Slide 1: Q2 2024 Investor Presentation
Q2 2024 Investor Presentation Five9 (NASDAQ: FIVN) © 2024 Five9, Inc. All rights reserved. Proprietary and confidential to Five9, Inc.
Slide 2: Safe Harbor
Safe Harbor This presentation is proprietary and is intended solely for the information of the persons to whom it is presented. Disclosure of this presentation, its contents, extracts or abstracts to third parties is not authorized without the express written permission of Five9, Inc. (the “Company”
Slide 3: Q2'24 Highlights
Q2’24 Highlights Financial Results ◦ Q2’24 revenue surpasses $1B in annual run rate ◦ LTM Enterprise subscription revenue growth of 21% YoY ◦ Total subscription revenue growth of 17% YoY ◦ Q2’24 adjusted EBITDA margin of 16.6% of revenue ◦ Strong LTM operating cash flow of $126M, or 13% of revenue K
Slide 4: Q2'24 Highlights (cont'd)
Q2’24 Highlights (cont’d) Pending Acqueon Acquisition ◦ A significant step in extending Five9’s AI-powered CX platform and market reach ◦ Acqueon excels in orchestrating proactive outbound omni-channel customer engagement and assists businesses to connect with audiences and increase revenue through
Slide 5: Illustrative TAM Expansion of 30% Driven by AI
Illustrative TAM Expansion of 30% Driven by AI 15% Automation Scenario Annual Customer Costs ARR Labor Savings ($M) Software Increase ($M) $52.4 $2.4 $3.1 $45.6 $3.1 +30% (15%) Labor $2.4 $50.0 Labor $42.5 Before AI After AI Before AI After AI 1,000 Seats 850 Seats 1,000 Seats 850 Seats Note: 15% au
Slide 6: Consistent Revenue Growth
Consistent Revenue Growth Quarterly Revenue ($M) Annual Revenue ($M) 13% YoY Growth 17% YoY Growth 910 247 252 239 230 779 218 223 208 198 183 189 174 610 154 138 144 128 112 435 95 100 328 258 2018 2019 2020 2021 2022 2023 6 © 2024 Five9, Inc. All rights reserved. Proprietary and confidential to Fi
Slide 7: Executing on Enterprise Opportunity
Executing on Enterprise Opportunity % YoY Enterprise Subscription Revenue Growth (LTM) 51% 51% 50% 45% 46% 39% 41% 37% 35% 33% 33% 32% 31% 28% 28% 25% 23% 21% Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Q3'23 Q4'23 Q1'24 Q2'24 7 © 2024 Five9, Inc. All rights r
Slide 8: Executing on Enterprise Opportunity (cont'd)
Executing on Enterprise Opportunity (cont’d) Enterprise as a % of Total Revenue (LTM) Enterprise Customers $1M+ ARR (Q4’23 Ann.) 183 88% 60% 3 Q2'14 (IPO) Q2'24 Q2'14 (IPO) Q4'23 Note: Historical results prior to 2018 based on ASC 605; $1M+ ARR based on Q4’23 annualized 8 © 2024 Five9, Inc. All righ
Slide 9: High Customer Retention
High Customer Retention % Annual Dollar Based Retention Rate (DBRR) 121% 123% 123% 122% 117% 120% 118% 118% 114% 115% 114% 111% 111% 112% 110% 110% 109% 108% Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Q3'23 Q4'23 Q1'24 Q2'24 Note: Annual DBRR based on last 12
Slide 10: Continuing to Drive Balanced Growth
Continuing to Drive Balanced Growth % YoY Revenue Growth % EBITDA Margin 61% 61% 61% 57% 55% 55% 53% 50% 16% 17% 49% 49% 47% 47% 23% 44% 45% 46% 46% 42% 42% 18% 21% 42% 21% 38% 38% 23% 18% 34% 34% 20% 21% 18% 13% 19% 36% 36% 34% 35% 16% 18% 31% 33% 16% 19% 15% 29% 29% 29% 12% 13% 28% 30% 3% 27% 6% 7
Slide 11: Robust Margin Expansion and Operating Leverage
Robust Margin Expansion and Operating Leverage Non-GAAP Adj. Gross Margin Non-GAAP Opex (% of revenue) Adj. EBITDA Margin 9.0% point expansion 35.4% point improvement 44.4% point expansion 60.5% 79.3% 51.5% G&A 21.4% 43.9% 16.6% S&M 37.5% 6.6% 25.6% R&D 20.4% (27.8%) 11.8% Q2'14 (IPO) Q2'24 Q2'14 (I
Slide 12: Operating Cash Flow and Margin
Operating Cash Flow and Margin LTM Operating Cash Flow ($M) DSO of 33 days in Q2'24 LTM Operating Cash Flow % LTM Operating Cash Flow Margin 15.7% 150 .0 14.8% 12.9% 14.0% 13.0% 10.9% 130 .0 125.8 118.5 10. 0% 2.7% 4.1% 110 .0 0.0 % 90.0 70.0 67.3 (10.0%) 58.4 50.0 42.9 (20.0%) 29.0 30.0 24.6 (30.0%
Slide 13: Balance Sheet Summary
Balance Sheet Summary Quarter Ended $ in Millions June 30, 2024 December 31, 2023 Cash, cash equivalents and marketable investments $ 1,106.3 $ 730.3 Working capital 707.4 756.8 Total assets 1,910.4 1,494.6 Total debt 1,162.4 742.1 Total stockholders’ equity 525.9 538.1 13 © 2024 Five9, Inc. All rig
Slide 14: Q3'24 and 2024 Guidance
Q3’24 and 2024 Guidance Q3’24 2024 Revenue $254.5M – $255.5 $1.013B – $1.017B GAAP Net Loss Per Basic Share ($0.06) – ($0.01) ($0.29) – ($0.19) Non-GAAP Net Income Per Diluted Share $0.57 – $0.59 $2.25 – $2.29 Basic Shares 74.9M 74.5M Diluted Shares 75.5M 75.2M Taxes $2.6M $9.6M Purchase of PP&E $22
Slide 15: Long-Term Operating Model
Long-Term Operating Model Non-GAAP Today Long-Term % of Revenue Q2’24 Model 2027 Revenue $252M Continued growth in Enterprise subscriptions $2.4B Subscription margin expansion and increasing Adj. Gross Margin 60% 70%+ subscription mix Continued investments in GTM in line with S&M 26% 26% - 30% reven
Slide 16: Appendix
Appendix 16 © 2024 Five9, Inc. All rights reserved. Proprietary and confidential to Five9, Inc.
Slide 17: GAAP to Adjusted Gross Profit Reconciliation
GAAP to Adjusted Gross Profit Reconciliation Q2’14 – Q4’17 Quarter Ended Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 GAAP gross profit $ 11,216 $ 12,365 $ 13,734 $ 15,496 $ 16,004 $ 17,475 $ 20,398 $ 21,405 $ 22,122 $ 23,192 $ 28,437 $ 27,043 $ 27,454 $
Slide 18: GAAP to Adjusted Gross Profit Reconciliation
GAAP to Adjusted Gross Profit Reconciliation Q1’18 – Q4’21 Quarter Ended Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 GAAP gross profit $ 34,203 $ 36,306 $ 39,125 $ 43,996 $ 43,687 $ 46,188 $ 49,297 $ 54,323 $ 55,051 $ 57,339 $ 65,582 $ 76,652 $ 78,
Slide 19: GAAP to Adjusted Gross Profit Reconciliation
GAAP to Adjusted Gross Profit Reconciliation Q1’22 – Q2’24 Quarter Ended Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Q3'23 Q4'23 Q1'24 Q2'24 GAAP gross profit $ 93,910 $ 101,153 $ 104,231 $ 112,051 $ 113,683 $ 118,521 $ 119,025 $ 126,569 $ 132,480 $ 133,672 % GAAP gross margin 51.4 % 53.4 % 52.6 % 53.8 % 52
Slide 20: GAAP to Adjusted Gross Profit Reconciliation
GAAP to Adjusted Gross Profit Reconciliation 2014 – 2023 Year Ended 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 GAAP gross profit $ 48,441 $ 69,373 $ 95,156 $ 117,121 $ 153,630 $ 193,495 $ 254,624 $ 338,492 $ 411,345 $ 477,798 % GAAP gross margin 47.0 % 53.8 % 58.7 % 58.5 % 59.6 % 59.0 % 58.5
Slide 21: GAAP Net Inc. (Loss) to Adj. EBITDA Reconciliation
GAAP Net Inc. (Loss) to Adj. EBITDA Reconciliation Q2’14 – Q4’17 Quarter Ended Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 GAAP net income (loss) $ (8,659) $ (11,435) $ (9,372) $ (8,903) $ (7,369) $ (6,048) $ (3,518) $ (4,911) $ (3,468) $ (3,890) $ 409 $
Slide 22: GAAP Net Inc. (Loss) to Adj. EBITDA Reconciliation
GAAP Net Inc. (Loss) to Adj. EBITDA Reconciliation Q1’18 – Q4’21 Quarter Ended Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 GAAP net income (loss) $ (607) $ (2,042) $ (1,305) $ 3,733 $ (1,924) $ (1,860) $ (1,604) $ 836 $ (7,437) $ (16,052) $ (11,431
Slide 23: GAAP Net Inc. (Loss) to Adj. EBITDA Reconciliation
GAAP Net Inc. (Loss) to Adj. EBITDA Reconciliation Q1’22 – Q2’24 Quarter Ended Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Q3'23 Q4'23 Q1'24 Q2'24 GAAP net income (loss) $ (34,120) $ (23,670) $ (23,207) $ (13,653) $ (27,248) $ (21,739) $ (20,419) $ (12,358) $ (7,077) $ (12,816) Non-GAAP adjustments: Depreci
Slide 24: GAAP Net Loss to Adjusted EBITDA Reconciliation
GAAP Net Loss to Adjusted EBITDA Reconciliation 2014 – 2023 Year Ended 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 GAAP net income (loss) $ (37,786) $ (25,838) $ (11,860) $ (8,969) $ (221) $ (4,552) $ (42,130) $ (53,000) $ (94,650) $ (81,764) Non-GAAP adjustments: Depreciation and amortization
Slide 25: GAAP to Non-GAAP COR and OpEx Reconciliation
GAAP to Non-GAAP COR and OpEx Reconciliation Q2’14 – Q4’17 Quarter Ended Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 GAAP COR $ 13,469 $ 13,504 $ 14,540 $ 14,778 $ 14,270 $ 14,812 $ 15,635 $ 16,610 $ 16,764 $ 17,790 $ 15,770 $ 19,971 $ 20,273 $ 20,497 $
Slide 26: GAAP to Non-GAAP OpEx Reconciliation
GAAP to Non-GAAP OpEx Reconciliation Q2’14 – Q4’17 Quarter Ended Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 GAAP S&M $ 9,674 $ 9,296 $ 9,453 $ 9,931 $ 10,594 $ 10,797 $ 10,720 $ 12,706 $ 12,637 $ 12,925 $ 14,480 $ 15,778 $ 16,932 $ 16,502 $ 17,358 % of
Slide 27: GAAP to Non-GAAP OpEx Reconciliation
GAAP to Non-GAAP OpEx Reconciliation Q2’14 – Q4’17 Quarter Ended Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 GAAP G&A $ 3,515 $ 7,967 $ 6,763 $ 7,275 $ 6,027 $ 6,087 $ 6,433 $ 6,536 $ 5,882 $ 6,143 $ 6,511 $ 8,860 $ 6,845 $ 4,679 $ 8,767 % of revenue 14.
Slide 28: GAAP to Non-GAAP COR and OpEx Reconciliation
GAAP to Non-GAAP COR and OpEx Reconciliation Q1’18 – Q4’21 Quarter Ended Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 GAAP COR $ 24,702 $ 24,814 $ 26,179 $ 28,339 $ 30,851 $ 31,248 $ 34,472 $ 37,940 $ 40,037 $ 42,453 $ 46,561 $ 51,233 $ 59,803 $ 64,
Slide 29: GAAP to Non-GAAP COR and OpEx Reconciliation
GAAP to Non-GAAP COR and OpEx Reconciliation Q1’22 – Q2’24 Quarter Ended Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Q3'23 Q4'23 Q1'24 Q2'24 GAAP COR $ 88,867 $ 88,229 $ 94,111 $ 96,294 $ 104,756 $ 104,361 $ 111,080 $ 112,493 $ 114,530 $ 118,414 % of revenue 48.6 % 46.6 % 47.4 % 46.2 % 48.0 % 46.8 % 48.3 %
Slide 30: Q1'18 – Q4'21 GAAP S&M % of revenue
GAAP to Non-GAAP OpEx Reconciliation Q1’18 – Q4’21 Quarter Ended Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 GAAP S&M $ 17,478 $ 17,912 $ 17,818 $ 18,793 $ 21,701 $ 23,250 $ 25,014 $ 25,627 $ 30,160 $ 32,231 $ 32,969 $ 37,053 $ 44,799 $ 46,024 $ 49
Slide 31: Q1'22 – Q2'24 GAAP S&M % of revenue
GAAP to Non-GAAP OpEx Reconciliation Q1’22 – Q2’24 Quarter Ended Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Q3'23 Q4'23 Q1'24 Q2'24 GAAP S&M $ 64,611 $ 64,098 $ 67,353 $ 65,928 $ 76,314 $ 74,077 $ 73,366 $ 72,956 $ 81,109 $ 78,332 % of revenue 35.3 % 33.8 % 34.0 % 31.6 % 34.9 % 33.2 % 31.9 % 30.5 % 32.8 %
Slide 32: GAAP to Non-GAAP OpEx Reconciliation
GAAP to Non-GAAP OpEx Reconciliation Q1’18 – Q4’21 Quarter Ended Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 GAAP G&A $ 9,103 $ 9,833 $ 10,746 $ 10,766 $ 11,762 $ 12,042 $ 12,146 $ 13,496 $ 14,658 $ 16,129 $ 16,724 $ 18,258 $ 22,245 $ 22,909 $ 26,7
Slide 33: GAAP to Non-GAAP OpEx Reconciliation
GAAP to Non-GAAP OpEx Reconciliation Q1’22 – Q2’24 Quarter Ended Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Q3'23 Q4'23 Q1'24 Q2'24 GAAP G&A $ 24,314 $ 23,824 $ 24,496 $ 22,509 $ 28,258 $ 30,477 $ 31,006 $ 33,338 $ 30,548 $ 33,988 % of revenue 13.3 % 12.6 % 12.4 % 10.8 % 12.9 % 13.7 % 13.5 % 13.9 % 12.4 %
Slide 34: GAAP to Non-GAAP COR and OpEx Reconciliation
GAAP to Non-GAAP COR and OpEx Reconciliation 2014 – 2023 Year Ended 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 GAAP COR $ 54,661 $ 59,495 $ 66,934 $ 83,104 $ 104,034 $ 134,511 $ 180,284 $ 271,099 $ 367,501 $ 432,690 % of revenue 53.0 % 46.2 % 41.3 % 41.5 % 40.4 % 41.0 % 41.5 % 44.5 % 47.2 % 4
Slide 35: GAAP to Non-GAAP OpEx Reconciliation
GAAP to Non-GAAP OpEx Reconciliation 2014 – 2023 Year Ended 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 GAAP G&A $ 24,416 $ 25,822 $ 25,072 $ 29,151 $ 40,448 $ 49,446 $ 65,769 $ 93,916 $ 95,143 $ 123,079 % of revenue 23.7 % 20.0 % 15.5 % 14.6 % 15.7 % 15.1 % 15.1 % 15.4 % 12.2 % 13.5 % Depreci
Slide 36: GAAP to Non-GAAP Net Income (Loss) Reconciliation
GAAP to Non-GAAP Net Income (Loss) Reconciliation Guidance(1) Three Months Ended Twelve Months Ended September 30, 2024 December 31, 2024 Low High Low High GAAP net loss $ (4,608) $ (1,098) $ (21,511) $ (14,503) Non-GAAP adjustments: Stock-based compensation(2) 42,053 40,053 173,848 169,848 Intangib
Slide 37: Capital Expenditure and Free Cash Flow (Q1'22 - Q2'24)
Capital Expenditure and Free Cash Flow (Q1'22 - Q2'24) 12 mo 12 mo ended ended 12/31/20 12/31/20 $ in Thousands Q1'22 Q2'22 Q3'22 Q4'22 22 Q1'23 Q2'23 Q3'23 Q4'23 23 Q1'24 Q2'24 Net cash provided by operating activities $ 28,724 $ (3,125) $ 30,526 $ 32,740 $ 88,865 $ 33,412 $ 21,852 $ 37,030 $ 36,54
Slide 38: Thank You
Thank You 38 © 2024 Five9, Inc. All rights reserved. Proprietary and confidential to Five9, Inc.