Ooma, Inc. · NYSE:OOMA
Ooma — Investor Presentation (May 2018)
33 slides from Ooma's investor presentation, May 22, 2018
Slide 1: Smart Connected Services Investor Presentation
Smart Connected Services Investor Presentation Information as of May 22, 2018
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation contains forward-looking statements. In particular, statements regarding future economic performance, finances, and expectations and objectives of management constitute forward-looking statements. Forward-looking statements can be identified by the fact that t
Slide 3: Ooma is a cloud/SaaS provider of telecommunications
Productivity Automation Ooma is a cloud/SaaS Network provider of telecommunications Portal App and other connected Appliance Communications services, with solutions for business, home, and mobile users Infrastructure www.ooma.com CONFIDENTIAL AND PROPRIETARY | 3
Slide 4: Company Overview
Company Overview Founded 2004 HQ: Sunnyvale, California IPO in 2015, NYSE: OOMA Multi-tenant SaaS platform ~950k Core Users ~90% Recurring revenue ~100% Recurring Revenue Retention 600+ employees/contractors CONFIDENTIAL AND PROPRIETARY | 4
Slide 5: Investment Highlights
Investment Highlights Total Revenue (in millions) Massive Connected Services Opportunity $114.5 $104.5 $88.8 Unique Hybrid SaaS Platform Solution $27.6 $30.2 FY16 FY17 FY18 F1Q18 F1Q19 Disruptive Cloud Communications and Annual Quarterly Other Connected Services Core User Recurring Revenue (in milli
Slide 6: Mega Trends Drive Our Business
Mega Trends Drive Our Business Cloud Communications “Traditional methods for voice are ripe for replacement.” - Macquarie SMB SaaS “SMBs are expanding the SaaS market opportunity for vendors.” - JPMorgan IoT “The Internet of Things represents huge potential … need for more … systems to deploy, manag
Slide 7: Disruptive Cloud Communications Opportunity
Disruptive Cloud Communications Opportunity Business Home 62M Business Lines in 74M Home Lines in North America North America 30% 2% CAGR1 CAGR1 39% Internet/ Cloud 40% 60% Traditional Internet/ Cloud 61% Traditional We Target Communications to Drive Adoption of the Ooma Platform 1: 2013 - 2016 Sour
Slide 8: Unique SaaS Platform
Unique SaaS Platform Linux Appliance, Multi-Tenant SaaS Router, USB, Platform Network DECT/ULE Radio Mobile Services, Alerts and Control Portal User Configurable Appliance App Services Connects to Many Endpoint Devices Integrated, Managed Platform Enabling Both Communications and Other Connected Ser
Slide 9: Competitive Advantages
Competitive Advantages Breakthrough Voice • Proprietary PureVoice Technology Quality Innovative Services • Unique Applications that Create Customer Interest and Stickiness Enhanced User • Plug-and-Play Solutions, Diagnostics Experience and New Service Upgrades Superior Value • Disruptive Low Cost Ca
Slide 10: Customers Rate Ooma #1
Customers Rate Ooma #1 Office Home #1 Ranked by Readers #1 Ranked by Readers 5 Years in a Row 5 Years in a Row1 1: 2011-2015 CONFIDENTIAL AND PROPRIETARY | 10
Slide 11: Ooma Ecosystem
Ooma Ecosystem Innovative DIY home security features & monitoring Mobile Take action Integration Home, With Remote 911 Home Business Phone Security Disruptive Quality and Value. SMB Enterprise Phone UCaaS DIY setup & Private label management for Resellers Curated business Enterprise-grade features f
Slide 12: SMB Phone: Ooma Office
SMB Phone: Ooma Office • Suite of user configurable cloud PBX features Business Services – Curated for SMB needs – Up to 200 users • Virtual • eFax Receptionist • Conferencing • Broadest Solution Available • Music-on-Hold • Call Forwarding • Voicemail • Ring Groups – Supports analog phones (using •
Slide 13: Small Businesses Are Switching From Traditional/Cable Phone Service
Small Businesses Are Switching From Traditional/Cable Phone Service Previous Phone Service Reasons For Purchasing % Ooma Office 1. Cost Savings/Unlimited Cloud Nationwide calling 13% 2. Easy to Install/Simple to No previous Configure phone service 18% Traditional/Telco 43% 3. Uses regular (existing)
Slide 14: Enterprise UCaaS: Ooma Enterprise
Enterprise UCaaS: Ooma Enterprise • Enterprise Targeted Solution Enterprise Services – Rich, Enterprise-Grade Functionality • Integrations • Collaboration • Rich Telephony • High Availability – Scales to thousands of users • Contact Center • Tailored Desk • Global Service phone Experience – Distribu
Slide 15: Home Phone: Ooma Telo
Home Phone: Ooma Telo • Free home phone service, just Home pay taxes and fees Services • Unlimited US • Blacklisting – Voicemail and mobile app Calling • 911 Alerts • Voicemail • Instant 2nd Line – Safe “landline” 911, plus • Multi-ring • Alexa Skills 911 text alerts • Ring Groups • Innovative Premi
Slide 16: Homes Are Switching From Traditional/Cable Phone Service
Homes Are Switching From Traditional/Cable Phone Service Previous Phone Service Reasons For Purchasing % Ooma Telo No Previous Service 6% 1. Free Calling/No More Phone Bills 2. Uses Existing Home Phones Cable 22% 3. Easy Installation Traditional/Telco 49% 4. Great Voice Quality Other VOIP 23% 5. Bun
Slide 17: Home Security: Ooma Home
Home Security: Ooma Home • Do-it-yourself home security that Security Services leverages the Ooma Telo Remote 911 Facial Recognition – Proprietary sensors Automatic Arm/Disarm Video Battery Backup Phone call Alerts Video On-board Memory Text & Push Notifications DIY Installation – Smart Home Integra
Slide 18: Smart Home Growth Opportunity
Smart Home Growth Opportunity Smart Home Security Ooma Opportunity Market Growth* North America • Large, growing market $9.2Bn • Unique integrated solution 18% $4.8Bn 27% CAGR • Leverage existing Household Penetration: 14% platform/customers 2018 2022 • Disrupt expensive traditional security *Source
Slide 19: Integrated Growth Strategy
Integrated Growth Strategy Efficient Marketing Cost-Effective Sales TV / Traditional Media Leading Retailers • Broad Reach • Low Cost • Builds Brand Image Online Targeted Campaigns • Directly Direct Sales • Through Retailers Social / Word of Mouth Net Promoter Resellers And Partners 72% Score1 1: PC
Slide 20: Growth Drivers
Growth Drivers • SMB/Home Cloud Communications Productivity Automation Network • Enterprise UCaaS Portal Appliance App • Security and Other Communications Connected Services • International Markets Infrastructure CONFIDENTIAL AND PROPRIETARY | 20
Slide 21: Investment Highlights
Investment Highlights Massive Connected Services Opportunity Unique Hybrid SaaS Platform Solution Disruptive Cloud Communications and Other Connected Services Efficient Integrated Go to Market Strategy Predictable SaaS Subscription Business/Financial Model CONFIDENTIAL AND PROPRIETARY | 21
Slide 22: Financial Overview
€3 ooma Financial Overview
Slide 23: Consistent Revenue Growth
Consistent Revenue Growth Annual Revenue Quarterly Revenue 1Q19 combined business and residential subscription revenue $114.5 growth of 20% yr./yr. $104.5 $30.2 $88.8 $27.6 FY 2016 FY 2017 FY 2018 F1Q18 F1Q19 $ Millions CONFIDENTIAL AND PROPRIETARY | 23
Slide 24: Strong Office Revenue Growth
Strong Office Revenue Growth Annual Revenue Quarterly Revenue $24.9 1Q19 business subscription revenue growth of 53% yr./yr. $16.2 $10.0 $7.7 $5.5 FY 2016 FY 2017 FY 2018 F1Q18 F1Q19 $ Millions CONFIDENTIAL AND PROPRIETARY | 24
Slide 25: Residential Growth Continues
Residential Growth Continues Annual Revenue Quarterly Revenue $81.8 1Q19 Telo subscription revenue growth $75.4 of 11% yr./yr. $68.0 $21.3 $19.8 FY 2016 FY 2017 FY 2018 F1Q18 F1Q19 $ Millions CONFIDENTIAL AND PROPRIETARY | 25
Slide 26: Blended Average Revenue Per User
Blended Average Revenue Per User $9.31 $8.79 $8.38 $8.13 $7.46 FY 2016 FY 2017 FY 2018 F1Q18 F1Q19 ARPU is blended monthly average subscription & services revenue per core user. Excludes Business Promoter and Talkatone. CONFIDENTIAL AND PROPRIETARY | 26
Slide 27: Annualized Exit Recurring Revenue
Annualized Exit Recurring Revenue 20% CAGR $105.3 $103.0 $88.3 $85.2 $71.4 FY 2016 FY 2017 FY 2018 F1Q18 F1Q19 $ Millions, Residential and Business Subscription Revenue CONFIDENTIAL AND PROPRIETARY | 27
Slide 28: Expanding Subscription & Services Revenue
Expanding Subscription & Services Revenue Business Residential Other $100.2 $85.7 22% $68.7 $27.3 17% $23.2 12% 26.5% 72% 20.4% 75% 79% 69.2% 73.5% FY16 FY17 FY18 F1Q18 F1Q19 Annual Quarterly $ Millions, % of Total Subscription & Service Revenue, excluding Business Promoter CONFIDENTIAL AND PROPRIET
Slide 29: Increasing Gross Margin
Increasing Gross Margin Subscription/Services Total Long-Term Target 80% 75% Growth Drivers 70% 70% 69% 69% 66% 69% 65% • Mix of SMB Increases 61% 59% 60% • Upselling Premium 58% 54% Services • Introduction of New Services • Scale Efficiencies FY16 FY17 FY18 F1Q18 F1Q19 Low High CONFIDENTIAL AND PRO
Slide 30: Strong Financial Position
Strong Financial Position ($ millions) FY17 FY18 F1Q19 Cash and Investments (no debt) $53.2 $51.8 $49.7 Cash from Operations $0.4 $3.2 $0.3 Capital Spending $1.6 $2.5 $0.4 Adjusted EBITDA ($1.4) ($0.2) ($0.5) CONFIDENTIAL AND PROPRIETARY | 30
Slide 31: Long-Term Target Model (Non-GAAP)
Long-Term Target Model (Non-GAAP) TARGET % REVENUE FY17 FY18 F1Q18 F1Q19 RANGE Subscription & Services Gross Margin 69% 70% 69% 69% 75% - 80% Total Gross Margin 58% 61% 59% 60% 65% - 70% Sales & marketing 31% 31% 31% 28% 20% - 25% Research & development 20% 22% 20% 25% 12% - 15% General & administra
Slide 32: Thank you
€3 ooma Thank you
Slide 33: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation $ Thousands FY2015 FY 2016 FY 2017 FY 2018 F1Q18 F1Q19 GAAP Gross Profit $35,477 $46,910 $59,329 $68,092 $16,033 $17,938 Add : Stock-based compensation expense and 36 437 1,038 1,129 322 202 related taxes Amortization of Intangibles 122 163 162 183 40 115 Non-GAAP Gro