A10 Networks, Inc. · NYSE:ATEN
A10 Networks — Q3 2020 Earnings Presentation
15 slides from A10 Networks's earnings presentation, Oct 27, 2020
Slide 1: Q3 2020 Financial Results & Commentary
Q3 2020 Financial Results & Commentary October 27, 2020 Always Secure. Always Available.
Slide 2: Cautionary Statements & Disclosures
Cautionary Statements & Disclosures This presentation and the accompanying oral presentation contain “forward-looking” statements that are based on our management’s beliefs and assumptions, including statements regarding organizational efficiencies, market demand and trends, our positioning as to or
Slide 3: Agenda
Agenda • Introduction • 3Q Overview • 3Q Financial Performance 3
Slide 4: A10 Advantage – Performance, Flexibility, Security
A10 Advantage – Performance, Flexibility, Security Security Flexible Automation & Performance Technical Stack Form Factor & Analytics @ Scale Support Consolidation Pricing Multi-cloud Lower Capex Future Better Business Trusted Efficiency & Opex Proof Outcomes Advice Simplification without Compromise
Slide 5: Q3'20: Culmination of Business Transformation
Q3’20: Culmination of Business Transformation • Delivering sustained growth • Third consecutive quarter of 6%+ revenue growth • Rebuilt the earnings power of A10 achieving record profitability • Annual operating expenses reduced by approximately $23 million • Reflecting 25% reduction • Operating inc
Slide 6: Near-term Expectations
Near-term Expectations • Continue to expect to see some near-term delays related to COVID-19 • Well-equipped to mitigate disruption • Strong pipeline and win rate with lower visibility of order patterns in the next 90-day period related to changing global business environment • Guidance • Targeting
Slide 7: Revenue & Non-GAAP Operating Income
Revenue & Non-GAAP Operating Income Revenue, $ Millions Revenue, $ Millions $60.3 $56.6 $52.8 $56.6 $53.8 $52.8 $52.5 Q3'19 Q3'20 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Non-GAAP Operating Income, $ Millions Non-GAAP Operating Income, $ Millions $10.0 $10.0 $7.7 $7.2 $4.1 $1.8 $1.8 Q3'19 Q4'19 Q1'20 Q2'20 Q3'
Slide 8: Revenue by Customer Vertical
Revenue by Customer Vertical $Millions 36% 35% 3Q 2020 41% 42% 40% $56.6 million 40% 64% 65% 60% 60% 59% 58% Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Service and Cloud Providers Enterprise 8
Slide 9: Revenue by Geography
Revenue by Geography $Millions 12% 12% 11% 15% 14% 9% 3Q 2020 16% 15% 15% 15% $56.6 million 33% 29% 27% 24% 32% 14% 15% 39% 43% 46% 47% 46% 39% 32% Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Americas Japan APAC ex Japan EMEA 9
Slide 10: Financial Performance Trends
Financial Performance Trends $ Millions (except EPS) 2Q'18 Q3’18 4Q'18 FY 2018 1Q'19 2Q'19 Q3’19 4Q'19 FY 2019 1Q’20 2Q’20 3Q’20 Revenue $60.7 $60.5 $61.8 $232.2 $50.3 $49.2 $52.8 $60.3 $212.6 $53.8 $52.5 $56.6 Non-GAAP Gross Margin % 78.6% 78.8% 78.2% 78.3% 76.3% 78.0% 78.1% 78.5% 77.8% 78.3% 78.8%
Slide 11: Appendix
Appendix 11
Slide 12: GAAP to Non-GAAP - Gross Margin and EPS
GAAP to Non-GAAP - Gross Margin and EPS % of Revenue except EPS Q3'18 Q4'18 FY 2018 Q1'19 Q2'19 Q3'19 Q4'19 FY 2019 Q1'20 Q2'20 Q3'20 Gross Margin % - GAAP 78.5% 77.7% 77.7% 75.6% 77.1% 77.4% 77.7% 77.0% 77.4% 78.2% 76.8% Stock-based compensation 0.3% 0.5% 0.7% 0.6% 1.0% 0.6% 0.8% 0.7% 0.9% 0.6% 0.8
Slide 13: GAAP to Non-GAAP - Operating Income (Loss)
GAAP to Non-GAAP - Operating Income (Loss) $ Millions Q3'18 Q4'18 FY 2018 Q1'19 Q2'19 Q3'19 Q4'19 FY 2019 Q1'20 Q2'20 Q3'20 Income (loss) from operations $ - GAAP $ (1.6) $ (2.4) $ (27.7) $ (11.0) $ (6.4) $ 0.2 $ 0.1 $ (17.1) $ (0.2) $ 3.9 $ 6.2 Stock-based compensation 2.3 4.0 17.0 3.9 5.0 3.5 4.3
Slide 14: GAAP to Non-GAAP - Adjusted EBITDA
GAAP to Non-GAAP - Adjusted EBITDA $ Millions Q3'18 Q4'18 FY 2018 Q1'19 Q2'19 Q3'19 Q4'19 FY 2019 Q1'20 Q2'20 Q3'20 GAAP net income (loss) $ (1.8) $ (1.6) $ (27.6) $ (12.3) $ (5.8) $ 0.2 $ 0.1 $ (17.8) $ (0.3) $ 3.8 $ 6.5 Exclude: Interest expense 0.0 0.0 0.1 0.2 0.0 0.0 0.0 0.2 - 0.0 - Exclude: Int
Slide 15: Thank You
Thank You Investors@a10networks.com Always Secure. Always Available.