contin- Tel: +86.21.5032.6300 Direct Inquiries to: William G. Oldham, Ph.D. Senior Vice President and Fax: +86.21.5032.6301 Cymer Investor Relations 90 watt light source to support double patterning at Department of Chief Technical Officer ued to realize the value of our OnPulse approach to light [email protected] Tel: +1.858.385.6096 Electrical Engineering 32 nm and beyond, began shipping in the second +1.858.385.6097 source productivity and we now have approximately and Computer Science, Rae Ann Werner Cymer Singapore Pte., Ltd. Fax: +1.858.385.6090 University of California, Berkeley Vice President, half of 2008. In September, we introduced the XLR 51 Goldhill Plaza Email: [email protected] 1000 light sources under OnPulse agreements. Our Corporate Controller #10-01 500d, an ArF light source for 32 nm dry lithography. In and Chief Accounting Officer Tactical Operations’ remote system monitoring capability Singapore, 308900 Peter J. Simone Consultant February 2009, we announced the newest addition to provides customers with value-added pre-emptive sup- Tel: +65.6259.9792 Fax: +65.6259.9036 our XLR products—the XLR 600ix—a 90 watt capa- [email protected] Young K. Sohn port capability. When chipmaker manufacturing utiliza- Chief Executive Officer, Inphi Corporation ble light source that can operate at any output power tion levels begin to increase, our Installed Base Products Cymer Southeast Asia, Ltd. from 60 watts to 90 watts selected by the scanner or revenue should respond accordingly and be a leading 3F, No. 49, Lane 2 Kuang-Fu Road, Sec. 2 Jon D. Tompkins Former Chairman, Hsin-Chu, Taiwan, R.O.C. tool operator. The differentiated performance of the external indicator of chip factory stabilization KLA-Tencor Corporation Tel: +886.3.573.9960 XLR coupled with our global field service and remote and recovery. Fax: +886.3.573.9961 [email protected] tool monitoring capability has contributed to a strong rate of customer adoption. Designed by Curran & Connors, Inc. / www.curran-connors.com 491765.Merrill.Cov.cs3.indd 2 3/30/3/30/0909 4:43:48 PM Financial Results installed base of tools, and we will complement these During 2008, we shipped a total of 100 light sources objectives with lean and efficient business operations including 48 XLRs for advanced chip making applica- to maintain the strength of Cymer’s balance sheet. tions. Reduced consumer spending negatively We feel Cymer is well positioned for the future with affected demand for consumer electronics, which in our strong DUV and EUV portfolio and our Installed turn reduced demand for semiconductor manufactur- Base Products. We are in a leadership position with ing equipment. As capital spending on semiconductor our newly introduced XLR 600ix, and we have taken manufacturing equipment fell 31 percent year-over- action to align our cost structure with changing busi- year, Cymer’s full year revenue of $459 million was ness conditions. By excelling at these endeavors, our down 12 percent versus 2007. Strong adoption of our company will be well positioned to realize the benefits XL series of products drove our average selling price when worldwide economic conditions improve and higher to $1.6 million in 2008. An approximate 10 per- the semiconductor industry recovers. cent growth in our Installed Base Products helped off- We look forward to the opportunities and challenges set the decline in lithography light source demand. that 2009 will bring. With the support of our employ- Through increased operational efficiency and XL plat- ees, customers and shareholders, we are confident form reliability improvements, we achieved a gross that Cymer will continue to advance our technology margin of 47.3 percent for 2008. We are focused on and market leadership. tightly managing our cash position through reductions in spending, inventory and capital purchases. Our bal- ance sheet, now debt-free with the repayment of our convertible notes in February 2009, remains strong and we believe that our financial position will help us navigate through the current business environment. Robert P. Akins Chairman & CEO 2009: A Year of Opportunity and Challenge Visibility into 2009 is extremely limited. We expect that the total available light source market will be consider- ably lower, with demand for ArF immersion light sources to be driven by the Logic sector. Edward J. Brown We are focusing on new and innovative ways to lower President & COO the cost of ownership and increase the efficiency of our customers’ Cymer, XLR, OnPulse, Gas Lifetime eXtension and all other Cymer product or service names used herein are either registered trademarks or trademarks of Cymer, Inc. Other marks mentioned herein if any are the property of their respective holders. 491765.Merrill.Narative.cs3.indd 1 3/26/09 11:20:42 PM 2008 Financial Highlights Total Revenue Average Selling Price ( in millions U.S. $ ) ( in thousands U.S. $ ) $418 $384 $544 $522 $459 $827 $982 $1,004 $1,260 $1,575 600 2,000 500 1,500 400 300 1,000 200 500 100 0 0 ’04 ’05 ’06 ’07 ’08 ’04 ’05 ’06 ’07 ’08 Gross Margin Operating Margin ( percentage ) ( percentage ) 41.76% 40.76% 48.29% 50.11% 47.30% 14.59% 10.60% 21.90% 21.94% 13.09% 60 25 50 20 40 15 30 10 20 10 5 0 0 ’04 ’05 ’06 ’07 ’08 ’04 ’05 ’06 ’07 ’08 Net Income Diluted Earnings per Share (in millions U.S.