Everpure, Inc. · NYSE:P

Everpure — Pure Storage — Q4 FY2018 Earnings Presentation

23 slides from Everpure's earnings presentation, Mar 1, 2018

  1. Slide 1: Q4 Fiscal 2018 Results

    Q4 FISCAL 2018 RESULTS MARCH 1, 2018 1 ZaARETe WEEE ©) purestorace

  2. Slide 2: Forward Looking Statements and Non-GAAP Information

    FORWARD LOOKING STATEMENTS AND NON-GAAP INFORMATION This presentation contains “forward-looking” statements that are based on our beliefs and assumptions and on information currently available to us. Such forward-looking statements include statements concerning our possible or expected future financ

  3. Slide 3: $35B+ Opportunity

    $35B+ OPPORTUNITY Worldwide IT Infrastructure Hardware Spend by Consumption Model (Compute, Networking, Storage) 2019 Cloud IT Hardware Spend $125.9B, Storage share: 31% MARKETS THAT MATTER ‘ofan TOP 500+ Leading Clouds ; oy laasS, SaaS, PaaS Are 22 7 5-YEAR CAGR inturt laaS/PaaS SaaS, Linked Tradit

  4. Slide 4: Q4 FY18 Key Highlights

    Q4 FY18 KEY HIGHLIGHTS Pram customers Leverage Non-GAAP +$35B >4,500 GB) +500 Leading Clouds ~500 adds Q/a, 48% growth Y/Y 55.1% 66.2%. & Next-Generation Data ~" $1 1 >$ 2 = Gross margin Gross margin [@ —clousitcation ofr Incremental purchases from top _ Incremental purchases from all ¥ 25 customers

  5. Slide 5: Quarterly and Annual Revenue

    io) QUARTERLY AND ANNUAL REVENUE +48 70 Q4 FY18 Y/Y TOTAL REVENUE GROWTH $338.3 $1,023.0 $728.0 $440.4 $814.0 $375.7 FY16 FY17 FY18 = Product Revenue (Millions) = Support Revenue (Millions) 5 sore pure stonace NC ©) purestorace $277.7 $227.9 $224.5 $197.0 $182.6 $150.2 $163.2 $139.9 - - ~ FY16 Q4 FY

  6. Slide 6: Customers: Number of Customers to Date

    >4,500 CUSTOM E RS NUMBER OF CUSTOMERS TO DATE ADDS Q/Q, 13% Q/Q “$11 Incremental purchases from top 25 customers within 18 months of initial purchase of $1 >$2 Incremental purchases from all customers within 24 months of initial purchase of $1 48% >4500 >3350 eee — >3050 . — >2600 >1650 YY, >1,450

  7. Slide 7: Non-GAAP Gross Margin & Profit

    NON-GAAP GROSS MARGIN & PROFIT _ 66.4% ___. —~o $223.8 ~ ~ ~ ' FY16 Q4 FY17Q1 FY17 Q2 FY17 Q@3 FY17Q4 FY18 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY16 FY17 FY18 LONG-TERM GM TARGET RANGE 68% 63% sms Non-GAAP Gross Profit (Millions). -®-Non-GAAP Gross Margin 7 sous pure sronacewe + See GAAP to non GAAP reconcati

  8. Slide 8: Non-GAAP Operating Expense

    NON-GAAP OPERATING EXPENSE AS A PERCENTAGE OF REVENUE 94.3% 96.7% 85.6% 83.1% 79.4% 69.5% 12.7% 9.9% FY16 G4 FY17Q1 FY17 Q2 FY17Q3 FY17 04 FY18 Q1 FY18 Q2 FY18 3 FY18.Q4 FY16 FYI7 FY18 G&A =S&M BR&D 8 sous pure sronacewe See GAAP to non GAAP reconcation nour append ©) purestorace

  9. Slide 9: Non-GAAP Operating Margin and Profit

    NON-GAAP OPERATING MARGIN +10.2 AND PROFIT Y/Y PPTS IMPROVEMENT FY16 Q4 FY17Q1 FY17 Q2 FY17 Q@3 FY17 Q4 FY18 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY16 FY17 FY18 $(20.9) $(19.4) $130.5) | $(26.4) $(31.4) $(414) $(96.3) $(140.1) lms Non-GAAP Operating Income (Loss) (Millions) —®-Non-GAAP Operating Margin 9 sous

  10. Slide 10: Free Cash Flow

    +$7.7 F RE E CASH F LOW FY18 FREE CASH FLOW (IN MILLIONS) Free Cash Flow «) (excluding ESPP] Impact) ‘SEE Free cash flow (non-GAAP) (Mitions) oe Free cash flow as % of revenue 21.4% 0.8% $7.7 FY16 -Q4 FY17-Q1 FY17-Q2 FY17-Q3 FY17-Q4 FY18-Q1 FY18 -Q2 FY18 -Q3 FY18-Q4 FY16 FY17 FY18 $3.4 FY16-Q4 FY17-

  11. Slide 11: Company Goals for 2018

    COMPANY GOALS FOR 2018 op Ww ON Deliver industry-leading growth by focusing on three key markets (the top 1000 Cloud and SaaS providers, next-generation use cases, and the Global 2000) Be a global company and expand our international revenue Scale in all that we do to maximize effectiveness and effi

  12. Slide 12: Guidance

    GUIDANCE Q1 FY19** FY19** Revenue $246M to $254M $1.310B to $1.360B Non-GAAP Gross Margin* 63.5% to 66.5% 63.5% to 66.5% Non-GAAP Operating Margin* -13.0% to -9.0% 0.0% to 4.0% * We have not reconciled guidance for non-GAAP gross margin and non-GAAP operating margin to their most directly comparable

  13. Slide 13: Long-Term Target Operating Model

    LONG-TERM TARGET OPERATING MODEL NON-GAAP Gross Margin 66.2% 63 - 68% R&D 16.4% 15 — 20% S&M 35.3% 25-30% G&A 6.2% 5-7% Operating Margin 8.3% 15 — 20% case See GAAP to non-GAAP reconcllation in our append ©) purestorace

  14. Slide 14: Appendix

    _ APPENDIX Q4 FISCAL 2018 RESULTS 1 careremewene ©) purestorace

  15. Slide 15: Gross Margin: GAAP to Non-GAAP Reconciliation

    GROSS MARGIN GAAP TO NON-GAAP RECONCILIATION Fiscal Quarter Full Year (Sin thousands) QarvIG (3) QIEVIT.« (S) QR EVI] «(GREY (S)QAEVIT«u)QTEVIB« () «QR EVIB = (S)GBFYIB (3) | QaFYIB oc) | EMG 6c) EIEN Product gross margin (GAAP) $86,928 68.2% $7692 69.5% $88073 67.3% $105798 65.9% $124,288 66.5% $HN

  16. Slide 16: Operating Expenses & Margin

    OPERATING EXPENSES & MARGIN GAAP TO NON-GAAP RECONCILIATION Fiscal Quarter Full Year As of Astiof As%ot Astiof As ot Asiof Astiof Astiof Astot Tetal ‘Total Total ‘Total Total ‘Total ‘Total ‘Total Total (Sin thousands) QAFYIG Revenue QIFYIT Revenue OZFYIT Revenue O3FYIT Revenue QAFYTT Revenue GIFYIE

  17. Slide 17: Free Cash Flow

    FREE CASH FLOW GAAP TO NON-GAAP RECONCILIATION Fiscal Quarter Full Year a4 Gt G2 3 of Gt a2 a3 a4 | ($ in millions) FY16 FY17 FY17 FY17 FY17 Fy18 Fy18 FY18 FY18 FY16 =FY17 FY18 Cash provided by (used in) operations (GAAP) $42.0 $7.0 $1.6 -$473 $37.5 -$14.3 -$0.2 $28.2 $59.0 -$7.9 -$14.4 $727 Less: C

  18. Slide 18: Q4 FY18 Share Count

    Q4 FY18 SHARE COUNT ACHIEVING PROFITABILTY IMPACTS EPS COMPUTATIONS WHEN THERE IS NET INCOME WHEN THERE IS NET LOSS DILUTED SHARES a») BASIC/DILUTED SHARES@) (a) Please note: - Share count as of 1/31/18 - anticipated to continue to increase in coming quarters. - Diluted shares computed based on weig

  19. Slide 19: New Revenue Standard

    _ NEW REVENUE STANDARD IMPACT OF ASC 606 ON PURE’S FINANCIALS (D cammesewene ©) purestorace

  20. Slide 20: Transactional Changes Under ASC 606

    TRANSACTIONAL CHANGES UNDER ASC 606 CURRENT TREATMENT ASC 606 TREATMENT Product pricing incentives are allocated Product / Support Revenue Product pricing incentives are allocated solely proportionally between Product AND Support Allocations to Product Revenue —— Revenue * Commissions attributable t

  21. Slide 21: FY17/FY18 Historical Commentary

    FYA7 FY18 Hi IRICAL COMMENTARY (FY17/FY18) ($ in millions): ASC 606 Change ASC 606 Change 8140 $ 834.5 2.5% 2090 $ 190.3 Product 590.0 $ 6145 41% 1380 $ 1247 -9.6% Revenue 728.0 $ 739.2 Pn ow 66.6% Gross Margin * 0.1pt Small (& Decreasing) Impact on Total Revenue & Total Gross Margin % Mix Shift Inc

  22. Slide 22: ASC 606 GAAP to Non-GAAP Reconciliation

    ASC 606 GAAP TO NON-GAAP RECONCILIATION FY17 FY18 ‘As % of Total ‘As % of Total} ‘As % of Total ‘As % of Total} thousands) ASC605 Revenue ASC606_—Revenue | ASCGOS Revenue ASCEOS — Revenue Product revenue $590,001 810% = $614.458 831%] $813,985 796% $834,455 81.4% Support revenue 137,976 190% 124713,

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Pure Storage — Q4 FY2018 Earnings Presentation on 6ix