A10 Networks, Inc. · NYSE:ATEN
A10 Networks — Q4 2020 Earnings Presentation
20 slides from A10 Networks's earnings presentation, Feb 9, 2021
Slide 1: Q4 and FY 2020 Financial Results & Commentary
Always Secure. Always Available. Q4 and FY 2020 Financial Results & Commentary February 9, 2021
Slide 2: Cautionary Statements & Disclosures
2 Cautionary Statements & Disclosures This presentation and the accompanying oral presentation contain “forward-looking” statements that are based on our management’s beliefs and assumptions, including statements regardingour positioning, global business environment, strategy, including portfolio ma
Slide 3: Agenda
3 Agenda • Introduction • 4Q Overview • 4Q Financial Performance • FY2020 Financial Performance
Slide 4: A10 at a Glance
4 A10 at a Glance Enabling a Secure and Available Digital World IoT Proliferation Shift to Cloud 5G Deployment Operational Complexity Security Threats Protect investments f or enterprises and s e rvice providers Support seamless migration to the cloud and cloud- native with hybrid solutions Se cure
Slide 5: Q4'20: Building on our Successes
5 Q4’20: Building on our Successes • Continued, sustained growth • Fourth consecutive quarter of 4%+ revenue growth • Record profitability • Annual operating expenses reduced by approximately $20.6 million • Reflecting 13% reduction • Q4 operating income improved by 81% ($6.2M) YoY • Adjusted EBITDA
Slide 6: Near-term Expectations
6 Near-term Expectations • Continue to effectively manage the business • Well-equipped to mitigate disruption • Sustainable win rate with lower visibility of order patterns in the next 90-day period related to changing global business environment • Increasing focus on portfolio management • Deliver
Slide 7: Quarterly Recurring Revenue
7 Quarterly Recurring Revenue $20.3 $20.9 $21.8 $21.7 $21.1 $21.2 $21.7 $22.4 $22.2 $22.5 $23.6 $24.1 $0.7 $0.8 $0.8 $2.1 $1.3 $1.4 $1.0 $1.2 $1.1 $2.2 $3.9 $3.3 $0.4 $0.4 $0.4 $0.6 $0.5 $0.8 $0.7 $1.2 $0.4 $0.8 $0.7 $1.0 $21.4 $22.1 $23.0 $24.4 $22.9 $23.4 $23.4 $24.8 $23.7 $25.5 $28.2 $28.4 Q1'18
Slide 8: Quarterly Revenue & Non-GAAP Operating Income
8 Quarterly Revenue & Non-GAAP Operating Income Operating Income is a Non-GAAP Financial Measure. See Appendix for reconciliation to most comparable GAAP financial measures. $60.3 $53.8 $52.5 $56.6 $62.7 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 Revenue, $ Millions $7.8 $4.0 $7.1 $10.3 $13.9 Q4'19 Q1'20 Q2'20 Q
Slide 9: Quarterly Revenue by Customer Vertical
9 60% 40% 4Q 2020 $62.7 million 64% 65% 58% 60% 60% 36% 35% 42% 40% 40% Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 $Millions Service and Cloud Providers Enterprise Quarterly Revenue by Customer Vertical
Slide 10: Quarterly Revenue by Geography
10 Quarterly Revenue by Geography 46% 47% 46% 39% 43% 27% 33% 24% 32% 30% 15% 9% 15% 15% 13% 12% 11% 15% 14% 14% Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 $Millions Americas Japan APAC ex Japan EMEA 43% 30% 13% 14% 4Q 2020 $62.7 million
Slide 11: Annual Revenue & Non-GAAP Operating Income
11 Annual Revenue & Non-GAAP Operating Income Operating Income is a Non-GAAP Financial Measure. See Appendix for reconciliation to most comparable GAAP financial measures. $212.6 $225.5 FY2019 FY2020 Revenue, $ Millions $2.0 $35.3 FY2019 FY2020 Non-GAAP Operating Income, $ Millions Up 6% Up 14X
Slide 12: Annual Revenue by Customer Vertical
12 57% 58% 61% 43% 42% 39% FY2018 FY2019 FY2020 $Millions Service and Cloud Providers Enterprise Annual Revenue by Customer Vertical 61% 39% FY2020 $225.5 million
Slide 13: Annual Revenue by Geography
13 Annual Revenue by Geography 48% 42% 44% 24% 28% 30% 16% 17% 13% 12% 13% 13% FY2018 FY2019 FY2020 $Millions Americas Japan APAC ex Japan EMEA 44% 30% 13% 13% FY2020 $225.5 million
Slide 14: Quarterly and Full-Year Cash Flows
159.1 158.1 0.2 19.2 16.8 2.8 - 50.0 100.0 150.0 200.0 250.0 Cash & Cash Equivalents September 30, 2020 Operations Investing Financing Share Repurchases Cash & Cash Equivalents December 31, 2020 Cash Flows Q4-20 Total Used Provided 130 158 33 55 5 10 - 50 100 150 200 250 Cash & Cash Equivalents Dece
Slide 15: Financial Performance Trends
15 Financial Performance Trends Numbers may not sum due to rounding. Please refer to the supplemental financials posted in the “Investor Relations” section of the A10 Networks website at investors.a10networks.com Gross Margin %, Operating Margin %, Adjusted EBITDA and EPS are Non-GAAP Financial Meas
Slide 16: Appendix
16 Appendix
Slide 17: GAAP to Non-GAAP - Gross Margin and EPS
17 GAAP to Non-GAAP - Gross Margin and EPS Numbers may not sum due to rounding. EPS data i s presented on a basic and diluted basis. Please refer to the supplemental f inancials posted the “Investor Relations” section of the A10 Networks website at investors.a10networks.com. % of Revenue except EPS
Slide 18: GAAP to Non-GAAP - Operating Income (Loss)
18 GAAP to Non-GAAP - Operating Income (Loss) Numbers may not sum due to rounding. Please refer to the supplemental financials posted the “Investor Relations” section of the A10 Networks website at investors.a10networks.com. $ Millions Q1'19 Q2'19 Q3'19 Q4'19 FY 2019 Q1'20 Q2'20 Q3'20 Q4'20 FY 2020
Slide 19: GAAP to Non-GAAP - Adjusted EBITDA
19 GAAP to Non-GAAP - Adjusted EBITDA Numbers may not sum due to rounding. Please refer to the supplemental financials posted the “Investor Relations” section of the A10 Networks website at investors.a10networks.com. $ Millions Q1'19 Q2'19 Q3'19 Q4'19 FY 2019 Q1'20 Q2'20 Q3'20 Q4'20 FY 2020 GAAP net
Slide 20: Thank You
Thank You Always Secure. Always Available. Investors@a10networks.com