# EDGAR Filing Document

**Accession Number:** 0001109345
**File Stem:** 0001178913-23-000648
**Filing Date:** 2023-2
**Character Count:** 28182
**Document Hash:** ed10df7a45fa6a901ba45bba205fb0f1
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001178913-23-000648.hdr.sgml**: 20230215

**ACCESSION NUMBER**: 0001178913-23-000648

**CONFORMED SUBMISSION TYPE**: 6-K

**PUBLIC DOCUMENT COUNT**: 2

**CONFORMED PERIOD OF REPORT**: 20230215

**FILED AS OF DATE**: 20230215

**DATE AS OF CHANGE**: 20230215

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** NOVA LTD.
- **CENTRAL INDEX KEY:** 0001109345
- **STANDARD INDUSTRIAL CLASSIFICATION:** OPTICAL INSTRUMENTS & LENSES [3827]
- **IRS NUMBER:** 000000000
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 6-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 000-30668
- **FILM NUMBER:** 23633614

**BUSINESS ADDRESS:**
- **STREET 1:** 5 DAVID FIKES STREET
- **CITY:** REHOVOT
- **STATE:** L3
- **ZIP:** 7610201
- **BUSINESS PHONE:** 972-73-229-5600

**MAIL ADDRESS:**
- **STREET 1:** 5 DAVID FIKES STREET
- **CITY:** REHOVOT
- **STATE:** L3
- **ZIP:** 7610201

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** NOVA MEASURING INSTRUMENTS LTD
- **DATE OF NAME CHANGE:** 20000315

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### UNITED STATES

### SECURITIES AND EXCHANGE COMMISSION

#### Washington, DC 20549

### FORM 6-K

#### REPORT OF FOREIGN PRIVATE ISSUER

#### PURSUANT TO RULE 13a-16 OR 15d-16 OF

#### THE SECURITIES EXCHANGE ACT OF 1934

For the month of February 2023<br> Commission File No.: 000-30668

### NOVA LTD.
(Translation of registrant's name into English)

#### 5 David Fikes Street, Rehovot, Israel
(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F ☒ Form 40-F ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ____

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ____

Attached hereto and incorporated by way of reference herein is a press release issued by the Registrant and entitled: "Nova Reports Fourth Quarter and Full Year 2022 Results".

The GAAP financial statements tables included in the press release attached hereto are hereby incorporated by reference into the Registrant's registration statements on Form S-8, filed with the Securities and Exchange Commission on the following dates: November 5, 2007 (File No. 333-147140); October 25, 2012 (File No. 333-184585), March 6, 2015 (File No. 333-202550); and August 25, 2017 (File No. 333-220158).

------

#### SIGNATURES

#### <br>
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: February 15, 2023

NOVA LTD.<br> (Registrant)<br>By: /s/ *Dror David*<br> —————————————<br> Dror David<br> Chief Financial Officer<br>

------

![](image0.jpg)

#### Company Contact:
Dror David, Chief Financial Officer

Tel: +972-73-229-5760

E-mail - investors@novami.com

<u>Nova website link</u> - https://www.novami.com/

#### Investor Relations Contact:
Miri Segal MS-IR LLC

Tel: +917-607-8654

E-mail - msegal@ms-ir.com

### Nova Reports Fourth Quarter and Full Year 2022 Results
**Rehovot, Israel, February 15, 2023 - Nova (Nasdaq: NVMI)** today announced financial results for the fourth quarter and full year ended December 31, 2022.

#### Fourth Quarter 2022 Highlights:
• Record quarterly revenue of $151.2 million, up 24% year over year

• GAAP net income of $36.1 million, or $1.14 per diluted share, up 56% year over year on a per-share basis

• Non-GAAP net income of $40.8 million, or $1.28 per diluted share, up 19% year over year on a per-share basis

<br> • Record revenues from Chemical Metrology solutions, driven by multiple penetrations to leading front-end customers

<br> • Continued proliferation of our most advanced product portfolio, led by major penetrations of METRION and ELIPSON to leading logic customers

#### Full Year 2022 Highlights:

#### <br>
• Record annual revenue of $570.7 million, up 37% year over year

• Record GAAP net income of $140.2 million, or $4.40 per diluted share, up 41% year over year on a per-share basis

• Record Non-GAAP net income of $161.5 million, or $5.07 per diluted share, up 32% year over year on a per-share basis

#### GAAP Results ($K)

#### <br>

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Q4 2022** | **Q3 2022** | **Q4 2021** | **FY 2022** | **FY 2021** |
|  Revenues | $151238 | $143906 | $121521 | $570729 | $416113 |
| Net Income | $36098 | $35075 | $22226 | $140213 | $93101 |
| Earnings per Diluted Share | $1.14 | $1.10 | $0.73 | $4.38 | $3.12 |

---

#### Non-GAAP Results ($K)

#### <br>

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Q4 2022** | **Q3 2022** | **Q4 2021** | **FY 2022** | **FY 2021** |
| Net Income | $40778 | $39698 | $32752 | $161509 | $114669 |
| Earnings per Diluted Share | $1.28 | $1.24 | $1.08 | $5.07 | $3.85 |

---

*A reconciliation between GAAP operating results and non-GAAP operating results is provided following the financial statements included in this release. See also "Use of Non-GAAP Adjusted Financial Measures" section.*

------

#### Management Comments
"The fourth quarter was a strong resolution to another record-breaking year for Nova, characterized by notable annual increase in revenue and profitability. Despite the volatility in the markets, the company was able to perform well during the fourth quarter, highlighting the strength of our diversified and agile business model," said Eitan Oppenhaim, President and CEO. "While we remain vigilant in addressing the current challenges, we continue to implement our long-term strategic plans to solidify our position and seize various opportunities, particularly in this dynamic environment."

#### 2023 First Quarter Financial Outlook
Management provided an outlook for the first quarter, the period ending March 31, 2023. Based on current estimates, management expects:

• $125 million to $135 million in revenue

• $0.77 to $0.98 in diluted GAAP EPS

• $0.93 to $1.14 in diluted non-GAAP EPS

#### 2022 Fourth Quarter Results
Total revenues for the fourth quarter of 2022 were $151.2 million, an increase of 5% compared with the third quarter of 2022 and an increase of 24% compared with the fourth quarter of 2021.

Gross margin in the fourth quarter of 2022 was 55%, compared with 57% in the third quarter of 2022 and compared with 56% in the fourth quarter of 2021.

Operating expenses in the fourth quarter of 2022 were $46.8 million, compared with $43.2 million in the third quarter of 2022 and $38.4 million in the fourth quarter of 2021.

On a GAAP basis, the Company reported net income of $36.1 million, or $1.14 per diluted share, in the fourth quarter of 2022. This is compared with net income of $35.1 million, or $1.10 per diluted share, in the third quarter of 2022, and net income of $22.2 million, or $0.73 per diluted share, in the fourth quarter of 2021.

On a non-GAAP basis, the Company reported net income of $40.8 million, or $1.28 per diluted share, in the fourth quarter of 2022. This is compared with net income of $39.7 million, or $1.24 per diluted share, in the third quarter of 2022, and net income of $32.8 million, or $1.08 per diluted share, in the fourth quarter of 2021.

#### 2022 Full Year Results
Total revenues for 2022 were $570.7 million, an increase of 37% compared to total revenues of $416.1 million for 2021.

Gross margin in 2022 was 56%, compared with 57% in 2021.

Operating expenses in 2022 were $172.5 million, compared with operating expenses of $125.0 million in 2021.

On a GAAP basis, the Company reported net income of $140.2 million, or $4.40 per diluted share, in 2022. This is compared with a net income of $93.1 million, or $3.12 per diluted share, in 2021.

On a non-GAAP basis, the Company reported net income of $161.5 million, or $5.07 per diluted share, in 2022. This is compared with net income of $114.7 million, or $3.85 per diluted share, in 2021.

------

#### Conference Call Information
Nova will host a conference call today, February 15, 2023, at 8:30 a.m. Eastern Time, to discuss the financial results and outlook. To attend the conference call, please dial one of the following teleconferencing numbers. Please begin by placing your calls five minutes before the conference call commences. If you are unable to connect using the toll-free numbers, please try the international dial-in number.

U.S. TOLL-FREE Dial-in Number: 1-844-826-3035

ISRAEL TOLL-FREE Dial-in Number: 1-80-921-3284

INTERNATIONAL Dial-in Number: 1-412-317-5195

At:

8:30 a.m. Eastern Time

5:30 a.m. Pacific Time

3:30 p.m. Israel Time

The conference call will also be webcast live from a <u>Link on Nova's website</u> at https://www.novami.com/investors/events/.

A replay of the conference call will be available from February 15, 2023, at 11:30 a.m. Eastern Time to February 22, 2023, at 11:59 p.m. Eastern Time. To access the replay, please dial one of the following numbers:

Replay Dial-in TOLL-FREE: 1-844-512-2921

Replay Dial-in TOLL/INTERNATIONAL: 1-412-317-6671

Replay Pin Number: 10174355

A replay will also be available for 90 days on <u>Nova's website link</u> at https://www.novami.com/investors/events/.

#### About Nova
Nova is a leading innovator and key provider of material, optical and chemical metrology solutions for advanced process control in semiconductor manufacturing. Nova delivers continuous innovation by providing state-of-the-art high-performance metrology solutions for effective process control throughout the semiconductor fabrication lifecycle. Nova's product portfolio, which combines high-precision hardware and cutting-edge software, provides its customers with deep insight into developing and producing the most advanced semiconductor devices. Nova's unique capability to deliver innovative solutions enables its customers to improve performance, enhance product yields and accelerate time to market. Nova acts as a partner to semiconductor manufacturers from its offices worldwide. Additional information may be found on <u>Nova's website link</u> - https://www.novami.com/.

Nova is traded on the Nasdaq and TASE, Nasdaq ticker symbol NVMI.

#### Use of Non-GAAP Adjusted Financial Measures
This press release provides financial measures that exclude amortization of acquired intangible assets, acquisition-related expenses, inventory step-up and contingent consideration revaluation, stock-based compensation expenses, revaluation of operating lease liabilities, amortization of debt discount and issuance costs, tax effect of non-GAAP adjustment and taxes attributed to one-time elective tax settlement, as applicable, and are therefore not calculated in accordance with generally accepted accounting principles (GAAP). Management believes that these non-GAAP financial measures provide meaningful supplemental information regarding Nova's performance because they reflect our operational results and enhance management's and investors' ability to evaluate Nova's performance before charges or benefits considered by management to be outside Nova's ongoing operating results. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Management believes that it is in the best interest of its investors to provide financial information that will facilitate comparison of both historical and future results and allow greater transparency to supplemental information used by management in its financial and operational decision making. A reconciliation of each GAAP to non-GAAP financial measure discussed in this press release is contained in the accompanying financial tables.

------

#### Forward-Looking Statements
This press release contains forward-looking statements within the meaning of safe harbor provisions of the Private Securities Litigation Reform Act of 1995 relating to future events or our future performance, such as statements regarding, but not limited to, anticipated growth opportunities and projections about our business and its future revenues, expenses and profitability. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to differ materially from any future results, levels of activity, performance or achievements expressed or implied in those forward-looking statements. Factors that may affect our results, performance, circumstances or achievements include, but are not limited to, the following: catastrophic events such as the outbreak of COVID-19; increased information technology security threats and sophisticated computer crime; foreign political and economic risks; changes in U.S. trade policies; inability to protect our intellectual property; open source technology exposure; failure to compete effectively or to respond to the rapid technological changes; consolidation in our industry; difficulty in predicting the length and strength of any downturn or expansion period of the market we target; factors that adversely affect the pricing and demand for our product lines; dependency on a small number of large customers; dependency on a single manufacturing facility per product line; dependency on a limited number of suppliers; difficulty in integrating current or future acquisitions; lengthy sales cycle and customer delays in orders; political, economic, and military instability in Israel; risks related to our convertible notes; currency fluctuations; and quarterly fluctuations in our operating results. We cannot guarantee future results, levels of activity, performance or achievements. The matters discussed in this press release also involve risks and uncertainties summarized under the heading "Risk Factors" in Nova's Annual Report on Form 20-F for the year ended December 31, 2021, filed with the Securities and Exchange Commission on March 1, 2022. These factors are updated from time to time through the filing of reports and registration statements with the Securities and Exchange Commission. Nova Ltd. does not assume any obligation to update the forward-looking information contained in this press release.

(Tables to Follow)

------

#### NOVA LTD.<br> CONDENSED CONSOLIDATED BALANCE SHEETS
(U.S. dollars in thousands) - (Unaudited)

---

| | | |
|:---|:---|:---|
|  | As of December 31, | As of December 31, |
|  | 2022 | 2021 |
| **ASSETS** |  |  |
| Current assets |  |  |
| &nbsp;&nbsp;&nbsp; Cash and cash equivalents | 111121 | 126698 |
| &nbsp;&nbsp;&nbsp; Short-term interest-bearing bank deposits | 95305 | 221897 |
| &nbsp;&nbsp;&nbsp; Marketable securities | 167073 | 61568 |
| &nbsp;&nbsp;&nbsp; Trade accounts receivable, net | 109320 | 68446 |
| &nbsp;&nbsp;&nbsp; Inventories | 116600 | 78665 |
| &nbsp;&nbsp;&nbsp; Other current assets | 13527 | 9242 |
| **Total current assets** | 612946 | 566516 |
| Non-current assets |  |  |
| &nbsp;&nbsp;&nbsp; Marketable securities | 153462 | 137415 |
| &nbsp;&nbsp;&nbsp; Interest-bearing bank deposits | 483 | 3672 |
| &nbsp;&nbsp;&nbsp; Restricted interest-bearing bank deposits and restricted cash | 1600 | 1600 |
| &nbsp;&nbsp;&nbsp; Deferred tax assets | 20097 | 6161 |
| &nbsp;&nbsp;&nbsp; Severance pay funds | 1194 | 1327 |
| &nbsp;&nbsp;&nbsp; Operating lease right-of-use assets | 44885 | 30627 |
| &nbsp;&nbsp;&nbsp; Property and equipment, net | 55886 | 34460 |
| &nbsp;&nbsp;&nbsp; Intangible assets, net | 43586 | 2601 |
| &nbsp;&nbsp;&nbsp; Goodwill | 49009 | 20114 |
| &nbsp;&nbsp;&nbsp; Other long-term assets | 957 | 661 |
| **Total non-current assets** | 371159 | 238638 |
| **Total assets** | 984105 | 805154 |
| **LIABILITIES AND SHAREHOLDERS' EQUITY** |  |  |
| Current liabilities |  |  |
| &nbsp;&nbsp;&nbsp; Convertible senior notes, net | - | 183037 |
| &nbsp;&nbsp;&nbsp; Trade accounts payable | 42732 | 36218 |
| &nbsp;&nbsp;&nbsp; Deferred revenues | 30543 | 15338 |
| &nbsp;&nbsp;&nbsp; Operating lease current liabilities | 5968 | 4452 |
| &nbsp;&nbsp;&nbsp; Other current liabilities | 54825 | 48885 |
| **Total current liabilities** | 134068 | 287930 |
| Non-current liabilities |  |  |
| &nbsp;&nbsp;&nbsp; Convertible senior notes, net | 196394 | - |
| &nbsp;&nbsp;&nbsp; Accrued severance pay | 3599 | 3686 |
| &nbsp;&nbsp;&nbsp; Operating lease long-term liabilities | 43697 | 33450 |
| &nbsp;&nbsp;&nbsp; Long-term deferred tax liability | 12190 | - |
| &nbsp;&nbsp;&nbsp; Other long-term liabilities | 7194 | 6334 |
| **Total non-current liabilities** | 263074 | 43470 |
| **Shareholders' equity** | 586963 | 473754 |
| **Total liabilities and shareholders' equity** | 984105 | 805154 |

---

------

#### NOVA LTD.<br> CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(U.S. dollars in thousands, except per share data) - (Unaudited)

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three months ended** <br> **December 31,** | **Three months ended** <br> **December 31,** | **Year ended** <br> **December 31,** | **Year ended** <br> **December 31,** |
|  | 2022 | 2021 | 2022 | 2021 |
| Revenues: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Products | 123486 | 99898 | 464152 | 337026 |
| &nbsp;&nbsp;&nbsp;&nbsp; Services | 27752 | 21623 | 106577 | 79087 |
| Total revenues | 151238 | 121521 | 570729 | 416113 |
| Total cost of revenues | 67510 | 53272 | 248333 | 178752 |
| **Gross profit** | 83728 | 68249 | 322396 | 237361 |
| Operating expenses: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Research and development, net | 26206 | 20140 | 90458 | 65857 |
| &nbsp;&nbsp;&nbsp;&nbsp; Sales and marketing | 14058 | 11219 | 52122 | 39336 |
| &nbsp;&nbsp;&nbsp;&nbsp; General and administrative | 5077 | 6262 | 23852 | 17324 |
| &nbsp;&nbsp;&nbsp;&nbsp; Amortization of intangible assets | 1463 | 735 | 6033 | 2458 |
| Total operating expenses | 46804 | 38356 | 172465 | 124975 |
| **Operating income** | 36924 | 29893 | 149931 | 112386 |
| &nbsp;&nbsp;&nbsp;&nbsp; Financing income (expense), net | 2157 | (1518) | 8478 | (3133) |
| **Income before taxes on income** | 39081 | 28375 | 158409 | 109253 |
| &nbsp;&nbsp;&nbsp;&nbsp; Income tax expenses | 2983 | 6149 | 18196 | 16152 |
| **Net income for the period** | 36098 | 22226 | 140213 | 93101 |
| **Earnings per share:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Basic | 1.26 | 0.78 | 4.89 | 3.28 |
| &nbsp;&nbsp;&nbsp;&nbsp; Diluted | 1.14 | 0.73 | 4.40 | 3.12 |
| **Shares used in calculation of earnings per share (in thousands):** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Basic | 28731 | 28539 | 28697 | 28372 |
| &nbsp;&nbsp;&nbsp;&nbsp; Diluted | 31737 | 30285 | 31870 | 29816 |

---

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#### NOVA LTD.<br> CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(U.S. dollars in thousands) - (Unaudited)

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Three months ended <br> December 31, | Three months ended <br> December 31, | **Year ended**<br> **December 31,** | **Year ended**<br> **December 31,** |
|  | 2022 | 2021 | 2022 | 2021 |
|  **Cash flows from operating activities:** |  |  |  |  |
|  **Net income** | 36098 | 22226 | 140213 | 93101 |
| Adjustments to reconcile net income to net cash provided by operating activities: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Depreciation of property and equipment | 2491 | 1681 | 8621 | 6475 |
| &nbsp;&nbsp;&nbsp;&nbsp; Amortization of intangible assets | 1463 | 735 | 6033 | 2458 |
| &nbsp;&nbsp;&nbsp;&nbsp; Amortization of premium and accretion of discount on marketable securities, net | (254) | 855 | 1666 | 1708 |
| &nbsp;&nbsp;&nbsp;&nbsp; Amortization of debt discount and issuance costs | 322 | 1075 | 1282 | 4229 |
| &nbsp;&nbsp;&nbsp;&nbsp; Share-based compensation | 4381 | 3496 | 16647 | 10488 |
| &nbsp;&nbsp;&nbsp;&nbsp; Net effect of exchange rate fluctuation | 412 | (694) | 4523 | (745) |
|  Changes in assets and liabilities: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Trade accounts receivables, net | (9421) | (3816) | (31634) | (5132) |
| &nbsp;&nbsp;&nbsp;&nbsp; Inventories | (2168) | (5964) | (29311) | (18457) |
| &nbsp;&nbsp;&nbsp;&nbsp; Other current and long-term assets | 5926 | 1076 | (4223) | 192 |
| &nbsp;&nbsp;&nbsp;&nbsp; Deferred tax assets, net | (6598) | (741) | (13740) | (2989) |
| &nbsp;&nbsp;&nbsp;&nbsp; Operating lease right-of-use assets | 841 | 489 | 3873 | 1680 |
| &nbsp;&nbsp;&nbsp;&nbsp; Trade accounts payables | (79) | 6799 | 5142 | 11697 |
| &nbsp;&nbsp;&nbsp;&nbsp; Deferred revenues | 10492 | (16572) | 15243 | 10621 |
| &nbsp;&nbsp;&nbsp;&nbsp; Operating lease liabilities | 115 | 164 | (6351) | (904) |
| &nbsp;&nbsp;&nbsp;&nbsp; Other current and long-term liabilities | 5548 | 9587 | 1509 | 17919 |
| &nbsp;&nbsp;&nbsp;&nbsp; Accrued severance pay, net | 27 | (133) | 46 | (79) |
|  **Net cash provided by operating activities** | 49596 | 20263 | 119539 | 132262 |
|  **Cash flows from investment activities:** |  |  |  |  |
| Acquisition of subsidiary, net of acquired cash | - | - | (78469) | - |
| Change in short-term and long-term interest-bearing bank deposits | (26517) | 37223 | 129944 | (31456) |
| Investment in marketable securities | (30064) | (6364) | (211742) | (215091) |
| Proceeds from maturities of marketable securities | 23390 | 5141 | 81325 | 12862 |
| Purchase of property and equipment | (8429) | (2250) | (21314) | (4816) |
|  **Net cash provided by (used in) investing activities** | (41620) | 33750 | (100256) | (238501) |
|  **Cash flows from investment activities:** |  |  |  |  |
| Settlement of a contingent consideration liability | - | - | (8480) | - |
| Purchases of treasury shares | (15000) | - | (21416) | - |
| Proceeds from exercise of options | 8 | - | 90 | 11 |
|  **Net cash used in financing activities** | (14992) | - | (29806) | 11 |
|  Effect of exchange rate fluctuations on cash and cash equivalents | (77) | 558 | (4454) | 622 |
| **Changes in cash and cash equivalents** and restricted cash | (7093) | 54571 | (14977) | (105606) |
|  **Cash and cash equivalents - beginning of period** | 118814 | 72127 | 126698 | 232304 |
|  **Cash and cash equivalents** and restricted cash **- end of period** | 111721 | 126698 | 111721 | 126698 |

---

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#### NOVA LTD.<br> RECONCILIATION OF GAAP TO NON-GAAP RESULTS
(U.S. dollars in thousands, except percentage and per share data) - (Unaudited)

---

| | | | |
|:---|:---|:---|:---|
|  | Three months ended | Three months ended | Three months ended |
|  | December 31,<br> 2022 | September 30,<br> 2022 | December 31,<br> 2021 |
| GAAP gross profit | 83728 | 82130 | 68249 |
| &nbsp;&nbsp;&nbsp;&nbsp; Stock-based compensation\* | 1148 | 1114 | 803 |
| Non-GAAP gross profit | 84876 | 83244 | 69052 |
| *GAAP gross margin as a percentage of revenues* | 55% | 57% | 56% |
| *Non-GAAP gross margin as a percentage of revenues* | 56% | 58% | 57% |
| GAAP operating income | 36924 | 38938 | 29893 |
| &nbsp;&nbsp;&nbsp;&nbsp; Stock-based compensation\* | 4381 | 4334 | 3496 |
| &nbsp;&nbsp;&nbsp;&nbsp; Acquisition-related expenses and contingent consideration revaluation | (752) | - | 999 |
| &nbsp;&nbsp;&nbsp;&nbsp; Amortization of acquired intangible assets | 1463 | 1444 | 735 |
| Non-GAAP operating income | 42016 | 44716 | 35123 |
| *GAAP operating margin as a percentage of revenues* | 24% | 27% | 25% |
| *Non-GAAP operating margin as a percentage of revenues* | 28% | 31% | 29% |
| GAAP net income | 36098 | 35075 | 22226 |
| &nbsp;&nbsp;&nbsp;&nbsp; Stock-based compensation\* | 4381 | 4334 | 3496 |
| &nbsp;&nbsp;&nbsp;&nbsp; Acquisition-related expenses and contingent consideration revaluation | (752) | - | 999 |
| &nbsp;&nbsp;&nbsp;&nbsp; Amortization of acquired intangible assets | 1463 | 1444 | 735 |
| &nbsp;&nbsp;&nbsp;&nbsp; Amortization of debt discount and issuance costs | 322 | 322 | 1075 |
| &nbsp;&nbsp;&nbsp;&nbsp; Revaluation of operating lease liabilities | 294 | (572) | 907 |
| &nbsp;&nbsp;&nbsp;&nbsp; Tax effect of non-GAAP adjustments | (1028) | (905) | (402) |
| &nbsp;&nbsp;&nbsp;&nbsp; Taxes attributed to one-time elective tax settlement | - | - | 3716 |
| Non-GAAP net income | 40778 | 39698 | 32752 |
| GAAP basic earnings per share | 1.26 | 1.22 | 0.78 |
| Non-GAAP basic earnings per share | 1.42 | 1.38 | 1.15 |
| GAAP diluted earnings per share | 1.14 | 1.10 | 0.73 |
| Non-GAAP diluted earnings per share | 1.28 | 1.24 | 1.08 |
| Shares used for calculation of earnings per share (in thousands): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Basic | 28731 | 28685 | 28539 |
| &nbsp;&nbsp;&nbsp;&nbsp; Diluted | 31737 | 31892 | 30285 |

---

\* Stock-based compensation for the three months ended December 31, 2022 included in – Cost of revenues - 1,148; Research and development, net – 1,856; Sales and marketing – 810; General and administrative – 567.

------

(U.S. dollars in thousands, except percentage and per share data) - (Unaudited)

---

| | | |
|:---|:---|:---|
|  | Year ended December 31, | Year ended December 31, |
|  | 2022 | 2021 |
| GAAP gross profit | 322396 | 237361 |
| &nbsp;&nbsp;&nbsp;&nbsp; Stock-based compensation\* | 4166 | 2160 |
| &nbsp;&nbsp;&nbsp;&nbsp; Acquisition-related inventory step-up | 2972 | - |
| Non-GAAP gross profit | 329534 | 239521 |
| *GAAP gross margin as a percentage of revenues* | 56% | 57% |
| *Non-GAAP gross margin as a percentage of revenues* | 58% | 58% |
| GAAP operating income | 149931 | 112386 |
| &nbsp;&nbsp;&nbsp;&nbsp; Stock-based compensation\* | 16647 | 10488 |
| &nbsp;&nbsp;&nbsp;&nbsp; Acquisition-related inventory step-up | 2972 | - |
| &nbsp;&nbsp;&nbsp;&nbsp; Acquisition-related expenses and contingent consideration revaluation | 2995 | 999 |
| &nbsp;&nbsp;&nbsp;&nbsp; Amortization of acquired intangible assets | 6033 | 2458 |
| Non-GAAP operating income | 178578 | 126331 |
| *GAAP operating margin as a percentage of revenues* | 26% | 27% |
| *Non-GAAP operating margin as a percentage of revenues* | 31% | 30% |
| GAAP net income | 140213 | 93101 |
| &nbsp;&nbsp;&nbsp;&nbsp; Stock-based compensation\* | 16647 | 10488 |
| &nbsp;&nbsp;&nbsp;&nbsp; Acquisition-related inventory step-up | 2972 | - |
| &nbsp;&nbsp;&nbsp;&nbsp; Acquisition-related expenses and contingent consideration revaluation | 2995 | 999 |
| &nbsp;&nbsp;&nbsp;&nbsp; Amortization of acquired intangible assets | 6033 | 2458 |
| &nbsp;&nbsp;&nbsp;&nbsp; Amortization of debt discount and issuance costs | 1282 | 4229 |
| &nbsp;&nbsp;&nbsp;&nbsp; Revaluation of operating lease liabilities | (4174) | 818 |
| &nbsp;&nbsp;&nbsp;&nbsp; Tax effect of non-GAAP adjustments | (4459) | (1140) |
| &nbsp;&nbsp;&nbsp;&nbsp; Taxes attributed to one-time elective tax settlement | - | 3716 |
| Non-GAAP net income | 161509 | 114669 |
| GAAP basic earnings per share | 4.89 | 3.28 |
| Non-GAAP basic earnings per share | 5.63 | 4.04 |
| GAAP diluted earnings per share | 4.40 | 3.12 |
| Non-GAAP diluted earnings per share | 5.07 | 3.85 |
| Shares used for calculation of earnings per share (in thousands): |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Basic | 28697 | 28372 |
| &nbsp;&nbsp;&nbsp;&nbsp; Diluted | 31870 | 29816 |

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\* Stock-based compensation for the year ended December 31, 2022, included in – Cost of revenues - 4,166; Research and development, net – 6,861; Sales and marketing – 3,179; General and administrative – 2,441

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#### NOVA LTD.<br> SUPPLEMENTAL INFORMATION - RECONCILIATION OF FIRST QUARTER 2023<br> GAAP TO NON-GAAP GUIDANCE
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Unaudited)

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| | | |
|:---|:---|:---|
|  | Low | High |
| Estimated GAAP net income per diluted share | 0.77 | 0.98 |
| Estimated non-GAAP items: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Stock-based compensation | 0.14 | 0.14 |
| &nbsp;&nbsp;&nbsp;&nbsp; Amortization of acquired intangible assets | 0.04 | 0.04 |
| &nbsp;&nbsp;&nbsp;&nbsp; Amortization of issuance costs | 0.01 | 0.01 |
| &nbsp;&nbsp;&nbsp;&nbsp; Tax effect of non-GAAP adjustments | (0.03) | (0.03) |
| Estimated non-GAAP net income per diluted share | 0.93 | 1.14 |

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