Slide 1: DTS Investor Presentation Q2 2016
Information on this slide is confidential property of DTS. Any unauthorized copying is strictly prohibited. © 2016 DTS, Inc. 1 DTS INVESTOR PRESENTATION Q2 2016 AUGUST 8, 2016
Slide 2: Safe Harbor
Information on this slide is confidential property of DTS. Any unauthorized copying is strictly prohibited. © 2016 DTS, Inc. 2 During this presentation, management may make forward - looking statements within the meaning of Section 27 A of the U . S . Securities Act of 1933 , as amended, and Section
Slide 3: DTS, Inc. 6/30/16 Snapshot
Information on this slide is confidential property of DTS. Any unauthorized copying is strictly prohibited. © 2016 DTS, Inc. 3 ~45% <15% <40% 2016E Revenue Breakdown by Market Home Mobile Automotive Stock/Financial Information FY Financial Highlights and 2016 Outlook ($ Millions, except per share da
Slide 4: DTS Overview: Leading Global Audio Solutions Provider
Information on this slide is confidential property of DTS. Any unauthorized copying is strictly prohibited. © 2016 DTS, Inc. 4 DTS OVERVIEW Leading Global Audio Solutions Provider ▪ Brand recognized for high quality and innovation ▪ IP licensing model: high margin, low capex, diversified revenue str
Slide 5: Entertainment Evolution
Information on this slide is confidential property of DTS. Any unauthorized copying is strictly prohibited. © 2016 DTS, Inc. 5 Intro Home Mobile Auto Results ENTERTAINMENT EVOLUTION The Shift Towards IoT Convenience Capability
Slide 6: The Trend Towards High Quality Entertainment
Information on this slide is confidential property of DTS. Any unauthorized copying is strictly prohibited. © 2016 DTS, Inc. 6 THE TREND TOWARDS HIGH QUALITY ENTERTAINMENT Companies and consumers recognize the importance of premium entertainment • Momentum is building around high - resolution video
Slide 7: DTS Business Drivers
Information on this slide is confidential property of DTS. Any unauthorized copying is strictly prohibited. © 2016 DTS, Inc. 7 Innovative Technology IC and OEM Footprint Market Opportunities Scalable Business Model Mobile Automotive Home Content Automotive Intro Home Mobile Auto Results DTS BUSINESS
Slide 8: Driving Ecosystems at DTS
Information on this slide is confidential property of DTS. Any unauthorized copying is strictly prohibited. © 2016 DTS, Inc. 8 Non - DTS Encoded Content DTS Content Non - DTS Enabled Products DTS Enabled Products Content Drives OEM Demand OEM Footprint Pulls New DTS Content New DTS Content New Licen
Slide 9: Growing IP Portfolio
Information on this slide is confidential property of DTS. Any unauthorized copying is strictly prohibited. © 2016 DTS, Inc. 9 Growing IP Portfolio Notes: 1. Chart represents issued patents 2. As of May 2016, DTS has 306 patents pending INNOVATIVE TECHNOLOGY • Team includes PhDs recognized as leader
Slide 10: Content
Information on this slide is confidential property of DTS. Any unauthorized copying is strictly prohibited. © 2016 DTS, Inc. 10 CONTENT Studios DTS Tools Intro Home Mobile Auto DTS Licensed Products Cinema/Streaming/Broadcast Results
Slide 11: IC and OEM Footprint
Information on this slide is confidential property of DTS. Any unauthorized copying is strictly prohibited. © 2016 DTS, Inc. 11 IC AND OEM FOOTPRINT DTS Licenses to all Major CE OEMs DTS IP is Deployed on all Major ICs Intro Home Mobile Auto Results
Slide 12: Market Opportunities
Information on this slide is confidential property of DTS. Any unauthorized copying is strictly prohibited. © 2016 DTS, Inc. 12 Automotive Home Mobile TVs Blu - ray stand alone players AVRs Soundbars Wireless speakers Game consoles Set - top - boxes Smartphones Tablets PCs Gaming headsets Auto - hea
Slide 13: Home: Expansion of Play-Fi Ecosystem
Information on this slide is confidential property of DTS. Any unauthorized copying is strictly prohibited. © 2016 DTS, Inc. 13 Expansion of Play - Fi Ecosystem Play - Fi modules drive higher revenue Play - Fi on more devices (AVRs, Set - top - boxes) DTS:X/ Headphone:X enable advanced functionality
Slide 14: Mobile: Increasing Penetration in Large Market
Information on this slide is confidential property of DTS. Any unauthorized copying is strictly prohibited. © 2016 DTS, Inc. 14 2015A 2020E $60M - $70M $20M Target Opportunity 2016E – 2020E • 14 ASUS phones and tablets released with Headphone:X • Momentum building in gaming accessories with partners
Slide 15: Automotive: Q2 2016 Highlights
Information on this slide is confidential property of DTS. Any unauthorized copying is strictly prohibited. © 2016 DTS, Inc. 15 • Neural launched in the Honda Civic, “2016 North American Car of the Year “ • Penetration of HD Radio in new cars sold in the U.S. continued to increase • Expanded broadca
Slide 16: 2020E Non-GAAP Financial Targets
Information on this slide is confidential property of DTS. Any unauthorized copying is strictly prohibited. © 2016 DTS, Inc. 16 2020E Non - GAAP* Financial Targets Revenue $270M - $300M Operating Margin 40% - 45% EPS** $4.50 - $5.85 Attractive Effective Tax Rate (20 - 25%) Minimal Capex Requirements
Slide 17: Financial Results: 2016 Non-GAAP Results and Revised Outlook
Information on this slide is confidential property of DTS. Any unauthorized copying is strictly prohibited. © 2016 DTS, Inc. 17 Revenue Operating Income Operating Margin EPS Intro Home Mobile Auto FY 2016E FY 2015A YoY Change $185M - $190M $138.2M 34% - 37% $56M - $67M $32.5M 72% - 106% 30% - 35% 23
Slide 18: Capital Allocation
Information on this slide is confidential property of DTS. Any unauthorized copying is strictly prohibited. © 2016 DTS, Inc. 18 Intro Home Mobile Auto CAPITAL ALLOCATION Disciplined Approach Focused on Optimizing Shareholder Value Solid Balance Sheet • Cash + Investments as of 6/30/16: $43.8M • Tota
Slide 19: Returning Value to Shareholders
Information on this slide is confidential property of DTS. Any unauthorized copying is strictly prohibited. © 2016 DTS, Inc. 19 $45M $75M $107M $122M $147M $154M $173M $30M $32M $15M $25M $7M $19M FY2007 - FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 Cumulative Cash Returned Share Buyback *In 20
Slide 20: DTS Summary
Information on this slide is confidential property of DTS. Any unauthorized copying is strictly prohibited. © 2016 DTS, Inc. 20 DTS SUMMARY ▪ Brand recognized for high quality and innovation ▪ High margin IP licensing model has multiple revenue sources and low capex, projected to generate solid and
Slide 21: DTS
Information on this slide is confidential property of DTS. Any unauthorized copying is strictly prohibited. © 2016 DTS, Inc. 21 DTS INVESTOR PRESENTATION Q2 2016
Slide 22: Appendix A: Non-GAAP Financial Targets
Information on this slide is confidential property of DTS. Any unauthorized copying is strictly prohibited. © 2016 DTS, Inc. 22 APPENDIX A Non-GAAP Financial Targets The following tables show the Company's fiscal year 2020 GAAP guidance reconciled to non-GAAP financial targets. Low High Operating in
Slide 23: Appendix B: Fiscal Year 2016 Non-GAAP Financial Targets
Information on this slide is confidential property of DTS. Any unauthorized copying is strictly prohibited. © 2016 DTS, Inc. 23 APPENDIX B *Provided on earnings call dated 8/8/16 The following tables show the Company's fiscal year 2016 GAAP guidance reconciled to non-GAAP financial targets. Low High