Slide 1: Investors Presentation: First Quarter 2016 Results
i2 Investors Presentation j<) First Quarter 2016 Results May 5, 2016
Slide 2: Safe Harbor for Forward-Looking Statements
j2 ) Safe Harbor for Forward-Looking Statements Certain statements in this presentation are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, particularly those regarding our 2016 Financial Guidance. Such forward- looking statements are subject
Slide 3: Risk Factors
j2) | Risk Factors The following factors, among others, could cause our business, prospects, financial condition, operating results and cash flows to be materially adversely affected: * Inability to sustain growth or profitability, particularly in light of an uncertain U.S. and worldwide economy and
Slide 4: Q1 2016 Results
Q1 2016 Results
Slide 5: 2016 Q1 Accomplishments
j2 ) 2016 Q1 Accomplishments Record Q1 ‘16 Consolidated Results * Qt Records(t)2): Revenue $201M, EBITDA $87M, FCF $60M, and Adjusted EPS $1.05 * Free Cash Flow'")) of $60M, up $17M or 39% vs. prior year * Q1 16 Revenue'!2) up $39M or 24% vs. prior year, EBITDA)2) up $17M or 25% vs. prior year * EBI
Slide 6: j2 Global Consolidated
j2 Global Consolidated
Slide 7: Financial Results by Unit
j2 ) Financial Results by Unit * 2016 Q1 operating margins breakdown within our Cloud segment are as follows: * Cloud Connect (FaxiVoice) * Cloud Services (Cloud Backup, Email Security, Email Marketing, Web Hosting) + Patents * Qt 2015 & 2016 are presented herein and annual data from 2011-2015is pro
Slide 8: Q1 2016 Results vs. Prior Year
j2 ) | Q1 2016 Results vs. Prior Year Total Cloud by Unit Cloud Connect (Fax/Vore) 1 2015, Qi 2016 4 2035 3 2016 3.2015 2015 4 2016; ‘Adj. Non-GAAP Revenues! $ 85201 § 90,244 © § 29599 § 46720 -§ $ 117s | $ 118061 § 138140 Ad), Non-GAAP Gross Profit! 71671 75,324 21044 34,003, 1172 94973 110,498, Ad
Slide 9: Business Cloud Services
Business Cloud Services
Slide 10: Q1 '16 User Cancel Rate for Cloud Business
2 ) | Q1 ‘16 User Cancel Rate for Cloud Business User cancel rate of 2.2% equals lowest historical rate for Q1 Cancel Rate?) 2.6% 2.5% | 2.8% m2011 23%. 2012 2.2% + 2013 2014 2.1% m 2015 20% m 2016 1.9% 1.8% + at a2 a3 a4 (1) User cancel rate, alsocalled user chum, is definedas cancellation of servi
Slide 11: Q1 2016 Cloud Connect (Fax/Voice) Highlights
* Q1‘16 Revenue" of $90M, +5% vs. Q1°15 * Fax Revenue") of $77M, +5% vs, Q1 ‘15, led by premium brands and corporate fax * FaxRevenue" represents 38% of consolidated Q1 ‘16 Revenue and ~47% of consolidated EBITDA) * Q1‘16 Revenue! run rate +8% vs Q115 * Subscriberbase of 2.4M DIDs, +3.5% vs. Q1°15 *
Slide 12: Q1 2016 Cloud Backup Highlights
i2 ) | Q1 2016 Cloud Backup Highlights * Revenue'?) of $28M, +112% vs Q1 15 * EBITDA) of $14M, +180% vs. Q1 15 * Expanded reach across existing backup (@) Pea teme 8 meen rons offerings VAULTLOGIX * ServerBackup * Disaster Recovery * Endpoint, and * File Sync & Share * Completed4 acquisitions in Q1
Slide 13: Q1 2016 Email Security Highlights
i2 ) | Q1 2016 Email Security Highlights * Q1‘16 Revenue of $12.3M, up 16% vs. Q1 15 * EBITDA?) of $4.4M, up 87% vs. Q115 * Consolidated datacenters in the Nordics resultingin future cost savings * MxToolbox customers fully migrated to Excel Micro * Opened2 new FuseMail Datacentersin the US to accom
Slide 14: Q1 2016 Email Marketing Highlights
i2 ) | Q1 2016 Email Marketing Highlights * Q1‘16 Revenue of $6M, +18% vs. Q1 15, Revenue?) run rate ~$26M * Campaigner Sales won two prestigious Stevie Awards: * Gold Stevie for Sales Operations Professional of the Year (head of sales) * Bronze Stevie for Distinctive Sales Achievements (sales team)
Slide 15: Digital Media
Digital Media
Slide 16: Q1 2016 Digital Media Highlights
j2 ) | Q1 2016 Digital Media Highlights * Digital media business demonstrating strong fundamentals * Q1 ‘16 Revenuel"?) of $62M, +44% vs. Q1 ‘15 * Q1 ‘16 EBITDA) of $20M, up, +49% vs. Q1 ‘15 * Q1 ‘16 EBITDA2) margin growth to 33% vs. 32% for Q1 ‘15 * Total multi-platform visits were up 15% YoY at 1.
Slide 17: Q1 2016 Digital Media Highlights
j2 ) | Q1 2016 Digital Media Highlights PE. t2siness Sotware index * Ookla continues to demonstrate its dominance in speed testing * Qokla’s mobile Speedtest app was installed on over 15.1M new devices during Q1 16, a 22.2% YOY increase vs. @1 2015 (") * All-time total unique device installs at the
Slide 18: 2016 Financial Guidance
2016 Financial Guidance
Slide 19: Reconfirming 2016 Guidance
j2 ) | Reconfirming 2016 Guidance Revenues” $830M - $860M Adjusted Non-GAAP EPS") $4.70 - $5.00 (1) Figures are adjusted Non-GAAP. (2) Adjusted earnings per diluted share excludes share-based compensation, amortization of acquired intangibles and the impact of any currently anticipated items, in eac
Slide 20: Supplemental Information
Supplemental Information
Slide 21: Financial Metrics: Consolidated
j2) | Financial Metrics: Consolidated j2 Global Consolidated ai a2 a3 a4 at Total GAAP Revenues $161,253 $176,038 $178,701 $204,823 $200,502 ‘Adjustments $0 so so so so Total Adjusted Non-GAAP Revenues @ _$161,253 $176,038 $178,701 $204,811 $200,502 Adjusted Non.GAAP Revenue By Segment 2 = Cloud Rev
Slide 22: Financial & Other Metrics Cloud & Media
j2 ) | Financial & Other Metrics Cloud & Media (a) Q) 3) @ (3) 204 a at Aaiusted Nom GAAP Revenue By Type Fixes Subseber Revenues seeoo7 si024a7 stosesr s112478 st15496 arable Susenber Revenues siggs7 s21960 sv154 _sa1ge4 21453 Subscriber Revenues srs 7e4 9129805 st25921 s1a9812 — $136989 Other Lice
Slide 23: Non-GAAP Financials Cloud Segment by Service
j2 ) Non-GAAP Financials Cloud Segment by Service Cloud Connect Fax/Voice) 2000-2010 mou now ms mu 215 cazois__ aime fal: Non GAAP Revenues sds 5 haess 5s basis § bass amass agz00 = § sote epiTpa™**"* $ 177,338 $ 186,382 S 186,818 $ 190,362 S 200,443 $ 47,596 S 48,088 capt invesment (Cap Acausions i
Slide 24: Non-GAAP Financials Digital Media, Corporate and Consolidated
j2) | Non-GAAP Financials Digital Media, Corporate and Consolidated 20002010 2011 2012 2013 2014 2018 12015 12016 ‘dl. Non-GAAP Revenues! so $971 $ 123931 $ 167,814 $216,374 $ 43257 $62,409 Adj. Non-GAAP Gross Profit ° 112980 43,787 194.625 23,908 57,10 Adj. NomGAAP Operating Profit 30 3 77e0s _ $48
Slide 25: GAAP Reconciliation Free Cash Flow & EBITDA
j2) | GAAP Reconciliation Free Cash Flow & EBITDA (8 in millions) Free Cash Flow (?) aris aris 3°45 415 aris Net cash provided by operating activities 945.716 951.894 $50.963 $80,488 $64,524 Less: Purchases of property and equipment (82.401) ($4.554) (84.972) (85.370) ($4.321) Add Excess tax benefit
Slide 26: GAAP Reconciliation Q1 Adjusted Non-GAAP Earnings & EPS
i2 GAAP Reconciliation Q1 Adjusted Non-GAAP Earnings & EPS ($ in thousands) faeus smm = = = = SS ta $ ume 8) = = (26) 2: 32048 BG (83 (a) - - (63) os: TS ane ‘ re ee oe om om Re tate a =o a Oe en) - oo oo a iBB m6 ae) — ta) Pe ar eee ee) wm = = fa) = = eK - = = BN B® = = = = oo my me ae en on wt Sa
Slide 27: GAAP Reconciliation EBITDA Q1 2016
j2) | GAAP Reconciliation EBITDA Q1 2016 ($ in thousands) EBITDA CONSOLIDATED CLOUD & DIGI MEDIA Q1 2016 (1) Corporate ‘Cloud Cloud andinter- Cloud P Tot Digital Subscription ‘segment. ‘Services «Licensing» Cloud = Mig «= Consolitated elimination cS Netincome (oss) Be (4378) 28.340 (eo) aso 2403 Bae
Slide 28: GAAP Reconciliation Operating Profit
j2 ) | GAAP Reconciliation Operating Profit ($ in thousands) CONSOLIDATED ry2ou,FY2012——FY 20132016 FY 2015 ants. ate |caAP Operating Proft S 135950 § tszie2 § 175423 § 186,206 § issam| [s aosao[s 5338 PatentSettiement 3 . (2572) . . . . man 17,638 12733 3,004 stion-related integration costs 25,408
Slide 29: GAAP Reconciliation Operating Profit
j2 ) | GAAP Reconciliation Operating Profit ($ in thousands) CLOUD Fran Fv2012 F203, FY2018 FY 2015 Ot45 ant6, [GAAP Operating Pratt S 150173 § iear2 $ is7ass $ t7ea08 § issaos| [s axgei[$ S027 Patant Settiement : z (22572) : g 5 Revenue : (4428) 2 x 2 2 10,325 . 3 : ueu 1558 as;08 32288 saan 23983
Slide 30: Global
Global