Ipg 2016 Investor Day Presentation

World Leadership in High Power Fiber Lasers
IPG Photonics Corporation

The Fiber Laser Company
(NASDAQ: IPGP)
2016 Investor Day

May 11, 2016
www.ipgphotonics.com
Welcome and Overview

Tim Mammen
Chief Financial Officer and Senior Vice President
Safe Harbor Statement
The statements in this presentation that relate to future plans, market forecasts,
events or performance are forward-looking statements. These statements involve
risks and uncertainties, including, risks associated with the strength or weakness of
the business conditions in industries and geographic markets that IPG serves,
particularly the effect of downturns in the markets IPG serves; uncertainties and
adverse changes in the general economic conditions of markets; IPG's ability to
penetrate new applications for fiber lasers and increase market share; the rate of
acceptance and penetration of IPG's products; inability to manage risks associated
with international customers and operations; foreign currency fluctuations; high levels
of fixed costs from IPG's vertical integration; the appropriateness of IPG's
manufacturing capacity for the level of demand; competitive factors, including
declining average selling prices; the effect of acquisitions and investments; inventory
write-downs; intellectual property infringement claims and litigation; interruption in
supply of key components; manufacturing risks; government regulations and trade
sanctions; and other risks identified in the Company's SEC filings. Readers are
encouraged to refer to the risk factors described in the Company's Annual Report on
Form 10-K and its periodic reports filed with the SEC, as applicable. Actual results,
events and performance may differ materially. Readers are cautioned not to rely on
the forward-looking statements, which speak only as of the date hereof. The Company
undertakes no obligation to release publicly the result of any revisions to these
forward-looking statements that may be made to reflect events or circumstances after
the date hereof or to reflect the occurrence of unanticipated events.
3
Agenda
Welcome and Overview ..Tim Mammen
Current and Future Market Opportunities. Trevor Ness

Accessories Felix Stukalin
Strategic Growth ProjectsYuri Erokhin
Medical Gregory Altshuler
TelecomMark Cannata
Manufacturing
Devices and Components.. Eugene Scherbakov
Diodes..Alex Ovtchinnikov
Break
China Trevor Ness
Financial Review.. Tim Mammen
Summary and Growth Strategy............................................................................ Valentin Gapontsev
Q&A Session
Tours and Lunch

4
IPG Overview
Global leader in industrial fiber lasers
FY 2015 sales of $901 million; YOY growth of 17%

$4.53 diluted EPS; up 20% YOY
Q1 2016 sales of $207.2 million; YOY growth of 4%

$0.99 diluted EPS; up 2% YOY excluding foreign
exchange transaction loss/gain
Growing acceptance of fiber lasers replacing traditional lasers
Products are sold to OEMs, systems integrators and end

users for use in many industries
Global operations with over 3,700 employees
5
Investment Highlights
The technology leader and most profitable

company in the rapidly growing fiber laser market
Expanding $4.8 billion opportunity for all lasers
Approximate average annual growth rate of 6%
Recognized leader in the rapidly growing fiber laser market

Estimated 12% CAGR from 2015 to 2020
Significant competitive advantages

First mover advantage
Performance, product range and reliability
Lowest cost (vertically integrated model)
Strong IP position
Vertical integration and direct sales model drives industry-leading

margins (54.6% GM in FY 2015, 55.2% GM in Q1 2016)
Broad geographies, end markets and applications

Asia & Australia 51%, Europe 33%, North & South America 15%
6
Rapidly Taking Share in Large, Existing Laser Markets
(000) 2015 - Share of Total Laser Market

$8,000
$6,751
$7,000
$6,000 Fiber, 31%
$4,800
$5,000
$4,000
$3,000 $2,600
$2,000
$1,480
$1,000
2020 - Share of Total Laser Market
$-
All Lasers Fiber Lasers All Lasers Fiber Lasers
2015 2020
Forecast
Fiber, 39%
Materials Processing Advanced Applications Medical
____________________
Source: Laser Focus World, Industrial Laser Solutions, Strategies Unlimited, Optech Consulting and IPGP estimates.
7
Materials Processing Diverse End Uses and Customers
Automotive
General Manufacturing
Heavy Industry
Oil & Gas
Shipbuilding
Nuclear
Construction
Aerospace
Shipbuilding
Semi/
Electronics
Displays
Consumer
8
Recent & New Product Introductions
Expand addressable market and enhance future growth opportunities by

addressing new application and customer specific requirements
CURRENT FUTURE
Brazing
Drilling
Marking & Welding of Alloys and Specialty
Engraving Materials
Cutting Cladding & Deposition
Welding Ablation
Fine Display & Imaging
Processing 3D-Cinema
Additive Entertainment and Projection
Manufacturing Micro-processing
Medical Devices
Bio-Medical
Sensing & LIDAR
9
Future Opportunities in Micro-processing
Semi/PC
Board/Display, $153
CO2/EUV ,
$193
Addressabl
e Market,
Solar/LED/ 36%
Other, $367 Other
Applications,
Excimer/DUV ,
64%
$719
Significant area of growth for ultra-fast pulsed lasers, and shorter

wavelength lasers at the green and ultra-violet wavelengths
10
Other Applications Provide Potential Additional Longer
Term Growth Opportunities
(US$ mm)
2015 2020
Displays & Light Shows
$192
$569
Sensors, LIDAR & Inspection
$161
$628 $1,042
$67
Mid-IR Spectroscopy
$236
R&D $108
$455
Defense $594
$372 $524
Medical
Fiber participation is relatively low in these other applications. Longer term opportunity will depend
on successful product development and market acceptance of fiber laser products.
____________________
Source: Strategies Unlimited, IPGP estimate of potentially addressable market.
11
IPGs Defensible Laser Position
Vertical
Integrated
Business
Model
Strong IP Manufacturing
Portfolio Scale
12
Leveraged Sales Model Maximizes Market Reach
Direct Sales End User
End User
OEM End User
End User
End User
Direct Sales OEM End User
End User
Factory 1
Large Manuf. Factory 2
Factory 3
Direct Sales Integrator End User
Representatives End User
Three Distribution Channels

OEMs/Integrators Direct Sales Representatives
13
Current and Future Market Opportunities

Trevor Ness
Senior Vice President, World Wide Sales and Marketing
Diverse Product Lines and Market Opportunities
IR Lasers
UV Laser
Ultrafast
Visible Fiber Lasers
Systems
Accessories (Felix Stukalin)
Strategic Growth Projects (Dr. Yuri Erokhin)
Medical Applications (Dr. Greg Altshuler)
Telecom (Mark Cannata)
15
IR Lasers
IPG Laser Wavelengths, Mode of Operation and Power
Wavelength 400 nm 700 nm 1.5 mm > 5 mm
Ultra-violet Visible Near-Infra-red Mid-Infra-red
UV ~0.36 mm Blue, green, yellow , orange and red 0.45-0.73 mm Diode Ytterbium Erbium Thulium, Cr:Zn/Se/S Fe:ZnSe/S
~0.98 mm ~1.07 mm ~1.5 mm Holmium 1.8-3.4 mm
3.4 -5.2 mm
~2 mm
Mode of Operation
CW: the laser is ON all the time
Any wavelength, any
Quasi-CW: the laser is modulated in ms to ms range
pulse duration, any
Pulsed: the laser is switched on for 10-9 s
average power:
Ultrafast: the laser is switched on for 10-12 t0 10-15 s
ANY APPLICATION
Laser Power
IPG manufactures lasers with average

power ranging from a few Watts to
hundreds of kW (virtually unlimited)
17
IR Lasers Overview
Overview:
IR fiber lasers are the laser of choice in
materials processing applications
Strategy:
IPG fiber lasers have the broadest product
range, the highest performance and
reliability, the lowest cost of ownership and
offer unmatched integration capabilities
Margin Profile:
Vertical integration and direct sales model
drives industry-leading margins
Growth Targets:
Fiber lasers forecast to outpace laser market
growth, with CAGR of 15% though 2019
Source: Optech Consulting and IPGP estimates. 18
Materials Processing Laser Market
Opportunity for Continued Fiber Laser

(US$ mm)
Market Share Gain is Significant
IPGs Core Existing Applications New Applications
$1,867
$1,453
$1,323
$718
$644 $662
$569 $520
$385 $431
$352 $333
$278
$219 $183
$144
2015 2020 2015 2020 2015 2020 2015 2020

High Power Marking Fine Processing Micro Processing
(Excludes lithography)
All Lasers Fiber Lasers
____________________
Source: Laser Focus World, Industrial Laser Solutions, Strategies Unlimited, Optech Consulting and IPGP estimates.
19
Fiber Laser Penetration of High Power Applications
$1,400 80%
$1,200 70%
$364 Welding
60% Opportunity -
$1,000
potentially
50%
$800 much more
40% significant
$591
$600
30%
$967 $180
$400
20%
$219
$200 $462
$356 10%
$182
$- 0%
2015 2020 2015 2020
(US$ mm)
Cutting Welding & Other High Power
Fiber Lasers All Other Lasers Fiber Market Share
Cutting Applications Welding Applications
Flat Sheet
7%
3% 16% Power Train 9%
Cutting
Tube Welding
Tube Cutting 27%
Car Body Scanner 17%
Welding
3D Cutting 81% Car Body Seam Welding 40%
/ Brazing
Other
20
IR Laser Applications
Cutting Welding Brazing Drilling
Cladding Additive Manufacturing Marking Surface Treatment
21
High Power Cutting
Market estimated at 7,500 systems per year.

Underlying growth rate est. at 5-7% per annum
- World leader with commanding market Cutting Applications

position with room to grow
Flat Sheet
Cutting 3% 16%
- Total market size expanding; ease of use,
Tube Cutting
lower cost, higher power trends
3D Cutting 81%
- Fiber penetration estimated at 35% in Y15
with potential to grow to 80% by Y2020
Source: Strategies Unlimited & IPGP estimate
22
High Power Cutting
Approximately 30 major OEMs
Y15 High Power Laser Cutting Total market size of kW scale

machines approximately 7,500
units, forecast to grow at CAGR
of 5-7% through 2020; over
10,000 machines
35.2%
55.6%
Fiber forecast to grow to 80%
market share by 2020, remainder
9.2% CO2 & Disk
Fiber Disk/OtherFiber CO2

Estimate 60-70% IPG share of
industry sales achievable by 2020
Some fiber opportunity not
available to IPG due to OEM
Source: IPGP estimate
own laser/competition
23
High Power Welding
Remote Welding Seam Welding Braizing (aesthetic,

roofs, trunks)
Spot Welding Laser Seam Stepper Fine Welding
24
Introduction Laser Welding Market
Welding Market USD - Laser Sources
600,000,000
500,000,000 CAGR
7%
400,000,000
300,000,000
200,000,000
100,000,000
0
2015 2019 Global HP Laser Welding Market - Analysis
by units (excl. Surface Treatment)
3,000
2,500
2,000
1,500
1,000
500
Source: Optech Consulting, Sep. 2015;
Strategies Unlimited Mar. 2016; IPG estimates 0
2015 2019
25
Transitions in Welding Medium and Long Term
CURRENT FUTURE
Limited Materials Diverse Materials Diverse Industries Diverse Products
Aircraft
Automotive Autos
High Strength Aerospace Bridges
Steel Construction
Buildings
Aluminum Heavy
Niche Welding Pipelines
Titanium Equipment
Applications Rails
Alloys Railways
Railcars
Thick Shipbuilding
Materials Ships
Transportation
& Storage Storage Tanks
Trucks
In many instances strength of the laser weld > welded material
Decreasing cost of laser welding, new laser welding technologies, know-how,

software & algorithms
26
High Power CW Welding
TAM Expecting to grow to 2,200 units by Y19

(conservative estimate)
Estimated CAGR of 6-7%, expected to outpace market
growth for 2016 ~10-15%
Welding covers a wide industry cross section that
encompasses aerospace, construction, consumer
appliances, furniture, heavy industry and automotive
2015
Opportunities include CO2 displacement, new braising
technologies, new remote welding solutions,
penetration of new industries and flagship customers
38.5%
IPG has strong traction within
automotive segment. Auto 61.5%
Over 850 HP lasers installed in Welding -
welding applications with other
automotive end users globally.
Source: Strategies Unlimited, Optech Consulting and IPGP estimates.
27
New High Power Scanning (Remote Welding)
2D currently undergoing testing, prototypes to
apps labs and test customers this quarter
3D alpha testing expected in Q316,

prototypes in Q316
New IPGWeld software and the scan

controller seamlessly interfaces to IPG lasers
and scanning systems
With the addition of the application software,

IPG is able to offer a complete remote
welding solution to Integrators and OEMs
Target to capture 50% of industry sales,

incremental $45-$50M
Market size scanning ~380 lasers in

Y15, our sales <30%. Expect to grow as
we roll out an integrated total product
that we can support, at a competitive
price point.
28
New Product Introductions: High Power Scan head
Market Opportunity*
[Product Image] (US$ mm)
$140
$90
High Power Scan head

2015 2019 (E)
Description: Launch:
Scan head for high speed welding in 2D and 3D for Q2 2016
use with kW class lasers
Market Opportunity*:
Applications/Markets: $140M estimated by Y19
Automotive; body in white, seat welding, battery
welding Strategy:
Customer testing from Q2 in multiple
Advantages: geographies
Ease of use, lightweight, competitively priced, 2D &
3D IPG is able to provide complete solution laser + *Source: Optech/IPG
beam delivery + chiller + software
29
New Product Introductions: Trifocal Brazing
Market Opportunity*
(US$ mm)
$65
$34.5
2015 2019 (E)

Trifocal Brazing
Description: IPG's new YLS-5000-BR trifocal laser Launch: Launched Q2 Y15, several large
brazing allows cleaning of the base metal parts improving automotive manufacturer wins, multiple
filler material flow, resulting in reproducible brazed joint global engagements
with increased strength and better appearance Market Opportunity*:
Applications/Markets: Brazing of Electrogalvanized Market size estimated at 140 units, growing
Material, Automotive manufacturing to 380+ by Y20
Strategy: Rapid deployment globally to

Advantages: Unique three beam approach, cleaning become technology of choice for brazing
and braising. Highly reproducible brazed joint with
increased strength and better appearance Source: Optech Consulting, Sep. 2015;
Strategies Unlimited Mar. 2016; IPG estimates
30
Unique Quasi-CW Fiber Lasers
Fine welding, brittle material cutting, high power drilling

QCW has grown strongly in past 3 years to $56M in Y15
Market opportunity to displace YAG remains with 5000+
per annum still produced in China. Expect 20-30% of
market to transition to QCW
Unique technology with high peak power, has typically
displaced old YAG lasers which are large, inefficient and
unreliable
Target to grow to $100M by Y20
Medical Devices
Micro welding
Computer
Components
Deep Engraving
Drilling (aerospace)
Cutting
Spot Welding
Batteries
Seam Welding 31
Pulsed Lasers
Main market application marking & 1-100 W, 1-200 ns, up to 1 mJ

engraving across most/all industries, Low Divergence
ablation, cleaning, micro-processing High Beam Quality
Increased competition in low power

pulsed market; erosion of ASPs
IPG working in higher power
applications, sales up 20% in Q1
with good pricing/margin
New integrated marking platform
(laser + scan head + software) New 100 W to 5 kW, 100-600 ns, 10-
gaining traction 100 mJ
Opportunities in higher power High Throughput
applications growing; coatings High Pulse Energy
removal, cutting applications
Strategy Defend volume market,

expand applications and trend to
high power
32
UV Fiber Lasers
New Product Introductions: UV Fiber Lasers
Market Opportunity*
(US$ mm)
$140
$110
Low Power UV Laser
2015 2019 (E)
Description:
Laser marking module with 2-axis scanner Launch:
integrated with IPG UV laser Ready for introduction
Applications/Markets: Market Opportunity*:

UV marking for white plastics and cabling; >$110 million
electronics, aerospace
*Source: IPG Estimates
Advantages:
IPGs Complete UV Marking Module Provides
Ease-of-Integration, High Performance and
Reliability to Integrators and OEMs at a
competitive cost point
34
Ultrafast Fiber Lasers
Ultrafast Lasers
Ultrafast lasers have short pulses of pico (10-12 s) to femtosecond (10-15 s) duration,
pulse duration so short that little of no thermal damage occurs when laser interacts
with materials.
Pico and femto pulses enable
microprocessing and medical applications
Key process areas are micro cutting,
scribing, 3D micro-milling, micro hole
drilling and blind hole machining, laser lift-
off, selective material removal and ultrafine
marking
Typical industries include production of
consumer and appliances, semiconductor
industry, medical device manufacturing and
medical procedures
Leverage IPG fiber laser technology into
the $130+M ultrafast laser market segment
by developing compelling new lasers
differentiated by performance, form factor
and total cost of ownership
36
New Product Introductions: Picosecond Fiber Lasers
Market Opportunity*
(US$ mm)
$300
$190
Industrial Picosecond
IR Laser 2015 2019 (E)
Launch:
Description:
Ready for introduction
Air-cooled, rack-mountable chassis featuring
remote head produces 50 J pulses at high Market Opportunity*:
repetition rate totaling >50 Watts average power $190 million annual industrial
picosecond laser market opportunity
Applications/Markets:
Sapphire scribing (LED)/cutting (watch glass), Strategy:
high strength glass cutting (smartphone/tablet), IPG will accelerate ultrafast market
thin film ablation (display/electronics) growth by providing robust, easy to
integrate economical fiber lasers
Advantages:
*Source: Strategies Unlimited
Compact, affordable, reliable picosecond laser
37
New Product Introductions: Femtosecond Fiber Lasers
Market Opportunity*
>$1B
$620
Industrial Femtosecond
IR Laser
2015 2019 (E)
Launch:
Description: Initial units available
Air-cooled, rack-mountable chassis featuring
remote head produces 500 femtosecond pulses Market Opportunity*:
at high repetition rates totaling >10 Watts >$600 million annual industrial
average power femtosecond laser market opportunity
Applications/Markets: Strategy:
Medical (Laser Eye Surgery), Scientific, IPGs robust, affordable fiber lasers will
Ultra-precise micromachining enable femtosecond laser processing to
enter the mainstream
Advantages: *Source: Strategies Unlimited
Compact, affordable, reliable femtosecond laser
38
Visible Fiber Lasers
Green Fiber Lasers Overview
Overview:
IPG provides visible fiber lasers in many wavelengths, including red, yellow,
orange, green. These sources can be utilised in many application areas such as
materials processing, medical and entertainment. For example green wavelength
has distinct advantages for fine processing of highly reflective metals like Copper,
gold and platinum
Strategy:
Penetrate emerging micro applications and enable new applications through the
introduction of visible fiber lasers with unprecedented performance levels
Competition:
IPG Green Fiber lasers provide unprecedented levels of average power with
reasonable pulse energy in a rack-mountable industrial footprint with an elegantly
compact remote laser head
40
New Product: High-Power High Rep Rate Green Fiber Laser
Market Opportunity*
$10-20
(US$ mm)
<$1
High-Power Quasi-CW
Green Fiber Laser 2015 2019 (E)
Launch:
Description: Expected Q3 2016
Rack-mountable 500 Watt single mode laser
Market Opportunity:
providing 1.5 nano second pulses at high 150 MHz
Kilowatt-class HRR green laser creates a new
repetition rate through a compact remote head
market segment
Strategy:
Emerging applications in reflective metal welding and
IPG is partnered with leading OEMs in the
drilling, wafer and glass panel annealing
PCB, Aerospace and Semi Equip industries to
Advantages: pioneer new applications
Unprecedented level of single-mode green power
*Source: IPG Internal Data
41
New Product: Nanosecond Green Fiber Laser
Market Opportunity*
(US$ mm) $451
$263
High Pulse Energy Green

Nanosecond Fiber Laser
2015 2019 (E)
Description:
Market Opportunity*:
Rack-mountable 100 Watt nanosecond laser
$250M annual micro materials laser
providing up to 500 milliJoule pulse energy
market in Semi, PCB and Solar
through a compact remote head
Strategy:
IPG partners with leading micro materials
Solar Cell thin film ablation and wafer dicing, processing companies to pioneer new high
precision via drilling for microelectronics PCBs pulse energy green applications
Advantages:
Unique combination of throughput and precision *Source: Strategies Unlimited, 2016 Worldwide Laser Report
stemming from high pulse energy and short 1.5
nanosecond pulse width
42
Laser Systems
Adding Value Through Integration
Resonators Lasers Chillers Process Heads

Couplers, Switches &
Amplifiers and Power Delivery Fibers
Supplies
$5-40K
$10-
$20K $4-$10K
$3K
$15-$20K
$4-$10K
$50K to $1.0
million
$8-$100K
COMPLETE SYSTEMS $200k to $5 million +
INTEGRATED LASER, ACCESSORIES

AND CONTROLLER TO DRIVE
LASER, OPTICAL PROCESSING AND
ROBOT
44
Laser Systems Developing New Applications and
Opportunities
Overview:
IPG manufactures complete integrated systems for welding, cladding, cutting, drilling. The
systems are typically customised solutions i.e. 50kW laser welding cell with IPG laser,
welding head, control software for US customer welding rockets. We integrate the industrys
best lasers with IPG high precision motion systems, optics, beam switches, processing
heads and software.
Strategy:
Penetrate new applications for lasers and expand product portfolio through the development
and introduction of specialized laser-based systems to meet the specific needs of
manufacturing end users whose requirements are not met by standard systems or in certain
geographic areas where fiber laser systems are not currently available
Growth Targets:
Target to develop systems business of $200M + by 2020
45
Laser Systems Overview
New system platforms offering specific laser and beam delivery tailored to specific
applications
Small format 2D Micromachining

cutting
Tube and Profile Welding
Multi-axis pipe
welding system
Small format multi-axis Multi-axis welding,

welding, cutting & drilling cutting & drilling
Laser Seam Stepper Orbital Pipe Welding
46
Robotic Laser Processing System
High Power Automated Welding System
Laser Equipment:
YLS-50000-CT 50 KW Welding Laser
IPG FLC D50 Welding Head
LC170 Chiller
Motion System
6-Axes Robot, 10 ft reach
10 ft linear track
Rotary worktable 22 ton 8 ft dia
Tip/Tilt 2-axes positioner
Application: Welding Aerospace Components

Example. Seam welding 1 inch thick copper
47
New Product Introductions: Laser Systems
5-Axis Pipe Welding System
Description: Launch:
Multi-axis high power fiber laser pipe welding First system delivered in Q1 2016
system
Market Opportunity:
Applications/Markets: Large application area with zero
Pipelines, construction penetration by lasers today
Advantages:
High productivity vs incumbent technology
48
Macro and Micro Laser Systems Market
Macro and Micro Laser Systems

2015 - Approximately $9.6 Billion*
10%
11% 38%
Cutting
Welding & Brazing
Other High Power
10% Micro-processing Excluding DUV & EUV
Fine Cutting, Welding & Drilling
Marking
19% 9% Other Low Power
2%
*Source: Strategies Unlimited, Optech Consulting and IPG Photonics estimates
49
Accessories
Felix Stukalin
Senior Vice President, U.S. Operations
Typical Laser System Architecture
Laser System Lasers & Chillers Couplers, Switches & Cutting Heads
Delivery Fibers
CUTTING
Welding Heads
WELDING
Controller + Scan Heads Integrated Modules

MARKING
Pulsed Laser
Software
51
Strategic Rational
Significant greenfield revenue opportunity
Facilitates higher power laser sales through integrated subsystem

solution
Enables new laser material processing applications through optimized

beam delivery and process control
Captures more value from laser processing by integrating lasers, with

beam delivery, controllers, software and process monitoring
52
IPG Strategy
Product Development of Laser Process Heads

Develop product platforms for highest volume applications
Leverage expertise into more specialized and new applications
IPG Differentiators
Achieve highest quality through technological superiority
In-house high power optics and coating capability
Extensive testing with high power laser
Advanced application expertise
Offer superior performance though integration with laser source
Provide lower cost through vertical integration
53
Major IPG Opportunity for Integrated Heads
Value
Cutting and welding heads are sold at 10% of laser price
Advanced process heads are sold at 30% to 50% of laser price
Marking heads are sold at 30% of laser price
Sensors and advanced features are sold at significant premium
IPG can offer better value to IPG customers
Performance
Power of IPG fiber lasers advanced faster than process heads
Existing offering have power limitations above 20 - 30 kW for welding and
above 6 kW for cutting
IPG in-house optics technology and sealed designs solve power limitations
Sales and Service
One-stop shop from IPG for the laser, processing head and application
Enhanced opportunity for advanced applications development
Service and warranties are aligned with integrated solution
Service and support benefits from IPGs worldwide infrastructure
54
Total Available Market* Accessories Sold with IPG Lasers
Total available in 2015 ~$150M, projected 2020 ~$280M to $300M

Targeting >60% market penetration by 2020 ~$180M
IPG currently provides 100% in Switches and Process Fibers
IPG current share is less then 10% in Process Heads and Scanners
TAM 2015 2020E
TOTAL $150M $280M-$300M
Welding heads $35M $80M
Cutting heads $50M $80M
Scanning heads $30M $60M
Beam Switches $22M $45M
Process Fibers $13M $25M
*Market size estimate by IPG
55
Recent Products Introduced in 2015
IPG CUTTING HEAD WOBBLE & SEAM

TRACKING MODULE
WELDING
CUTTING
Highest power handling in the Wobble and Seam Tracking

Industry 12kW combined in one product
Ultra-stable capacitive height Unique Product
sensing Provides improved weld quality
Hermetically sealed design and better visual finish
Motorized Focus and Pierce Variety of Wobble shapes at a
Sensing options frequency of 300Hz
Power Handling of up to 12kW
MID-POWER 50kW WELDING HEAD

SCANNING SYSTEM
Optimized for welding applications
WELDING
SCANNING
of up to 50kW
Remote Scanning Hermetically sealed design
Applications Provides unmatched results in
Plug & Play with QCW or penetration depth
CW lasers
Up to 2kW laser power 35mm+ of penetration
handling depth in SST at 50kW
Calibrated Scan Field
56
New Products for 2016 Introduction
IPG HP CUTTING D30 WOBBLE & SEAM
HEAD TRACKING MODULE
WELDING
CUTTING
IPG Wobbler design is now

Highest power handling in the available in a compact and
Industry 15kW lightweight architecture
Ultra-stable capacitive height Wobble frequencies of up to
sensing 1000Hz
Hermetically sealed design Power Handling of up to 6kW
UV INTEGRATED 2D/3D REMOTE
REMOTE WELDING
MARKER WELDING
Highest power handling in
MARKING
Integrated Module
the Industry 15kW
Optimized for Marking
Hermetically sealed design
applications
Through the lens vision
Completely sealed
Plug and Play with IPG
design
Lasers
Includes Controller and
Available with IPG Controller
Software
and IPGWeld software
57
Next Level of Integration - Specialized Beam Delivery
Systems Expand Market Opportunities
Welding with Seam Seam Stepper Cladding Heads and 3D
Tracking Sub-system Cutting Heads
Specialized cladding and 3D

Welding unit with seam Integrated robotic welding unit
cutting heads for emerging
tracking capability addresses addresses large resistance
material processing applications
pipe and seam welding market spot welding market
58
Strategic Growth Projects

Dr. Yuri Erokhin
VP, Strategic Marketing
Laser Luminaire: Large Greenfield Opportunity
Industry Trend
Major cinema players upgrading image quality and overall moviegoer
experience, opportunities in other entertainment and signage markets
Transitioning projectors from Xenon Bulb to laser luminaires
Opportunity
~$200M annualized IPG revenue potential beginning to ramp in 2017
IPG Solution
Key Differentiators versus laser diode based illumination alternatives:
Improved image quality: higher brightness & contrast, lower speckle
Increased optical efficiency of next gen projector designs
Reduced overall Cost-of-Ownership
Leverages IPG existing fiber laser technologies
Successful product introduction at CinemaCon-2016 Significant interest
from leading projector makers and high-end theater operators
60
5/11/2016
Cinema Market Opportunity: Up to $2.4B Over 8-10 Years
Projected Top-Down Laser Luminaire

Market Adoption Screen TAM over
Segment
Count 8-10 years
Ultra-Premium
Laser Strength Segments

$200M-
IMAX, Dolby, etc. 2,000
3D Ultra $400M
Premium Mostly 3D
Very Large
Very Large $250M-
Screens 2D Screens 5,000
$450M
and 3D 2D and 3D
Large Screens $300M-

Primarily 2D, some Large Screens 10,000
$600M
3D capable
Fiber Lasers or
diodes
$425M-
Medium Screens, Mostly 2D Medium Screens 38,000
$950M
55,000* $1.2B to
screens $2.4B**
* Remaining 85.000 (+/-) screens WW are small size

**Revenue opportunity is exclusive of service
61
Laser Opportunities in Signage and Entertainment Markets
2015 Freightliner unveiling autonomous truck - Hoover Dam

promo event. 60 projectors with 1.17M lumen Laser Projection is rapidly gaining
traction in signage and
entertainment
High impact advertising
campaigns
Theme parks and museums
Architectural projection mapping
Concerts, other performances
Laser projectors enable lower
Creating Technology design; Barco Entertainment projection system
costs, easier field installation and
superior image quality
$50M annualized RGB Fiber Laser

http://www.barco.com Projection mapping: A map to spectacle Illumination Source opportunity
62
Flat Panel Display Anneal Market Opportunity
FPD market segments are undergoing

disruptive structural shifts:
Accelerated growth of high resolution
smartphone displays
iPhone adopts OLED displays in 2018
High-Res OLED tablets
Laser Annealed Low Temperature
Poly-Si (LTPS) is key enabler of these Source: Samsung Display
products
$500M market today, dominated by
Excimer Lasers
Unique Flat Panel market opportunity

Source: DisplaySearch, 2014
for IPG UV fiber lasers
63
UV Fiber Laser Flat Panel Market Opportunity
Excimer Laser Anneal (ELA) is an

incumbent LTPS process
ELA process (excimer) suffers from

high cost, both initial capital
requirements and high ongoing
equipment maintenance
96% of LCDs (by area) still fabricated

on a-Si will transition to high mobility
DisplaySearch, Jan., 20th, 2014
backplane fiber laser opportunity
By 2018 Samsung Projects Proliferation of LTPS
3-5x lower operating cost vs. ELA into High End Tablets
expands OLED to next generation
smartphone, tablet and laptop displays
>$300M IPG opportunity
IPG patent pending processes under

evaluation with three major WW Flat
Panel Manufacturers
*Source: Samsung
64
Laser Ablation for Paint Stripping and Surface Cleaning
Environmental Benefits: Ablates paint from the surface
Plus 165 lbs of Liquid Waste

Vacuum removes 99.9% of residue
10 Does not require chemicals which produce toxic
Solid waste (lb.) generated
Per 1 lb. on paint stripped
sludge or plastic beads

Manual paint stripping requires:
5
F-16 4 people
16 to 18 people for a C-130
0 Dept. of Defense current paint stripping costs >
Media Blast* Solvent* Laser $800 million per year (2015 Air Force LCMC)
Ablation**
Paint Stripping Method Many applications outside of aerospace:
Cleaning of molds, casts, tanks, pipes &
other surfaces
New generation of Nano-Second Pulsed laser
with average power up to 4 kilowatt
Pulsed product limits thermal damage to
cleaned surface
Sources:
*Potential alternative report for the portable handheld laser small area
supplemental coating removal system, prepared for USAF by SAIC, Feb. 2001
** Penn State Applied Research laboratory, Automated Rotor Blade Stripping
System (ARBSS) study for the USN, 2005
65
Medical
Dr. Greg Altshuler
President, IPG Medical
Large Medical Laser and Systems Market
4-8 Times Larger Opportunity for Laser Medical Systems

$9,000
($ in Millions)
$8,000 $7,759
$7,000
$6,000
$5,000 Laser medical systems*,

$4,110 $MM
$4,000 Laser sources for medical
systems**, $MM
$3,000
$2,000
$1,042
$1,000 $628
$0
2015 2020
*Includes Ophthalmic, Surgical, Cosmetic, Dental and Veterinary applications
Source: BCC Research
**Source: Strategies Unlimited
67
Medical Laser Sources by Type
Laser Medical Systems use legacy technologies such as flash lamp pumped
and gas lasers with slow transition to new diode and fiber laser platforms
2015 2020
Diode laser Diode laser

17% 20%
Lamp Pumped
Diode Lamp Pumped Diode SSL
Pumped SSL Pumped SSL 35%
SSL 37% 12%
16%
Fiber laser Fiber laser CO2

CO2
5% 9% 20%
Eximer laser 21%
4% Eximer laser
4%
IPGM believes it can target 20% to 30% growth
Source: Strategies Unlimited
68
Fundamental Advantages of Fiber Lasers for Photo-medicine
All spectrum of wavelengths for safer and more effective selective

photothermolysis and tissue surgery
Pulse width from CW to picosecond and femtosecond
High-quality laser beam enables tight focusing of energy for precise
and safe surgery and delivery of laser energy to tissue through
ultra-thin quartz fiber
Low cost compare with old laser technology
Small system size, air cooling
High reliability, no water and lamp replacement - low ownership cost
Opportunity for dramatic improvement of existing laser medical
applications and development new medical technologies
69
69
IPG Medical Overview and Strategy
Overview:
IPG Medical provides turn-key solutions for development and manufacturing
of lasers and laser-based medical systems
ISO 13485 certified and FDA registered manufacturer (2016)
Research and development in Marlboro (USA) and Fryasino (Russia)
Production of components and final product in Fryasino (Russia) and final
product for US market in Marlboro (USA)
Strategy:
IPGs unique fiber lasers new game-changing products which are more
efficient, safe and cost-effective and enable new medical procedures
Penetrate new medical applications, such as urology (BPH and Lithotripsy),
aesthetic (hair removal, vascular and pigment, skin texture and tightening,
body contouring, tattoo), dental (surgery and tissue regeneration),
ophthalmology, through the development and introduction of new products
Approach the market in partnership with leading medical device companies
in particular fields or direct distribution in selective field and territory
Growth Targets:
We target medical opportunities from $70M - $150M in 2020
70
Dental Laser Partnership
IPG:
Conducts joint research, design and development of the new product
platform for professional dental use
Manufactures laser console and application modules on exclusive basis
Biolase:
Commercializes the final medical products with Biolase accessories in the
professional dental field under Biolase brand
Exclusive, performance-based distribution rights
Expected revenue beginning in 2016
71
Urology Opportunity
New IPG products based on QCW Tm fiber laser: laser for Lithotripsy and
Benign Prostatic Hyperplasia & Lithotripsy would replace flash-lamp pumped
Ho:YAG laser platforms with more than 10,000 installed base
2 times faster speed of human stone dusting with significantly lower retropusion
than current gold standard Ho laser has been demonstrated in vitro study
(Super Pulse Tm Laser for Lithotripsy, ASLMS Annual Meeting 2016)
First product would be launched in 2016 in Russia pending regulatory approval
US and worldwide market would be approached in partnership with leading
urology partner with product launch in 2018
IPG Consumable Surgical Fiber with proprietary connector
72
Dentistry Opportunity
Gum regeneration for periodontology and implantology

New solution with IPG proprietary patent pending fractional dental
laser technology
ALD 2015, G. Altshuler et al.: Laser
Patterned technology: a new natural method Before Tx 3 w after Tx
of tissue regeneration
Laser patterns on gum Replacement of tissue

tissue treatment 73 grafting
Telecom Products
Mark Cannata
Director, Sales and Marketing, Telecommunications Products
Differentiated Products for Growing Market
Product Line Today

Optical amplifiers and Raman lasers
Optical transmission and DWDM systems
Markets/Customers
Fiber-based Fiber to the Home (FTTH) and Cable TV (CATV)
Arris, Calix, Portugal Telecom
Ultra-long haul
ABB, Saudi Electricity Company, Rostelecom
IPG Differentiators
Highest power amplifiers, any wavelength/any power Raman
Proprietary signal processing system technology for ultra-long haul telemetry
and DWDM applications
Eliminates mid-span optical regeneration in long-haul links
Provides industrys highest density amplification with the lowest electrical
power utilization
Amplifier Market Size
$520M (2016) growing to $630M (2020)1; 15% CATV amplifiers / 85%
transport amplifiers1
1 Ovum, Total OC Forecast Spreadsheet: 201420, August 2015
75
Optical Amplifiers for Broadband and CATV
IPG EDFAs for FTTH Networks

RF Overlay for CATV delivery
64-port with integrated WDMs

32-port Front Access ~10W amplification
OEM EDFAs for CATV Networks

Fiber Deep architectures
e.g. RFOG, Node Segmentation
Node EDFA
Head-end CATV EDFA
76
Optical Transmission - Line Cards, Modules, DWDM Systems
Addressable Optical Networks Market:

$12.8B in 2016 to $15.4B in 2020
All Growth in 100G+ Line Cards and Pluggable Modules
IPG DWDM and Optical Transport Menara Optical System Modules

Repeater-less 40x100G DWDM 400+ Km
10G OTN XFP

System in a Module
100G CFP/CFP2/QSFP 10G SFP+

Data Center / metro / Regional Vendor Agnostic Plug-and-Play
And DWDM Connectivity
77
IPG to Enter Large and Growing Optical Pluggable
Systems Market with Menara Acquisition
Product Line Tomorrow (with Menara)

Patented System in a pluggable module integrating all line card functions;
transponder-less transport
Short Reach to Ultra-Long Reach, 1G to 100G+ DWDM for all network segments
Markets and Customers
Major network operators, CATV MSOs, Data, Wireless
Optical network equipment manufacturers
Large and Growing Optical Line Card Market Opportunity
100G+ market growing from $5.4B in 2016 to $8B by 2020
IPG + Menara Differentiators
Vertically integrated transponder technology- optics, ASICs, manufacturing
ASIC with patented mixed-mode coherent & multilevel 100G+ signal processing
Plug-and-play functionality with all vendor transmission and switching equipment
Optimized DWDM solutions with transponder blade elimination
Software Defined Network control
Synergies
Vertical integration of IPGs optical transmission solutions
Add new addressable markets for IPGs telecom portfolio
Leverage IPGs resources to accelerate time to market, lower cost, expand Menaras
current markets
78
100% of Optical Networks 5yr Growth in 100G Line Cards
$2.5B Growth
2016 In 100G+ Transmission Line Cards 2020
$12,830M $15,350M
Terminals, Terminals,
L2/OTN L2/OTN
switching, switching,
$1,973 $2,002
100G, >100G ROADMs,
MXP/TXP, ROADMs, 100G, >100G Amplifiers,
Amplifiers, MXP/TXP,
$5,360 $1,967
$2,531
$7,900
10G, 40G TXP,

$2,915
10G, 40G TXP,
$3,536
$25.0 Optimistic Most likely

$20.0 Pessimistic
$15.0
Revenue ($bn)
$10.0
$5.0
$0.0
2012 2013 2014 2015 2016 2017 2018 2019 2020
Ovum, Optical Networks Forecast Spreadsheet: 201520, December 2015
79
Growing Telecom Opportunity
Telecom Acquisition Adds Scale to Business and

Expands 3-to-5 Year Growth Opportunity
to between $100 million and $150 million
160,000.00
140,000.00
120,000.00
100,000.00
80,000.00
60,000.00
40,000.00
20,000.00
-
Current Business With Menara 3-5 Year Opportunity
80
Manufacturing: Devices and Components

Dr. Eugene Scherbakov
Managing Director, IPG Laser GmbH and SVP, Europe
Proven Vertical Manufacturing Drives Leading Results
Vertically integrated volume manufacturing provides cost and

technology advantages
Leverages scientific and manufacturing expertise in different locations to
develop new technologies and implement low cost high volume
manufacturing
Capitalizes on labor intensive component and finished product
manufacturing in lowest cost geographic locations
Benefits from proximity to large end markets and customers
Manufactures in strategic locations where there is strong IP protection
Manufactures close to customers, providing excellent service
82
Vertical Integration Drives Significant Benefits
83
Major Global Production Facilities
Production Facility and

IPG Laser Facility NTO Facility
World Headquarters
Burbach, Germany Fryazino, Russia
Oxford, MA
Total: 57,000 sq.m. Total: 38,600 sq.m. Total: 50,000 sq.m.
Clean Rooms: 10,000 sq.m. Clean Rooms: 10,000 sq.m. Clean Rooms: 8,000 sq.m.
Employees: 1,400 Employees: 1,113 Employees: 1,100
84
Vertical Integration & Production Location
US US, Germany & Russia
Laser diode
Fab Operations
Packaging
Semiconductor Wafer Growth
Up to 120-watts
Diode Processing, Chip Mounting
& Burn-In Germany & Russia
US & Russia Optical Preform

Optical Delivery Silica based glass
Systems: Welding MCVD method
& Cutting Heads,
Scanners, process Dope with rare
fibers earth ions
US, Germany & Russia Germany & Russia
Deep in technology
Deep in experience Fiber Draw
Draw towers
US, Germany & Russia

Final Assembly US, Germany & Russia
US, Germany & Russia
Coupling Components
Final burn in Bragg Gratings
Modules
Shipment Isolators, Couplers
Up to 2000 Watts
Fiber Block
85
Core Technologies Manufactured at IPGs Facilities
Core Technologies U.S. Germany Russia

Diode Fab/Front End
Laser Diode Packaging
Active and Passive Fibers
Laser Crystals
Fiber & Bulk Gratings
Fiber Couplers & Combiners
Fiber Blocks & Modules
Bulk and Micro Optics.
Thin Film Coatings
Laser Assembly
Laser Systems Assembly
Optical Heads & Scanners
86
IPG's Commercial Products
IPG offers more than 510 different fiber lasers for micro and
macro applications!
2015 - First 6kW ECO laser

2013 - First 100kW HPL WPE>50%
10 20 100 200 400 600 1000 2000 4000 5000 8000 10000 15000 20000 50000
Output Power [W]
87
NTO Sales 2013-2015 at Internal Transfer Prices
($ in millions)
200.0
180.0 $173
160.0
140.0 $129
120.0 $109
100.0
80.0
60.0
40.0
20.0
0.0
2013 2014 2015
HP Lasers LP Lasers Systems Laser Heads
Telecom Medicine Components
88
Components Production: Fibers
Active Fibers
NTO IRE-Polus 1,331
1,400 IPG Laser GmbH
Total length, km 1,200
985 497
1,000 879
795 192
56
800 67
644
600 66
418 402
400 823 793 834
728
200 578
200 386 384
180
0
2008 2009 2010 2011 2012 2013 2014 2015
Passive Fibers
14,000 NTO IRE-Polus
12,018
IPG Laser GmbH
12,000
Total length, km
9,523
10,000
8,000 6,729 7,800

6,213
6,100
6,120
6,000
3,600
3,564 3,388 3,713
4,000 3,095
1,541 2,134 4,218

2,000 985 3,403
2,712 2,500 3,129
1,554 1,430
0 575
2008 2009 2010 2011 2012 2013 2014 2015
89
Components Production: Fiber Blocks
Fiber Blocks: Production in Germany and Russia

100,000
NTO IRE-Polus 93,833
80,000
Quantity, pcs
70,000 65,631
60,000 54,488
79,570
50,000 47,677
42,735
40,000 52,600
32,756
41,032
30,000 34,838
22,569 32,278
20,000 24,480
15,756 9,486
10,000
4,133 12,839 13,456 13,031 14,263
6,813 8,276 10,457
5,353
0
2008 2009 2010 2011 2012 2013 2014 2015
Year
90
Pulsed Lasers Production
Pulsed Lasers. Production in US, Germany and Russia.
20,000
IPG Photonics 18,604
NTO IRE-Polus 15,681
16,000
14,829
14,051
14,000
Quantity of Lasers, pcs
11,579
12,000 6,181 7,940
10,468 5,334
10,000 9,246
4,011
8,000 2,637
5,916
6,000 -
7,697 7,434
4,000 3,159 6,616
6,011 5,640 6,578
5,785 -
2,000 2,951
817 1,020 1,214 1,125
-
2008 2009 2010 2011 2012 2013 2014 2015
91
High Power Lasers (P > 1KW)
High Power Lasers. Production in US, Germany and Russia.
4,500
IPG Photonics
4,000 IPG Laser GmbH 3,883
NTO IRE-Polus
3,500
3,021
3,000
2,500 2,241 2,758
2,000
2,015
1,518
1,500 1,266 1,398
1,000 947
590 842
500 259 276 1,051
724 886
413 461
164 191 352
-
2008 2009 2010 2011 2012 2013 2014 2015
92
Low- & Mid-power Lasers (P < 1KW)
Low- & Mid-power Lasers. Production in US, Germany and Russia.
10,000
IPG Photonics
9,000 IPG Laser GmbH 8,734
8,000 NTO IRE-Polus

1,677
7,000
6,000
5,148
3,616
5,000 634
4,000 3,652
2,686 2,940 2,759

3,000 2,317
1,957
2,000 1,647 1,635
1,259 1,583 3,441
1,454
694
1,000 1,755
1,083 1,230 1,518
939 827 1,043
-
2008 2009 2010 2011 2012 2013 2014 2015
93
Scale in High Power Laser Sales
IPG has shipped more than 19,000 lasers with output power of
more than 500-watts since 2007
7,000
6,000
5,000
4,000
>500W
3,000 >1KW
2,000
1,000
-
2007 2008 2009 2010 2011 2012 2013 2014 2015
94
Rapid Penetration of the Laser Market Across All Products
Approximately 160,000 IPG lasers in the field since 2007

35,000
30,000
25,000
20,000
Total Units Sold

15,000
10,000
5,000
-
2007 2008 2009 2010 2011 2012 2013 2014 2015
95
Automotive IPGL
IPG is already an important player in automotive welding field; ~$108M

revenue in 2015 (primarily for welding, some cutting)
Potential upside in automotive welding is substantial

Many OEMs are just starting to use fiber lasers
Huge potential substitution for spot/ arc/ other joining technologies
Move to lightweight materials creates opportunities for fiber lasers
Strong growth potential in electric vehicle batteries
Many new products; trifocal braising, high power scan head, three beam
LSS aid application and market growth
However- this is a difficult and time consuming market to penetrate

Requires extensive design in work with auto OEMs
Long preproduction time frames
Competition with other joining techniques
96
Automotive Outlook for HP Lasers
Auto HP units for joining forecast to Growth in HP Lasers for

grow from 718 in 2015 to 1,200 in 2019 Automotive Joining
IPG targeting to grow sales in joining
1200
from ~50% to 65% through superior
technology, technical differentiation,
1000
applications wins, regional excellence
and strong commercial position
800
Opportunity is $200M+ by 2019 (mid
and HP welding, cutting and ablation)
600
Existing market forecast could have
strong upside from electric vehicles
400
200
0
2015 2019
Total IPG
97
Manufacturing: Diodes
Dr. Alexander Octchinnikov
SVP, Components
IPG Diode Manufacturing: Significant Competitive Barrier
Most technically advanced, highest volume and lowest cost in the industry
Key Benefits:
Cost control: Advantage of internal manufacturing
Quality control: Key subcomponents manufactured internally
Technology/IP control: Significant process know how, trade secrets & strong
patent protection
Unprecedented flexibility: Rapid product development and introduction into
volume production
Scale and Scope:
Full vertical integration: Not a single manufacturing step or key subcomponent
is outsourced
High-volume manufacturing: IPG is largest manufacturer of high power pump
laser diodes
Highly automated robotic manufacturing: Most automation processes and
equipment are designed and manufactured in-house
99
Ongoing Strategic Initiatives and Cost Improvements
Enhancing vertical integration

Capitalizing on next-generation pumps
Increases output power per chip and reliability
Lowers manufacturing cost volume of packaged diodes
Improving utilization of existing global facilities
Result: Driving down cost and maintaining significant competitive

advantage
100
Diode Manufacturing Steps and Facilities World Wide
Total Worldwide Facilities:

~135,000 sq. ft. production floor area and ~750 employees
Front-End U.S. Germany Russia

Wafer Growth (MBE)
Wafer Fab Operation Wafer Processing
Facet Passivation and Coating
Submount Manufacturing
Chip-On-Submount Assembly
COS Assembly
Back-End U.S. Germany Russia

Screening out low-reliability lots
Test and Burn-In
and individual devices
Manufacturing of various types of
Packaging
pumps
101
FRONT-END: Wafer Fab Operation Oxford, MA
Requires most technical expertise

and capabilities
Highly qualified technical staff,
proprietary designs, equipment and
technology ensure industry best diode
performance and reliability
Capital Intensive
Ensures redundant high-volume
manufacturing operation
Over-capacity in MBE and Wafer
Processing equipment
Strategic stock of MBE-grown qualified
wafers
102
FRONT-END: Chip-On-Submount Assembly Oxford, MA
Scale of Operation
IPG assembles over 0.5 million Chip-On-Submount
each month
Vertical Integration
IPG manufactures submounts internally
Automation
Manufacturing is based on automated equipment
(some built in-house), and proprietary processes
Paperless Manufacturing
Production processes are fully DB-traceable:
translates to higher yields and little direct labor
These advantages result in high yield, little direct labor and subcomponent cost;
thus IPG manufacturing is cheaper than off-shore contract manufacturing
103
BACK-END: Test & Burn-In Operation in
US, Germany and Russia
Purpose
Key operation to screen out weak devices
to ensure long-term reliability of pumps
Scale
IPG has industrys largest TEST/BI facility:
over 100,000 COS devices are tested
simultaneously
Competition Barrier to Entry
All TEST/BI equipment has been designed
and manufactured internally for a fraction of
an open market price
Long-term Benefit
Every COS used in IPG Fiber Lasers
undergoes rigorous screening by burn-in:
elevated temperature and elevated current
TEST/BI operation ensures high reliability of DIODE pumps:

Contributes to low cost of ownership of Fiber Lasers, and
Minimizes IPG need for field service
104
BACK-END: Packaging Operation in
Packaging is the most labor-intensive part of pump

manufacturing and the most value-added operation
Facts about IPG Packaging operation:

Pioneered commercialization of single emitter pumping
over 20 years ago
Produces industrys most efficient pumps
All automated equipment and processes used in PKG
PLD130 operation:
Designed and manufactured internally for a fraction of open
market analogues cost, and
PLD70 More productive than commercially available analogues
Cost of subcomponents:
PLD40 IPG is the only company in the industry that
manufactures all micro-optics and packages mechanical
subcomponents internally
Most commonly used pumps
More than 90% of BOM are internally manufactured parts
PLD40 3 COS 40 W CW
PLD70 6 COS 60 W CW
and components
PLD130 12 COS 120 W CW
New pumps: introduced through 2016
PLD80 6 COS: new design > 70 W CW: Q2
PLD90 6 COS: next design; new package > 80 W CW: H2
105
BACK-END: Packaging Manufacturing Cost in
Labor Productivity Improvement Labor Productivity

in PKG Operation IPG continues to increase PACKAGING
labor productivity through wider robots
2.50 2.35
utilization and automation
2.00
2.00 Internal development and manufacturing
1.56 of automation equipment
1.50 1.28
1.00
1.00
0.50
0.00
2011 2012 2013 2014 2015
Manufacturing Cost of IPG PACKAGING operation is lower than

overseas contract manufacturing
106
Summary: Diode Production a Significant Advantage
High volume production levels of pump diodes, proprietary processes

and use of unique chip and package designs allows IPG to increase
yields, lower component costs and assure high quality
Diode Production and Cost Trends

6,000,000 120%
100%
% Change in Packaged Diode Cost

5,000,000
80%
Tested Chips Produced
4,000,000
60%
3,000,000 40%
20%
2,000,000
0%
1,000,000
-20%
- -40%
2009 2010 2011 2012 2013 2014 2015
Tested Chip Production Cost/watt % decrease (base yr 2009) Annual cost decrease %
____________________
Source: IPGP estimates. 107
China
Trevor Ness
Senior Vice President, World Wide Sales and Marketing
Broad Established Presence in Growth Market
10 year presence
~150 employees servicing customers in 17 locations.
Broad Geographic Coverage close to customers
Best service and support in the industry drives sales
Beijing
Shenyang

Headquarter
Central warehouse
ZhengZhou Qingdao
Jinan
Nanjing
Suzhou
Shanghai
Chongqing
Wuhan Hangzhou
Chengdu
Ningbo
NingDe
Sheet Metal cutting Automotive application
application lab Guangzhou lab
Shenzhen
Branch office/application lab/service station
Remote service station Micro Process Application Lab
109
TAM in China
Total addressable market for IPG is $916M , IPG has 36% sales position
big enough space for growth.
M$
320
300 288
280
260
240
220
203
200
180
160 147
142
140
120 104
100
80
60
40 32
20
Marking/ Micro Micro Cutting HP welding Beam Delivery

Engraving/ processing welding (metal/ / adhesive System
Cleaning non-metal) manufacture
Resource:
Input from major IPG
Chinese OEMs 110
Diverse and Growing End Markets Drive Laser Sales
Chinese industry is intent on adopting advanced technologies to enhance
manufacturing capability
Cutting:
Fiber laser has significant and growing share vs other sources
Hundreds of OEMs
OEMs expect underlying annual growth of 10%
Significant installed base of 12K+ expected to be replaced by fiber laser during next 2-3 years
IPG is well positioned with strongest product portfolio, superior quality, highest reliability and largest
service coverage
Welding:
Automotive: seat welding, body in white, electric vehicles (productivity and weight reduction trends)
Heavy industry: locomotive, oil and gas, pipe lines
Emerging applications replacing traditional non-laser welding: white goods, elevator manufacturers,
cabinet/furniture
New applications to drive production efficiency
Remote welding, scanner welding and trifocal braising
Cutting and Welding Optical Heads:

Optical head; IPG is growing its penetration into a large opportunity, selling optical heads into
cutting, welding and scanning applications
$32M annual addressable market in China)
111
Diverse and Growing End Markets Drive Laser Sales
Fine and Micro Processing:
International and Chinese local electronic brands are accelerating adaption
of laser process: quality and efficiency improvements
QCW lasers are entering new applications (micro-welding replacing YAG)
and new customers
UV and Pico second laser are quickly adopted on a large scale: marking
and precise cutting of brittle materials
Marking and Engraving:

High power pulse fiber laser (>=100w)
Cleaning/cutting, engraving, mold making
Display applications
Emerging Applications:
Additive manufacturing
Cleaning and ablation
112
Future Strategies
Manufacturing
Low cost manufacturing in Russia
Highest volume vertically integrated producer
Cost and product solution
Broadest product range
High-end and low-end offerings
Vertical integration drives lowest cost
Service and support
Unrivaled service capabilities drives sales
113
Financial Review
Tim Mammen
Chief Financial Officer and Senior Vice President
Financial Highlights
2014 2015 Revenue growth ~17%
17% CAGR from 2011 to 2015
Highly diversified revenue stream and business model
Customers, powers, geographies, applications
Vertically integrated model driving gross margin
High return on R&D and SG&A drives strong operating margins
Strategically focused and efficient R&D that creates value
Track record of profitability and financial discipline
Strong return on invested capital (excluding cash)
43% in 2015
115
Sales and Gross Margin Growth
Gross Margin(1)
Sales ($ mm) (%)
$1,000 70.0%
$901.3
$900
60.0%
54.2% 55.2%
$800 52.5% $769.8 54.1% 54.6% 54.2%
50.0%
$700 $648.0
$600 $562.5
40.0%
$500
30.0%
$400
$300 20.0%
$199.0 $207.2
$200
10.0%
$100
$0 0.0%
2012 2013 2014 2015 Q1 2015 Q1 2016
Revenue ($mm) Gross Margin
____________________
(1) Gross margin includes stock-based compensation of $2.2mm, $3.2mm, $4.2mm, $5.3mm, $1.2mm and $1.4mm for
2012, 2013, 2014, 2015, Q1 2015 and Q1 2016, respectively.
116
Operating Leverage Improvement
Sales & Operating Operating Margin(1)
Income(1) ($mm) (%)
$1,000 80.0%
$901.3
$900
70.0%
$800 $769.8
60.0%
$700 $648.0
50.0%
$600 $562.5
(2)
41.2%
$500 40.0%
(2) (2)
36.9% 38.0% 33.8%
$400 37.1%
33.7% $342.0 30.0%
$300 $283.8
$208.9 $218.1 $199.0 $207.2 20.0%
$200
$100 $82.0 $70.0

10.0%
$0 0.0%
2012 2013 2014 2015 Q1 2015 Q1 2016
Revenue ($mm) Operating Income ($mm) Operating Margin
____________________
(1) Operating income includes stock-based compensation of $8.6mm, $11.7mm, $15.2mm, $19.0mm, $4.1mm and $5.0mm for
2012, 2013, 2014, 2015, Q1 2015 and Q1 2016, respectively.
(2) Operating margin includes FX gains/(losses) of $2.6mm, $8.8mm and ($5.0mm) for 2015, Q1 2015 and Q1 2016, respectively.
117
Strong Cash and Liquidity Position
($ in thousands) As of December 31, 2015 As of March 31, 2016
Cash and cash equivalents $582,532 $613,692
Short-term investments $106,584 $126,273
Total assets $1,453,429 $1,550,100
Revolving line-of-credit facilities -- --
Long-term debt, including current portion $19,667 $19,167
Stockholders' equity $1,259,528 $1,345,856
Long-term CapEx target <10% of revenue
Investments in product and manufacturing technology development,

capacity expansion and sales and service infrastructure
118
A Diverse Mix with Year-over-Year Growth
IPG Sales by Product Lines

($US mm)
$550
$499.6
$500
$450
$426.1
$400
$344.1
$350
$300
$250
$200
$150 $135.3
$131.6
$124.8 $118.2
$99.5
$100 $81.0
$53.8 $56.5
$50 $28.6 $34.9
$22.6
$13.3 $13.2 $13.8 $3.0 $21.5 $8.6
$0
Pulsed High-Power Medium-Power Low-Power QCW
2013 2014 2015 YTD 2016
119
The technology leader and most profitable

company in the rapidly growing fiber laser market
Expanding $4.8 billion opportunity for all lasers
Approximate average annual growth rate of 6%
Recognized leader in the rapidly growing fiber laser market

Estimated 12% CAGR from 2015 to 2020
Significant competitive advantages

First mover advantage
Performance, product range and reliability
Lowest cost (vertically integrated model)
Strong IP position
Vertical integration and direct sales model drives industry-leading

margins (54.6% GM in FY 2015, 55.2% GM in Q1 2016)
Broad geographies, end markets and applications

Asia & Australia 51%, Europe 33%, North & South America 15%
120
Summary and Growth Strategy

Dr. Valentin Gapontsev
Chief Executive Officer and Chairman of the Board
Q&A

Ipg 2016 Investor Day Presentation

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Ipg 2016 Investor Day Presentation

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World Leadership in High Power Fiber Lasers

IPG Photonics Corporation

2016 Investor Day

Welcome and Overview

Welcome and Overview ..Tim Mammen

Current and Future Market Opportunities. Trevor Ness

China Trevor Ness

Financial Review.. Tim Mammen

Summary and Growth Strategy............................................................................ Valentin Gapontsev

Tours and Lunch

Global leader in industrial fiber lasers

FY 2015 sales of $901 million; YOY growth of 17%

Q1 2016 sales of $207.2 million; YOY growth of 4%

Growing acceptance of fiber lasers replacing traditional lasers

Products are sold to OEMs, systems integrators and end

Global operations with over 3,700 employees

The technology leader and most profitable

Recognized leader in the rapidly growing fiber laser market

Significant competitive advantages

Vertical integration and direct sales model drives industry-leading

Broad geographies, end markets and applications

(000) 2015 - Share of Total Laser Market

$6,000 Fiber, 31%

Oil & Gas

Expand addressable market and enhance future growth opportunities by

Significant area of growth for ultra-fast pulsed lasers, and shorter

Direct Sales End User

OEM End User

Direct Sales OEM End User

Large Manuf. Factory 2

Direct Sales Integrator End User

Representatives End User

Three Distribution Channels

Current and Future Market Opportunities

Wavelength 400 nm 700 nm 1.5 mm > 5 mm

Ultra-violet Visible Near-Infra-red Mid-Infra-red

IPG manufactures lasers with average

Opportunity for Continued Fiber Laser

2015 2020 2015 2020 2015 2020 2015 2020

All Lasers Fiber Lasers

Cutting Applications Welding Applications

Cladding Additive Manufacturing Marking Surface Treatment

Market estimated at 7,500 systems per year.

- World leader with commanding market Cutting Applications

Source: Strategies Unlimited & IPGP estimate

Approximately 30 major OEMs

Y15 High Power Laser Cutting Total market size of kW scale

Fiber Disk/OtherFiber CO2

Remote Welding Seam Welding Braizing (aesthetic,

Spot Welding Laser Seam Stepper Fine Welding

Limited Materials Diverse Materials Diverse Industries Diverse Products

In many instances strength of the laser weld > welded material

Decreasing cost of laser welding, new laser welding technologies, know-how,

TAM Expecting to grow to 2,200 units by Y19

3D alpha testing expected in Q316,

New IPGWeld software and the scan

With the addition of the application software,

Target to capture 50% of industry sales,

Market size scanning ~380 lasers in

High Power Scan head

2015 2019 (E)

Strategy: Rapid deployment globally to

Fine welding, brittle material cutting, high power drilling

Main market application marking & 1-100 W, 1-200 ns, up to 1 mJ