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NMS Communications Investor Summary. November 2007. Safe Harbor Statement.
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NMS Communications Investor Summary November 2007
Safe Harbor Statement This presentation may contain projections or other forward-looking statements regarding future events or the future financial performance of the company. While these statements represent management’s current judgment on the future direction of the business, actual results may differ materially from any future performance suggested in the company’s forward-looking statements. We refer you to the documents that the company files from time to time with the Securities and Exchange Commission. These documents contain and identify important factors that could cause the actual results to differ materially from those contained in our projections or forward-looking statements.
NMS Communications at a Glance Value Added Services Focus – Developers and Operators Technologies, Platforms and Applications Components Leader in Ringback Tone deployments Global presence with product s deployed in 100+ countries 25 year history of successes and industry “firsts” Slide 3 Slide 3
Investment Summary Communications Platforms $70M Business w/ Gross Margins > 65% & Contribution Margins > 20% Global Customer Base Technology Leadership & VAS Market Growth Drive Demand Mobile Applications Early Stage…$11M business - TTM Revenue Growing 50% Y-o-Y Beginning Shift to Managed Services Model Corporate Total Market capitalization $75M as of October 31st, 2007 Strong Balance Sheet - $28M cash as of September 30th, 2007 Improved financial performance – top line growth - and return to operating profitability (non-GAAP) in Q3 ‘07 Slide 4
Communications Platforms Slide 5
NMS Market Focus • VAS - Enhanced Services/Applications • Technology leader • New application areas emerging • Mobile • Highest growth area for VAS (>ARPU) • Video/Multi-media • Central to next wave of applications + investment • Asia – Global Innovation Leader • Approach: Fast TTM w/New Apps • “Applications Driven” Offerings Landline Broadband Wireless Triple-play Voice SMS Mobile Video Services
MobileTV • VideoSMS • VideoPortal Application Components • VXML servers • Application-specific Gateway Server • Signaling Server • ATCA MRFP platform Servers, App Platforms Services • Mobile Video technology • Media Processors: boards + HMP • Signaling, protocols, global approvals Core Technologies Business Model Service Providers / Enterprises Enabling NEPS and Systems Integrators to deliver Value Added Services quickly and efficiently – 3 ways to win emerging apps NEPs SI’s
Real-World Deployments:Mobile TV: Hong Kong CSL Hong Kong CSL launch Mobile Video TV Built on NMS Vision VxML servers and Golden Dynamic’s VOIR Mobile TV Application Slide 8
Real-World Deployments: VISION VXML Ontario Systems’ Verified Contacts Industry-leading debt collection solution using Vision VoiceXML Server to enhance functionality and performance Rapidly develop and deploy speech-enabled predicative dialer applications for increased right party contacts Slide 9
CP Performance • Market Challenges • Industry Consolidation • China 3G Delays • Low end erosion • Growth Drivers • New Design Wins • Mobile Subscriber & VAS Demand • New Technologies • Continued Strength in Margins Slide 10
Mobile Applications Slide 11
Ringback Tones Market (Source: OVUM) Revenue from Subscribers Western Europe: $846M Asia-Pacific: $776M China/India: $512M North America: $230M Latin America: $93M Middle East/Africa: $63M
MyCaller Subscribers Total Subs Passed: 161M • Active Sub Growth: • since Jan 2007: +97% • Year-over-year: +196%
RBT Revenue Drivers Consumer Subscription + Content Consumer Content Enterprise B-B Advertising $$ Brand B-C Advertising $$
Move to Managed Service Offering Capex (2007) Service (2009) Go-to-market indirect direct Product MyCaller MyCaller+ $/subscriber over 3 years $N 3 – 5x$N # Operators 30 10 Target wins Business Driver technology service success Revenue One-Time/Unpredictable Repeatable/Predictable
RBT market leader 30+ operators; 200M+ subs passed; 10M+ subs personalizing Mobile Place personalization platform Built to drive usage & adoption Network through handset Domain expertise Communications network integration SUCCESS Marketing • Managed Services capability • Storefront & content management • Experienced operations team • Customer proof points • Need to expand at current customers Our Differentiation: Why We’ll Win
Financial Overview Slide 17
Balance Sheet Slide 18
NMS P&L(Non-GAAP*) Q4 ’07 Guidance** • Modest revenue increase in Q4; Mobile Apps revenue remain lumpy • Q4 operating profit about break-even (Non-GAAP); Gross margins likely to be below Q4 levels *Not including impact of stock-based compensation and amortization of acquired intangible assets **Guidance as of October 31st, 2007 Slide 19
NMS Target Business Model(Non-GAAP*) *Not including impact of stock-based compensation and amortization of acquired intangible assets Slide 20
Investment Summary Communications Platforms Highly Profitable… modest growth outlook Mobile Applications Rapid growth… business model shift Corporate Strong Balance Sheet… improving P&L Slide 21