Slide 1: Fourth Quarter and Full Year 2016 Earnings Results
Click here to edit the name of your presentation Fourth Quarter and Full Year 2016 Earnings Results 1
Slide 2: Safe Harbor
Safe Harbor Forward-Looking Statements This presentation contains forward-looking statements, within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, that involve risks and uncertainties. Such forward-looking statements may include projections regard
Slide 3: Key Metrics: Q4'16
Key Metrics: Q4’16 Registered Users Premium Subscriptions Collections ( million) (000s) ($ million) 97.4 $97.7 2,465 27% 46% Y/Y 39% Y/Y Y/Y 76.9 1,767 $66.9 Q4'15 Q4'16 Q4'15 Q4'16 Q4'15 Q4'16 Improvement Improvement in Conversion in ACPS 3
Slide 4: Q4'16 Highlights
Q4’16 Highlights • GAAP revenue of $84.2 million, 48% Y/Y growth, exceeding prior guidance of $81-82 million • Collections of $97.7 million exceeded prior guidance of $93-94 million; 46% Y/Y growth is an acceleration from last quarter • Net premium subscription additions were 171,000; Total subscrip
Slide 5: 2016 Highlights
2016 Highlights • GAAP revenue of $290 million, 43% Y/Y growth, exceeding prior guidance of $287-288 million • Collections of $342 million exceeded prior guidance of $337-338 million; 42% Y/Y growth is an acceleration from 2015 • Added over 20 million new registered users to reach 97 million. As of
Slide 6: Users and Subscriptions
Users and Subscriptions 27% 39% Y/Y Y/Y Registered Users Premium Subscriptions (million, at End of Period) (000s, at End of Period) 97 2,465 92 87 2,294 82 2,121 77 72 1,938 68 1,767 63 1,643 58 1,503 50 1,371 50 46 1,233 42 1,125 39 1,019 36 908 32 790 28 707 25 627 22 549 20 470 17 338378414 298 Q
Slide 7: Collections and Revenue
Collections and Revenue Collections 46% Revenues 48% ($ million) Y/Y ($ million) Y/Y $98 $84 $87 $76 $81 $69 $76 $62 $67 $57 $62 $54 $57 $49 $56 $45 $49 $42 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 7
Slide 8: Deferred Revenue Growth
Deferred Revenue Growth Deferred Revenue 51% Revenues 48% ($ million) Y/Y Y/Y ($ million) $157 $84 $143 Deferred Revenue nearly all $132 $76 realized over next 12 months $119 $69 $105 $95 $62 $87 $57 $54 $67 $49 $45 $42 Q4'14 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1
Slide 9: Consistent Behavior
Consistent Behavior Active Premium Subscriptions from Q1 User Cohorts New Registered Users 203,289 1Q16 5,305,726 1Q15 150,577 4,568,323 126,962 1Q14 121,001 4,089,253 102,980 1Q13 92,019 3,714,472 80,182 1Q12 62,071 2,651,656 1Q11 1,833,897 33,747 34,880 29,612 26,925 1Q10 18,513 18,169 919,221 1 2
Slide 10: Long Term Subscriptions
Long Term Subscriptions • Lower Promotional Activity of Annual Duration Packages % of New Subscriptions • User Funnel Optimization Generated Incremental Monthly % of Total Subscriptions 77% 79% 77% 74% 75% 75% Subscriptions 73% 70% 65% 17% 35% 27% 30% 83% 26% 25% 25% 23% 21% 23% Q4'14 Q1'15 Q2'15 Q3
Slide 11: Ongoing Cohort Conversions
Ongoing Cohort Conversions % of Gross New Subscriptions by Prior and Current User Cohorts 64% 62% 63% 62% 63% 60% 58% 60% 60% 40% 42% 40% 40% 36% 38% 37% 38% 37% Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Prior user cohorts Current user cohort Note: Data as of December 31, 2016 11
Slide 12: Growing Base of Cohort Collections
Growing Base of Cohort Collections Annual collections by user cohort ($ million) User Cohort Collections $500 In 2015: $236 million In 2016: $251 million1 $400 $300 $200 $100 $0 2010 2011 2012 2013 2014 2015 2016 2010 & Prior 2011 2012 2013 2014 2015 2016 12016 collections are constant currency assu
Slide 13: Marketing Efficiency
Marketing Efficiency … After 16 Quarters … After 20 Quarters One Time Marketing, Ongoing Monthly Collections … After 12 Quarters 6.0x 5.7x 3.3x $27 To Date … After 8 Quarters $49 $5 2.2x $57 $33 To Date Q1’12 Cohort … After 4 Quarters To Date 1.1 x $33 $40 $43 $8 To To Date $33 To Date Date $18 To D
Slide 14: Increasing Collections per New Subscription
Increasing Collections per New Subscription $153 $150 $145 $141 $132 $133 $133 $132 $132 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Avg. Collection per New Annual Subscription Note: Based on New Annual Subscriptions in the US 14
Slide 15: Increasing Geographic Penetration
Increasing Geographic Penetration Revenue by Geography (% of Total) 9% 14% 54% Y/Y 3% 17% 8% 36% Y/Y 27% 44% Y/Y Growth Rate vs. Q4’15 (Constant currency basis) 71% 51% 52% Y/Y 2010 Q4'161 North America Europe Latin America Asia and others 1Revenue by Geography and Y/Y Change based on constant FX ra
Slide 16: Non GAAP Financial Results
Non GAAP Financial Results (in 000s) 2011 2012 2013 2014 2015 Q4’15 Q4’16 Y/Y% Collections $29,648 $52,479 $98,673 $171,255 $241,687 $56,831 $97,652 46% Revenues $24,600 $43,676 $80,473 $141,841 $203,518 $70,707 $84,176 48% Gross Margin % 79% 79% 82% 82% 83% 84% 85% R&D expenses $12,807 $16,229 $26,
Slide 17: APPENDIX
APPENDIX 17
Slide 18: Reconciliation of GAAP to Non-GAAP
Reconciliation of GAAP to Non-GAAP (in 000s) 2012 2013 2014 2015 2016 Q4’15 Q4’16 Revenues $43,676 $80,473 $141,841 $203,518 $290,103 $56,831 $84,176 Change in $8,803 $18,200 $29,414 $38,169 $51,966 $10,039 $13,476 Deferred Revenues Collections $52,479 $98,673 $171,255 $241,687 $342,069 $66,870 $97,
Slide 19: Reconciliation of GAAP to Non-GAAP
Reconciliation of GAAP to Non-GAAP (in 000s) 2012 2013 2014 2015 2016 Q4’15 Q4’16 GAAP Operating Loss ($14,961) ($26,523) ($55,643) ($48,635) ($44,032) ($10,163) ($4,742) Adjustments: Realized losses (gains) on - ($156) $281 $3,492 $791 $516 $167 hedging transactions Depreciation $871 $1,229 $2,662
Slide 20: Reconciliation of GAAP to Non-GAAP
Reconciliation of GAAP to Non-GAAP (in 000s) 2012 2013 2014 2015 2016 Q4’15 Q4’16 GAAP Gross Profit $34,443 $65,216 $115,733 $168,548 $244,816 $47,224 $71,438 Stock-based Compensation $105 $490 $1,005 $1,353 $1,798 $380 $429 Non-GAAP Gross Profit $34,548 $65,706 $116,738 $169,901 $246,614 $47,604 $7