Slide 1: Executive Compensation Program Update November 2024
Executive Compensation Program Update November 2024 ©2024 – ALL RIGHTS RESERVED Exhibit 99.1
Slide 2: Forward-looking statements
This presentation contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. The words “anticipate,” “expect,” “believe,” “will,” “may,” “should,” “estimate,” “project,” “outlook,” “forecast” or other similar words are used to identify such f
Slide 3: Letter from Chair of Compensation and Human Capital Committee
Letter from Chair of Compensation and Human Capital Committee ARLO INVESTOR PRESENTATION: NOV 2024
Slide 4: Overview: say-on-pay outcome, Q3 2024 performance and key changes
At the 2024 annual meeting, Arlo’s “say-on-pay” vote was unsuccessful, gaining support of approximately 41% of votes cast by our shareholders. Arlo’s management and Board of Directors were disappointed with this outcome and engaged in an outreach effort to shareholders to understand their perspectiv
Slide 5: Main Concerns Raised by Shareholders and Arlo Response
“Investors are against the use of retention awards except in extenuating circumstances.” “Concerns about company using duplicative CPS goals across multiple PSU Grants.” “Total compensation for executives (inclusive of retention awards) perceived as high relative to peers.” “Desire for annual execut
Slide 6: Additional Metrics in PSU Design and significant changes
Additional Metrics in PSU Design Multiple metrics drive sustained value creation Annual Awards are 100% Performance-Based Aligns value with achievement of desired goals Hired new compensation consulting firm New firm worked with high growth tech and Fortune-500 Companies No intention to use Special
Slide 7: Overview of Executive Compensation Program
Overview of Executive Compensation Program Philosophy: The Compensation and Human Capital Committee ensures Arlo employs exceptional talent, retention and compensation practices that align with a carefully selected peer group related to our size and industry. Arlo provides compensation to executive
Slide 8: Background on 2022 Executive Retention Program
Background on 2022 Executive Retention Program Plan Adoption - 1.7M CPS October 2, 2022 Q322 Services GM – 66.7% 2M CPS Achieved March 16, 2023 Q422 Services GM – 69.7% 3M CPS Achieved February 29, 2024 Q423 Service GM – 74.4% 4M CPS Achieved July 9, 2024 Q224 Service GM – 76.4% Arlo in its entire h
Slide 9: Retrospective on 2022 Retention Plan
Retrospective on 2022 Retention Plan 167% Total Shareholder Return Aug 2022 to Current We recognize that retention packages are not a desired approach within the investor community, but looking back, we believe the 2022 retention plan yielded significantly positive results. Retained CEO and General
Slide 10: Relationship between Pay and Performance
Relationship between Pay and Performance Subscriber Growth *Current subscribers 4.24 million Annual Recurring Revenue *Current ARR $241.6M up 21% Operating Margin *Current Operating Income 7.9% up 140 basis points Paid subscribers are up 25x since IPO and 2.2x since original long-range plan Annual r
Slide 11: Future Compensation Structure
Future Compensation Structure No Special Awards The Compensation and Human Capital Committee has no intention to use special off-cycle equity awards for the foreseeable future other than for new hires or promotions. Any special awards will be performance-based vesting with multiple metrics that are
Slide 12: Reconciliations of GAAP to Non-GAAP: Gross Profit
Reconciliations of GAAP Measures to Non-GAAP Measures Gross Profit, In Thousands, except percentage data
Slide 13: Reconciliations of GAAP to Non-GAAP: Operating Income (Loss)
Reconciliations of GAAP Measures to Non-GAAP Measures Operating Income (Loss), In Thousands, except percentage data
Slide 14: Reconciliations of GAAP to Non-GAAP: Free Cash Flow
Reconciliations of GAAP Measures to Non-GAAP Measures Free Cash Flow (Usage), In Thousands, except percentage data