Slide 1: Smart Connected Services Investor Presentation
Smart Connected Services Investor Presentation August 27, 2024
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation contains forward-looking statements. In particular, statements regarding future economic performance, finances, and expectations and objectives of management constitute forward-looking statements. Forward-looking statements can be identified by the fact that t
Slide 3: Ooma Provides Leading Communications Services
Ooma Provides Leading Communications Services We transform sophisticated technology into elegant, simple communications solutions accessible to everyone. 3
Slide 4: Ooma Today
Ooma Today TOTAL REVENUE (in millions) Founded 2003; IPO 2015 NYSE: OOMA $237 $216 Multi-tenant SaaS platform $192 >1.2 million core users Annual recurring revenue of $233 million* $58.4 $64.1 90+% recurring revenue (100% retention*) 1,130 employees and contractors FY 2022 FY 2023 FY 2024 2QF24 2QF2
Slide 5: Our UCaaS Solutions Serve Customers Better
Our UCaaS Solutions Serve Customers Better HOME HOME OFFICE SMALL / MEDIUM BUSINESS LARGE BUSINESS ENTERPRISE Superior Value Created for SMB Extensive Features Innovative Features Simple to Install / Use Flexible, Customizable “ Free home phone service (just pay taxes and fees) “ Sound like a big bu
Slide 6: Customers Rate Ooma #1
Customers Rate Ooma #1 #1 Ranked by Readers 11 Years in a Row Top Ranked by Readers 9 Times for Telecom Services Consumer Reports ranking through 2021, including a tie with a regional provider 6
Slide 7: Our Reach Extends to New Markets
Our Reach Extends to New Markets AIRDIAL IoT & TELEPHONY WHOLESALE SOLUTIONS POTS (Copper Line) replacement Wholesale platform for carriers/others Solves critical infrastructure problem Modern API/CPaaS design >10 million line U.S. market opportunity1 Worldwide market, 50+ million users2 1. IDC, Apr
Slide 8: AirDial: Solution for POTS (Copper) Line Replacement
AirDial: Solution for POTS (Copper) Line Replacement Common Applications Elevators Fire Alarm Panels Security Panels PBX Trunks Gate Phones Security Blue Light Panels Phones • Reduce costs • Sustain existing equipment • Cloud/SaaS DNA for remote management and features leadership Boiler Room Alarms
Slide 9: 2600Hz: One Platform for all Business Comms
2600Hz: One Platform for all Business Comms UCaaS 2600Hz Custom Development Video- CPaaS Conference CCaaS Mobile 100% API-Driven Turnkey, Multi-Tenant Low-Cost Platform Architecture Operating Model Everything from server orchestration to End user, admin, and back-office Low-cost cloud model plus the
Slide 10: Our Platform Delivers Breakthrough Features
Our Platform Delivers Breakthrough Features DEPENDABLE VOICE QUALITY Overcomes Internet Congestion TAILORED SOLUTIONS • Advanced codec • Adaptive redundancy Enables Customization • Router / QoS • Modern flexible design • Easy integrations EASE OF USE Provides End-to-End Solution ENHANCED RELIABILITY
Slide 11: Our Cost Structure Enables Superior Value
Our Cost Structure Enables Superior Value RECURRING ARPU1 WHY CUSTOMERS BUY (Monthly) Ooma Telo Ooma Office Ooma Enterprise $15.07 • Free calling / no • Value/unlimited • Customizable to more phone bills nationwide calling individual needs • Uses existing • Easy to install / • High reliability 72% h
Slide 12: Massive Market Transformation Underway
Massive Market Transformation Underway North American Business Market Growth Opportunity 58M Business Lines1 Worldwide hosted voice/UC public cloud (UCaaS) market 26% 35 28% CAGR1 $32B Over the Top 30 36% VoIP All other VoIP 25 $23B 7% 35% 20 CAGR Traditional 15 37% Cable/Other 10 VoIP 5 1% 0 CAGR1
Slide 13: Integrated Growth Strategy
Integrated Growth Strategy Advertising Direct Sales 73%1 Customer Resellers Net Promoter Satisfaction and Partners Score and Referrals Geographic Expansion2 Retailers 1PC Mag 2022, for Ooma’s Small Business Solution 2Ooma Now Serves Customers in 32 Countries 13
Slide 14: Significant Growth Drivers
Significant Growth Drivers Small businesses with underserved needs Large businesses with custom requirements Our platform uniquely enables Telecom resellers requiring own-brand solutions solutions to untapped New adjacent services opportunities Geographic expansion 14
Slide 15: Financial Overview
Financial Overview 15
Slide 16: Consistent Revenue Performance
Consistent Revenue Performance ANNUAL REVENUE QUARTERLY REVENUE (in millions) (in millions) $236.7 $64.1 $216.2 $58.4 All Other Revenue $192.3 All Other Revenue Core Core Subscription Subscription and Services $171.1 $193.6 $213.9 $53.3 $56.0 and Services Revenue Revenue FY 2022 FY 2023 FY 2024 2QF2
Slide 17: Ooma Business Drives Growth
Ooma Business Drives Growth CORE SUBSCRIPTION AND SERVICES REVENUE CORE USERS (in millions) (in thousands) $213.9 1,210 1,243 1,244 $193.6 Business $105.3 $125.9 428 484 500 Business $56.0 Residential $88.4 $88.0 781 759 744 Residential $34.0 $21.9 FY 2023 FY 2024 2QF25 FY 2023 FY 2024 2QF25 Core Bu
Slide 18: Key Metrics
Key Metrics ARPU AERR ($ per month) ($ millions) $14.72 $15.07 $233 $14.24 $227 $13.41 $207 $177 FY 2022 FY 2023 FY 2024 2QF25 FY 2022 FY 2023 FY 2024 2QF25 Monthly Business ARPU ~$23, Monthly Residential ARPU ~$9 Average Revenue Per User (ARPU) is blended monthly average subscription and services r
Slide 19: Robust Gross Margin
Robust Gross Margin HISTORICAL GROSS MARGIN RANGES LONG TERM TARGET GROSS MARGIN RANGES Subscription/Services High Total Low 80% 73% 75% 72% 72% 70% 64% 63% 65% 62% FY 2023 FY 2024 2QF25 Total Subscriptions/Services 19
Slide 20: Growing Adjusted EBITDA & Free Cash Flow
Growing Adjusted EBITDA & Free Cash Flow Trailing 12-month Adjusted EBITDA1 and Free Cash Flow2 (thousands) $22,500 $20,000 $17,500 $15,000 $12,500 $10,000 $7,500 $5,000 $2,500 $0 2QF23 3QF23 4QF23 1QF24 2QF24 3QF24 4QF24 1QF25 2QF25 Adjusted EBITDA Free cash flow 1. Adjustments to EBITDA are descri
Slide 21: Financial Position Summary
Financial Position Summary ($ millions) FY 2023 FY 2024 2QF25 Cash and Investments $26.9 $17.51 $16.6 Debt $0.0 $16.02 $8.5 Cash from Operations $8.8 $12.3 $7.1 Capital Spending ($5.2) ($6.2) ($1.7) Adjusted EBITDA $17.4 $19.8 $5.6 1. During 3QF24 Ooma acquired 2600Hz for approximately $33.0 million
Slide 22: Target Model (Non-GAAP)
Target Model (Non-GAAP) Actual Results Targets Mid-Term (% revenue) FY 2023 FY 2024 2QF25 Long-Term (1-2 Year) Subscription & Services 73% 72% 72% 73%-75% 75% - 80% Gross Margin Overall Gross Margin 64% 63% 62% 63%-65% 65% - 70% Sales & Marketing 31% 29% 27% 29%-31% 20% - 25% Research & Development
Slide 23: Thank You.
Ooma Thank You.
Slide 24: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation $ Thousands FY 2023 FY 2024 2QF24 2QF25 GAAP Gross Profit $137,648 $147,232 $36,588 $38,700 Add : Stock-based compensation and related taxes 986 1,026 260 285 Amortization of intangibles 430 1,151 82 771 Non-GAAP Gross Profit $139,064 $149,409 $36,930 $39,756 GAAP Sal