Slide 1: Investor Presentation – Q2 2024
Investor Presentation – Q2 2024 August 1, 2024
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements within the meaning of applicable U.S. securities laws, including statements regarding our 2024 financial guidance and our plans to continue to focus on driving efficient revenue growth, profitability and cash flow as we
Slide 3: Company Overview
Company Overview O OneSpan
Slide 4: OneSpan – The Digital Agreements Security Company
OneSpan – The Digital Agreements Security Company1 595 4,000+ 100+ >60% $247M $165M 112% $64M Employees Customers Countries of the World’s Revenue ARR2 NRR3 Cash & Equiv. 100 Largest Banks (TTM) are Customers 1 Metrics as of 6/30/24 PROPRIETARY 2,3 AND CONFIDENTIAL. ALL RIGHTS RESERVED 4 See Appendi
Slide 5: Trusted Security Partner to Global Blue-Chip Enterprises
Trusted Security Partner to Global Blue-Chip Enterprises Other Financial Banking Insurance Government Healthcare Other Services PROPRIETARY AND CONFIDENTIAL. ALL RIGHTS RESERVED 5
Slide 6: Two Operating Segments
Two Operating Segments $247M TTM Revenue (6/30/24) Security Solutions • Leading provider of authentication and transaction signing solutions for the who’s who of global banks • Transition to subscription from perpetual software Security Digital license model is substantially complete Solutions Agree
Slide 7: GTM Focused on Enterprise Sales and Growing Partner Network
GTM Focused on Enterprise Sales and Growing Partner Network CUSTOMER SEGMENTATION BASED ON EMPLOYEE COUNT OSPN SALES FOCUS PARTNER COVERAGE Tiers Efficient Resource Global System Resellers & Platform (Employee Count) Allocation with Sellers Integrators Distributors Partners Large Enterprise SAM 100,
Slide 8: Competitive Differentiation
Competitive Differentiation World-class security DNA in identity verification, authentication and transaction signing Deep expertise in end-user experience, cloud workflows, document verification and electronic signing Deep roots and experience in highly regulated global markets Ability to leverage
Slide 9: Financial Highlights & Outlook
Financial Highlights & Outlook
Slide 10: Q2 2024 Financial Highlights
Q2 2024 Financial Highlights $61M $165M $16M Revenue ARR1 Adjusted EBITDA (9% growth) (15% growth) (27% Margin) $30M 112 % $64M Subscription Revenue NRR1 Cash and Equiv. (29% growth) no long-term debt 1 See Appendix for definition. PROPRIETARY AND CONFIDENTIAL. ALL RIGHTS RESERVED 10
Slide 11: Q2 2024 Revenue Growth
Q2 2024 Revenue Growth Security Solutions Digital Agreements Total Company 9% 4% $60.9M $55.7M $43.9M $45.5M 30% $15.5M $11.9M Q2'23 Q2'24 Q2'23 Q2'24 Q2'23 Q2'24 Subscription Maintenance Subscription Maintenance Subscription Maintenance PS & Other Digipass PS & Other PA & Other Digipass ▪ Subscript
Slide 12: Q2 2024 ARR Growth
Q2 2024 ARR Growth1,2 Security Solutions Digital Agreements Total Company 15% $165M $144M 9% 25% $105M $96M $61M $49M Q2'23 Q2'24 Q2'23 Q2'24 Q2'23 Q2'24 1 ARR is approximate. The sum of Security Solutions and Digital Agreements ARR may differ from total company ARR due to rounding. 2 We made the de
Slide 13: 2024 Guidance Metrics
2024 Guidance Metrics FY24 Guidance FY24 Guidance Metric FY23 Actual (previous) (current) Revenue $235.1M $238M - $246M $238M - $246M Adjusted EBITDA1 $12.0M $51M - $55M $55M - $59M ARR2 $154.6M $160M - $168M $166M - $170M 1 Adjusted EBITDA is a non-GAAP financial measure. The Company is not providi
Slide 14: Cost Reduction Actions
Cost Reduction Actions Approximate combined annualized cost savings from our 2023 Cost Reduction Actions and Phase Two of our Restructuring Plan, announced May 20221,2,3 Cumulative, end of Q4, 2022: $10.0 million Cumulative, end of Q4, 2023: $58.5 million 1H 2024 annualized cost savings: $15.0 milli
Slide 15: Appendix
Appendix O OneSpan
Slide 16: Non-GAAP Reconciliation
Non-GAAP Reconciliation Reconciliation of Net Income to Adjusted EBITDA5 (in thousands, unaudited) Three months ended Six months ended June 30, June 30, 2023 2024 2023 2024 Net income (loss) $ (17,751) $ 6,553 $ (26,107) $ 20,021 Interest income, net (585) (521) (1,088) (622) Provision for income ta
Slide 17: Revenue Trend – Last Two Years
Revenue Trend – Last Two Years1 Security Solutions Digital Agreements Total Company (in millions) (in millions) (in millions) $65 $63 $61 $59 $57 $57 $58 $56 $53 $50 $48 $45 $44 $46 $44 $46 $45 $42 $15 $14 $14 $12 $12 $12 $12 $13 $10 Q2'22 Q2'23 Q2'24 Q2'22 Q2'23 Q2'24 Q2'22 Q2'23 Q2'24 1 Rounding o
Slide 18: ARR Trend – Last Two Years
ARR Trend – Last Two Years1,2 Security Solutions Digital Agreements Total Company (in millions) (in millions) (in millions) $165 $155 $155 $150 $139 $141 $144 $105 $134 $136 $101 $100 $93 $96 $98 $88 $90 $92 $61 $55 $49 $51 $54 $45 $46 $47 $48 Q2'22 Q2'23 Q2'24 Q2'22 Q2'23 Q2'24 Q2'22 Q2'23 Q2'24 1
Slide 19: Definitions
Definitions 1 – ARR, or Annual Recurring Revenue, is calculated as the approximate annualized value of our customer recurring contracts as of the measurement date. These include subscription, term-based license, and maintenance and support contracts and exclude one-time fees. To the extent that we a
Slide 20: Non-GAAP Financial Measures
Non-GAAP Financial Measures We report financial results in accordance with GAAP. We also evaluate our performance using certain Non-GAAP financial metrics, namely Adjusted EBITDA, Non-GAAP Net Income (Loss) and Non-GAAP Net Income (Loss) Per Diluted Share. Our management believes that these measures
Slide 21: Copyright and Trademarks
Copyright and Trademarks Copyright© 2024 OneSpan North America Inc., all rights reserved. OneSpan , the “O” logo, “BE BOLD. BE SECURE.” , DIGIPASS® and “The Digital Agreements Company” are registered or unregistered trademarks of OneSpan North America Inc. or its affiliates in the U.S. and other cou
Slide 22: OneSpan
OneSpan The Digital Agreements Company