Slide 1: Q4 2017 Presentation
Napatech Q4 2017 Presentation February 13, 2018 1 Napatech A/S © Copyright 2017
Slide 2: Highlights
Highlights Sales performance for full year and Q4 2017 ▪ 7% decrease in USD sales for the full year and 32% for Q4 2017 ▪ 12% decrease in DKK Revenue for the full year and 48% for Q4 2017 Pandion business ▪ 4% of our sales in Q4 coming from Pandion products ▪ Branded solution not well accepted in th
Slide 3: Napatech Q4 2017 Financials
Napatech Q4 2017 Financials 3 Napatech A/S © Copyright 2017
Slide 4: Q4 2017 Revenue
Q4 2017 Revenue Sales and Revenue Growth (YoY) 0% Comments: • Revenue decline in Q4 is 48% -10% • Revenue decline FY 2017 is 12% -20% • The revenue for the period has been negatively influenced by the -30% postponement of a few major projects into 2018 -40% • Currency has had a large effect as -50%
Slide 5: Pandion Progression
Pandion Progression Pandion share of sales 14% Comments: 12% • Q4 Pandion sale is below our expectations 10% • Pandion product mix sold: • As a recorder solution for 8% system integrators • As recorder software and 6% accelerators to OEM customers • As a DELL-branded recorder 4% through DELL 2% 0% Q
Slide 6: Regional Revenue Distribution
Regional Revenue Distribution Quarterly revenue in MDKK -53% Comments: 70 • North America and EMEA growth 60 affected by the postponement of a few major projects into 2018 50 • APAC decline due to timing of 40 projects in the region 30 -35% 20 -14% 10 - NAM EMEA APAC Q4'16 Q4'17 6 Napatech A/S © Cop
Slide 7: Last Twelve Months Rolling Revenue
Last Twelve Months Rolling Revenue Revenue (DKK) 280 Comments: -12% 260 • Last twelve months (LTM) rolling 240 revenue is negative 12 % (FY 2017 guidance “negative 220 growth”) 200 • By comparison, EBITDA (LTM) for 180 same period has shown an decline of 68% 160 140 120 100 Q4'16 Q1'17 Q2'17 Q3'17 Q
Slide 8: Gross Margin Development
Gross Margin Development Gross Margin 80% Comments: • Gross margin FY 2017 is 68% (FY 2017 guidance “around 68%”) 75% • The gross margin in Q4’17 is at 54%, a decrease compared to Q4 2016 70% • Larger volumes to strategic accounts and changes in product 65% mix are expected to drive the gross margin
Slide 9: EBITDA Margin
EBITDA Margin EBITDA Margin 35% Comments: 30% • EBITDA margin Q4’17 is negative 15% 25% • EBITDA margin FY 2017 is 7% 20% • EBITDA margin is lower in Q4 compared to last year. This is due 15% to the lower revenue and lower gross margin, as our cost are very 10% stable, the EBITDA margin is heavily d
Slide 10: Financial Results Q4 2017
Financial Results Q4 2017 (Figures in MDKK) Q4 2017 Q4 2016 2017 2016 Revenue 47.9 92.3 206.0 234.7 Growth YoY** (48%) 32% (12%) 8% Gross Margin 54% 66% 68% 70% EBITDA (7.2) 28.0 13.9 43.5 EBIT (16.5) 17.2 (23.9) 6.0 Cash flow from operating activities 8.2 5.7 12.7 13.0 Cash and cash equivalents, en
Slide 11: This is Napatech
This is Napatech Today with focus on: “Network Function Virtualization” for the 5G Mobile market 11 Napatech A/S © Copyright 2017
Slide 12: Major market trends allow Napatech to expand to high-growth applications
Major market trends allow Napatech to expand to a new range of high-growth applications – as presented on CMD’17 Cyber Security Big Data Mobile Infrastructure Testing Firewall Analytics 5G Load Balancer Quality of Experience Next-Gen Firewall Trading SD-WAN Service Assurance Intrusion Detection Netw
Slide 13: Hyper-Scale Cloud Data Centers
Hyper-Scale Cloud Data Centers Common Platform Ensures Scalability to Meet Demand Billions of Mobile and IoT Devices Hyper-Scale Cloud Datacenter Thousands of interconnected servers running cloud services 5G Mobile Connectivity Smart Phones Smart Cars Hyper-Scale Cloud Service Providers Tablets Smar
Slide 14: Reconfigurable Computing Platform
Reconfigurable Computing Platform FPGA’s Provide The Additional Processing Power Reconfigurable Computing Platform Combination of CPU and FPGA processes all the data for cloud services FPGAs can focus on specific tasks while CPU continues to support other tasks CPU Processing FPGA-based SmartNIC can
Slide 15: 5G Mobile is a complementary disruption
5G Mobile is not an evolution but a complementary disruption designed to enable new services on new devices reusing 4G 1G 2G 3G 4G 5G First First First First First analog digital smartphones high-speed all-IP multi-device multi-purpose mobile mobile tablets and apps mobile network mobile network pho
Slide 16: 5G Mobile scope and requirements more demanding
5G Mobile scope and requirements more demanding massive scale and ultra-low latency enables new solutions Ultra-High Speed and Bandwidth 100x 4G Mobile speeds today Network Virtualization 5G Network Slicing High-Speed Internet Access Automated flexibility to Meet specific support on-demand requireme
Slide 17: 5G is real and is anticipated to roll-out towards 2020
5G is real and is anticipated to roll-out towards 2020 17 Napatech A/S © Copyright 2018
Slide 18: 5G Mobile facing formidable challenges
5G Mobile facing formidable challenges Performance Operational Security Challenge Challenge Challenge Virtual switching costs too Insight into virtual traffic Performance and many server resources or provided by pure software operational challenges places too many solutions requiring double mean eit
Slide 19: Napatech Reconfigurable Computing address 5G challenges
Napatech Reconfigurable Computing address 5G challenges Performance Operational Security Faster virtual switching with Low cost insight into virtual Efficient insight for low cost and traffic for automation automated response and high flexibility and quality assurance offload of critical functions N
Slide 20: 5G Virtual RAN solution based on Napatech reconfigurable computing
5G Virtual RAN solution based on Napatech reconfigurable computing – showcased at MWC 5G 5G Virtual Core Network Virtual Radio Access Network Cloud 5G Core Gateways Radio Base vRAN vRAN Station SW SW Smart Phones Encrypt Napatech SmartNIC Napatech SmartNIC and software accelerates virtual switching
Slide 21: Upcoming webinar reimagining mobile networks for 5G
Upcoming webinar reimagining mobile networks for 5G Register at: https://www.mobileworldlive.com/ 21 Napatech A/S © Copyright 2018
Slide 22: Business Highlights
Business Highlights 22 Napatech A/S © Copyright 2017
Slide 23: Recent Design Wins to Drive Future Business
Recent Design Wins to Drive Future Business ▪ 40 Gigabit Accelerator solution design win for a North American Tier-1 customer delivering a Network Monitoring solution ▪ 10 Gigabit Accelerator solution design win for a Tier-1 Chinese customer focused on Network Monitoring applications ▪ 10 Gigabit Ac
Slide 24: Design-win Effect on Q4 Revenue
Design-win Effect on Q4 Revenue ▪ Design wins during the last 8 quarters delivered 22% Pandion DWs of the overall Q4 2017 revenue Accelerator ▪ The Pandion business delivered: DWs ▪ 4% of the overall revenue in Q4 ▪ is based on design-wins secured in 2016 and 2017 ▪ The Accelerator business delivere
Slide 25: Progress in our Business Strategy
Progress in our Business Strategy ▪ Progress in business transition towards a software delivery model taking longer than expected. The company have a strong believe in this journey and expect this part of the strategy to open new and larger market segments ▪ Substantial progress with Xilinx and Inte
Slide 26: Outlook
Outlook 26 Napatech A/S © Copyright 2017
Slide 27: Management's Outlook
Management’s Outlook ▪ We have a sharp focus at being Application Driven to align with Comments: the leading cloud, mobile, IoT and security applications and services that are behind the current network transformations. Guidance for 2018: Our strategy is Software Centric in order to provide the most
Slide 28: Q&A Session
WANT TO LEARN MORE? …about Napatech, Smarter Data Delivery, SmartNICs, IoT, cloud computing, 5G Mobile, and other trends in the industry? Sign up for the Napatech News Q&A Session Sign up for OSE news Follow us on social media 28 Napatech A/S © Copyright 2017