Slide 1: Q2-2024 Business Update
Q2-2024 Business Update Kevin Simzer Chief Operating Officer
Slide 2: AI-Powered Strategy
AI-Powered Strategy Trend Micro Unveils New AI-Driven Cyber Risk Management Capabilities to Anticipate and Eliminate Breaches 10-to-1 tool consolidation drives record adoption by thousands of enterprise customers Trend Micro to Secure AI-Enabled Private Data Centers Worldwide New security solution u
Slide 3: Q2-2024 Summary
Q2-2024 Summary Beat Top and Enterprise Consumer Bottom Line Performance Growth Net Sales: +13% YoY* Enterprise Net Sales @ +16%* Net Sales: +2% YoY* Operating Margin: 18%* 10K Vision One Customers ARPU: +7% * * Growth across all regions, Powered by strong Growth in operating expenses on track platf
Slide 4: Q2-2024 Regional Performance
Q2-2024 Regional Performance Pre-GAAP Q2-2023 Q2-2024 +1%* * +10% * * +8% (1%) Japan AMEA Europe Americas 4 | ©2024 Trend Micro Inc. * Pre-GAAP in millions of Yen @ constant currency
Slide 5: Recurring Revenue
Recurring Revenue Large Enterprise $1.65B Small Enterprise +6% Consumer $396M $1.3B 1% $232M $360M (1%) $218M $1B +9% $706M Q1-2021 Q2-2021 Q3-2021 Q4-2021 Q1-2022 Q2-2022 Q3-2022 Q4-2022 Q1-2023 Q2-2023 Q3-2023 Q4-2023 Q1-2024 Q2-2024 5 | ©2024 Trend Micro Inc. * Hybrid ARR at constant currency: 1U
Slide 6: Enterprise Recurring Revenue
Enterprise Recurring Revenue $1.25B * Subscription ARR +7% YoY 10% Perpetual ARR CAGR $420M $925M (8%) Shift $522M $831M +17% $403M Q1-2021 Q2-2021 Q3-2021 Q4-2021 Q1-2022 Q2-2022 Q3-2022 Q4-2022 Q1-2023 Q2-2023 Q3-2023 Q4-2023 Q1-2024 Q2-2024 6 | ©2024 Trend Micro Inc. * Hybrid ARR at constant curr
Slide 7: Our Enterprise Opportunity
Our Enterprise AI-Powered ASRM XDR Opportunity Next Gen SOC 23% of Enterprise ARR* SOAR + more modules S E R Hybrid Multi- EPP XDR V Cloud & Endpoint I 28,000 Container + more modules 54% of Enterprise ARR* C E IPS XDR S Network OT + more modules MDR LARGE ENTERPRISE CUSTOMERS 15% of Enterprise ARR*
Slide 8: Large Enterprise Recurring Revenue
Large Enterprise Recurring Revenue $1B * Vision One Connected ARR +9% YoY Other Hybrid ARR 12% CAGR $706M (10%) Shift +45% Q1-2021 Q2-2021 Q3-2021 Q4-2021 Q1-2022 Q2-2022 Q3-2022 Q4-2022 Q1-2023 Q2-2023 Q3-2023 Q4-2024 Q1-2024 Q2-2024 8 | ©2024 Trend Micro Inc. * Hybrid ARR at constant currency: 1US
Slide 9: Large Enterprise Recurring Revenue
Large Enterprise Recurring Revenue $1B * AI Powered Next Gen SOC +9% YoY Hybrid Multi-Cloud & Endpoint Network 12% CAGR +21% Email +1% $706M +3% +26% Q1-2021Q2-2021Q3-2021Q4-2021Q1-2022Q2-2022Q3-2022Q4-2022Q1-2023Q2-2023Q3-2023Q4-2023Q1-2024Q2-2024 9 | ©2024 Trend Micro Inc. * Hybrid ARR at constant
Slide 10: Large Enterprise Platform Attach
Large Enterprise Platform Attach 10K Vision One Attached Customers Q2-2024 Platform Highlights Attach Rate % 36% 500+ New Vision One customers in 2024 $236 Next-gen SOC ARR @ +26% Million* 2588 2.5X ASP increase once attached 114% Next-gen SOC Subscription NRR 9% Q1-2021Q2-2021Q3-2021Q4-2021Q1-2022Q
Slide 11: The Power of the Platform
The Power of the Platform ENTERPRISE MODULE ADOPTION RETENTION ARR CUSTOMERS RATE IMPACT 56% 85% 1X 21% 92% 3X 11% 94% 7X 12% + 98% 15X 11 | ©2024 Trend Micro Inc. * Constant currency: 1USD= 147.74 yen. Non-GAAP and reference for internal management.
Slide 12: Q2-2024 Enterprise Platform Wins
Q2-2024 Enterprise Platform Wins $477K $100K $420K • Security tool consolidation • Security modernization project • Cloud security project combined supporting acquisitions, lower connected to new AI-centric with addressing security skills risk & compliance costs applications shortage • One platform
Slide 13: Consumer Performance
Consumer Performance Q2-2024 Highlights Direct Average Retail Price Per User (ARPU) $35.66 13,948 Q2 net sales @ +2% YoY Million Yen $32.84 5% Growth in mobile channel revenue Growth in Beyond Device offerings 117% as % of overall consumer sales Q1 Q2 Q3 Q4 Q1 Q2 2023 2023 2023 2023 2024 2024 13 | ©
Slide 14: Road to 2027
Road to 2027 1H 2024 2027E (2) 2022 2023 (1) 2024E (2) Progress(3) Post-GAAP Revenue 18% 11% 9% 13% 8-10% Growth % COGS % of Revenue (3) 19% 22% 19% 21% 18-20% S&M % of Revenue (3) 37% 37% 34% 34% 28-30% R&D % of Revenue (3) 17% 17% 17% 18% 12-14% G&A % of Revenue (3) 8% 8% 7% 7% 5-7% Operating Marg
Slide 15: Q2-2024 Business Update
Q2-2024 Business Update Kevin Simzer Chief Operating Officer