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Mellanox Financial Overview
- 2. Major Takeaways from Earlier Presentations
Exponential increase in data consumption emphasizes
critical importance of interconnect
Experience developing 7 generations of interconnects
gives us an advantage in reaching 100 Gb/s solutions
Solutions deliver unmatched ROI for multiple markets
Global sales team focused on opportunities within
traditional and new markets
Mellanox focuses on building an infrastructure to
enable scalable growth
© 2013 Mellanox Technologies
- Mellanox Confidential -
2
- 3. Core Affects from Acquisitions
Voltaire
1Q11
IPtronics
3Q13
Kotura
3Q13
TAM
ASP
Long-term Gross Margins
*
Accretive after 4 Quarters
*
IP Portfolio
Team
Geography
Israel
Denmark
US
*Based on Company forecasts
© 2013 Mellanox Technologies
- Mellanox Confidential -
3
- 4. Historical Annual Revenue Growth
Annual Revenue ($M)
500.8
360.0
Mid-point of 4Q13
Guidance
392.8E
259.3
154.6
107.7
YoY
%
116.0
2008
2009
2010
2011
2012
2013E
28.1%
7.7%
33.3%
67.6%
93.2%
(21.6%)
Source: Company financial statements
CAGR over the past 5 years ~ 30%
© 2013 Mellanox Technologies
- Mellanox Confidential -
4
- 5. 2011 – 2013 Revenue Proforma
Annual Revenue ($M)
500.8
300.0310.0
154.6
107.7
YoY
%
116.0
2008
2009
2010
28.1%
7.7%
33.3%
2011
Actual revenue
© 2013 Mellanox Technologies
400.0410.0
430.0 440.0 E
2012
2013E
Proforma revenue (estimated)
- Mellanox Confidential -
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- 6. Historical Quarterly Revenue Growth
156.5
Quarterly Revenue ($M)
133.5
122.1
104.1
105 –
110
98.2
88.7
83.1
72.7
68.2
63.3
55.1
40.0
32.7
22.6
35.5
36.2
37.8
40.7
25.3
2009
2010
2011
2012
2013
Source: Company financial statements
© 2013 Mellanox Technologies
- Mellanox Confidential -
6
- 7. Percentage of Revenue by Product Family
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
Q3’12 Q4’12 Q1’13 Q2’13 Q3’13
IC
Q3’12 Q4’12 Q1’13 Q2’13 Q3’13
Board
IC
Board
© 2013 Mellanox Technologies
Q3’12 Q4’12 Q1’13 Q2’13 Q3’13
Switch
Switch
- Mellanox Confidential -
Q3’12 Q4’12 Q1’13 Q2’13 Q3’13
Cable / Other
Cable / Other
7
- 8. Percentage of Revenue by Data Rate
100%
90%
80%
70%
60%
Other
Ethernet
50%
FDR
QDR
DDR
40%
SDR
30%
20%
10%
0%
1Q08
2008
© 2013 Mellanox Technologies
1Q09
2009
1Q10
2010
1Q11
- Mellanox Confidential -
2011
1Q12
2012
1Q13
2013
8
- 9. Quarterly Head Count Trend
18%
1,600
16%
1,371
14%
1,400
1,229
1,205
1,200
1,160
1,089
12%
1,000
10%
800
8%
600
6%
400
4%
200
2%
0%
0
Q3'12
Q4'12
Q1'13
Total HC
© 2013 Mellanox Technologies
Q2'13
Q3'13
% q-o-q increase
- Mellanox Confidential -
9
- 10. Quarterly Head Count Trend (excluding Q3’13 acquisitions)
18%
1,600
16%
1,400
1,272
14%
1,229
1,205
1,200
1,160
1,089
12%
1,000
10%
800
8%
600
6%
400
4%
200
2%
0%
0
Q3'12
Q4'12
Q1'13
Total HC
© 2013 Mellanox Technologies
Q2'13
Q3'13
% q-o-q increase
- Mellanox Confidential -
10
- 11. Positive Cash Flow from Operations
182.5
Cash Flow from Ops ($M)
63.1
41.2
31.0
32.8
21.3
2008
1Cash
2009
2010
2011
2012
YTD 2013
and investments include $7.4m in restricted cash
Cash and Investments @ September 30, 2013 = $306.4M1
© 2013 Mellanox Technologies
- Mellanox Confidential -
11
- 12. Long-Term Target Model
1
Percentage-Based Income Statement (Non-GAAP )
Q3
2013
FY
2012
Long term model
Revenue
100%
100%
100%
Gross Margin
69%
70%
65% - 69%
R&D
35%
24%
26% - 30%
SG&A
20%
14%
15% - 18%
Operating Income
13%
33%
24% - 29%
Net Income
13%
31%
23% - 28%
a reconciliation of non-GAAP to GAAP financial measures, please reference the Company’s 3Q13 financial results press release
Source: Company financial statements
1For
Strategy is to drive revenue and earnings growth rates with end-to-end solutions, expand distribution channels
and enhance product offerings
© 2013 Mellanox Technologies
- Mellanox Confidential -
12
- 13. Drive Shareholder Value
Focus on high growth, profitable opportunities in
the data center
Continue to drive efficiencies across the
organization
Make strategic investments in technologies in our
core business
Deliver increased operating profits and EPS
Generate healthy levels of cash flow
© 2013 Mellanox Technologies
- Mellanox Confidential -
13