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Limelight NetworksInvestor OverviewApril 2016
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Certain statements in this presentation relate to future results that are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. This presentation contains statements involving risks and uncertainties, including statements relating to Limelight Networks’ market opportunity and future business prospects. Actual results may differ materially and reported results should not be considered as an indication of future performance. Factors that could cause actual results to differ are included in the Limelight Networks’ Annual Report on Form 10K and our periodic reports on Form 10Q.
Safe Harbor Statement
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About Limelight
Our Mission and Vision: To securely manage and globally deliver
digital content, building customer satisfaction through exceptional reliability
and performance.
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LimelightAt A Glance
Founded2001
IPO (LLNW)2007
Customers925+
of Revenue is International42%
Worldwide Locations20+
Headcount Globally500+
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15 TBPSOne of the largest CDNs in
the world
>800Directly connected unique
networks
>98%Industry leading cache hit
efficiency
4 of 5TOP MEDIA COMPANIES
5 of 8TOP TECHNOLOGY COMPANIES
3 of 5TOP GAMING COMPANIES
SSLOne of the largest SSL
CDNs in the world
PURGEGlobal purge in seconds
Limelight Today
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Limelight Responds to Market Need
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Increasing Market Demands
Superior Quality At Global Scale
Instant Access
Everywhere
On All Devices
Securely
Every Time
“A great digital experience is no longer a nice-to-have; it’s a make-or-break point for your business.”
–Forrester *SOURCE: FORBES
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http://www.forbes.com/pictures/ehjh45lihf/2-digital-experience-delivery-makes-or-breaks-firms/
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Increasing prominence of emerging markets
Explosive growth in networked devices
Growing percentage of overall traffic
Increase in attack frequency and size
Built For Where The Internet Is Going
GlobalizationMobilityVideo Security
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The Limelight DifferenceThe world’s largest private CDN. Backed by industry experts.Delivers digital experiences quickly, reliably, and securely every time.
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Global private network with industry leading cache-hit ratio
Digital delivery of content to any device, anywhere
Powerful architecture with specific solutions for industries
Automated workflows and policy intelligence
Designed for 100% availability and 5 9s durability
Leading ingest/egress capacity; 80+ locations and 19 countries
Personalized, complex sites/apps on any device, anywhere
Industry leading delivery speed and availability
Lower page load times = more $
Robust offering protects content investment at scale
Proactive DDoS monitoring and attack mitigation
SSL delivery, content protection, access controls
Simple, customizable online publishing workflow
Multi-Device Media Delivery (Live/OD)
Integrated high performance delivery
Platform Value Proposition
Orchestrate Delivery
Orchestrate Storage
Orchestrate Performance
Orchestrate Security
Orchestrate Video
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Limelight Strategy and Focus Areas
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Attract talent Reduce turnover Increase productivity
EMPLOYER OF CHOICE
Achieve double digit growth Increase gross margin Drive new business Generate cash
Increase NPS Reduce churn Grow existing business
Corporate Goals and Priorities
CUSTOMERS FOR LIFE
REVENUE / PROFIT GROWTH
Improve reliability, performance and capacity1
Strengthen the customer relationship3
Deliver differentiated solutions within target use cases2
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Improving Network PerformanceThreaded EP Production Test – Lower Latency and Faster
63% increase in throughput
Before After
High and variable latencyLow and consistent
latency
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Improving Capacity / Efficiency with SavingsSelected Colocation-related Projects
Project by Location Racks Servers
Chicago shutdown (one of several locations) -100% -63% $345k No change
Washingto DC consolidation -48% -30% $360k No change
Amsterdam consolidation -47% -62% $840k No change
Frankfurt consolidation -100% -50% $460k > 40% increase
Tokyo consolidation -48% -49% $1,600k > 50% increase
London consolidation (one of several locations) -78% -65% $580k > 200% increase
New York consolidation -64% -51% $460k No change
Los Angeles consolidation -47% -35% $290k No change
Dallas consolidation -50% -54% $325k No change
San Jose consolidation -40% -39% $345k > 30% increase
% ReductionCapacity Impact
Annual Savings
(Approx)
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Improving Customer Relationship and Differentiated Solutions
Fall 2014
Spring 2014
Fall 2013
Spring 2013
Spring 2015
15.1 points
10.6 points
11.9 points
14.6 points+64 points
12.1 pointsFall 2015
Net Promoter Score Progress
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Financials
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Financial Highlights
Robust recurring revenue model with improving customer churn characteristics
Return to demonstrable top-line growth
Significant margin opportunity
Disciplined capital investment strategy
Moving from cash utilization to cash generation
Capped litigation exposure
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Core Revenue Trend
$36.00 $35.70 $37.50 $40.73 $42.30
$43.80 $42.05 $42.74 $41.42
$0.30 $0.30
$4.90 $5.40 $1.20
$0
$5
$10
$15
$20
$25
$30
$35
$40
$45
$50
1Q 14 2Q 14 3Q 14 4Q 14 1Q 15 2Q 15 3Q 15 4Q 15 1Q 16
Clickability Netflix$ millions
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Gross Profit and Margin
$15.27 $15.87 $16.14 $16.13
$16.52
$18.15
$15.91
$17.54 $16.64
37.1% 38.4%41.4%
39.6% 39.0%41.4%
37.8%41.0% 40.2%
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
$0
$2
$4
$6
$8
$10
$12
$14
$16
$18
$20
1Q 14 2Q 14 3Q 14 4Q 14 1Q 15 2Q 15 3Q 15 4Q 15 1Q 16
Gross Profit Gross Margin
$ millions
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Operating Income Trends
-$7.66
-$6.98-$6.22
-$5.86
-$7.51
-$6.22
-$8.24
-$3.75
-$6.02
-$9
-$8
-$7
-$6
-$5
-$4
-$3
-$2
-$1
$01Q 14 2Q 14 3Q 14 4Q 14 1Q 15 2Q 15 3Q 15 4Q 15 1Q 16
$ millions
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EBITDA / Adjusted EBITDA Profile$ millions
-$2.26-$1.86
-$1.19 -$1.21
-$2.72
-$1.21
-$2.96
$2.06
-$0.72
$0.60
$1.32 $1.41 $1.48
$0.37 $0.90
$0.31
$5.33
$3.95
-$4
-$3
-$2
-$1
$0
$1
$2
$3
$4
$5
$6
1Q 14 2Q 14 3Q 14 4Q 14 1Q 15 2Q 15 3Q 15 4Q 15 1Q 16
EBITDA Adjusted EBITDA
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1Q2016 Highlights Revenue of $41.4 million, down 2%
year over year
Excluding FX fluctuations, down 1% year over year
Gross Margin of 40.2%, up 120 basis points year over year
Operating Expenses down 6% year over year, despite $1.2 million of litigation expense
Non GAAP EPS of $(0.01)
Adjusted EBITDA of $4 million, up from $0.4 million in 1Q2015
Generated $1.1 million of cash in 1Q2016 (ex debt financing)
$0.00
$0.50
$1.00
$1.50
$2.00
$2.50
$3.00
$3.50
$4.00
$4.50
$5.00
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
Trading Volume LLNW Price
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2016 Guidance
$150.99
$170.91
$11.27
$0
$50
$100
$150
$200
$250
2014A 2015A 2016E
GuidanceNetflixNon-Netflix
Revenue ($ millions)
$180 - $188
$162.26
39.1% 39.9%
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
2014A 2015A 2016E
Guidance
+41.9%
GAAP Gross Margin
Additional guidance: • Non-GAAP EPS between $(0.05) and $0.05• Less than $20M Capex (cash paid and financed) vs $26.7M in 2015• Generate cash 23
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Long-term Financial Model
10-15% annual revenue growth
16-20% adjusted EBITDA as % of revenue
10-14% Capex as % of revenue
Cash flow positive
Increase existing customer revenue growth
Lower new customer acquisition costs
Improve server efficiency and infrastructure utilization
Consistent G&A and R&D dollar spend as revenue grows
Drivers Long-Term Targets
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Investment Thesis: Attractive Market
Returning to top line growth
Improving earnings and generating cash
Aligning cost structure to revenue streams
Multiple expansion
Increased strategic flexibility
Higher shareholder valueImpact
Growth Drivers
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Appendix: Non-GAAP Financial Measures
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Non-GAAP Net Loss
Three Months Ended
Mar 31, 2016 Dec 31, 2015 Mar 31, 2015
Amount Per Share Amount Per Share Amount Per Share
U.S. GAAP net loss $(5.946) $(0.06) $(4,145) $(0.04) $ (5,683) $(0.06)
Share-basedcompensation 3,496 0.03 2,863 0.03 3,069 0.03
Litigation expenses 1,178 0.01 402 0.00 19 0.00
Amortization of intangible assets 6 0.00 461 0.00 197 0.00
Non-GAAP net loss $ (1,266) $(0.01) $ (419) $0.00 $ (2,398) $(0.02)
Weighted average shares used in per share calculation
102,693 101,391 98,636
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in thousands
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EBITDA and Adjusted EBITDA
Three Months Ended
Mar 31, 2016 Dec 31, 2015 Mar 31, 2015
U.S. GAAP net loss $ (5,946) $ (4,145) $ (5,683)
Depreciation and amortization 5,291 5,816 4,793
Interest expense 179 25 4
Interest and other (income) expense (406) (321) (1,886)
Income tax provision 158 46 55
EBITDA (724) 2,063 (2,717)
Share-based compensation 3,496 2,863 3,069
Litigation expenses 1,178 402 19
Adjusted EBITDA $ 3,950 $ 5,328 $ 371
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$ thousands
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THANK YOU
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© 2016 Limelight Networks, Inc. All rights reserved. No part of this document may be reproduced, or transmitted by any means (electronic, mechanical, photocopying, recording, or otherwise) without the express written permission of Limelight Networks, Inc. Limelight Orchestrate™ is a trademark owned by Limelight Networks, Inc. All rights reserved. All other trademarks referred to herein are the property of their respective owners.
Disclaimer
Limelight Networks�Investor OverviewSlide Number 2Slide Number 3Slide Number 4Slide Number 5Slide Number 6Increasing Market DemandsBuilt For Where The Internet Is GoingSlide Number 9Platform Value Proposition Slide Number 11Slide Number 12Improving Network PerformanceImproving Capacity / Efficiency with SavingsImproving Customer Relationship and Differentiated Solutions Slide Number 16Financial HighlightsCore Revenue TrendGross Profit and MarginOperating Income TrendsEBITDA / Adjusted EBITDA Profile1Q2016 Highlights2016 GuidanceLong-term Financial ModelInvestment Thesis: Attractive MarketSlide Number 26Non-GAAP Net LossEBITDA and Adjusted EBITDASlide Number 29Slide Number 30