The 53rd Annual General Meeting of Shareholders June 17, 2016

The 53rd Annual General Meeting of Shareholders June 17, 2016 The 53 rd Annual General Meeting of Shareholders 1

FY2016 Financial Report (FY2016: April 1, 2015 March 31, 2016) The 53 rd Annual General Meeting of Shareholders 2

Consolidated Statement of Income (Billion Yen) FY2015 (%) FY2016 53 期 (%) (%) Variance Net sales 613.1 100.0 639 100.0 +50.8 Sales by division SPE 576.2 94.0 6,130 613.0 92.3 +36.7 FPD 32.7 5.3 44.6 446 6.7 +11.9 Others 4.1 0.7 62 1.0 +2.0 SPE: Semiconductor Production Equipment FPD: Flat Panel Display Production Equipment 663.9 100.0 6.2 1.0 Increased sales of both semiconductor and FPD production equipment YoY The 53 rd Annual General Meeting of Shareholders 3

Consolidated Statement of Income (Billion Yen) FY2015 (%) FY2016 (%) Variance Net sales 613.1 100.0 +50.8 Gross profit 242.7 39.6 +24.4 Operating income 88.1 14.4 +28.6 Ordinary income 92.9 15.2 +26.4 Unusual or infrequent profit 1.8 0.4 Unusual or infrequent loss 8.0 +6.3 Income before income taxes 86.8 14.2 +19.6 Net income attributable to 663.9 100.0 267.2 40.2 116.7 17.6 119.3 18.0 owners of parent 71.8 11.7 +6.0 The 53 rd Annual General Meeting of Shareholders 4 1.4 14.4 106.4 16.0 77.8 11.7 since the 2008 global financial crisis Achieved over 100.0B operating income

Consolidated Profit and Loss Highlights 150 100 50 Operating income Gross profit Operating margin 40.2% Highest-ever gross 116.7B profit margin 17.6% Operating margin improved 3.2pts YoY to 17.6% 0 (FY) 2012 2013 2014 2015 2016 The 53 rd Annual General Meeting of Shareholders 5

Consolidated Balance Sheet Assets (Billion Yen) Liabilities & Net Assets (Billion Yen) 876.1 317.6 793.3 236.6 Cash & cash equivalents* 876.1 234.9 793.3 229.1 Liabilities 110.8 116.5 Trade notes, accounts receivables 175.5 195.0 66.7 69.1 106.8 96.3 27.5 17.6 70.8 62.0 2015/3/31 2016/3/31 Inventories Other current assets Tangible assets Intangible assets Investment & other assets 641.1 564.2 2015/3/31 2016/3/31 Net assets *Cash and cash equivalents: Cash and deposits + Short-term investments, etc. (Securities on B/S). The 53 rd Annual General Meeting of Shareholders 6

Consolidated Statements of Changes in Net Assets (Billion Yen) 700 650 Net Assets Net income attributable to owners of parent 77.8 Cash Dividends 33.0 Repurchase of treasury stock 105.8 600 550 641.1 Other changes 15.9 Net Assets 500 564.2 0 Balance as of 2015/3/31 Balance as of 2016/3/31 The 53 rd Annual General Meeting of Shareholders 7

Non-consolidated Financial Statement (Billion Yen) Statement of Income FY2015 (%) FY2016 (%) Variance Net sales 555.0 100.0 582.6 100.0 +27.5 Operating income 47.0 8.5 5.0 Ordinary income 86.5 15.6 74.8 12.8 11.6 Income before income 42.0 7.2 taxes 61.9 11.2 78.5 13.5 +16.6 Net income 63.2 11.4 63.5 10.9 +0.2 Balance Sheet FY2015 (%) FY2016 (%) Variance Total assets 671.7 100.0 625.9 100.0 45.7 Total liabilities 266.2 39.6 +30.3 Total net assets 405.4 60.4 76.1 Total liabilities & net 296.6 47.4 329.3 52.6 assets 671.7 100.0 625.9 100.0 45.7 The 53 rd Annual General Meeting of Shareholders 8

FY2016 Dividends Annual dividend per share (Yen) 250 237 200 150 100 50 80 51 50 143 0 FY2012 FY2013 FY2014 FY2015 FY2016 Interim Year-end Annual dividends Total dividends Payout ratio FY2016 125yen 112yen 237yen 39.1 Billion yen 51.4% The 53 rd Annual General Meeting of Shareholders 9

FY2017 Financial Estimates (FY2017: April 1, 2016 March 31, 2017) The 53 rd Annual General Meeting of Shareholders 10

Business Environment SPE Capex CY2016 WFE capex expected to be similar level to CY2015 Memory: DRAM investment past its peak, 3D-NAND investment expanding Foundry/logic: Expand investment in advanced nodes from second half of 2016 FPD Capex Demand for FPD manufacturing equipment forecast to increase 20% YoY, primarily for small/medium panels for mobile devices The 53 rd Annual General Meeting of Shareholders 11

FY2017 Consolidated Financial Estimates (Billion Yen) 1 st Half 2 nd Half Full year YoY changes Net Sales 330.0 384.0 714.0 +7.5% Sales by division SPE 304.0 361.0 665.0 +8.5% FPD 26.0 23.0 49.0 +9.7% 75.0 124.0 +6.2% 19.5% 17.4% 0.2pts Operating Income 49.0 14.8% Ordinary Income 49.0 75.0 124.0 +3.9% Income before income taxes 39.0 75.0 114.0 +7.1% Net income attributable to owners of parent 29.0 56.0 85.0 +9.1% SPE: Semiconductor Production Equipment FPD: Flat Panel Display Production Equipment Forecasting further YoY increases in sales and profits The 53 rd Annual General Meeting of Shareholders 12

Utilizing opportunities at the market transition point for further growth 1. Business environment 2. New TEL business policies 3. Corporate governance/ Shareholder return The 53 rd Annual General Meeting of Shareholders 13

1. Business environment The 53 rd Annual General Meeting of Shareholders 14

Coming of the IoT era Number of things connected to the internet in 2020) 50 billion (2014: 14.2 billion) Source: CISCO Things connected to the internet dramatically increasing The 53 rd Annual General Meeting of Shareholders 15

World IP traffic Zettabyte/year 3 World IP traffic 2 1 0.9 2.3 CAGR 22% (2015~2020) 0 2015 2016 2017 2018 2019 2020 Source: CISCO Visual Networking Index(VNI)Complete Forecast 2015 to 2020 Data traffic explosion will occur in the future = Big Data The 53 rd Annual General Meeting of Shareholders 16

Cloud computing High-performance processors/ memories etc. installed for high-speed, low-power consumption processing of big data commons.wikimedia.org Data center servers require higher capabilities due to big data processing The 53 rd Annual General Meeting of Shareholders 17

Artificial Intelligence (AI) AI Abilities of learning/ judgement/ prediction High-performance processors/ memories etc. installed for enormous computing A.I. with big data analysis feature The 53 rd Annual General Meeting of Shareholders 18

Car-autonomous driving A number of sensors/ highperformance processors etc. installed for precise information processing on a real-time basis de.wikipedia.org Automobiles as computers on wheels The 53 rd Annual General Meeting of Shareholders 19

The IoT future Connected things in 2020 50bn (2014: 14.2bn) AI IP Traffic CAGR 22% (2015~2020) Potential economic impact of IoT in 2025 Up to $11.1tn (2015: $900bn) Source: CISCO, McKinsey & Company The 53 rd Annual General Meeting of Shareholders 20

Semiconductor market continuously expanding (Billion $) 400 Semiconductor Market 300 Industrial 200 Mobile Medical/ healthcare 100 Server 0 Wearables Smart homes Source:WSTS Automobiles IoT will expand semiconductor applications and markets The 53 rd Annual General Meeting of Shareholders 21

The market TEL participates in CY2015 world Electronics-related industry Electronic equipment US$1,704.7B Semiconductor US$334.8B Wafer Fab Equipment US$31.5B WFE market assuming a critical role in the value chain Source: Gartner Forecast: Semiconductor Wafer-Level Manufacturing Equipment, Worldwide, 1Q16 Update April 2016 Charts/graphics created by Tokyo Electron based on Gartner research. The 53 rd Annual General Meeting of Shareholders 22

Evolution of semiconductor scaling 1970 1990 2000 2015 Intel s 14nm node microprocessor 20XX 10μm 1μm 100nm 10nm 1nm Red blood cell Smoke particle Minimum virus Width of DNA helix 6μm 100nm 14nm 2nm Semiconductor technology is bound for ultimate nanoelectronics The 53 rd Annual General Meeting of Shareholders 23

Go Adventure! Semiconductor evolution will never stop Advanced patterning E-Beam lithography EUV DSA Multiple patterning New structure/ New materials Carbon/CNT SiGe/III-V 3D NAND FinFET High-k metal gate MRAM New memory ReRAM PcRAM FeRAM Advanced packaging Si photonics Printable electronics TSV/WLP Evolution of semiconductors involves new, extensive technologies The 53 rd Annual General Meeting of Shareholders 24

As technology advances, new opportunities arise The 53 rd Annual General Meeting of Shareholders 25

For SPE manufacturers, comprehensive strengths will be increasingly vital The 53 rd Annual General Meeting of Shareholders 26

2. New TEL business policies The 53 rd Annual General Meeting of Shareholders 27

TEL vision A truly global company generating high added value and profits in the semiconductor and flat panel display industries through innovative technologies and groundbreaking proactive solutions that integrate diverse technologies Technology The 53 rd Annual General Meeting of Shareholders 28

Our resolutions Reward shareholders who trust and invest in the Company Support fulfilling lives for employees and their families Contribute to the industry and society Pursue profits Enhance corporate value through Innovative technologies and groundbreaking solutions The 53 rd Annual General Meeting of Shareholders 29

The medium-term management plan toward 2020 was prepared and announced last summer Our first step to new growth The 53 rd Annual General Meeting of Shareholders 30

TEL medium-term business policy Medium-term plan Best-in-class profitability in the industry Further growth Current 2020 2025 Realize best-in-class profitability by 2020 The 53 rd Annual General Meeting of Shareholders 31

Medium-term financial target WFE market size $30B $37B Sales Operating margin ROE 720B 20% 15% 900B 25% 20% Aiming to achieve global-level profitability The 53 rd Annual General Meeting of Shareholders 32

Current progress for the medium-term financial target WFE market size FY2015 $31.9B FY2016 $31.5B Medium-term financial target $30B $37B Sales 613.1B 665.2B 720B 900B Operating margin 14.4% 17.6% 20% 25% ROE 11.8% 13.0% 15% 20% We have made steady progress for the 1 st year The 53 rd Annual General Meeting of Shareholders 33

Financial indicator comparison Gross margin Operating margin ROE JP peers avg. TEL U.S. peer A 32.9% 5.2% 10.2% 40.2% 17.6% 13.0% 40.9% 17.5% 17.8% U.S. peer B 43.4% 15.0% 12.9% U.S. peer C 56.8% 23.5% 17.9% Averages of JP peers (semiconductor/ FPD production equipment companies from Nikkei NEEDS), FYE March 2016; Data on U.S. peers, FYE Oct. 2015 and FYE Jun. 2015 Approaching the U.S. level and going to push even harder The 53 rd Annual General Meeting of Shareholders 34

Three focus items for new growth opportunities Product competitiveness Create strong nextgeneration products Be one and only strategic partner Responsiveness to customers Increased profitability Pursue operation efficiency The 53 rd Annual General Meeting of Shareholders 35

Organization reforms to achieve strength 1 2 3 Unification of development teams Implementation of new account structure Reorganization of business units Completed (Jan. 2016) Completed (Jan. 2016) To be implemented in Jul. 2016 Optimized organization for further growth The 53 rd Annual General Meeting of Shareholders 36

Quest for leading-edge technologies The 53 rd Annual General Meeting of Shareholders 37

Creating strong next-generation products (Billion Yen) 1,000 100 800 600 400 200 R&D Expenses 80.0B 0 (FY) 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 plan Strengthening development in growing areas The 53 rd Annual General Meeting of Shareholders 38

EXIM won award for excellence at Semiconductor of the year 2015 Selected out of 38 nominees in the SPE category Sputtering system for the next-generation devices EXIM Semiconductor of the year:an annual award program sponsored by the Electronic Device Industry News. Reporters from the Electronic Device Industry News vote on candidate products and technologies to select winners for each category, based on such criteria as innovativeness of development concept readiness of mass production infrastructures, impact on society and future potential. The 53 rd Annual General Meeting of Shareholders 39

SPE product line-up Coater/developer CLEAN TRACK LITHIUS Pro Z Single wafer cleaning system CELLESTA -i Plasma etch system Tactras Vigus Thermal processing system TELINDY PLUS ALD system NT333 Single wafer CVD system Triase + EX-II TiN Multi-cell test system Cellcia Wide range of products that solve customers tough technological issues The 53 rd Annual General Meeting of Shareholders 40

Make the most of increasing business opportunities brought by IoT The 53 rd Annual General Meeting of Shareholders 41

Semiconductor manufacturing process node for IoT (Mil. sq. inch) 12,000 10,000 8,000 6,000 4,000 2,000 0 Wafer Consumption by Node 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Source : IHS, Semiconductor Silicon Forecast Tracker Q2, 2016 Forecast The 53 rd Annual General Meeting of Shareholders 42 7nm 10nm 14nm 20nm 0.25micron 0.5micron Manufacturing process node going multi-generational <10nm 28nm 14nm 45nm 65nm 20nm 90nm 28nm 0.13micron 65nm 0.18micron 90nm 0.35micron >90nm Leading-edge Legacy

New direction of our strategic moves Develop leading-edge equipment Improve performance of legacy equipment Maximize business in both areas The 53 rd Annual General Meeting of Shareholders 43

Revenue source of our field solution business TEL s world-wide installed base: Industry s largest 59,000 units Spares, paid-services, repair, modifications, used equipment, etc. Sold equipment now serves as our new source of profits The 53 rd Annual General Meeting of Shareholders 44

Field solutions business expanding Spares, paid-service, repair, modifications, used equipment, etc. (Billion Yen) 200 100 0 >200B 185B (FY) 2012 2013 2014 2015 2016 2020 Estimate IoT will bring growth in demand for modifications and used equipment About to reach the targeted 200 billion yen Sales from field solutions business included in the sales of SPE and FPD. The 53 rd Annual General Meeting of Shareholders 45

FPD new generation technology OLED Smartphone OLED Curved TV Samsung.com lg.com New display requires Ultra-high resolution Ultra-low power consumption Large size Flexibility (curved, foldable, rollable) Post-LCD - the era of OLED on the way The 53 rd Annual General Meeting of Shareholders 46

FPD production equipment market approaching 1 trillion yen again FPD etch/ash system Impressio 1800 PICP (Billion $) 14 12 10 8 6 4 2 0 FPD Production Equipment Market 2009 2010 2011 2012 2013 2014 2015 2016 2017 Source: IHS Forecast Inkjet printing system for OLED panel manufacturing Elius 2500 Capture opportunities in the rapidly growing OLED market with new products The 53 rd Annual General Meeting of Shareholders 47

3. Corporate governance / Shareholder return The 53 rd Annual General Meeting of Shareholders 48

TEL Corporate Governance Guidelines(effective December 2015) Active and open-minded debate is emphasized in the board of directors meeting Nomination Committee and Compensation Committee are in place to ensure fair, effective, and transparent management The Corporate Senior Staff formulates and advances company strategy Proactive governance to achieve further growth The 53 rd Annual General Meeting of Shareholders 49

New policy for shareholder returns (announced in July 2015) Dividend payout ratio: 50% Annual DPS of not less than 150 yen We will review our dividend policy if the company does not generate net income for two consecutive fiscal years The 53 rd Annual General Meeting of Shareholders 50

Repurchase and cancellation of own shares Cancellation of 15.4m shares completed (January 20, 2016) Representing 8.53% of pre-cancellation outstanding shares The 53 rd Annual General Meeting of Shareholders 51

Shareholder return (Billion Yen) 1,500 1,000 500 144.7B 105.5bn 39.1bn Repurchase of own shares Dividend Deliver high shareholder returns, utilizing the source including 105.5 billion yen from the repurchase of own shares 0 (FY) 2012 2013 2014 2015 2016 The 53 rd Annual General Meeting of Shareholders 52

Dividend forecast (Yen) 300 200 100 0 (FY) Dividend per share 143 237 260 2012 2013 2014 2015 2016 2017 Year-end 171 Interim 89 Estimate Dividend for FY2017(E): 260 yen Dividend per share expected to be at record high for the third consecutive year The 53 rd Annual General Meeting of Shareholders 53

The 53 rd Annual General Meeting of Shareholders 54