Slide 1: Q3 2021 Earnings Release
FALCONSTOR Q3 2021 Earnings Release November 10, 2021
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation includes forward-looking statements that involve risk and uncertainties that could cause actual results to differ materially from the forward-looking statements. These risks and uncertainties are discussed in FalconStor's reports on Forms 10-K, 10-Q, and other
Slide 3: FalconStor is the trusted data protection software leader
FalconStor is the trusted data protection software leader modernizing disaster recovery and backup operations for the hybrid cloud world. The Company enables enterprise customers and managed service providers to secure, migrate, and protect their data while reducing data storage and long-term retent
Slide 4: Our Key 2021 Growth Initiatives
Our Key 2021 Growth Initiatives Expand our industry-leading backup and long-term retention and recovery product line by creating flexible and extensive data protection innovations to drive our growth over the next decade. data replication products to ensure we are focused on those use cases which ar
Slide 5: Q3 2021 Highlights
Q3 2021 Highlights > Quarterly GAAP Subscription Revenue continuing to grow Q4 2020 GAAP Subscription Revenue YoY Gawain 35% 16% 113% 42% > Quarterly GAAP Revenue growth consistency remains a key priority 3 FALCONSTOR
Slide 6: Q3 2021 Highlights
Q3 2021 Highlights > Quarterly GAAP Operating Expenses being tightly managed to enable growth investment GAAP Operating Expenses 2,391,966" 3,000,719" 3,196,760 3,231,270 “includes $633k gain on litigation settlement * includes $349k of expenses to exit 60k sqft. office in Melville, NY ($135k / mont
Slide 7: Our Reinvention - A Broader View
Our Reinvention - A Broader View Net Customer Revenue Retention (excl. hardware) 92%* Gross Margin % 78% 83% 82% 88% Adjusted EBITDA% 7% 15% 12% 28% Free Cash Flow ($2.9) million ($1.9) million ($2.1) million $0.7 million “Rule of 40” Score** (14) (13) 5 7 % of Sales From Non-Core Markets (e.g., Chi
Slide 8: Our 20+ year history gives us unique insight into growing markets
Our 20+ year history gives us unique insight and proven experience into our growing, mission-critical data protection markets FalconStor Growth Markets 2019 2027 CAGR Data Protection as a Service (DPaaS)* $12B $104B 31% 2020 2027 CAGR Hybrid Cloud** $56B $204B 20% 2021 2026 CAGR Managed IT Services*
Slide 9: FalconStor Today
FalconStor Today Last 4 Quarters - Commercial Highlights e NEW: Launched multi-tenant StorSafe™ with integration into cloud storage from IBM Cloud, AWS, and others e MODERNPRICING: Created new and disruptive per tenant per month pricing model for our MSP customersto better align with their OPEX stru
Slide 10: Our Growth Focus
Our Growth Focus Continue increasing subscription-based recurring revenue, including monthly recurring MSP revenue Invest in data protection solutions and efficient routes to market aligned with high-growth hybrid cloud use cases Generate consistent quarterly year-over-year revenue and profitability
Slide 11: Q3 2021 Income Statement Summary
Q3 2021 Income Statement Summary Q3 2021 results were less than we were targeting and continue to highlight our need to deliver consistent quarterly revenue growth while we are transitioning from perpetual to subscription license model GAAP Total Revenue 3,283,469 4,436,400 GAAP Gross Profit 2,841,1
Slide 12: Q3 YTD 2021 Income Statement Summary
Q3 YTD 2021 Income Statement Summary Q3 YTD GAAP Total Revenue 10,370,542 16,199 GAAP Gross Profit 8,838,509 9,756,635) GAAP Operating Expenses 8,589,445 7,892,917 GAAP Operating Income 249,064 1,863,718 GAAP Net Income After Tax 449,996 17252927) FALCONSTOR
Slide 13: Key Balance Sheet Figures
Key Balance Sheet Figures Cash & Cash Equivalents 3,474,784 3,741,600 2,020,989 1,920,656 871,28) Net Working Capital (ex. Deferred 3,772,526 3,066,234 402,000 (250,802) (501,554) Revenue) Accounts Receivable 2,363,026 2,329,616 3,105,704 2,987,908 3,757,134 Accounts Payableand 1,441,351 2,357,104 3
Slide 14: 2021 Guidance
2021 Guidance Revised 2021 Guidance Guidance (in $ mili ar Total Revenue 141$ 151 Adjusted EBITDA* $ 255) 5 45 % 25% 30% Net Income $ 06 $ 17 % 4% 11% Rule of 40 (Revenue Growth % + Adjusted EBITDA %) 20 3S *Adjusted EBITDA adds back Non-Operating and Other Expenses and Income FALCONSTOR
Slide 15: Summary
Summary
Slide 16: Q&A
Q&A
Slide 17: Thank you!
Thank you!