Netgear, Inc. · NASDAQ:NTGR
Netgear — Investor Presentation (October 2005)
19 slides from Netgear's investor presentation, Oct 26, 2005
Slide 1: NETGEAR
Slide 2: Mission Statement
Mission Statement The Preferred Customer-Driven Provider of Innovative Networking Solutions for Small Businesses and Homes
Slide 3: Investment Highlights
Investment Highlights 9Tremendous Market Opportunity For Revenue Growth 9Superior Cost Structure Leads to Sustained Profitability 9Unique R&D Model Results In Innovative Products 9Global Distribution Channel Second to None
Slide 4: Market Opportunity
Market Opportunity Forecast of Broadband Subscribers Worldwide Subscribers in Millions 226 196 A GR C 30 % Cable Modem 165 130 96 DSL 61 Other 2002 2003 2004 2005 2006 2007 Source: Cahners/In-Stat
Slide 5: Market Continues to Grow
Market Continues to Grow Small Business / Home Networking $7.5 ($ in billions) R AG 19 %C $6.5 $5.4 $4.3 $3.7 2002 2003 2004 2005 2006 Source: Cisco Systems, Dell’Oro, Synergy Research.
Slide 6: NETGEAR Annual Revenue Growth
NETGEAR Annual Revenue Growth ($ in millions) $383 AG R %C $299 28 $237 $192 $177 $112 1999 2000 2001 2002 2003 2004
Slide 7: Continuous Revenue Growth
Continuous Revenue Growth ($ in millions) Post-IPO $109 $108 $111 $105 $101 $87 $88 $88 $76 $68 $69 Q1'03 Q2'03 Q3'03 Q4'03 Q1'04 Q2'04 Q3'04 Q4'04 Q1'05 Q2'05 Q3'05
Slide 8: Continue to Leverage Our Volume
Continue to Leverage Our Volume 9 (Hon Hai) added in 2004 9 Increase our quarterly units from To 2.6M 9 Moving more manufacturing to Northern China
Slide 9: End-to-End Inventory Management
End-to-End Inventory Management U.S. EMEA Asia On hand Push/Pull Channel Channel Channel and pipeline Latest Actions to Weekly Sell Thru Weekly Sell Thru Weekly Sell Thru Inventory info demand and suppliers & Inventory & Inventory & Inventory + + + margin forecast Tighter Inventory Means Lower Perio
Slide 10: Expanding Gross Margin
Expanding Gross Margin ($ in millions) Post-IPO 35.9% 35.2% 32.9% 33.0% 32.1% 32.1% 31.1% 29.1% 27.3% 27.7% 27.8% Q1'03 Q2'03 Q3'03 Q4'03 Q1'04 Q2 '04 Q3 '04 Q4'04 Q1'05 Q2'05 Q3'05 Note: Excludes stock-based compensation charges
Slide 11: Expanding Operating Margin
Expanding Operating Margin Post-IPO 12.5% 12.7% 11.4% 11.5% 9.8% 8.9% 8.2% 7.2% 5.3% 5.4% 5.6% Q1'03 Q2'03 Q3'03 Q4'03 Q1'04 Q2' 04 Q3' 04 Q4'04 Q1'05 Q2'05 Q3'05
Slide 12: Rising Earnings Per Share
Rising Earnings Per Share $0.27 $0.25 $0.25 $0.23 $0.20 $0.17 $0.14 $0.14 $0.08 Q3'03 Q4'03 Q1'04 Q2' 04 Q3' 04 Q4'04 Q1'05 Q2'05 Q3'05 On a Non GAAP Basis
Slide 13: Speedy, Leveraged R&D Process
Speedy, Leveraged R&D Process Partner Partner Partner Partner Identify Identify = Recognize Recognize with with Market + + = promising with with key market key market promising world-class world-class networking world-class world-class opportunities networking opportunities technologies technologies
Slide 14: Business – Data, Voice, Security
Business – Data, Voice, Security Small Business LAN 3 New Switches UTMS And 2 modules Hotspots Branch Office & Telecommuters 5 New Products in Q3’05
Slide 15: Home – Data, Voice, Entertainment
Home – Data, Voice, Entertainment Low cost a or g wireless card 3 new carrier Gateways 5 new wireless Storage Central router kits 10 New Products in Q2’05
Slide 16: Continue to Increase our Sales Channels
Continue to Increase our Sales Channels VAR / Catalog / Retail Online Service Reseller DMR Retail Provider Over 29,000 VARs worldwide
Slide 17: Global Distribution Second To None
Global Distribution Second To None 37% 53% 10% More Shelf Space Means Higher Volume
Slide 18: Proven Profitable Business Model
Proven Profitable Business Model
Slide 19: Slide 19