Atomera Incorporated (NASDAQ:ATOM) Q4 2022 Earnings Conference Call February 15, 2023 5:00 PM ET Company Participants Mike Bishop - IR Scott Bibaud - President and CEO Frank Laurencio - CFO Conference Call Participants Cody Acree - Benchmark Richard Shannon - Craig-Hallum Mike Bishop Hello, everyone, and welcome to Atomera's Fourth Quarter Fiscal Year 2022 Update Call. I'd like to remind everyone that this call and webinar are being recorded, and a replay will be available on Atomera's IR website for one ye ...

Company Overview - Atomera is focused on transistor enhancement technology for the $550 billion semiconductor market[6] - The company operates with a high leverage IP licensing business model and a strong, growing, and defensible patent portfolio[6] - Atomera collaborates with customers to improve their products through the integration of MST (Material Science Technology)[18] Customer Engagement - Atomera is working with 50% of the world's top semiconductor makers[9] - The company has 20 customers with 26 engagements[9] - Customer engagements progress through phases: Planning, Setup, Integration, Installation, Qualification, and Production[7] Financial Performance - The company's revenue for the year ended December 31, 2022, was $382 thousand, compared to $400 thousand for the year ended December 31, 2021[16] - The operating loss for the year ended December 31, 2022, was $(17,526) thousand, compared to $(15,529) thousand for the year ended December 31, 2021[16] - Net loss for the year ended December 31, 2022, was $(17,441) thousand, compared to $(15,714) thousand for the year ended December 31, 2021[16] - The company's cash balance as of December 31, 2022, was $21,184 thousand, compared to $28,699 thousand as of December 31, 2021[16]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2022 or ☐ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number: 001-37850 ATOMERA INCORPORATED (Exact name of registrant as specified in its charter) Delaware 30-0509586 (State or Other jurisdiction ...

Financial Data and Key Metrics Changes - The GAAP net loss for Q3 2022 was $4.6 million or $0.20 per share, slightly up from a net loss of $4.5 million in Q2 2022, which was also $0.20 per share [19] - GAAP operating expenses in Q3 2022 were $4.7 million, an increase of approximately $210,000 over Q2 2022 [20] - The cash balance at September 30, 2022, was $23.3 million, compared to $21.8 million at the end of Q2 2022, reflecting an increase of $1.5 million [21] Business Line Data and Key Metrics Changes - The company continues to see strong interest in its two most mature MST solutions, MST-SP and MST for RF-SOI, with growing customer engagement [12] - Development activity by customers is increasing, leading to additional wafer runs and interest from new customers seeking competitive advantages [8] Market Data and Key Metrics Changes - The semiconductor industry is experiencing a softening of demand, leading to forecast reductions and some reductions in projected capital expenditures [7] - Despite the slowdown, there is still a plentiful allocation of CapEx budgets to support the acquisition of new technologies and equipment [8] Company Strategy and Development Direction - The company is focused on driving customers to adopt MST technology, particularly those who are further along in their development [8] - Atomera aims to leverage the current industry environment to increase licensing activity and move towards commercialization [18] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the current industry cycle, believing it provides a favorable environment for Atomera to grow and adopt its technology [18] - The company is confident that the slowdown in the semiconductor industry will lead to increased interest in cost-reducing technologies like MST [44] Other Important Information - The company is not providing revenue guidance beyond the current quarter, consistent with past practices, and expects Q4 revenue to be zero [22] - The company has a diverse array of applications where customers need innovative breakthroughs, indicating a strong engagement pipeline [22] Q&A Session Summary Question: Expansion of JDA customer relationships - Management indicated that while they are not discussing expansion into different business units yet, they are working closely with existing customers and hope to reach license agreements soon [28] Question: Customer utilization and prioritization of R&D wafers - Management noted that customers are now able to plan new wafer runs without issues, indicating a positive shift in customer engagement [30] Question: Confidence in licensing gate-all-around technologies - Management expressed optimism about intersecting with future technology developments, believing their technology will be applicable even if not immediately adopted [34] Question: Exposure to the China market - Management stated that they currently have no significant exposure to China and are cautious due to IP concerns, but see potential opportunities if the trade situation improves [40] Question: Customer attitudes towards spending in 2023 - Management remains optimistic about customer spending, noting that while some have scaled back forecasts, they are still spending significantly more than in previous years [49] Question: Visibility on future revenue - Management acknowledged the frustration with zero revenue forecasts but indicated that several customers are close to obtaining manufacturing licenses, which would provide more visibility [52]

Atomera Incorporated (NASDAQ:ATOM) Q2 2022 Earnings Conference Call August 2, 2022 5:00 PM ET Company Participants Mike Bishop - Investor Relations Scott Bibaud - President and Chief Executive Officer, Board Director Frank Laurencio - Chief Financial Officer Conference Call Participants Richard Shannon - Craig Hallum Cody Acree - The Benchmark Company Mike Bishop Hello, everyone, and welcome to Atomera’s Second Quarter Fiscal Year 2022 Update Call. I’d like to remind everyone that this call and webinar ar ...

[PART I. Financial Information](index=2&type=section&id=PART%20I.%20Financial%20Information) [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) The unaudited financial statements show Atomera as an early-stage company with limited revenue, recurring losses, and operations funded by equity financing Condensed Balance Sheet Highlights (in thousands) | Account | June 30, 2022 (Unaudited) | December 31, 2021 | | :--- | :--- | :--- | | Cash and cash equivalents | $21,838 | $28,699 | | Total current assets | $22,488 | $29,008 | | Total assets | $28,782 | $36,060 | | Total current liabilities | $2,795 | $2,753 | | Total liabilities | $7,032 | $7,679 | | Total stockholders' equity | $21,750 | $28,381 | Condensed Statements of Operations Highlights (in thousands, except per share data) | Metric | Three Months Ended June 30, 2022 | Three Months Ended June 30, 2021 | Six Months Ended June 30, 2022 | Six Months Ended June 30, 2021 | | :--- | :--- | :--- | :--- | :--- | | Revenue | $0 | $0 | $375 | $400 | | Total operating expenses | $4,447 | $3,712 | $8,759 | $7,720 | | Loss from operations | ($4,447) | ($3,712) | ($8,465) | ($7,320) | | Net loss | ($4,481) | ($3,726) | ($8,567) | ($7,346) | | Net loss per share, basic & diluted | ($0.20) | ($0.17) | ($0.37) | ($0.33) | Condensed Statements of Cash Flows Highlights (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2022 | Six Months Ended June 30, 2021 | | :--- | :--- | :--- | | Net cash used in operating activities | ($6,615) | ($6,634) | | Net cash used in investing activities | ($19) | ($79) | | Net cash (used) provided by financing activities | ($227) | $3,112 | | Net decrease in cash and cash equivalents | ($6,861) | ($3,601) | - The company is an early-stage entity focused on developing, commercializing, and licensing proprietary technologies for the semiconductor industry, with limited revenue-generating activities to date[23](index=23&type=chunk) - As of June 30, 2022, the company had approximately **$21.8 million** in cash and cash equivalents, believed sufficient to fund operations for at least the next 12 months, supplemented by an At-The-Market (ATM) facility for up to **$50.0 million** established in May 2022[24](index=24&type=chunk)[25](index=25&type=chunk)[26](index=26&type=chunk) - Subsequent to the quarter's end, as of August 1, 2022, the company issued an additional **235,050 shares** through its ATM offering, raising net proceeds of approximately **$2.6 million**[58](index=58&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=13&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's MST technology commercialization through licensing, noting a slight revenue decrease and a **14%** increase in operating expenses for the first six months of 2022 - The company's business model involves licensing its proprietary MST technology to foundries, IDMs, and fabless semiconductor companies, generating revenue from license fees and future royalties[61](index=61&type=chunk)[62](index=62&type=chunk)[63](index=63&type=chunk) Revenue Comparison (in thousands) | Period | 2022 | 2021 | | :--- | :--- | :--- | | Three Months Ended June 30 | $0 | $0 | | Six Months Ended June 30 | $375 | $400 | Operating Expenses Comparison (in thousands) | Expense Category | Three Months Ended June 30, 2022 | Three Months Ended June 30, 2021 | Six Months Ended June 30, 2022 | Six Months Ended June 30, 2021 | | :--- | :--- | :--- | :--- | :--- | | Research & development | $2,433 | $2,069 | $4,772 | $4,298 | | General & administrative | $1,667 | $1,506 | $3,315 | $3,019 | | Selling and marketing | $347 | $137 | $672 | $403 | | **Total Operating Expenses** | **$4,447** | **$3,712** | **$8,759** | **$7,720** | - The increase in R&D expense was primarily due to tool lease expenses, while selling and marketing expenses rose due to increased employee-related costs and outsourced marketing activities[71](index=71&type=chunk)[72](index=72&type=chunk)[75](index=75&type=chunk)[76](index=76&type=chunk) - As of June 30, 2022, the company had **$21.8 million** in cash and cash equivalents and **$19.7 million** in working capital, which management believes is sufficient to fund operations for at least the next 12 months[82](index=82&type=chunk)[83](index=83&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=17&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This section is not applicable for the current reporting period - The company has indicated that this disclosure is not applicable[85](index=85&type=chunk) [Controls and Procedures](index=17&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2022, with no material changes to internal controls over financial reporting during the quarter - Based on an evaluation, management concluded that the company's disclosure controls and procedures were effective as of June 30, 2022[86](index=86&type=chunk) - There were no changes during the quarter ended June 30, 2022, that materially affected, or are reasonably likely to materially affect, the company's internal controls over financial reporting[87](index=87&type=chunk) [PART II. Other Information](index=18&type=section&id=PART%20II.%20Other%20Information) [Risk Factors](index=18&type=section&id=Item%201A.%20Risk%20Factors) The company reports no material changes to the primary risk factors from those disclosed in its Annual Report on Form 10-K for the year ended December 31, 2021 - The primary risk factors have not changed materially from those set forth in the Annual Report on Form 10-K for the year ended December 31, 2021[90](index=90&type=chunk) [Exhibits](index=18&type=section&id=Item%206.%20Exhibits) This section lists key exhibits filed with the Form 10-Q, including Sarbanes-Oxley certifications and the Equity Distribution Agreement for the ATM offering - The list of filed exhibits includes Sarbanes-Oxley certifications (Exhibits 31.1, 31.2, 32.1) and the Equity Distribution Agreement with Oppenheimer & Co. Inc. and Craig-Hallum Capital Group LLC dated May 31, 2022 (Exhibit 10.1)[92](index=92&type=chunk) [Signatures](index=19&type=section&id=Signatures)