Investor PresentationSeptember 2012

NASDAQ: MEMS“Powerful sensing solutions for a better life”

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Forward-Looking Statement

This presentation contains forward-looking statements within the meaning of Section27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of1934. These statements are subject to risks and uncertainties that could cause theCompany’s actual operating results to differ materially from those indicated by theforward-looking statements. For further information on risk factors affecting theCompany’s business, please refer to the “Risk Factors” section of our Form 10-K andother filings with the Securities and Exchange Commission. The Company expresslydisclaims any obligation to update and revise publicly any forward-looking statements,whether as a result of new information, future events or otherwise.

MEMSIC Introduction

� A standalone pure-play MEMS sensor & solution company that has:

� Complete capability in MEMS product design, process development, and high-volume, low-cost manufacturing

� Sensing system integration differentiates MEMS

� Global customer base and wide range of market penetration

� Provides state-of-the-art, cost-effective MEMS IC sensors and multi-sensor system solutions

� MEMS sensors will be the largest growth driver in IC’s for the next decade

� Market for MEMS sensors will grow to 3B+ annual units by 2015 at >30% CAGR

� Executing diversification strategy for long term gross margin growth

� The consumer market by nature has lower margin

� Diversifying into high-precision, high-end industrial and automotive application

� Investing in industrial level multi-sensor solution products

� MEMSIC has accumulated many fundamental patents in MEMS process and applications

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$8.7

$10.2$11.4

$13.0

$15.0

$17.3

$0.0

$2.0

$4.0

$6.0

$8.0

$10.0

$12.0

$14.0

$16.0

$18.0

$20.0

2010 2011E 2012E 2013E 2014E 2015E

$ in

Billio

ns

Fast-Growth MEMS Market

MEMS Sensor Market Forecast (2010-2015)(1)

�Fastest growing sub-segment of semiconductors

�Consumer / mobile phone will constitute >50% of all MEMS sales in 2015

�Integrated sensor systems forecasted to drive substantial share of additional growth

MEMS Market Forecasted to Grow at ~2x the Broader Semiconductor Market through 2015

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(1) Source: Yole Developpement, March 2011

MEMSIC Addressable Markets

Handset Market

� Handset market projected to grow to 2.3B+ units by 2015

� Sensor systems are a de-facto standard in handsets

Consumer Market

� Cameras (DSCs/SLRs); Projectors; Toys

� DSC camera market forecasted to grow to $150MM units by 2015

Automotive Market

� Automotive MEMs - growing content in multiple car applications

� Global market for automotive MEMS grew by 22% in 2011 to $2.2B; forecasted to grow to $3.1B by 2015

Industrial Market

� Large and stable

� Increasing need for flexible, intelligent, distributed and wireless monitoring & control in industrial manufacturing, avionics, agricultural and defense applications

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Wide Product and Technology Range

Technology and Product Application Market

MEMS Sensors

� eCompass

� Accelerometers

� Gas Flow Sensors and modules

�Mobile Phones

�Automotive

� LBS

�Consumer

� Industrial

Inertial Navigation

System & Solution

� Inertial Sensing

� Navigation System

� Flight Display

�Aerospace

� Industrial Control

�Robot

�High-Speed Trains

Wireless Sensing

Network (WSN)

� X-mesh Network

� Sensor Integration

� Transceivers

�Environmental Monitoring

�Green Living

�Smart GRID

�Agricultural

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3x growth in device shipments

$6.9$9.1

$13.1

$25.3$20.1

$28.4

$38.7

$68.2

Washing machineProjector customers:

Rollover application

1st CMOS monolithic accelerometer

1st MEMS company listed on

Company founded - 1999

The most reliable sensor for

automotive

Company Milestones

Product Milestones

Bu

sin

ess

Fin

an

cia

lP

rod

ucts

Desig

n W

ins

Honored for world’s smallest accelerometer

Revenue

Stability control application

HDD Protection

Profitable for 6 out of 8 years (from 2004-2011)

1st MEMS sensor fusion IMU with GPS

1st MEMS-based AHRS with FAA certification

1st cell phone application for AMR compass

1st cell phone application for accelerometer

Acquired IP for sensor fusion & system technology

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 1H12

$34.4

Introduced gas flow sensor module

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MEMSIC eCompass ProductBeats Every Competition by Performance

(1) Source: Yole Developpement, March 2011

�Definition - Device that measures the strength and/or direction of magnetic fields

Applications

• Compass in Mobile

Devices

• Position Sensing

• Current Sensing

• Automotive

• Medical

• Mineral

Exploration

• Military

• Gesture

Recognition

� Unique AMR technology enables:

• Highest accuracy

• Highest response speed

• Low power consumption

• Lowest noise

Magnetometer / Compass

MEMSIC – A Leader in the Compass Market

MMC3140MS MMC3316MTMMC3280MA

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� Unique packaging technology enables:

• Low-cost package capturing superior performance

• High yield

• High reliability

� Worldwide volume will reach >800M units by 2014

Large TAM

(1) Source: Yole Developpement, September 2011

Mobile PhoneAutomotive Consumer Industrial

� Definition - Device that measures acceleration and tilt

� Uses heated gas molecules to detect acceleration

• Low cost, highest reliability (no moving parts)

• High shock survivability

• High accuracy and temperature performance

- World’s Smallest Accelerometer, honored by Electronic Products Magazine

• Special handling & testing not required, saving significant costs

�Electronic Stability Control �Rollover�Headlight Levelling�Alarm�Testing

�Systems�Gas Flow Meter�Equipment�Facilities Monitoring�Current Sensing

�Digital Cameras�Projectors�PMPs�Game Consoles

�Orientation Sensing�Pedometer�Picture Rotation�Image Stabilization�Gaming

�White Goods�Hard Disk Protection�Navigation Devices

MEMSIC AccelerometerBeats Every Competition by Size and Cost

Large TAMMEMSIC’s Unique Patented Thermal Technology

MEMSIC – Accelerometer / Tilt Sensor Applications

Accelerometer / Tilt Sensor

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� Projected to grow from $1.3B in 2010 to $1.8B by 2014

MEMSIC Inertial Systems and SolutionsIntegration Capability Way Ahead of Competition

Description

� High-performance inertial 11DOF systems for avionics and industrial applications

� MEMS-based solutions for measuring static and dynamic motion in challenging environments – e.g., avionics,

remotely operated vehicles, agricultural and construction vehicles, automotive test and wind power turbines

� MEMSIC: First to market with FAA-certified, MEMS-based systems flying in 600+ types of aircraft

• Anticipate 30,000 retrofit upgrades in next 5 years

� Integrated: Integrated with MEMS sensors, GPS, and wireless links to extend applications in industrial and transportation for safety and structural health monitoring

� High barriers to entry: Proprietary algorithms, FAA certification and established customer relationships

MEMSIC’sInertial Systems

MEMSIC – Inertial Systems Applications

Products:� Inertial Measurement Units� Remote magnetometer systems� Heading Reference Systems (AHRS)� Vertical gyroscopes (VG)� Fiber optic vertical gyros

Avionics Industrial

Applications:� Avionics systems� Unmanned vehicle control� Platform stabilization� Land vehicle guidance� Flight management systems� Airborne antennal control

Products:� Accelerometer systems� Magnetometer systems� Tilt sensors

Applications:� Automotive Testing� Monitoring (Condition, Vibration,� Wind Turbine, Structural Health)� Seismic Instrumentation� Antenna Stabilization� Towed sonar arrays� Construction

AHRS Family:� Vertical and

directional gyro � Measures roll,

pitch, and heading

VG Family:� Vertical gyro � Measures roll

and pitch

IMU Family:� 6DOF � Measures roll

angular rate and linear accel

NAV Family:� Mag sensors and

GPS� Full data – angles,

rates and accels

Product Features and Capabilities Select Systems

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MEMSIC Strategy

MEMSIC at Strategic Crossroad

� Sensor unit shipments to mobile phone applications grew 3x over the past two years

� MEMSIC’s market share grew to ~15% in 2011, up from 1% in 2010

� However, mobile phone gross margin decreased

� Primarily reflected pricing pressure at one major mobile phone customer

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Gro

ss M

arg

in %

Ship

ment (m

illio

n u

nits)

Trading Rapid Revenue Growth for Stable Revenue and Higher Margin

Going Forward: Targeting Margin Growth

� Focusing on design wins at higher-margin mobile customers

� Diversified group of global Tier 1 customers

� China smart phone market (market size: 300+M units in 2013)

� Developing marketing strategy in higher-margin applications

� Industrial applications

� Automotive applications

� Investing in higher-margin products

� Integrated solutions combining components, systems and software

� High performance industrial IMUs

� Gas flow sensor module for home gas metering, medical, and industrial apps

� Magnetic sensors for automotive, industrial, and medical applications

� Accelerometers for industrial and automotive applications 13

MEMSIC Gas Flow Sensor Module –Proprietary and High-Margin Product Example

� Disruptive Technology Over the Old Mechanical Meters

� True MASS flow measurement

� >15 years reliability, with performance guaranteed

� Fully electrical and easier integration to form SMART meter

� No moving parts, no wearing

� Potential future market: $170M*

� ~$80MM: residential gas meters

� ~$50M: automotive MAF (Mass Air Flow) sensors

� ~$40M: industrial/medical (HVAC, respiration, anesthesia, etc.)

� Starting to sample with interested customers

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Building a Stronger Organization

� Enhanced management team by bringing on industry experts

� Paul Zavracky, President, North American & European Operations

Co-founder, President & COO of The MicroOptical Corporation and Kopin Corporation

100+ publications and named inventor in 67 issued patents

� John Newton, VP, Marketing

23 years’ experience in IC industry

9 years as Executive Director, Product Definition & Business Management, Maxim Integrated Products

� Enhanced total quality system by hiring experienced corporate QA director

� Built a marketing team focusing on automotive and industrial applications

� Investing in R&D resources

� Improving new product development process

� Driving productivity improvements by implementing lean manufacturing

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Financial Highlights

Net Sales $38.7 $68.2 $34.4

Gross Profit $15.3 $23.8 $13.2

Gross Margin 39.6% 35.0% 38.3%

Net Income (Loss) ($7.4) ($6.1) 1 $0.7

EBITDA2 ($3.9) ($1.7) $3.2

Cash, Restricted Cash & S-T Investments $61.8

Total Assets $123.0

Total Liabilities $35.2

Shareholder’s Equity $87.8

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Financial Snapshot

Income Statement

as of 06-30-12

FY 2010 FY 2011

Balance Sheet

1 Includes a $4.5 million non-cash goodwill impairment charge 2 See Appendix

1H 2012

Investment Summary

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Large

Opportunity

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Right Products

at the

Right Time

Positioned

for Growth

& Profitability

�Large and fast-growing handset market

�Large and growing automotive market

�Diversified customer base including industrial

�Volume shipments of magnetic sensor and accelerometer

�Integrated sensing system product

�Leader in emerging flow sensor technology

�Managing risk with operating efficiency and leverage

�Continuously introducing cost-competitive products

�Strong balance sheet supports new product development initiatives

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MEMSIC INC.

One Tech Drive, Suite 325

Andover, Massachusetts 01810

TEL +1-978 738-0900

FAX +1-978 738-0196

EMAIL info@memsic.com

www.memsic.com

Thank You!

Yang Zhao, PhD

Chairman, CEO & President

zhao@memsic.com

+1-781-888-8688

Patricia Niu

Chief Financial Officer

pniu@memsic.com

+1-978-738-0900, ext. 225

Appendix

EBITDA is a measure used by management to evaluate the Company’s ongoing operations and as a general indicator of its operating cash flow (in

conjunction with a cash flow statement that also includes, among other items, changes in working capital and the effect of non-cash charges). The

Company defines EBITDA as net income, plus interest expense, net of interest income, provision for income taxes, and depreciation and amortization.

Management believes EBITDA is useful to investors because it is frequently used by securities analysts, investors and other interested parties in the

comparative evaluation of companies. Because not all companies use identical calculations, the company's presentation of EBITDA and EBITDA per

share may not be comparable to similarly titled measures of other companies. EBITDA is not a recognized term under GAAP and does not purport to be

an alternative to net income as a measure of operating performance or to cash flows from operating activities as a measure of liquidity. Additionally,

EBITDA is not intended to be a measure of free cash flow for management's discretionary use as it does not reflect certain cash requirements such as

interest payments, tax payments and debt service requirements. Pursuant to the requirements of Regulation G, we have provided a reconciliation of

EBITDA to GAAP net income:

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2012 2011 2012 2011

Net income (loss) (461,414)$ (1,108,301)$ 739,090$ (2,436,482)$

Interest (income) expense, net (125,259) (98,366) (233,034) (181,855)

Income tax expense 29,355 (3,084) 97,938 114,310

Depreciation and amortization 1,305,595 1,085,682 2,613,747 2,155,002

EBITDA 748,277$ (124,069)$ 3,217,741$ (349,025)$

Three months ended June 30, Six months ended June 30,