Slide 1: Investor Presentation – Q1 2024
Investor Presentation – Q1 2024 May 2, 2024
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements within the meaning of applicable U.S. securities laws, including statements regarding our 2024 financial guidance and our plans to continue to focus on driving efficient revenue growth, profitability and cash flow as we
Slide 3: Company Overview
Company Overview O OneSpan
Slide 4: OneSpan – The Digital Agreements Security Company
OneSpan – The Digital Agreements Security Company 642 4,000+ 100+ 60% $242M $155M 107% $64M Employees Customers Countries of the World’s Revenue ARR1 NRR2 Cash & Equiv. (3/31/24) Largest Banks (TTM 3/31/24) (3/31/24) (3/31/24) (3/31/24) are Customers 1,2 See Appendix for definitions. PROPRIETARY AND
Slide 5: Trusted Security Partner to Global Blue-Chip Enterprises
Trusted Security Partner to Global Blue-Chip Enterprises Other Financial Banking Insurance Government Healthcare Other Services PROPRIETARY AND CONFIDENTIAL. ALL RIGHTS RESERVED 5
Slide 6: Two Operating Segments
Two Operating Segments TTM Revenue (3/31/24) Security Solutions • Leading provider of authentication and transaction signing solutions for the who’s who of global banks • Transition to subscription from perpetual software Security Digital license model is largely complete Solutions Agreements • 37%
Slide 7: GTM Focused on Enterprise Sales and Growing Partner Network
GTM Focused on Enterprise Sales and Growing Partner Network CUSTOMER SEGMENTATION BASED ON EMPLOYEE COUNT OSPN SALES FOCUS PARTNER COVERAGE Tiers Efficient Resource Global System Resellers & Platform (Employee Count) Allocation with Sellers Integrators Distributors Partners Large Enterprise SAM 100,
Slide 8: Competitive Differentiation
Competitive Differentiation World-class security DNA in identity verification, authentication and transaction signing Deep expertise in end-user experience, cloud workflows, document verification and electronic signing Deep roots and experience in highly regulated global markets Ability to leverage
Slide 9: Financial Highlights & Outlook
Financial Highlights & Outlook
Slide 10: Q1 2024 Financial Highlights
Q1 2024 Financial Highlights $65M $155M $20M Revenue ARR1 Adjusted EBITDA (13% growth) (9% growth) (30% Margin) $40M $128M $64M Subscription Revenue Subscription ARR Cash and Equiv. (34% growth) (17% growth) no long-term debt 1 See Appendix for definition. PROPRIETARY AND CONFIDENTIAL. ALL RIGHTS RE
Slide 11: Q1 2024 Revenue Growth
Q1 2024 Revenue Growth Security Solutions Digital Agreements Total Company 13% 9% $64.8M $50.4M $57.6M $46.1M 25% $14.4M $11.6M Q1'23 Q1'24 Q1'23 Q1'24 Q1'23 Q1'24 Subscription Maintenance Subscription Maintenance Subscription Maintenance PS & Other Digipass PS & Other PA & Other Digipass ▪ Subscrip
Slide 12: Q1 2024 ARR Growth
Q1 2024 ARR Growth Security Solutions Digital Agreements Total Company 9% 7% $155M $144M $100M $93M 14% $55M $48M Q1'23 Q1'24 Q1'23 Q1'24 Q1'23 Q1'24 Subscription Maintenance Subscription Maintenance Subscription Maintenance ▪ Subscription ARR grew 16% ▪ Subscription ARR grew 18% ▪ Subscription ARR
Slide 13: 2024 Guidance Metrics
2024 Guidance Metrics FY24 Guidance FY24 Guidance Metric FY23 Actual (previous) (current) Revenue $235.1M $238M - $246M $238M - $246M Adjusted EBITDA1 $12.0M $47M - $52M $51M - $55M ARR2 $154.6M $160M - $168M $160M - $168M 1 Adjus ted EBITDA is a non-GAAP financial measure. The Company i s not provi
Slide 14: Cost Reduction Actions
Cost Reduction Actions Approximate combined annualized cost savings from our 2023 Cost Reduction Actions and Phase Two of our Restructuring Plan, announced May 20221,2,3 Cumulative, end of Q4, 2023: $58.5 million Q1 2024 intra-quarter: $6.0 million Cumulative, end of Q1, 2024: $64.5 million Cumulati
Slide 15: Appendix
Appendix O OneSpan
Slide 16: Non-GAAP Reconciliation
Non-GAAP Reconciliation Reconciliation of Net Income to Adjusted EBITDA 5 (in thousands, unaudited) Three months ended March 31, 2023 2024 Net income (loss) $ (8,356) $ 13,468 Interest income (expense), net (503) (101) Provision for income taxes 689 1,034 Depreciation and amortization of intangible
Slide 17: Revenue Trend – Last Two Years
Revenue Trend – Last Two Years Security Solutions Digital Agreements1 Total Company (in millions) (in millions) (in millions) $65 $63 $57 $57 $58 $56 $59 $52 $53 $50 $48 $45 $44 $46 $44 $46 $42 $39 $14 $14 $13 $13 $12 $12 $12 $12 $10 Q1'22 Q1'23 Q1'24 Q1'22 Q1'23 Q1'24 Q1'22 Q1'23 Q1'24 1 Q1 2022 a
Slide 18: ARR Trend – Last Two Years
ARR Trend – Last Two Years Security Solutions1 Digital Agreements 1 Total Company1 (in millions) (in millions) (in millions) $155 $155 $150 $139 $141 $144 $134 $136 $129 $96 $98 $101 $100 $90 $92 $93 $87 $88 $55 $49 $51 $54 $45 $46 $47 $48 $42 Q1'22 Q1'23 Q1'24 Q1'22 Q1'23 Q1'24 Q1'22 Q1'23 Q1'24 1
Slide 19: Definitions
Definitions 1 – ARR, or Annual Recurring Revenue, is calculated as the approximate annualized value of our customer recurring contracts as of the measurement date. These include subscription, term-based license, and maintenance and support contracts and exclude one-time fees. To the extent that we a
Slide 20: Non-GAAP Financial Measures
Non-GAAP Financial Measures We report financial results in accordance with GAAP. We also evaluate our performance using certain Non-GAAP financial metrics, namely Adjusted EBITDA, Non-GAAP Net Income (Loss) and Non-GAAP Net Income (Loss) Per Diluted Share. Our management believes that these measures
Slide 21: Copyright and Trademarks
Copyright and Trademarks Copyright© 2024 OneSpan North America Inc., all rights reserved. OneSpan , the “O” logo, “BE BOLD. BE SECURE.” , DIGIPASS® and “The Digital Agreements Company” are registered or unregistered trademarks of OneSpan North America Inc. or its affiliates in the U.S. and other cou
Slide 22: OneSpan
OneSpan The Digital Agreements Company