Slide 1: Quarterly Presentation Q2 2021
Meet the world with video communication as it should be Quarterly Presentation Q2 2021 August 12, 2021
Slide 2: Important notice and disclaimer
Important notice and disclaimer These materials have been produced by Pexip Holding ASA (the "Company“, and with subsidiaries the “Group”). The materials have been prepared for the exclusive use of persons attending an oral briefing and meeting to which these materials relate given by a representati
Slide 3: Recent highlights
Recent highlights 41% y-o-y Executing on growth NOK 177 million in growth in ARR to strategy; -23% EBITDA revenue for Q2 2021 USD 93 million margin for Q2 2021 Pexip Control Center, “Best Telehealth Continued to add several Direct Peering and Avaya Platform” award in the new Fortune 500 Videoconfere
Slide 4: Addressing a global market with a recurring revenue business model
Addressing a global market with a recurring revenue business model Booked Annual Recurring Revenue (“ARR”) portfolio per year end, USD million 93 82 • Users in ~190 countries CAGR • Over 300 partners in 70+ countries • Over 451 employees in 20+ countries 70% • ~97% of revenue from subscriptions EMEA
Slide 5: Video communications as it should be
✓A better way to meet with business-quality audio/video Video communications as it ✓Securely join from anywhere across multiple should be technologies ✓Customize the platform to meet the unique needs for the organization and IT ✓Full control of data privacy and sovereignty, and compliance with data
Slide 6: Large organizations choose Pexip for three main use cases
Large organizations choose Pexip for three main use cases High-quality video Vertical market Expanding access to meetings with focus applications and Microsoft Teams and on privacy and integrations Google Meet security 6
Slide 7: Pexip's differentiated customer offering is underpinned by unique technology
Pexip’s differentiated customer offering is underpinned by unique technology Smart transcoding Cloud agnostic deployment flexibility Private Cloud On-premise SaaS Self-Hosted • Proprietary real time media engine • Proprietary technology allows Pexip’s experience to be delivered on • Unique interoper
Slide 8: Solid growth path to long-term value creation
Solid growth path to long-term value creation 6 1 Massive, high-growth market Solid growth path to reach with unique position towards USD 300m by end-of-2024 large organizations 5 2 Massively scalable business Industry recognized video model with high sustainability communication platform with impac
Slide 9: Pexip is targeting USD 300 million in ARR by end of 2024
Pexip is targeting USD 300 million in ARR by end of 2024 Revenue growth ARR of USD 300 million by end-of-2024 2025 EBITDA of +25% with +25% revenue growth Long-term profitability Plan for negative 25-35% EBITDA margin in 2021/2022, neutral to positive EBITDA in 2023 Market recognition Recognized lea
Slide 10: Q2 Operational Update
Q2 Operational Update
Slide 11: Recent market developments
Recent market developments Broad adoption of video in knowledge worker organizations – early adoption in frontline customer care Increased competitiveness on cloud-based meetings from large known brands, with customers mainly focused on PC-to-PC meetings during pandemic Return to the office has take
Slide 12: Market impact on Pexip's main use cases - exemplified with recent customer wins
Market impact on Pexip’s main use cases - exemplified with recent customer wins High-quality video Vertical market Expanding access to meetings with focus applications and Microsoft Teams and on privacy and integrations Google Meet security 12
Slide 13: Pexip continues to win the trust of new large enterprises and public organizations
Pexip continues to win the trust of new large enterprises and public organizations Selected by a range of large organizations Large organizations driving growth Selected customer wins in Q2 2021 Share of ARR by account size in ARR, USD 93M YoY growth: +41% 23% 25% 66M 23% 25% 28% 26% 54% 56% 49% Q2
Slide 14: Pexip's product and go-to-market model designed for large organizations
Pexip’s product and go-to-market model designed for large organizations Generate demand internally Partners executing sales and integration services Targeting Large Organizations System integrators Pexip Scale through Audio / Video sales partners specialists teams Sales and go-to-market Equinor team
Slide 15: Continue to build growth capacity and culture
Continue to build growth capacity and culture Scaling the team Number of employees Strong team and culture is key for future growth Sales and Marketing R&D +80% Other 451 • Plan for 550-600 employees year end 2021 416 47 • Approx 100-150 new employees in 2022 361 41 • 50-100 new employees in 2023 an
Slide 16: Sales and Financial Performance
Sales and Financial Performance
Slide 17: 41% growth in Annual Recurring Revenue – Added 5.5 million in Q2 2021
41% growth in Annual Recurring Revenue – Added 5.5 million in Q2 2021 Booked Annual Recurring Revenue (ARR) development Q-o-Q growth in ARR USD million USD million +41% 93 87 82 9.1 73 • Q2 2021 growth in ARR of USD 5.5 million, compared +64% 66 to USD 9.1 million in Q2 57 2020 and USD 2.4 million i
Slide 18: Solid growth contributions from all geographies and product lines
Solid growth contributions from all geographies and product lines ARR per geo ARR per product USD million USD million APAC AMERICAS Pexip as-a-Service EMEA YoY growth: Self-hosted Software YoY growth: +41% 93 93 87 87 9 36% 82 82 9 73 8 73 62% 38 66 7 66 35 32 48% 33 7 29 28 27 25 24 23 29% 52 61% 5
Slide 19: New sales is the main driver for ARR growth with 40% in the last twelve months
New sales is the main driver for ARR growth with 40% in the last twelve months Development in ARR portfolio last twelve months USD million +11% -10% +41% • Continue to increase last twelve +40% months new sales 7,3 6,8 92,7 – New sales were USD 1.8 million lower than Q1 2021, impacted by 26,5 Net re
Slide 20: ARR growth driving revenue growth
ARR growth driving revenue growth Quarterly revenue development Comments NOK million Self-hosted Software Operating revenues – Pexip as-a-Service Pexip as-a-Service • Overall growth of 68% year-on-year to NOK 75 million, in line with ARR growth despite development in NOK/USD exchange rate. +9% Opera
Slide 21: Increase in operating expenses from planned investments in Sales and R&D capacity
Increase in operating expenses from planned investments in Sales and R&D capacity Quarterly OPEX development Comments NOK million IPO-related costs Other operating expenses Share option costs Other Salary and personnel expenses Other Operating expenses 218.8 • Overall increased activity level, while
Slide 22: Executing on communicated growth strategy
Executing on communicated growth strategy Cash flow from Significant investing activities investments per quarter in sales-related headcount, impacting EBITDA Comments NOK million, cash outflow 126 additional people • Significant investments into growth -11 in Sales and 40 14 acceleration, as indica
Slide 23: Capitalized investments
Capitalized investments Cash flow from investing activities per quarter Comments NOK million, cash outflow PPE and intangibles Software dev. 39.1 (17%) • Lower spend on PPE and intangibles compared to Q4 2020 and Q1 2021 as majority of UK office move is completed and 26.7 no spend related to custome
Slide 24: Cash flow bridge
Cash flow bridge Cash flow bridge Q2 2021 Comments NOKm • Negative EBITDA and CAPEX main -117 contributors to cash flow, in addition to 1,147 share buy back 41 1 6 12 72 • Negative cash flow of NOK 72 million, on the 1,031 same level as the net proceeds from March 5 6 employee option share issue – N
Slide 25: Summary and Outlook
Summary and Outlook
Slide 26: Q2 2021 in brief
Solid top line growth • Continued ARR growth with USD 5.5 million in Q2 2021/41% y-o-y growth • NOK 177 million in revenue for Q2 2021, +9% compared to Q2 2020 Q2 2021 in brief Executing on the acceleration plan • Launch of Pexip Control Center, Direct Peering and Avaya Collaboration • Continue to b
Slide 27: Outlook
Positive outlook for video communication • Majority of enterprises shifting to hybrid working • Organizations looking to embed video into their workflows towards customers • Pexip’s technology is uniquely positioned to meet these new customer needs • Sales pipeline for 2H 2021 is strong Will continu
Slide 28: Upcoming dates
Upcoming dates Update on Annual Recurring October 7, 2021 Revenue Q3 2021 quarterly November 11, 2021 presentation 28
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