Getting to know you: Spotlight on Yair Alcobi, the new President of Orbotech’s PCB division

Q1. Can you tell us a little about your personal background?

I’m a mechanical engineer by training and started off my career in R&D. I’ve been in the electronics industry for over 20 years and joined Orbotech in 2007 as the VP of sales and marketing in the PCB division. In 2010, I moved to Hong Kong where I served in a number of business and customer-facing roles, including President of Orbotech Asia East and, before that, VP products, marketing and customers. As the new President of Orbotech’s PCB division, I have now re-located back to our corporate offices in Israel where I am responsible for providing our customers with the innovative solutions that will meet their current and future PCB needs.

Q2. End-user demands are driving a significant amount of change in PCB technology (size, rigid-to-flex, stacking to support additional features, etc.). How does Orbotech see these changes impacting the design and production of PCBs today and in the future?

The Consumer Technology Association’s 2018 mid-year report predicts record-breaking consumer tech revenue will reach $377B by the end of this year. It is still the consumer that drives new component needs, and this ultimately leads back to PCB design and production. Whether it's a device that needs to be thinner, smaller, lighter, flexible, more connectable, or all of the above, our customers need to anticipate and respond quickly to these market demands. Orbotech has been in the PCB business for over 35 years and we know that our continuous innovation and our collaboration with customers and the OEMs is key to our continued mutual success.

The electronics revolution is impacting all industries and applications, and the automotive industry is a good example of the remarkable innovation that is happening.  The trend toward electrification and autonomous driving is prompting designs for an unprecedented amount of electronics. In fact, electronics are projected to account for 35% of the total cost of the car by 2020, and 50% of the total cost by 2030. Endless possible solutions are evolving, making this a highly innovative and dynamic environment for manufacturers. We are already seeing increased demand for HDI boards from the automotive industry. The boards are being used for a variety of functionality, including for highly reliable, high capacity, strong computing abilities to handle real-time ADAS (advanced driver-assistance systems) events for smarter safety decisions. Another example of how innovation is impacting the electronics industry is in the smartphone market, where the continuous demand to increase battery capacity and functionality has led the high-end smartphone industry to shift production to SLP/mSAP with its finer lines and smaller, higher density PCBs.

Whatever the end solution, all of these new capabilities call for sophisticated manufacturing designs, testing, and solutions that Orbotech supports through new technologies and a deep understanding of our customers’ needs.

Q3. Is it a major challenge to develop and adopt new PCB innovations while helping customers implement tighter manufacturing process windows, reduce OPEX, improve yields and boost quality?

The PCB industry is currently experiencing an accelerated rate of change due to the trend toward seemingly unending device miniaturization, flexibility and functionality. These product innovations are compounded by the parallel need for manufacturers to gain greater insights into factory-wide manufacturing processes. For effective product and process improvement, manufacturers need to develop more precise tracking, traceability, transparence and repeatability, often from analog environments. This new depth of analysis requires optimal data acquisition, data quality and advanced analytical tools, but equally important, a high level of support and collaboration from Orbotech to solve these complex challenges.

It is important to note, that regardless of the challenge, Orbotech’s support organization is committed to our customers’ problem solving. This includes ensuring maximum uptime and support for customers when adjustments are needed for application software or hardware issues. In fact, we often help customers well before production begins in the design phase of future products, as manufacturability is a key aspect of a design’s success.

Q4. An area that is getting a lot of attention is Artificial Intelligence (AI). This heavily computer-driven capability must have implications for PCB design, testing, etc.?

The robots of the 1950s promised human-like intelligence, but it hasn’t been until recently that the neural networks and the computing power necessary to accomplish this intellect have been available. The media has declared the “arrival” of AI, and Orbotech is deeply committed to developing AI solutions for our customers. Although a precursor to AI, a good example of Orbotech using system data and analysis for customer process improvement is the use of artificial intelligence algorithms for post-AOI verification. We are committed to using artificial intelligence to develop even more advanced, more efficient solutions which will enable our customers to further optimize their manufacturing process.

Orbotech’s AI vision is built on three unique elements: control of the data, operational excellence and expert application knowledge. Our decades of expertise and experience in the PCB industry, and our wide range of solutions that touch numerous points in the PCB manufacturing process mean that we have a vast amount of accurate and reliable production data and are well-positioned to train our customers’ systems. We are able to simplify the normally very lengthy and very complex process of data tagging and training by embedding application-specific knowledge in each individual system. This ensures that the system is individualized, more effective and more robust. Our solutions enable an advanced level of machine learning and smarter, more accurate artificial intelligence and will lead to an optimized manufacturing process, which will help boost yields and reduce operational costs.

Q5. What do you see as the major focus (goals, priorities) for Orbotech’s PCB division in the next 5 years?

As a company, we invest 12-14% of our revenues annually in our R&D efforts to ensure innovation leadership in the PCB industry. Our top-level priority is to develop manufacturing processes and solutions that will support 5G and the other megatrends and trends that it will enable, including autonomous and connected cars, Industrial IoT, the next generation of smart phones, stronger and more robust cloud servers, and more. Orbotech is committed to delivering a pipeline of revolutionary and evolutionary solutions that meet our customers’ needs today, tomorrow and well into the future, through close partnership with our customers, and through our in-depth understanding of their needs, processes and roadmaps.

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Except for historical information, the matters discussed in this website (including in press releases, webcasts, presentations, posts and other places) are forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These statements relate to, among other things, future prospects, developments and business strategies and involve certain risks and uncertainties. The words “anticipate,” “believe,” “could,” “will,” “plan,” “expect” and “would” and similar terms and phrases, including references to assumptions, have been used in this website to identify forward-looking statements. 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Actual results may differ materially from those referred to in the forward-looking statements due to a number of important factors, including but not limited to the foregoing matters and the possibility that expected benefits of the transaction may not materialize as expected, that the transaction may not be timely completed, if at all, that KLA-Tencor may not be able to successfully integrate the solutions and employees of the two companies or ensure the continued performance or growth of Orbotech’s products or solutions, the risk that the Company may not achieve its revenue and margin expectations within and for 2018 (including, without limitation, due to shifting move-in dates); cyclicality in the industries in which the Company operates, the Company’s supply chain management and production capacity, order cancelation (often without penalty), timing and occurrence of product acceptance (the Company defines ‘bookings’ and ‘backlog’ as purchase arrangements with customers that are based on mutually agreed terms, which, in some cases for bookings and backlog, may still be subject to completion of written documentation and may be changed or cancelled by the customer, often without penalty), fluctuations in product mix within and among divisions, worldwide economic conditions generally, especially in the industries in which the Company operates, the timing and strength of product and service offerings by the Company and its competitors, changes in business or pricing strategies, changes in the prevailing political and regulatory framework in which the relevant parties operate, including as a result of the United Kingdom’s prospective withdrawal from the European Union (known as “Brexit”) and political uncertainty in the United States, or in economic or technological trends or conditions, including currency fluctuations, inflation and consumer confidence, on a global, regional or national basis, the level of consumer demand for sophisticated devices such as smart mobile devices, automotive electronics, flexible applications and devices, augmented reality/virtual reality and wearable devices, high-performance computing, liquid crystal display and organic light emitting diode screens and other sophisticated devices, the Company’s global operations and its ability to comply with varying legal, regulatory, exchange, tax and customs regimes, the timing and outcome of tax audits, including the best judgment tax assessment issued by the Israel Tax Authority with respect to the audit of tax years 2012-2014 in Israel and the related criminal investigation, the Company’s ability to achieve strategic initiatives, including related to its acquisition strategy, the Company’s debt and corporate financing activities; the timing, final outcome and impact of the criminal matter and ongoing investigation in Korea, including any impact on existing or future business opportunities in Korea and elsewhere, any civil actions related to the Korean matter brought by third parties, including the Company’s customers, which may result in monetary judgments or settlements, expenses associated with the Korean matter, and ongoing or increased hostilities in Israel and the surrounding areas.

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