investor & financial analyst day...2018/04/12 · •comcast •british telecom •bharti airtel...

INVESTOR & FINANCIAL ANALYST DAY2018

2 © Cloudera, Inc. All rights reserved.

SAFE HARBOR STATEMENT

Statements in this presentation that are not historical in nature are forward-looking statements that, within the meaning of the federal securities laws including the safe harbor provisions of the Private

Securities Litigation Reform Act of 1995, involve known and unknown risks and uncertainties. Words such as "may", "will", "expect", "intend", "plan", "believe", "seek", "could", "estimate", "judgment",

"targeting", "should", "anticipate", "goal" and variations of these words and similar expressions, are also intended to identify forward-looking statements. The forward-looking statements in this

presentation address a variety of subjects, including our belief that the enterprise machine learning and analytics market will quickly emerge and that we will continue to lead its direction through

technology and product innovation, our expectation that we will continue our momentum in machine learning, analytics and the cloud, and our “Progress Towards Our Long Term Model”. Readers are

cautioned that actual results could differ materially from those implied by such forward-looking statements due to a variety of factors, including global economic conditions, competitive pressures and

pricing declines, intellectual property infringement claims, and other risks or uncertainties that are described under the caption “Risk Factors” in our Prospectus filed pursuant to Rule 424(b) filed with

the Securities and Exchange Commission, or the SEC, on September 28, 2017, our most recently filed Quarterly Report on Form 10-Q and in our other SEC filings. Although we believe the

expectations reflected in such forward-looking statements are based upon reasonable assumptions, we can give no assurances that our expectations will be attained. We undertake no obligation to

update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

We report all financial information required in accordance with U.S. generally accepted accounting principles (GAAP). To supplement our unaudited condensed consolidated financial statements

presented in accordance with GAAP, we use certain non-GAAP measures of financial performance. The presentation of these non-GAAP financial measures is not intended to be considered in

isolation from, as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP, and may be different from non-GAAP financial measures used by other

companies. In addition, these non-GAAP measures have limitations in that they do not reflect all of the amounts associated with the results of our operations as determined in accordance with GAAP.

We believe that these non-GAAP financial measures, when taken together with the corresponding GAAP financial measures, provide meaningful supplemental information regarding our performance

by excluding certain items that may not be indicative of our core business, operating results or future outlook. Management uses, and believes that investors benefit from referring to, these non-GAAP

financial measures in assessing our operating results, as well as when planning, forecasting and analyzing future periods. We use these non-GAAP financial measures in conjunction with traditional

GAAP measures to communicate with our board of directors concerning our financial performance. These non-GAAP financial measures also facilitate comparisons of our performance to prior

periods.

Please see the slides entitled GAAP to Non-GAAP Reconciliation at the end of this presentation for a reconciliation of each of these measures to the most directly comparable GAAP financial

measure. This reconciliation can also be found in the earnings release dated April 3, 2018, which is available on www.cloudera.com or on the “Investor Relations” section of our website.

We periodically update the Global 8000 list based on the FORBES Global 2000 list and information from Data.com, using the most recently published FORBES Global 2000 list (which is updated by

Forbes annually) and the most recent Data.com information (which is continuously updated by Data.com). Our customer count is subject to ongoing adjustment and, when adjustments occur,

previously disclosed numbers of customers are updated to allow for comparability.

Unless otherwise noted, the information in this presentation is as of January 31, 2018.

Cloudera and associated marks are trademarks or registered trademarks of Cloudera, Inc. All other company and product names may be trademarks of their respective owners.

© Cloudera, Inc. All rights reserved.

TOM REILLY | CHIEF EXECUTIVE OFFICER


TOM REILLY

CEO

MIKE OLSON

CO-FOUNDER & CSO

AMR AWADALLAH

CO-FOUNDER & CTO

DANIEL STURMAN

SVP ENGINEERING

CHARLES

ZEDLEWSKI

SVP EMERGING

BUSINESSES

DAVID MIDDLER

CHIEF LEGAL

OFFICER

JIM FRANKOLA

CHIEF FINANCIAL

OFFICER

MICK HOLLISON

CHIEF MARKETING

OFFICER

BRITT SELLIN

VP HUMAN

RESOURCES

AMY O’CONNOR

CHIEF DATA &

INFORMATION OFFICER

HILARY MASON

GM MACHINE LEARNING

ANUPAM SINGH

GM ANALYTICS

VIKRAM MAKHIJA

GM CLOUD

CLOUDERA LEADERSHIP TEAM


QUICK SUMMARY

• Large addressable market—machine learning, analytics, cloud, big data & IoT

• Innovation driving competitive advantage and extending category leadership

• Strategic partnerships expand reach and accelerate consumption

• Powerful land and expand economicsnet expansion

Driven by data and new use cases

recurring software

Subscription software revenue

FY18 revenue

50% FY18 subscription revenue growth

Global 8000 customers

Across all industry verticals

Notes:

1. FQ4’17: 566, FQ1’18: 595, FQ2’18: 643, FQ3’18: 666.

2. Our quarterly net subscription revenue expansion rate equals: the subscription revenue in a given quarter from all customers that had

subscription revenue in the same quarter of the prior year, divided by the subscription revenue attributable to that same group of customers in

that prior quarter. Our net expansion rate equals the simple arithmetic average of our quarterly net subscription revenue expansion rate for the

four quarters ending with the most recently completed fiscal quarter.

(2)(1)


of unstructured data is analyzed or

used at all (3)

THE DATA-DRIVEN ENTERPRISE

connected devices

more data

(2)

AN UNTAPPED OPPORTUNITY

(1)

of structured data is actively used in making decisions (3)

1. IDC estimates that there will be 30B IoT and connected devices in 2020

2. IDC estimates that there will be 440x more data in 2020 than 2005

3. Harvard Business Review 2017

THE DATA ECONOMY


WE DELIVER THE MODERN PLATFORM FOR MACHINE LEARNING AND ANALYTICS OPTIMIZED FOR THE CLOUD

SCALABLEENTERPRISE GRADE RUNS ANYWHERE

✓ Elastic

✓ Cost-effective

✓ Lower TCO

✓ Secure

✓ Performant

✓ Compliant

✓ Cloud

✓ Multi-cloud

✓ On-premises


WE EMPOWER PEOPLE TO TRANSFORM COMPLEX DATA INTO CLEAR AND ACTIONABLE INSIGHTS

CONNECT PRODUCTS &

SERVICES (IoT)

GROW BUSINESS PROTECT BUSINESS


CLOUDERA POWERING DATA-DRIVEN CUSTOMERS

Using deeper customer insights

to personalize customer solutions

GROW BUSINESS

Reducing manufacturing costs and

•improving product quality with IoT analytics

CONNECT PRODUCTS &

SERVICES (IoT)

Uncovering zero-day attacks and stopping

advanced persistent threats more quickly

PROTECT BUSINESS


CLOUDERA POWERING DATA-DRIVEN CUSTOMERS

•Enhancing customer experience

with network visibility and tailored offers•Predicting electrical energy demand

with machine learning•Identifying deposit fraud

•with machine learning

GROW BUSINESS CONNECT PRODUCTS &

SERVICES (IoT)

PROTECT BUSINESS


LARGE AND GROWING MARKET

Source: IDC. Note: Transformative markets represented $10.6B in 2016 and $27.7B in 2021, approximately broken down into $13.3B for Cognitive/AI Systems and Content Analytics Software, $9.7B for Dynamic Data

Management Systems, $4.7B for Advanced and Predictive Analytics Software

2016 2021

$10B Dynamic data mgmt

$5B Advanced analytics

$13B Cognitive / AI$11B

$28B

Relational and

non-relational

DBMSs

$45B

TAM

$73B

+ =21%CAGR


MARKET DEVELOPMENT & PHASES OF GROWTH

BIG DATA

TECH

DATA

PLATFORM

CIO

& Data Admins

ML, ANALYTICS

& CLOUD

LOB

& Data ScientistsIT early

adopters &

Developers

DIGITAL

TRANSFORMATIONpowered by data

C-suite &

Boards


Go-to-market

• Refined customer targeting

• Dedicated sales resources for acquiring

new customers and expanding existing

customers

• Field specialists supporting ML,

analytics, cloud

• Extend channel for non-target accounts

• New VP Public Sector

• New global field leader (pending)

Product and organization

• Invest in

• Lead machine learning in enterprise

• Disrupt data warehouse market

• Capitalize on cloud adoption

• Introduced organizational structure with

new SVP high growth businesses and 3

new General Managers

• Drive industry-specific partner solutions

• Matrix alignment

PHASE THREE STRATEGIC INITIATIVES


Lead machine

learning in the

enterprise

Disrupt the data

warehouse market

Capitalize on cloud

adoption

STRATEGIC GROWTH DRIVERS


MODERN DATA ARCHITECTURE ML / AI

(DATA SCIENCE)ANALYTICS

CLOUD STORAGE ON-PREMISES STORAGE

MANAGEMENT & SECURITY

DATA

ENGINEERING


CLOUDERA ENTERPRISE DATA PLATFORM

The modern platform for

machine learning & analytics

optimized for the cloud

WORKLOADS 3RD PARTY

SERVICES

DATA

ENGINEERIN

G

DATA

SCIENCE

ANALYTIC

DATABASE

OPERATIONA

L DATABASE

DATA CATALOG

GOVERNANCESECURITY LIFECYCLE

MANAGEMENT

STORAGE Microsoft

ADLS

COMMON SERVICES

HDFS

Amazon

S3

CONTROL

PLANE

KUDU


HIGH PROPENSITY TO BUY ACCOUNT FIRMOGRAPHICS

COMPANY PROFILE

• Revenue

• Industry

• Regulated and competitive environments

• Market capitalization

SPENDING PATTERNS

• IT/Data warehouse spend

• Changing product/service delivery environment

• Providing data as business or service

• Digital asset size/data driven focus


REFINING OUR MARKET SEGMENTATIONTargeting ~5,000 high propensity to buy new and expansion customers

• Expand reach through partners

• Lower cost of acquisition

• Accounts beyond Global 2000

• New named account model

• Increase Global 2000 penetration

• New customer account managersG2K

G2K+

Other


TOP GLOBAL

ADOPTION DRIVEN BY LARGE ENTERPRISES

TOP GLOBAL TOP GLOBAL TOP GLOBALCOUNTRIES WITH GOV

CUSTOMERS

BANKING TELCO HEALTHCARE TECHNOLOGYPUBLIC

Customers across

all verticals

400+ Global 2000

customers

Plant the flag

international strategy


TOP INDUSTRY VERTICALS

BANKING

300+

• Fraud detection

• Anti-money

laundering

• CCAR

• Barclays

• Bank of America

• Citi

HEALTHCARE

70+

• Patient care (IoT)

• Genomics research

• Regulatory

compliance

• GlaxoSmithKline

• Symphony Health

• Sharp Healthcare

TECHNOLOGY

200+

• Customer

analytics

• Threat detection

• Predictive support

• Cisco

• Intel

• NetApp

TELCO

100+

• Churn analysis

• Customer care

• Network

optimization

• Comcast

• British Telecom

• Bharti Airtel

MANUFACTURING

60+

• Predictive

maintenance (IoT)

• Supply chain

optimization

• Remote monitoring

• Navistar

• Faurecia

• Sikorsky

CUSTOMER #

USE CASES

CUSTOMERS


11%12%

14%

16% 17%18%

21% 21%22%

24%

25%26%

-

1.0

2.0

3.0

4.0

5.0

6.0

Q1 FY16 Q2 FY16 Q3 FY16 Q4 FY16 Q1 FY17 Q2 FY17 Q3 FY17 Q4 FY17 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18

0%

3%

6%

9%

12%

15%

18%

21%

24%

27%

Clo

ud

Cu

sto

me

rs (

as

a %

of

To

tal)

Clusters per Customer Cloud Customers (as % of Total)

Notes for cloud-related metrics:

- Total Customers: all customers who share diagnostic data

- Cloud Customers: customers with utilization in prior six month

period on AWS, Azure and GCP

PUBLIC CLOUD USAGE


CLOUD COMPETITIVE DIMENSIONS

This analysis is based on the analysis and opinion of the management of Cloudera

Enterprise Grade & Secure

Unified / Multi-function(Shared data)

Cloud + On-Premises(Hybrid)

Public Cloud

Vendors(House offerings)

Multi-cloud(No lock-in)

Cloudera(IaaS + PaaS)

Cloud-only

Vendors(Single product)


PARTNER ECOSYSTEM

ISVs & SOLUTIONS

CLOUD & PLATFORM

SYSTEM

INTEGRATORSRESELLERS

Focus on strategic

partnerships to expand reach

and accelerate consumption


BENEFITTING FROM MULTIPLE GROWTH VECTORS

BUSINESS MODEL & FINANCIAL REVIEWJIM FRANKOLA | CHIEF FINANCIAL OFFICER

© Cloudera, Inc. All rights reserved.26 © Cloudera, Inc. All rights reserved.

FINANCIAL HIGHLIGHTS

Rapid revenue growth

Powerful land & expand

economics

Proven pathto profitability

Large market

opportunity


DIVERSIFIED REVENUE MODEL

5 PLATFORM PRODUCTS 3 NEW OFFERINGS SUBSCRIPTION PRICING

BY

CONSUMPTION

BY NODE

BY USER


RAPID REVENUE GROWTH

HISTORIC QUARTERLY REVENUE ($M) HISTORIC ANNUAL REVENUE ($M)

41%Y/Y growth

$34$38

$44$50

$56

$64$67

$73

$80

$90$95

$103

Q1FY16

Q2FY16

Q3FY16

Q4FY16

Q1FY17

Q2FY17

Q3FY17

Q4FY17

Q1FY18

Q2FY18

Q3FY18

Q4FY18

$109

$166

$261

$367

$440

FY15 FY16 FY17 FY18 FY19EGuidance*

Services Subscription

*FY19E guidance at midpoint


REVENUE MIX TRENDS

25%International

SERVICES(% of Total Revenue)

INTERNATIONAL (% of Total Revenue)

12%

21%

25%

28%

FY15 FY16 FY17 FY18

33%

28%

23%

18%

FY15 FY16 FY17 FY18


THE CLOUDERA CUSTOMER JOURNEY

PHASE ARR CHARACTERISTCS

Phase 1 Acquisition ● High customer acquisition cost, low initial ARR

Phase 2 Departmental $0K - $100K ● Single use case

● Highest rate of expansion and churn

● S&M expense remains high

Phase 3 Multi-case $100K - $500K ● Multiple use cases

● Expansion drops to the average rate and churn

moderates

● S&M cost moderate

Phase 4 Platform $500K - $1M ● Net expansion rate stable

● Churn continues to fall

● S&M expense better than target modelPhase 5 Enterprise >$1M


LANDING IS AN INVESTMENT

AND REQUIRE

TECHNICAL EXPERTISE

YIELDING LONG PAYBACK

(BUT HIGH LTV)

CUSTOMERS START

SMALL

ARR

$71K

CAC

~$250K

2-5 year

payback

136% net

expansion rate


136%net

expansion

rate*

134%

145%

126%

142%

139%

Note: Our quarterly net subscription revenue expansion rate equals: the subscription revenue in a given

quarter from all customers that had subscription revenue in the same quarter of the prior year, divided by

the subscription revenue attributable to that same group of customers in that prior quarter. Our net

expansion rate equals the simple arithmetic average of our quarterly net subscription revenue expansion

rate for the four quarters ending with the most recently completed fiscal quarter.

NET EXPANSION RATE BY ANNUAL COHORT (as of Q4 FY18)

Note: Our cohort quarterly net subscription revenue expansion rate equals: the subscription revenue in a

given quarter from a particular cohort of customers, divided by the subscription revenue attributable to

that same cohort of customers in same quarter of the prior year. Our cohort net expansion rate equals the

simple arithmetic average of our cohort quarterly net subscription revenue expansion rate for the four

quarters ending with the most recently completed fiscal quarter.


EACH PHASE EXHIBITS STRONG GROWTH

TOTAL NUMBER OF CUSTOMERS BY CUSTOMER JOURNEY PHASE

0

100

200

300

400

500

600

700

800

Phase 2($0K - $100K)

Phase 3($100K - $500K)

Phase 4($500K - $1M)

Phase 5($1M+)

Q4 FY15 Q4 FY16 Q4 FY17 Q4 FY18


AS CUSTOMERS “GRADUATE”,$1M+ ACCOUNTS COMPRISE MORE OF OUR REVENUE

FY17 REVENUE* MIX(by Customer Phase)

FY18 REVENUE* MIX(by Customer Phase)

* Revenue = Subscription

Software Revenue

10%

24%

18%

48%

$0K-$100K $100K-$500K

$500K-$1M $1M+

8%

25%

14%

53%

$0K-$100K $100K-$500K

$500K-$1M $1M+


35%

60%

41%

24%

Phases 3 - 5($100K+)

Phase 3($100K - $500K)

Phase 4($500K - $1M)

Phase 5($1M+)

CUSTOMER SCALE DRIVES EFFICIENCY…

FY18 S&M EXPENSE BY CUSTOMER PHASE

As our customers grow:

○ They become more self

sufficient

○ Partners are more

engaged

○ Our technical resources

support more customer

applications, use cases

and data


YIELDINGOPERATING LEVERAGE

REVENUE

GROWTH ($)

NON-GAAP

EXPENSE

GROWTH ($)

OCF MARGIN

$166M

$261M

$367M

FY16 FY17 FY18

$304M

$401M

$464M

FY16 FY17 FY18

(55%)

(45%)

(12%)

FY16 FY17 FY18

FY18

+41%

FY18

+16%


TARGETING THE HIGHEST VALUE CUSTOMERS


SIGNIFICANT SCALE GROWTH PROFITABLE*

net expansion rate (Q4)

ARR Q4 run rate

SW profit margin

S&M / RevenueCustomers over $1M ARR

G2K

PROFILE OF A $1M SOFTWARE ARR CUSTOMER

Note: FY18 estimates based on allocated and directly identified expenses


OUR BEST CUSTOMERS DOUBLE IN SIZE

One out of every six

customers grew at 2X

or more in Q4-FY18

2X+


HIGHER

LIFETIME VALUE

HIGHER

AVERAGE DEAL

SIZE

HIGHER NET

EXPANSION

RATE

G2K FUELS “LAND + EXPAND” MODEL

MAJORITY OF

SUBSCRIPTION

REVENUE


CUSTOMER SUCCESS DRIVES INCREASING ARR

TOTAL CUSTOMER

AVERAGE ARRG2K AVERAGE ARR

$184K $207K

$261K

Q4 FY16 Q4 FY17 Q4 FY18

$311K

$377K

$479K

Q4 FY16 Q4 FY17 Q4 FY18


STEADY CUSTOMER GROWTH

TOTAL CUSTOMERS (net) G2K & G8K CUSTOMERS (net)

283354

431

163

212

267446

566

698

Q4 FY16 Q4 FY17 Q4 FY18

G2K N6K

799

1,086

1,290

Q4 FY16 Q4 FY17 Q4 FY18

Total Customers


UNIT ECONOMICS


CASH BURN IS DRIVEN BY NEW CUSTOMER ACQUISITION

● Existing customers generate

strong cash flow

● Acquiring target profile

customers drives future

expansion and cash

generation

-$100M

$0M

$100M

$200M

$300M

SubscriptionRevenue

S&M OCF

New Customers Existing Customers

FY18 NEW vs. EXISTING CUSTOMER ECONOMICS

Note: FY18 estimates based on allocated and directly identified expenses


STRONG EXPANSION RATES & SALES EFFICIENCIES DRIVE LTV

AVERAGE ARR VS. S&M BY PHASE

● Margin growth is a function

of customer size, not time

● Rapid expansion drives

ARR up at a much faster

rate than sales expense

CAC

ARR

S&M

$0M

$1M

$2M

$3M

New Phase 2($0K -$100K)

Phase 3($100K -$500K)

Phase 4($500K -

$1M)

Phase 5($1M+)


LIFETIME VALUE OF A TYPICAL & “2X” CUSTOMER

ANNUAL ARR ($M)

● Each year, approximately

one of six customers

double in size

● Resulting in >60 customers

over $1M ARR

$0M

$1M

$2M

$3M

$4M

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8

Typical 2x


2X CUSTOMERDELIVERS HIGH LIFETIME VALUE

Profile:

● CAC of ~$250K

● Initial ARR of $71K

● Gross Expansion Rate of

200% for first 5 years,

then 150%

● 10 year LTV of $19M

VALUE OF A 2X CUSTOMER – ANNUAL ARR ($M)

CAC

Rev-S&M

Revenue

S&M

$0M

$1M

$2M

$3M

$4M

CAC Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8


A REPRESENTATIVE “2X” CUSTOMER

• Started mid-FY15 ~$75K per year

• $3M+ ARR in less than 3 years

• CGR of >200%

$0.0M

$1.0M

$2.0M

$3.0M

$4.0M

FY15 FY16 FY17 FY18

ANNUALIZED ARR

ML

Cloud

Analytic

DB


A REPRESENTATIVE “2X” CUSTOMER

ARR

S&M

$0.0M

$1.0M

$2.0M

$3.0M

$4.0M

FY15 FY16 FY17 FY18

ANNUALIZED ARR AND S&M COST

ML

Cloud

Analytic

DB

• Started mid-FY15 ~$75K per year

• $3M+ ARR in less than 3 years

• CGR of >200%


FINANCIAL SUMMARY


RAPID SOFTWARE GROWTH DRIVES GROSS MARGIN EXPANSION

• Software subscription

revenue growth

• Benefiting from cloud

deployment

• Machine learning powers

proactive support

60%

69%73%

FY16 FY17 FY18

78%82%

85%

FY16 FY17 FY18

OVERALL SOFTWARE

NON-GAAP GROSS MARGIN TRENDS

Note: Presented on a non-GAAP basis. Please see appendix for a Non-GAAP to

GAAP reconciliation


THE PATH TO POSITIVE CASH FLOW

• Estimated to be OCF

Positive in:

• Q1-FY19

• Q1-FY20

• Full Year FY20

-$120M

-$100M

-$80M

-$60M

-$40M

-$20M

$0M

$20M

FY17 FY18 FY19 FY20

OPERATING CASH FLOW (OCF)


Deferred Revenue

Debt Capital Expenditures

(non-leasehold < 1% revenue)

Cash, Cash Equivalents &

Marketable Securities

STRONG BALANCE SHEET


PROGRESS TOWARD LONG-TERM MODEL

NON-GAAP FY16 FY17 FY18 Long-term model

Subscription Margin

Services Margin

Total Gross Margin

78%

14%

60%

82%

24%

69%

85%

17%

73%

90%+

20%+

82% - 84%

R&D / Revenue

S&M / Revenue

G&A / Revenue

46%

84%

13%

37%

75%

10%

31%

56%

12%

16% - 20%

30% - 34%

5%

Operating Income Margin

Operating Cash Flow Margin

(83%)

(55%)

(54%)

(45%)

(26%)

(12%)

30%

>30%

Note: Presented on a non-GAAP basis. Please see appendix for a Non-GAAP to

GAAP reconciliation


THANK YOU


APPENDIX


GAAP to Non-GAAP Reconciliation (Three Months Ended – Jan 31, 2018)


GAAP to Non-GAAP Reconciliation (Three Months Ended – Jan 31, 2017)


GAAP to Non-GAAP Reconciliation (Twelve Months Ended – Jan 31, 2018)


STEADY CUSTOMER GROWTH

Total Customers (net) G2K / G8K Customers (net)

1,0861,128

1,2051,250

1,290

Q4 FY17 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18

Total Customers

354 363 399411 431

212 232244 255

267566

595643 666

698

Q4 FY17 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18

G2K N6K

investor & financial analyst day...2018/04/12 · •comcast •british telecom •bharti airtel...

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