Slide 1: Q1 FY 2024 Conference Call
Q1 FY 2024 Conference Call NETSCOUT SYSTEMS, INC. July 27, 2023 ©2023 NETSCOUT July 27, 2023 1
Slide 2: Agenda
Agenda • Introduction & Safe Harbor – Tony Piazza, SVP, Corporate Finance • CEO Perspective – Anil Singhal, President and CEO • COO Update – Michael Szabados, Chief Operating Officer • CFO Financial Review – Jean Bua, EVP and CFO July 27, 2023 2
Slide 3: Safe Harbor
Safe Harbor Forward Looking Statements: Certain information provided in this presentation includes forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, which are made pursuant to the safe harbor provisions of the Private Securities Liti
Slide 4: Non-GAAP Financial Metrics
Non-GAAP Financial Metrics Regulation G Disclosure: To supplement the financial measures presented in NETSCOUT's press release in accordance with accounting principles generally accepted in the United States (GAAP), NETSCOUT also reports the following non-GAAP measures: non-GAAP gross profit, non-GA
Slide 5: CEO Perspective
CEO Perspective Anil Singhal President and Chief Executive Officer July 27, 2023
Slide 6: Q1 FY’24 Non-GAAP Financial Results
Q1 FY’24 Non-GAAP Financial Results Non-GAAP Q1 FY’24 Q1 FY’23 ($ in millions, except per share data) 6/30/2023 6/30/2022 Revenue $ 211.1 $ 208.8 Gross Margin 78.3% 74.5% Operating Margin 14.0% 11.7% EPS $ 0.31 $ 0.24 • Delivered solid financial results for the first quarter of fiscal year 2024 • Re
Slide 7: Market and Business Insights
Market and Business Insights • Enterprise • Service Provider July 27, 2023 7
Slide 8: FY’24 Outlook & Summary
FY’24 Outlook & Summary • Excited about market opportunities we see for our new and existing solutions • Reiterating fiscal year 2024 outlook • Remain focused on operating NETSCOUT’s business with a balanced approach to growth and profitability as we manage the dynamic macro-economic environment Jul
Slide 9: COO Update
COO Update Michael Szabados Chief Operating Officer July 27, 2023
Slide 10: COO Highlights
COO Highlights • Customer Wins • Go-to-Market Activities July 27, 2023 10
Slide 11: Financial Review & FY’24 Outlook
Financial Review & FY’24 Outlook Jean Bua Executive Vice President and Chief Financial Officer July 27, 2023
Slide 12: Q1 FY’24 Results
Q1 FY’24 Results Q1 FY’24 Q1 FY’23 Non-GAAP Non-GAAP % (in millions except EPS and % data) 6/30/2023 6/30/2022 Change Revenue: Product $ 94.7 $ 98.3 -3.7% Service $ 116.5 $ 110.6 5.4% Total revenue $ 211.1 $ 208.8 1.1% Gross profit margin 78.3% 74.5% Operating Margin 14.0% 11.7% Net income $ 22.7 $
Slide 13: Q1 FY’24 Revenue Trends: Customer Verticals & Product Lines
Q1 FY’24 Revenue Trends: Customer Verticals & Product Lines Total Non-GAAP Revenue by Customer Vertical Total Non-GAAP Revenue by Product Line ($ in millions) ($ in millions) $211.1 $208.8 $211.1 $208.8 $65.1 $59.2 $110.8 $98.2 31% 28% 52% 47% $146.1 $149.6 $100.3 $110.6 69% 72% 48% 53% Q1 FY'24 Q1
Slide 14: Q1 FY’24 Revenue Trends: Geographic Mix
Q1 FY’24 Revenue Trends: Geographic Mix Q1 FY’24 Q1 FY’23 6/30/23 6/30/22 Q1 FY’24 Q1 FY’23 Total Revenue $211.1 $208.8 United States $127.9 $134.8 7% 6% International $83.2 $74.0 61% 39% 16% 13% 65% 35% 16% 16% Europe $34.0 $33.8 Asia $16.0 $13.7 Rest of World $33.3 $26.6 United States Internationa
Slide 15: GAAP Balance Sheet Highlights & Free Cash Flow
GAAP Balance Sheet Highlights & Free Cash Flow (in millions) Q1 FY'24 Q1 FY’24 6/30/2023 (Unaudited) 6/30/23 Operating Cash Flow $ (22.3) Cash and Securities* $ 390.5 Purchase of Fixed Assets & Intangible Assets $ (2.0) Free Cash Flow $ (24.3) Accounts Receivable, Net $ 108.3 Note: Free cash flow is
Slide 16: FY’24 Outlook
FY’24 Outlook Revenue FY’23 FY’24 Outlook Other FY’24 Outlook Assumptions $ millions GAAP & Non-GAAP GAAP & Non-GAAP Revenue $914.5 ~$915 to ~$945 * Anticipate tax rate to be in the range of 20% to 22% EPS (Diluted) * Anticipate 74 to 75 million weighted average diluted shares outstanding FY’23 FY’2
Slide 17: Appendix
Appendix July 27, 2023
Slide 18: Q1 FY’24 Results
Q1 FY’24 Results Q1 FY’24 Q1 FY’23 Q1 FY’24 Q1 FY’23 GAAP GAAP % Non-GAAP Non-GAAP % (in millions except EPS and % data) 6/30/2023 6/30/2022 Change 6/30/2023 6/30/2022 Change Revenue: Product $ 94.7 $ 98.3 -3.7% $ 94.7 $ 98.3 -3.7% Service $ 116.5 $ 110.6 5.4% $ 116.5 $ 110.6 5.4% Total revenue $ 21
Slide 19: Total Revenue Composition: Service Assurance & Cybersecurity
Total Revenue Composition: Service Assurance & Cybersecurity (in millions, GAAP & Non-GAAP) Full Year Q1 FY’23 Q2 FY’23 Q3 FY’23 Q4 FY’23 FY’23 Q1 FY’24 Total Revenue 208.8 228.1 269.5 208.1 914.5 211.1 Service Assurance Revenue 149.6 167.3 211.8 149.9 678.7 146.1 Cybersecurity Revenue 59.2 60.8 57.
Slide 20: GAAP to Non-GAAP Reconciliation: Gross Profit, Income from Operations and Net Income
GAAP to Non-GAAP Reconciliation: Q1’FY24, Q1’FY23 & Q4’FY23 Gross Profit, Income from Operations and Net Income (loss) NETSCOUT SYSTEMS, INC. Reconciliation of Current GAAP to Current and Historical Non-GAAP Financial Measures (In thousands, except per share data) (Unaudited) Three Months Ended Thre
Slide 21: GAAP to Non-GAAP Reconciliation: Itemization
GAAP to Non-GAAP Reconciliation: Q1’FY24, Q1’FY23 & Q4’FY23 Itemization NETSCOUT SYSTEMS, INC. Reconciliation of Current GAAP to Current and Historical Non-GAAP Financial Measures - Continued (In thousands) (Unaudited) Three Months Ended Three Months Ended June 30, March 31, 2023 2022 2023 (1) Share
Slide 22: FY’24 Financial Outlook: GAAP to Non-GAAP Reconciliation
FY’24 Financial Outlook: GAAP to Non-GAAP Reconciliation NETSCOUT SYSTEMS, INC. Reconciliation of GAAP Financial Outlook to Non-GAAP Financial Outlook (Unaudited) (In millions, except net income per share - diluted) FY'23 FY'24 GAAP & Non-GAAP revenue $ 914.5 ~$915 million to ~$945 million FY'23 FY'
Slide 23: Thank You
Thank You July 27, 2023