Slide 1: Financial Results Q1 2022
NASDAQ : CRCT Financial Results Q1 2022 May 10, 2022 Q1 2022 Financial Results 1
Slide 2: Safe Harbor Statement
This presentation contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. We intend all forward-looking statements to be covered by the safe harbor provisions of the Private Securities Litigation Re
Slide 3: Welcome!
NASDAQ: CRCT Welcome! Q1 2022 Financial Results 3
Slide 4: Sound business fundamentals
Sound business fundamentals Profitable and durable Engagement engine that business model leads to greater 13th straight quarter of monetization positive net income Nearly 7M total users on Continued investments our platform drive robust product Added over 495 thousand roadmap and long-term new users
Slide 5: Long-term trends will continue to drive growth
Long-term trends will continue to drive growth 1 Personalization 2 Digitization of tools 3 Technology enabling a new generation of entrepreneurs 4 Proliferation of social media Q1 2022 Financial Results 5
Slide 6: Creativity across the globe
Creativity across the globe Did you know? We recently launched in Turkey and will be launching in Japan and South Korea soon Q1 2022 Financial Results 6
Slide 7: Investing to drive user engagement
Investing to drive user engagement 6.9M Users Onboarding o Enabling seamless onboarding o Creating products and learning tools Engagement designed for new users o Enhancing Cricut Design experience Monetization Q1 2022 Financial Results 7
Slide 8: Connected platform is our core asset
Connected platform is our core asset o Improving content discovery and enabling dynamic user experience o Fostering more inspiration, sharing, and engagement amongst users o Desktop experience mobile experience Q1 2022 Financial Results 8
Slide 9: Increasing our value proposition
Increasing our value proposition o Adding exclusive functionality for subscribers, like Monogram Maker o Enabling wide range of diverse content with Contributing Artist Program o Seamless compatibility with Cricut accessories & materials with continuous focus on innovation Q1 2022 Financial Results
Slide 10: Focused on long-term growth
Grow international Focused on Drive onboarding and engagement long-term growth Drive Cricut Access + Accessories and Materials monetization Innovate and expand platform Q1 2022 Financial Results 10
Slide 11: Financial Results
Financial Results Q1 2022 Financial Results 11
Slide 12: FY 2021 highlights / Q1 2022 financial highlights
FY 2021 highlights Q1 2022 financial highlights Revenue Operating Income Net Income $244.8M $31.4M $23.5M (24%) 12.8% 9.6% YoY Decrease Operating Margin Net Income Margin Q1 2022 Financial Results 12
Slide 13: Revenue breakdown
Revenue breakdown 70% 2 yr. basis $350 $323.8M o Connected Machine revenue $300 in Q1 declined (56%) YoY and up nearly 10% from Q1 2020 $244.8M $250 o Accessories & Materials revenue in Q1 $ in millions declined about (14%) YoY and $200 up 74% from Q1 2020 $150 $143.7M o Subscription revenue in Q1 g
Slide 14: Growing user base
Growing user base Users Engaged Users1 Paid Subscribers2 146% 121% 212% 2 yr. basis 2 yr. basis 2 yr. basis 3.7M 2.3M 6.9M 3.1M 4.9M 1.6M 1.7M 2.8M 0.7M 60% 62% 54% 26% 33% 33% Q1 2020 Q1 2021 Q1 2022 Q1 2020 Q1 2021 Q1 2022 Q1 2020 Q1 2021 Q1 2022 1. Number and percentage of users creating on their
Slide 15: User monetization
User monetization Subscriptions ARPU 1 Accessories & Materials ARPU 1 $9.96 $9.73 $29.45 $25.40 $7.20 $17.67 Q1 2020 Q1 2021 Q1 2022 Q1 2020 Q1 2021 Q1 2022 1. ARPU = Average Revenue Per User Q1 2022 Financial Results 15
Slide 16: Gross margin
Gross margin 31.1% 37.1% 40.5% 100% 90% Contributing Factors 80% Q1 2022 70% GROSS MARGIN % o Benefited from mix – higher proportion of revenue 60% driven by subscriptions 50% o Continued supply chain and inflationary pressures 40% o Connected machine margins impacted by lower 30% volumes compared t
Slide 17: Increased investments to drive growth
Increased investments to drive growth Operating Expense $27.3M $55.6M $67.6M 28% Disciplined and balanced approach 17% 6% Investments for future growth in… 4% o International expansion 13% o Onboarding and engagement 19% o Software 8% 4% o New product development o Subscriptions 9% 8% 5% 6% Q1 2020
Slide 18: Profitability
Profitability Did you know? Operating margin increased by 70 basis points on a two-year basis, as operating expenses more than doubled. Operating Income Net Income 80% 80% 2 yr. basis 2 yr. basis $64.7M $49.4M $31.4M $23.5M $17.5M $13.0M Q1 2020 Q1 2021 Q1 2022 Q1 2020 Q1 2021 Q1 2022 Operating Net
Slide 19: Balance Sheet and Cash Flow highlights
Balance Sheet and Cash Flow highlights Strong balance sheet positions Cash & Cash Equivalents as of Cash Flow generated from us well to mitigate supply chain 3/31/22 Operations during Q1 3/31/22 risk and continue to invest in future growth $245.7M $15.6M Cash & cash equivalents $150M Credit line rem
Slide 20: Forward looking commentary
Near term headwinds with seasonality trends and slower consumer demand to impact next few quarters Uncertainty of environment puts pressure on new user and paid subscriber additions for 2022 Forward looking commentary Remain highly focused on driving profitable growth; will likely be a few points be
Slide 21: Let's make.
Let’s make. Q1 2022 Financial Results 21
Slide 22: Appendix
Appendix Q1 2022 Financial Results 22
Slide 23: Long-term target model
Long-term target model Long-Term As % of Revenue FY19 FY20 FY21 Targets Gross Margin 29% 35% 35% 37 - 38% R&D Expense 5% 4% 6% 7 - 8% S&M Expense 8% 7% 10% 8 - 10% G&A Expense 5% 3% 4% 3 - 4% Operating Margin 11% 21% 15% 15 - 19% Q1 2022 Financial Results 23