Slide 1: Q3 FY 2021 Conference Call
Q3 FY 2021 Conference Call NETSCOUT SYSTEMS, INC. January 28, 2021 ©2021 NETSCOUT January 28, 2021
Slide 2: Agenda
Agenda • Introduction & Safe Harbor – Tony Piazza, Vice President, Corporate Finance • CEO Perspective – Anil Singhal, President and CEO • COO Update – Michael Szabados, Chief Operating Officer • CFO Financial Review – Jean Bua, EVP and CFO January 28, 2021 ©2021 NETSCOUT 2
Slide 3: Safe Harbor
Safe Harbor Forward Looking Statements: Forward-looking statements in this communication are made pursuant to the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934 and other federal securities laws. Investors are cautioned that statements in this communication, which are n
Slide 4: Non-GAAP Financial Metrics
Non-GAAP Financial Metrics Regulation G Disclosure: This presentation makes reference to the following non-GAAP metrics: non-GAAP total revenue, non-GAAP product revenue, non-GAAP service revenue, non-GAAP income from operations, non-GAAP gross profit, non-GAAP operating margin, non-GAAP net income,
Slide 5: CEO Perspective
CEO Perspective Anil Singhal President and Chief Executive Officer N E T S C O U T.C O M January 28, 2021
Slide 6: Q3 FY'21 Non-GAAP Financial Results
Q3 FY’21 Non-GAAP Financial Results Non-GAAP Q3 FY’21 Q3 FY’20 YTD FY'21 YTD FY'20 ($ in millions, except per share data) 12/31/2020 12/31/2019 12/31/2020 12/31/2019 Revenue $ 228.7 $ 260.1 $ 617.9 $ 662.6 Gross Margin 78.6% 77.8% 76.1% 76.6% Operating Margin 28.2% 27.3% 20.2% 17.3% EPS $ 0.66 $ 0.7
Slide 7: Market Trends and Business Insights
Market Trends and Business Insights • Service Provider Vertical • Enterprise Vertical • Security January 28, 2021 ©2021 NETSCOUT 7
Slide 8: FY'21 Outlook & Summary
FY’21 Outlook & Summary • Focused on our team, customers, and driving overall margins while preserving liquidity, a strong balance sheet, and financial flexibility • Our relevant solutions, trusted brand, strong customer relationships, dedicated team, and a solid financial profile have positioned us
Slide 9: COO Update
COO Update Michael Szabados Chief Operating Officer N E T S C O U T.C O M January 28, 2021
Slide 10: COO Highlights
COO Highlights • Customer Wins • Go-to-Market Activities January 28, 2021 ©2021 NETSCOUT 10
Slide 11: Financial Review & FY'21 Guidance
Financial Review & FY’21 Guidance Jean Bua Executive Vice President and Chief Financial Officer N E T S C O U T.C O M January 28, 2021
Slide 12: Q3 and YTD FY'21 Results
Q3 and YTD FY’21 Results Q3 FY’21 Q3 FY’20 YTD FY’21 YTD FY’20 Q3 FY’21 Q3 FY’20 YTD FY’21 YTD FY’20 GAAP GAAP % GAAP GAAP % Non-GAAP Non-GAAP % Non-GAAP Non-GAAP % (in millions except EPS and % data) 12/31/2020 12/31/2019 Change 12/31/2020 12/31/2019 Change 12/31/2020 12/31/2019 Change 12/31/2020 1
Slide 13: YTD FY'21 Revenue Trends: Customer Verticals
YTD FY’21 Revenue Trends: Customer Verticals Total Non-GAAP Revenue by Customer Vertical Total Non-GAAP Revenue Composition by Customer Vertical ($ in millions) YTD FY’21 YTD FY’20 $617.9 $662.6 Non-GAAP Non-GAAP $303.6 $317.1 49% 51% 48% 52% $314.3 $345.5 YTD FY'21 YTD FY'20 Service Provider Enterp
Slide 14: YTD FY'21 Revenue Trends: Geographic Mix on a GAAP Basis
YTD FY’21 Revenue Trends: Geographic Mix on a GAAP Basis YTD FY’21 YTD FY’20 GAAP GAAP 12/31/20 12/31/19 YTD FY’21 YTD FY’20 Total Revenue $617.9 $662.5 United States $364.5 $410.3 7% 6% 59% 41% 62% 38% 15% International $253.3 $252.2 19% 15% 17% Europe $116.9 $110.3 Asia $43.2 $41.6 Rest of World $
Slide 15: GAAP Balance Sheet Highlights & Free Cash Flow
GAAP Balance Sheet Highlights & Free Cash Flow (in millions) Q3 FY'21 Q1 FY’21 Q2 FY'21 Q3 FY'21 YTD FY'21 (Unaudited) 12/31/20 6/30/2020 9/30/2020 12/31/2020 12/31/2020 Cash and Securities* $ 490.4 Operating Cash Flow $ 44.9 $ 11.7 $ 65.3 $ 121.9 Purchase of Fixed Assets & Intangible Assets $ (6.8)
Slide 16: FY'21 Guidance
FY’21 Guidance Revenue Other FY’21 Guidance Assumptions FY’20 FY’20 FY’21 Guidance * Anticipated gross profit margin of $ millions GAAP Non-GAAP GAAP & Non-GAAP approximately 76% Revenue $891.8 $892.0 ~$825 to ~$840 * Tax rate anticipated to be approximately 21% * Weighted average of approximately 7
Slide 17: Appendix
Appendix N E T S C O U T.C O M January 28, 2021
Slide 18: FY'21 Guidance: GAAP to Non-GAAP Reconciliation
FY’21 Guidance: GAAP to Non-GAAP Reconciliation NETSCOUT SYSTEMS, INC Reconciliation of GAAP Financial Guidance to Non-GAAP Financial Guidance (Unaudited) (In millions, except net income per share - diluted) FY'20 FY'21 GAAP revenue $ 891.8 ~$825 million to ~$840 million Deferred service revenue fai
Slide 19: GAAP to Non-GAAP Reconciliation: Revenue
GAAP to Non-GAAP Reconciliation: Q3’FY21, Q3’FY20, Q2’FY21, YTD’FY21 & YTD’FY20 Revenue NETSCOUT SYSTEMS, INC. Reconciliation of Current GAAP to Current and Historical Non-GAAP Financial Measures (In thousands, except per share data) (Unaudited) Three Months Ended Three Months Ended Nine Months Ende
Slide 20: GAAP to Non-GAAP Reconciliation: Gross Profit, Income from Operations and Net Income
GAAP to Non-GAAP Reconciliation: Q3’FY21, Q3’FY20, Q2’FY21, YTD’FY21 & YTD’FY20 Gross Profit, Income from Operations and Net Income (loss) NETSCOUT SYSTEMS, INC. Reconciliation of Current GAAP to Current and Historical Non-GAAP Financial Measures (In thousands, except per share data) (Unaudited) Thr
Slide 21: GAAP to Non-GAAP Reconciliation: Itemization
GAAP to Non-GAAP Reconciliation: Q3’FY21, Q3’FY20, Q2’FY21, YTD’FY21 & YTD’FY20 Itemization NETSCOUT SYSTEMS, INC. Reconciliation of Current GAAP to Current and Historical Non-GAAP Financial Measures - Continued (In thousands) (Unaudited) Three Months Ended Three Months Ended Nine Months Ended Decem
Slide 22: Thank You
Thank You N E T S C O U T.C O M January 28, 2021