Slide 1: Kalray Half-Year Results 2023
KALRAY HALF-YEAR RESULTS 2023 Investor Presentation – September 2023 Intelligent Data processing, from Cloud to Edge www.kalrayinc.com © Kalray SA. Confidential - All Rights Reserved. 1
Slide 2: Important Notice
IMPORTANT NOTICE The information in this document has been prepared by Kalray (the “Company”) for information purposes only and is furnished to you by the Company solely for your information and is the sole responsibility of the Company. This presentation does not constitute, and is not a part of, a
Slide 3: The Speakers
THE SPEAKERS Eric Baissus Denis Scherrer Executive Board Chairman Chief Financial Officer 25 years’ experience as senior executive 30 years of experience in finance, accounting, for major telecom (Alcatel-Lucent) and audit and business operations in semi- electronics (Texas Instruments) groups, star
Slide 4: Agenda
AGENDA • Kalray in a Nutshell • H1 2023 Key Facts • H1 2023 Results • 2023 Outlook • What’s Next ? Coolidge 2 • Q&A © Kalray SA. Confidential - All Rights Reserved. 4
Slide 5: Agenda
AGENDA • Kalray in a Nutshell • H1 2023 Key Facts • H1 2023 Results • 2023 Outlook • What’s Next ? Coolidge 2 • Q&A © Kalray SA. Confidential - All Rights Reserved. 5
Slide 6: Kalray in a Nutshell
KALRAY IN A NUTSHELL Intelligent Data Processing from Cloud to Edge LEADER IN MANYCORE LEADING CUSTOMERS DPU TECHNOLOGY & PARTNERS Kalray offers a new type of processor (DPU1) 3rd + €180m 30 Generation R&D investment Patent and solutions that meet of MPPA® processor families the demands of data- IND
Slide 7: Our Vision: Data Is Key
OUR VISION: DATA IS KEY Faster and better insights determine whether companies win or lose in today’s market. Getting the best insights requires highly efficient processing and analysis of increasing volumes of data. OUR MISSION To become a global leading provider of hardware and software technologi
Slide 8: A Complete Offer for Data-Intensive Applications
A COMPLETE OFFER FOR DATA-INTENSIVE APPLICATIONS From Chips to Software Solutions A UNIFIED VALUE PROPOSITION PROCESS DATA SMARTER, MORE EFFICIENTLY, AND PCIe Cards Reference Solutions MORE SECURELY - NO MATTER WHERE IT RESIDES Data Management & Storage MPPA® DPU Software Solutions Processors © Kalr
Slide 9: Agenda
AGENDA • Kalray in a Nutshell • H1 2023 Key Facts › Strong H1 – EBITDA break-even › Large contracts on track • H1 2023 Results • 2023 Outlook • What’s Next ? Coolidge 2 • Q&A © Kalray SA. Confidential - All Rights Reserved. 9
Slide 10: Strong Increase in Revenue and EBITDA
STRONG INCREASE IN REVENUE AND EBITDA 1rst Time EBITDA Consolidated Revenue Breakeven €16.4M €15.3M (2) Consolidated EBITDA (2) - €2.0M - €0,34K €4.8 M (1) 3.2X + €1.9M H1 2022 H1 2023 H1 2022 2022 H1 2023 (1) Audited data (2) Data submitted to limited review by the auditors © Kalray SA. Confidentia
Slide 11: Strong Gross Margin
STRONG GROSS MARGIN Kalray K200-LP™ Acceleration cards Software (2) Hardware (1) Kalray 1/3 €15.3M Flashbox™ Storage appliances 62% GM 2/3 Kalray pixstor™ & ngenea® Software solutions (1) Hardware: supply of processors, cards and complete sets of storage. (2) Software: software licences mainly and s
Slide 12: Consolidated Revenue by Region
CONSOLIDATED REVENUE BY REGION Other 2% EU (incl. UK) 46% US & EUROPE US 52% ARE MAJOR FOCUS Growing demand comes largely from selling complete solutions (HW and SW) to enterprises running data-intensive applications (AI, health, media, research..) © Kalray SA. Confidential - All Rights Reserved.
Slide 13: On Track for the "Jumbo" Contract
ON TRACK FOR THE “JUMBO” CONTRACT Strong Milestones (Technology, Financial and Commercial Terms) 3 STEPS PHASE 1 PHASE 2 PHASE 3 A FEW TENS OF $1 MILLION €MILLIONS / €MILLIONS YEAR over several years Nov.22 2021/2022 2023 2024 2025 - 2030 • Deep technical • Technical, commercial Kalray has developed
Slide 14: Multi-Million Contract with Major Media Company
MULTI-MILLION CONTRACT WITH MAJOR MEDIA COMPANY Customer : Large US based media company Solution: Ngenea2, powered by Kalray DPUs data intensive storage Value: efficient, multi-location, multi workload management of their whole media data © Kalray SA. Confidential - All Rights Reserved. 14
Slide 15: Agenda
AGENDA • Kalray in a Nutshell • H1 2023 Key Facts • H1 2023 Results • 2023 Outlook • What’s Next ? Coolidge 2 • Q&A © Kalray SA. Confidential - All Rights Reserved. 15
Slide 16: Income Statement – H1 2023
INCOME STATEMENT – H1 2023 Data submitted to limited review by the auditors H1 H1 K€ Var % 2022 2023 Net Sales 4 768 15 275 220% Lower subsidies revenue in H1/23 versus 2022 due to lower depreciation accounted in H1/23 . Will increase in H2/23 with start of Coolidge 2 depreciation Subsidies 1 223 46
Slide 17: Balance Sheet H1 2023
BALANCE SHEET H1 2023 Data submitted to limited review by the auditors Including Arcapix goodwill (€13.3M) as well K€ ASSETS 31/12/2022 30/06/2023 K€ LIABILITIES 31/12/2022 30/06/2023 1 as IP's and Developments for a net value of 18,006K€ and next generation developments for 1,149 K€. Intangible ass
Slide 18: Cash Flow Statement – H1 2023
CASH FLOW STATEMENT – H1 2023 Data submitted to limited review by the auditors Cash flow in K€ December 31st, 2022 June 30th, 2023 Gross Margin 7 062 7 435 H1/23 Gross Margin 62% versus 56% for FY 2022 (12 months) Opex (26 153) (15 696) R&D subsidies 1 888 2 034 Change in working capital 863 (195) T
Slide 19: Agenda
AGENDA • Kalray in a Nutshell • H1 2023 Key Facts • H1 2023 Results • 2023 Outlook • What’s Next ? Coolidge 2 • Q&A © Kalray SA. Confidential - All Rights Reserved. 19
Slide 20: 2023 Company Main Objective
2023 COMPANY MAIN OBJECTIVE “ A NEW MAJOR STEP IN BUILDING A LEADING HIGHLY PROFITABLE BUSINESS IN THE FAST-GROWING MARKET OF DATA PROCESSING” © Kalray SA. Confidential - All Rights Reserved. 20
Slide 21: 2023 Key Objectives
2023 KEY OBJECTIVES BUSINESS EBITDA GROWTH • Strong commercial pipe • Cost structure more dynamic efficient thanks to indirect • Success of combined offers sales strategy (hardware/soft) • Rigorous management • Ramp-up indirect sales slower with longer sales cycle than direct sales BREAKEVEN 30M€ VS
Slide 22: Strong Improvement of Results Since IPO
2023 KEY OBJECTIVES Sales revenue – 5 years (in €m) TARGET €30M(e) STRONG IMPROVEMENT OF RESULTS SINCE IPO €16.4M €0.8M €1.3M €1.0M €1.5M BREAK EVEN 2018 2019 2020 2021 2022 2023 - €2.7M - €4,3M - €5,6M - €5,9M - €5,8M CA EBITDA Revenues and EBITDA from 2018 to 2022 are audited datas © Kalray SA. Co
Slide 23: Agenda
AGENDA • Kalray in a Nutshell • H1 2023 Key Facts • H1 2023 Results • 2023 Outlook • What’s Next ? Coolidge 2 • Q&A © Kalray SA. Confidential - All Rights Reserved. 23
Slide 24: Coolidge 2 Is Available
LATEST NEWS Coolidge 2 Is Available “ The First DPU processor optimized for AI and Data-Intensive Processing” • Kalray 3.5 Generation • Tailored for AI at Edge and Storage • 50 TOPS / 25 FLOPS • Optimized Power Consumption • Open SDK First Customer : “Jumbo Contract” First deliveries of Coolidge2 sa
Slide 25: Why AI Is Booming Now?
WHY AI IS BOOMING NOW? 2 Key Drivers: • Exponential growth of amount of unstructured data available • Exponential growth of AI chip compute performance © Kalray SA. Confidential - All Rights Reserved. 25
Slide 26: Why Is It Only the Beginning?
WHY IS IT ONLY THE BEGINNING ? 2 Reasons: • AI is the only way to analyse huge amount of unstructured data • The more compute power, the better it is © Kalray SA. Confidential - All Rights Reserved. 26
Slide 27: Where Will AI Run?
WHERE WILL AI RUN ? 2 Locations: • Cloud (Public or Private) • Edge © Kalray SA. Confidential - All Rights Reserved. 27
Slide 28: AI in the Cloud: Where Does Kalray Sit?
AI IN THE CLOUD : WHERE DOES KALRAY SIT ? Hyper Fast Storage for GenAI GPU GPU GPU GPU GPU GPU GPU GPU COMPUTE • Million of Files/s • Millions of “IOPS” • Microseconds Latency Primary • 100’s of GB/s Storage DATA STORAGE Archive © Kalray SA. Confidential - All Rights Reserved. 28
Slide 29: What Is Edge Computing
WHAT IS EDGE COMPUTING Edge Computing Definition & Edge Locations “Edge computing is a distributed computing paradigm that brings data processing and Everytime processing in storage closer to the source of data generation or consumption”. the cloud or in centralized datacenters FAR EDGE NEAR EDGE CL
Slide 30: AI at the Edge – Main Use Cases
AI AT THE EDGE – MAIN USE CASES INDUSTRY & LOGISTICS & HEALTHCARE TRANSPORT & UTILITIES MANUFACTURING SUPPLY CHAIN & LIFE SCIENCE MOBILITY & SMART CITIES RETAIL MEDIA & ENTERTAINMENT AGRICULTURE EDUCATION & RESEARCH TELECOM & CSP © Kalray SA. Confidential - All Rights Reserved. 30
Slide 31: AI at the Edge: Where Does Kalray Sit?
AI AT THE EDGE : WHERE DOES KALRAY SIT ? Local Compute Islands Architecture requiring Heterogeneous Solutions • Microseconds Latency • High Density • Cost & Power © Kalray SA. Confidential - All Rights Reserved. 31
Slide 32: A Unique Opportunity for Semiconductor Companies
A UNIQUE OPPORTUNITY FOR SEMICONDUCTOR COMPANIES Fast Growing Market : 30% CAGR from 2023 to 2032 “Reasonably” Segmented High Barrier of Entry © Kalray SA. Confidential - All Rights Reserved. 32
Slide 33: DPU Will Play a Key Role in AI Adoption Along GPU
DPU WILL PLAY A KEY ROLE IN AI ADOPTION ALONG GPU Data Processing Unit Market In charge of accelerating all the workloads which are not pure compute © Kalray SA. Confidential - All Rights Reserved. 33
Slide 34: Kalray Is a Pioneer and One of Top Leaders of the DPU Market
KALRAY IS A PIONEER AND ONE OF TOP LEADERS OF THE DPU MARKET Challengers Leaders ❶ A UNIQUE ARCHITECTURE Kalray MPPA ® (“Massively Parallel Processor Arrays”) offer a Kalray MPPA (“Massively Parallel Processor Arrays”) offer a unique alternative to traditional GPUGPU unique alternative to traditiona
Slide 35: Q&A Session
Q&A SESSION 6 * MICROSOFT TEAMS PHONE "Hands Up" button Keys " * " then " 6 " © Kalray SA. Confidential - All Rights Reserved. 35
Slide 36: Thank You
THANK YOU www.kalrayinc.com © Kalray SA. Confidential - All Rights Reserved. 36
Slide 37: Disclaimer
DISCLAIMER Kalray makes no guarantee about the accuracy of the information contained in this document. It is intended for information purposes only and shall not be incorporated into any contract. It is not a commitment to deliver any material, code or functionality, and should not be relied upon in
Slide 38: Appendices
APPENDICES © Kalray SA. Confidential - All Rights Reserved. 38
Slide 39: A Wide Market to Conquer: DPU-Based Solutions
AAWIDE WIDEMARKET MARKETTO TOCONQUER: CONQUER DPU-BASED SOLUTIONS : DPU MARKETS Acceleration and Offload Cards: Markets Are Fast Growing and Moving to DPUs Storage Acc. Cards HPC / Machine Vision 5G/Telecom & SmartNIC Radio Access Network CAGR 22% CAGR 40% CAGR 48% $6.2B $1,9B $1.1B $0,5B $1,6B $0,4
Slide 40: Kalray DPU
KALRAY DPU Unique Technology, Most Advanced DPU on the Market, Result of 15 Years of Development USUAL APPROACH K A L R AY ’ S M P P A ® 3 COOLIDGE™ CPU CPU CPU CPU core core core core Control Plane CPU CPU CPU CPU core core core core Data Plane ASIC • A few power-hungry RISC CPU cores • 80 highly e
Slide 41: Kalray Stock Market Data
AGENDA KALRAY STOCK MARKET DATA SHAREHOLDING STOCK EXCHANGE AS OF JUNE 30, 2023 • Market: Euronext Growth • Name: KALRAY Company • ISIN code: FR0010722819 related holders1 • Ticker symbol: ALKAL 33.5% • Share price: €27.95 (at 06/09/2023) Free float 2 66.5% • Number of shares: 8 469 498 • Market cap