Slide 1: Investor Presentation
Investor Presentation August 2023
Slide 2: Safe Harbor
Safe Harbor This presentation includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Any statements made herein that are not statements of historical fact, including statements about Radware’s plans, outlook, beliefs or opinions, are forward
Slide 3: Radware Complete Mitigation Suite
Radware Complete Mitigation Suite Radware’s Core Business The Hawks Business Application Application and Cloud Security SkyHawk Protection of application Availability Data Center As-a-Service hosted in the public cloud Application delivery Security Mitigation of data centers, web applications, API a
Slide 4: Why Radware?
Leading Critical Cyber Security Vendor Large Growing TAM and SAM Leading Differentiated Technology Why Radware? Large Enterprise and Carriers Customer Base Fast Growing Cloud Security Business Sustainable Growth and Profitability 4
Slide 5: Industry Trends
Industry Trends Leading Critical Cyber Security Vendor Growing Accelerated Shortage Threat Cloud Digital in Security Landscape Transition Transformation Experts & Skills 5
Slide 6: Industry Trends
Industry Trends Leading Critical Cyber Security Vendor Growing Accelerated Shortage Threat Cloud Digital in Security Landscape Transition Transformation Experts & Skills Critical, Need State-of-the-Art Security 6
Slide 7: Growing Threat Landscape
Growing Threat Landscape DDoS Application New Attack Attacks Attacks Vectors Reaching Continue Challenging New Heights to Grow Defenses 7
Slide 8: Attack Campaign on Airports
Attack Campaign on Airports October 2022 8
Slide 9: Attack Campaign on Health Care February 2023
Attach Campaign On Health Care February 2023 https://www.scmagazine.com/news/threat-intelligence/killnet- https://www.malwarebytes.com/blog/news/2023/02/killnet ddos-attacks-inflicting-damage-on-healthcare-this-is-war -group-targets-us-and-european-hospitals-with-ddos-attacks 9
Slide 10: 2022 New Norm: Cyber Attacks on US Infrastructure
2022 New Norm: Cyber Attacks on US Infrastructure 400Gbps – Series of DDoS attacks by pro-Russian hacker groups, targeting US civilian infrastructure, such as websites of major airports 1.1Tbps DDoS Attacks 1.1Tbps Attack on Service Provider US service provider under attack for over 36 hours Ukraine
Slide 11: Industry Trends
Industry Trends Leading Critical Cyber Security Vendor Growing Accelerated Shortage Threat Cloud Digital in Security Landscape Transition Transformation Experts & Skills Critical, Need State-of-the-Art Security Consistent Security Across Clouds 11
Slide 12: Cloud Transition Introduces Uncertainties
Cloud Transition Introduces Uncertainties Pace & Final Deployment Unknown Multi-Cloud Creates 99% Deploy Applications in at Least One Public Cloud New Security Risks 69% Experienced Data Exposure Due to Inconsistencies Between Platforms Private Cloud Legacy Data Center Kubernetes 70% Aren’t Confiden
Slide 13: Industry Trends
Industry Trends Leading Critical Cyber Security Vendor Growing Accelerated Shortage Threat Cloud Digital in Security Landscape Transition Transformation Experts & Skills Critical, Need Consistent State-of-the-Art Security Security Across Clouds Frictionless Security 13
Slide 14: Accelerated Digital Transformation
Accelerated Digital Transformation Multiple End- Users & Partners Distributed Applications Workforce at Center Increased Use Time to market and agility of APIs of Business are critical to staying competitive Online Consumption of Goods Need frictionless security that does not hold you back 14
Slide 15: Industry Trends
Industry Trends Leading Critical Cyber Security Vendor Growing Accelerated Shortage Threat Cloud Digital in Security Landscape Transition Transformation Experts & Skills Critical, Need Consistent Frictionless State-of-the-Art Security Security Automated Security Across Clouds Protection and Fully Ma
Slide 16: Shortage in Security Experts & Skills
Shortage in Security Experts & Skills +25% ~3.4M 70% 43% demand for open positions businesses are can’t find enough cyber security worldwide facing skill qualified talent experts shortages Need for automated protections and fully managed services * Sources: 2022 (ISC)² Cybersecurity Workforce Study
Slide 17: Industry Trends
Industry Trends Leading Critical Cyber Security Vendor Growing Accelerated Shortage Threat Cloud Digital in Security Landscape Transition Transformation Experts & Skills Critical, Need Consistent Frictionless Automation State-of-the-Art Security Security Fully Managed Security Across Clouds 17
Slide 18: The CISO Challenge
The CISO Challenge STATE OF THE ART FRICTIONLESS Protection from the most Security operations that advanced threats enables business agility Organizations Shouldn’t Have to Choose 18
Slide 19: The Radware Difference
The Radware Difference Combining State-of-the-Art & Frictionless Security State-of-the-Art Protection Frictionless Security From the Most Advanced Threats Enables business agility & lowers TCO Widest Coverage Agnostic, Consistent ALL APP SURFACES, ALL VECTORS ACROSS ALL CLOUDS, FULLY INTEGRATED High
Slide 20: State-of-the-Art Protection: Winning Industry Recognition
State-of-the-Art Protection: Winning Industry Recognition APP & API PROTECTION 2022 BOT MANAGEMENT 2023 DDoS 2023 WAF 2023 LEADER & OUTPERFORMER LEADER LEADER LEADER BOT DETECTION MATRIX, 2022 BEST IN CLASS WAF LEADERSHIP “The largest global financial COMPASS 2022 institutions, brokerage firms, OVER
Slide 21: State-of-the-Art Protection: Winning Industry Recognition
State-of-the-Art Protection: Winning Industry Recognition CRITICAL CAPABILITIES FOR CLOUD WEB APPLICATION AND API PROTECTION (WAAP), 2022 #2 IN HIGH SECURITY & API USE CASES 94% WOULD RECOMMEND Radware Cloud WAF Service 94% WOULD RECOMMEND Radware Cloud DDoS “Radware Cloud WAF “Radware offers one of
Slide 22: Growth Strategy: Profitable Growth Powered by Cloud Security
Growth Strategy: Profitable Growth Powered by Cloud Security
Slide 23: The Markets We Operate In
The Markets We Operate In Bot/API Bot/API $0.9B $3.9B ADC $2.3B WAF $1.1B 2027 2023 $7.2B $3.7B $10.7B $1.8B $1.6B DDoS ADC $2.7B WAF DDoS Source: IDC: Worldwide Application Protection and Availability Forecast, 2022–2026: Security Powers the Digital Experience, November 2022 23
Slide 24: Large Enterprise and Service Providers
Large Enterprise and Service Providers Blue Chip Customers 6 10 7 10 6 12 4 10 4 10 OF TOP OF TOP OF TOP OF TOP OF TOP WORLD’S WORLD TELECOM WORLD’S STOCK WORLD’S MOST WIDELY BANKS COMPANIES EXCHANGES ECOMMERCE USED SAAS COMPANIES APPLICATIONS 24
Slide 25: Radware Application Protection
Radware 360 Application Protection Secure Your Apps. Regain Control. Enable Your Business. FORMJACKING KNOWN BAD ACTORS BAD BOTS UNWANTED IPs WEB ATTACKS API ABUSE Mobile & Web Applications APIs DDOS ATTACKS CLOUD THREATS 25
Slide 26: Global Cloud Security Network Enables Cloud Expansion
Global Cloud Security Network Enables Cloud Expansion 40+ WITH GLOBAL COVERAGE AppSec PoPs 12 Tbps OF GLOBAL MITIGATION CAPACITY DDoS MITIGATION SCRUBBING CENTER CLOUD WAF PoP BOT MANAGER SERVICE CENTER 19 Worldwide SCRUBBING CENTERS 26
Slide 27: Radware Strategy Summary
Radware 1 On-Prem Business Strategy TAM is growing, best of breed required Summary 2 Critical Areas Large, strong and profitable Accelerating Cloud Security Business 3 Strong growth, expanding SAM, SaaS business model 4 Leverage in the Model Driving profitable growth with OpEx leverage 27
Slide 28: Environment, Social, Governance
Environment, Social, Governance Protecting the Promoting Investing in Environment Human Rights Community • Implemented KPIs for • Published Human Rights • Building strong relationship reduction in the use of and Labor Standard with the community with water, power and paper Policy various projects •
Slide 29: Financial Overview
Financial Overview
Slide 30: Q2 2023 Highlights
Q2 2023 Highlights $66M 79% 82.3% $208M $59M Revenue Recurring Gross Margin Total ARR Cloud ARR 13% decrease Revenue Compared to 7% increase 23% increase YoY Compared to 83.3% last YoY YoY 65% last year year * Total ARR includes the annualized value of booked orders for services, subscription licens
Slide 31: ARR Driven by Cloud ARR
ARR Driven by Cloud ARR Total ARR ($M) Cloud ARR ($M) 208 195 177 163 59 150 48 127 39 28 22 15 Q2 2018 Q2 2019 Q2 2020 Q2 2021 Q2 2022 Q2 2023 Q2 2018 Q2 2019 Q2 2020 Q2 2021 Q2 2022 Q2 2023 * Total ARR includes the annualized value of booked orders for services, subscription licenses and maintenan
Slide 32: Revenue ($M) and EPS ($)
Revenue ($M) and EPS ($) Total Revenue ($M) Total Revenue ($M) $148.8 $75.1 $134.6 $65.6 Q2 2022 Q2 2023 H1 2022 H1 2023 EPS ($) EPS ($) $0.18 $0.37 $0.24 $0.10 Q2 2022 Q2 2023 H1 2022 H1 2023 32
Slide 33: Q2 2023 Revenue Breakdown by Geographies
APAC Q2 2023 +3% YoY Revenue Breakdown by $16 Geographies ($M) $66 Million $27 AMERICAS -10% YoY EMEA -24% YoY $23 33
Slide 34: Cash Generation
Cash Generation Cash & OCF FCF Capex Buyback Proceeds from issuance of Preferred A shares in subsidiary Equivalents 35 $43 32 29 18 15 9 8 5 3 $223 $402M $136 -3 -1 -2 -2 -5 -5 Deposits -18 -20 Marketable Securities Q2 2020 Q2 2021 Q2 2022 Q2 2023 34
Slide 35: Thank You!
Thank You!