Slide 1: 2021 Third Quarter Results
2021 THIRD QUARTER RESULTS Ended September 30, 2021
Slide 2: Forward Looking Statements Disclaimer
Forward Looking Statements Disclaimer This presentation contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. In some cases, forward-looking statements may be identified by words such as “believe,” “expect,” “seek,” “may,” “will,” “inten
Slide 3: Explanation of Non-GAAP measures
Explanation of Non-GAAP measures Non-GAAP financial measures are included in this press release. Non-GAAP financial measures consist of GAAP financial measures adjusted to exclude share-based compensation, amortization of acquired intangible assets, acquisition related expenses, amortization of disc
Slide 4: Q3 2021 Highlights
Q3 2021 Highlights Income Statement Balance Sheet and Cash Flow Analysis Outlook
Slide 5: Q3 2021 Highlights (Non-GAAP)
Q3 2021 Highlights (Non-GAAP) Total revenue Cloud revenue Q3 cloud gross Recurring revenue increased 20% to increased 29% margin increased increased to $494M; compared compared to Q3 154 bps to 67.1%; $390M; to Q3 2020 2020; compared to 65.6% representing 79% representing 53% in Q3 last year of tota
Slide 6: Income Statement
Q3 2021 Highlights Income Statement Balance Sheet and Cash Flow Analysis Outlook
Slide 7: Solid Growth and Execution
Solid Growth and Execution REVENUES (Non-GAAP, $M) 20% 494 • Significant growth in total revenue driven by growth 412 67 in cloud and product revenue in Q3 39 165 • Third consecutive quarter of accelerated total 169 revenue growth 262 • Cloud revenue of $262M represented 53% of total 204 revenue in
Slide 8: GAAP and Non-GAAP Income Statement (USD in thousands except EPS)
GAAP and Non-GAAP Income Statement (USD in thousands except EPS) NICE LTD. AND SUBSIDIARIES RECONCILIATION OF GAAP TO NON-GAAP RESULTS U.S. dollars in thousands (except per share amounts) Quarter ended Year to date Sep 30, Sep 30, 2021 2020 2021 2020 GAAP revenues $ 490,404 $ 409,827 $ 1,401,456 $ 1
Slide 9: GAAP and Non-GAAP Income Statement (cont.)
GAAP and Non-GAAP Income Statement (cont.) NICE LTD. AND SUBSIDIARIES RECONCILIATION OF GAAP TO NON-GAAP RESULTS (continued) U.S. dollars in thousands (except per share amounts) Quarter ended Year to date Sep 30, Sep 30, 2021 2020 2021 2020 GAAP financial and other expense, net $ 3,138 $ 1,032 $ 15,
Slide 10: GAAP and Non-GAAP Income Statement (cont.)
GAAP and Non-GAAP Income Statement (cont.) NICE LTD. AND SUBSIDIARIES RECONCILIATION OF GAAP TO NON-GAAP RESULTS (continued) U.S. dollars in thousands (1) Share-based Compensation Quarter ended Year to date Sep 30, Sep 30, 2021 2020 2021 2020 Cost of cloud revenue $ 2,117 $ 809 $ 5,287 $ 2,601 Cost
Slide 11: Q3 2021 Revenue Breakdown by Region (Non-GAAP)
Q3 2021 Revenue Breakdown by Region (Non-GAAP) 82% 12% AMERICAS EMEA $408M, +19% YoY $57M, +30% YoY 6% APAC $29M, +14% YoY
Slide 12: Q3 2021 Revenue Breakdown by Business Unit (Non-GAAP)
Q3 2021 Revenue Breakdown by Business Unit (Non-GAAP) 18% FINANCIAL CRIME & COMPLIANCE $91M, +21% YoY 82% CUSTOMER ENGAGEMENT $403M, +20% YoY
Slide 13: Gross Profit and Gross Margin Q3 2021 (Non-GAAP)
Gross Profit and Gross Margin Q3 2021 (Non-GAAP) 80.0% $380 $358M 78.0% $330 76.0% $293M $280 74.0% 72.3% 72.0% $230 Axis Title 70.0% 71.0% $180 68.0% 66.0% $130 64.0% $80 62.0% 60.0% $30 Q3 20 Q3 21 Gross Profit Gross Margin • Gross profit growth of 22% driven primarily from expanding cloud busines
Slide 14: Gross Margin Q3 2021 (Non-GAAP)
Gross Margin Q3 2021 (Non-GAAP) PRODUCT MARGIN SERVICES MARGIN CLOUD MARGIN 90.1%| +105bp 73.3%| -16bp 67.1%| +154bp Product GM Product GM 90.1% 89.1% Service GM Service GM 73.4% 73.3% Cloud Cloud GM GM 65.6% 67.1% Q3 20 Q3 21 Q3 20 Q3 21 Q3 20 Q3 21 • Cloud gross margin increased as a result of inc
Slide 15: Operating Income and Operating Margin Q3 2021 (Non-GAAP)
Operating Income and Operating Margin Q3 2021 (Non-GAAP) $150 34.0% $140M $130 32.0% $117M 30.0% $110 Axis Title 28.0% 28.3% 28.3% $90 26.0% $70 24.0% $50 22.0% 20.0% $30 Q3 20 Q3 21 Operating Income Operating Margin
Slide 16: Cost Ratios Q3 2021 (Non-GAAP)
Cost Ratios Q3 2021 (Non-GAAP) R&D S&M G&A As % of revenue As % of revenue As % of revenue S&M S&M 22.2% 22.5% R&D R&D 15.8% 15.2% 2.2%* 2.4%* 13.6% 12.8% G&A G&A 7.7% 7.9% Q3 20 Q3 21 Q3 20 Q3 21 Q3 20 Q3 21 * R&D capitalization
Slide 17: Balance Sheet and Cash Flow Analysis
Q3 2021 Highlights Income Statement Balance Sheet and Cash Flow Analysis Outlook
Slide 18: Condensed Consolidated Balance Sheet (USD in thousands)
Condensed Consolidated Balance Sheet (USD in thousands) Sep 30, December 31, 2021 2020 Unaudited Audited ASSETS CURRENT ASSETS: Cash and cash equivalents $ 397,696 $ 442,267 Short-term investments 1,057,790 1,021,613 Trade receivables 355,136 303,100 Prepaid expenses and other current assets 170,513
Slide 19: Cash Flow From Operations
Cash Flow From Operations $M Q3 21 Q3 20 %∆ 9M 21 9M 20 %∆ Cash flow from operations 103.5 99.0 4% 349.2 313.4 11% - Capital expenditure 8.2 4.2 94% 21.1 21.7 (3%) - Capitalization of software development 10.7 9.6 12% 32.0 28.8 11% Cash flow from operations after capex & software capitalization 84.6
Slide 20: Cash Movement and Liquidity (USD in millions)
Cash Movement and Liquidity (USD in millions) September 30, 2021 Acquisitions ($144M) Operating CF $349M Other CAPEX* ($22M) ($53M) Buyback Repayment of Debt Liquidity 12/31/20 ($49M) ($93M) Proceeds from $1,464M Option Exercises Liquidity 9/30/21 $3M $1,455M * CAPEX movement includes R&D capitaliza
Slide 21: Outlook
Q3 2021 Highlights Income Statement Balance Sheet and Cash Flow Analysis Outlook
Slide 22: Outlook (Non-GAAP)
Outlook* (Non-GAAP) FY 2021 Revenue ($M) 1,899 - 1,909 EPS ($) 6.43 – 6.53 The outlook is provided as of November 11, 2021. There is no guarantee that the Company will change or update these figures in this presentation should a need arise in the future to update the outlook. This is in addition to
Slide 23: NICE
NICE