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ofNICE ANALYST ANDINVESTOR DAYINTERACTIONS 2016
Analyst and Investor Program – Tuesday, May 24, 2016TIMECONTENTWelcome – Marty Cohen, VP, Investor RelationsCompany Overview – Barak Eilam, CEO, NICECompany Overview, inContact – Paul Jarman, CEO, inContact11:30 am – 1:15 pmFinancial Crime & Compliance Overview – Joe Friscia, President, NICE ActimizeFinancial Overview – Eran Liron, EVP, Marketing and Corporate Development, NICEQ&A Session – Senior Management1:15 pm – 2:00 pmLunch2:00 pm – 3:00 pmSolutions Tour at the Showcase3:15 pm – 4:00 pmA Peek into the Future of Your Back Office – David Geffen, NICE4:00 pm – 4:45 pmInteraction Analytics Outside the Box Thinking – Fred G. Daum, PSEG Long Island4:45 pm – 5:30 pmA Peek into the Future of Customer Experience – Oded Karev, NICE7:00 pmCustomer Party – Mango’s Tropical Cafe
Forwards Looking Statement DisclaimerThis presentation contains statements, including statements about future plans and expectations, which constitute forward-lookingstatements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward looking statements are generally statedin terms of the Company’s plans, expectations and intentions. These statements are based on the current beliefs, expectations andassumptions of the Company’s management and the current economic environment. Forward looking statements are inherently subject tosignificant economic, competitive and other uncertainties and contingencies, many of which are beyond the control of management. TheCompany cautions that these statements are not guarantees of future performance. There are or will be important known and unknownfactors and uncertainties that could cause actual results to differ materially from those expressed or implied in the forward lookingstatements. These factors, include, but are not limited to, risks associated with the global economic environment on the Company’scustomer base (particularly financial services firms) potentially impacting our business and financial condition; competition; changes intechnology and market requirements; decline in demand for the Company's products; inability to timely develop and introduce newtechnologies, products and applications; difficulties or delays in absorbing and integrating acquired operations, products, technologies andpersonnel; loss of market share; an inability to maintain certain marketing and distribution arrangements; and the effect of newly enacted ormodified laws, regulation or standards on the Company and its products; and other factors and uncertainties discussed in our filings with theU.S. Securities and Exchange Commission (the “SEC”). You are encouraged to carefully review the section entitled “Risk Factors” in ourlatest Annual Report on Form 20-F and in our other relevant filings with the SEC for additional information regarding these and other factorsand uncertainties that could affect our future performance, and undue reliance should not be placed upon these statements. The forwardlooking statements contained in this presentation are made as of the date hereof, and the Company undertakes no obligation to update orrevise them, except as required by law.
ofCOMPANY OVERVIEWBarak Eilam, CEO, NICE
Financial Crime & ComplianceCustomer InteractionsMaking people’sexperiences timely andseamlessProtecting people’s moneyand assets5
WARECOMPANY6
Divestiture of Security divisionsENTERPRISESOFTWARECOMPANYAligned businesses across alldimensions: technologies,customers and marketsEnterprise software businessmodel7
Accelerated MULTICHANNELCUSTOMERSERVICESNICEENGAGETOTAL VOICEOF THECUSTOMEREnhanced go-to-marketAcquired PortfolioIVRJOURNEYANALYTICSNICE ANCEEMPLOYEEENGAGEMENTMANAGERNICEINVESTIGATEREAL TIMEAUTHENTICATIONBACKOFFICESUITE
Robust analytics platformINFUSINGANALYTICSAnalytics across entire portfolioNexidia: analytics with no limits
ScalabilitySpeedANALYTICSwith no limitsDeploymentIntegration10Accuracy
CLOUDIFYINGNICE
Customer Service is in constant ‘catch up’ modeEmpowered customerNew employee Highly knowledgeable In control and has power Many choices High expectations Wants to be engaged Expects personalization Transparency Adaptive environmentCommunicationChannels12
The continuously evolving Contact opGuidanceVoice Ofthe astructureTelephonyNetworkServersACDIVRDialerWeb
The continuously evolving Contact Center Siloed purchases, separate vendors Compromise:Powerful point-solution VS.Limited suite offerings The de facto system integrator ofthe industry Legacy purchase model: Always buy for max capacity Upfront investment Long-term commitment
The continuously evolving Contact CenterIt’s time to stop catching-upand get ahead of the curve!
A new VISION for customer serviceWFOANALYTICSOmni-Channel CC The market’s most complete omni-channel CC in the cloud Powered by the most comprehensive WFO portfolioFrom theContact Center to the Infused by advanced analytics Seamlessly integratedExperience Center Fully cloud- easy to implement, low TCO, highly scalableand ELASTIC
2 by 2 by 2OpportunityIncreases forNICE TotalAddressableMarket2x2x28double portfoliodouble market segmentsdouble customer lifetime valueTAM increases 6x to 8x: 15 billion opportunity
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inContact OverviewApril 2016
More than a 15B OpportunityNorth America Contact Center Agents2016 Forecast“CCaaS will support 12.6% of NorthAmerica contact center agents byCCaaS in 2016”Worldwide Contact CenterMarket OpportunityEstimated TAM: 15 billionCloud ContactCenter Agents13%Estimated Concurrent Seats: 10.5 millionClicktoeditMastertitleClick to edit Master titleClick to edit textClick to edit textSource: Gartner2016 North American installed based 6.2 million agents20
Customer Experience TransformationConsumers have heightened expectationsClicktoeditMastertitleClick to edit Master titleCustomer interactions are more complexClick to edit textClick to edit textCompanies must take a strategic view of theconsumer to stay competitive21
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Integrated Contact Center EcosystemCustomer Relationship Management (CRM): e.g. Siebel, SalesForce, ZendeskData RepositoryClicktoeditMastertitleClick to edit Master titleCustomer Interaction ManagementSoftwareWorkforce Optimization and AnalyticsSoftwareVoice-as-a-ServiceClick to edit text UNIFIED COMMUNICATIONS: e.g. Avaya, RingCentral, 8x8, Cisco, VonageClick to edit textPBX23
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Broadest Channel in Cloud Contact Center MarketIncreasing our coverage and routes to ditMastertitleClick to edit Master titleA GlobalCommunicationsProviderClick to edit textClick to edit text25VARSOthers
Enterprise TractionoOver 90 customers billing over 500KoOver 20 customers billing over 1MoOver 4 customers billing over 2MClicktoeditMastertitleClick to edit Master titleClick to edit textClick to edit text26oCurrent pipelinesupports increasesin all segments: Enterprise Midmarket BPOs Government
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Summaryo The cloud leader in a large and growing 15 billion marketo Highly-differentiated offering, delivering unique value to customerso Diverse, highly loyal and expanding customer baseo Multiple growth vectors with new and existing customers and profile with strong growth in recurring SaaS RevenueClick to edit Master titleand significant operating leverageo Seasoned management team with deep industry expertiseClick to edit textClick to edit text28
FINANCIALCRIME &COMPLIANCEofJoe Friscia, President, NICE Actimize
The headlinesOffshore Accounts SpotlightWill Only Heighten AMLCompliance Issues2 charged with StockMarket ManipulationHuman Trafficking RiskIndex Provides SupplyChain TransparencySPEAK FORTHEMSELVESMossack Fonseca: insidethe firm that helps Thesuper-rich hide their moneyBanks Wrestle WithIran Sanctions Move
CURRENTMARKETDRIVERSNew RegulationsNew Fraud SchemesAdoption of CloudRising People CostsThe Emergence of FinTech31
MARKET OPPORTUNITYIT Spend on Financial Crime & ComplianceThe Price ofFinancial Crime 2.1 trillion to theWorld EconomyTotal AddressableMarket 1.2bMaintained Market Leadership in 201515 New Logos 20 % of TAM
WE STOPBAD PEOPLEFROM DOINGBAD THINGSBY FINDING UNUSUALBEHAVIOR EARLIER ANDFASTER THAN OURCOMPETITION
HOW WE DO ITAMLFRAUDFMC
STRATEGIC AREASOF FOCUS TO GROWTHE BUSINESSNew ProductsBased on HorizontalTechnologiesDown MarketExpansion35Partners &Channels
STRATEGIC AREAS OF FOCUS TO GROW THE BUSINESSNEW PRODUCTS BASED ONHORIZONTAL TECHNOLOGIESAMLReporting Pack & DashboardsInvestigation ManagementFRAUDNotifications & AttestationsAuthentication IQFMCBig Data Advanced AnalyticsBI/VisualizationHolistic Surveillance
STRATEGIC AREAS OF FOCUS TO GROW THE BUSINESSDOWN MARKET EXPANSIONVIA THE CLOUDAML EssentialsCross-Asset CloudFraud Essentials (coming)Expands Addressable Market to 1.6b
STRATEGIC AREAS OF FOCUS TO GROW THE BUSINESSPARTNERS & CHANNELSBusiness Partners/Sell With Competitive intelligence Lead generationCross-Sell w Customer Interactions Holistic Surveillance Work item managementBusiness Partners/Sell Through Geographies expansion New marketsopportunitiesDelivery Partners License extensions Competitive alternatives
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ofFINANCIALOVERVIEWEran Liron, EVP Marketing & CorporateDevelopment, NICE
Q1 2016 HighlightsRevenue of 226 million, 4.3% growthGross margin increased to 70.6% compared to 69.8% last yearOperating margin of 25.6% compared to 23.3% last yearEPS of 0.81, 17.4% increase year-over-yearOperating cash flow a record of 113 million compared to 104 million last yearNexidia Acquisition closed at the end of Q1 2016* All numbers, except cash flow, are Non-GAAP** All Q1 2015 comparable numbers exclude divestituresAnalyst and Investor Day
Revenue Trends ( M, Non-GAAP)Guidance 995- 1015* 8232013 927 873201420152016** 2016 revenue guidance as provided on May 5, 2016** All numbers exclude divestitures42Analyst and Investor Day
Improving Profitability While Maintaining Growth - Gross 82082380078060.0%76020132014Gross Margin* All numbers exclude divestitures2015Revenue43Analyst and Investor Day
Improving Profitability While Maintaining GrowthOperating 820823210bp50bp80078015.0%7602013Operating Margin2014Revenue* All numbers exclude divestitures2015Decrease in OPEX as % of Revenue44Analyst and Investor Day
Business Model:Strong Base ofRecurring Revenue(Full-Year 2015)RecurringRevenueProductRevenue 35% 45% 20%ProfessionalServicesRevenue* All numbers exclude divestitures45Analyst and Investor Day
Business Model:Illustrated SnapshotIncluding Acquisitions(Full-Year 2015)RecurringRevenue 55% 45%Non-RecurringRevenue* All numbers exclude divestitures46Analyst and Investor Day
Seasonality27426024%24325%25%190195195Q1 13Q2 13Q3 13208208Q2 14Q3 14217216Q1 15Q2 15221198Q4 13Q1 14* All numbers exclude divestitures47Q4 14Q3 15Q4 15Analyst and Investor Day
58%Analytics54%44%Q1 13(% of New Bookings)47%Q1 14Q1 15* All numbers exclude divestituresQ1 1648
Strong Operating Cash Flow 270 182 1552013*20142015***Excludes one-time cash payment and release of “trapped profit” of 30.9 million in Q3 2013** Excludes proceeds from divestitures and one-time tax payment on capital gain related to the divestitures*** Cash Flow includes divestitures49
inContact AcquisitionDeal Size 14 per share, total 940 millionAccretionTo Non-GAAP EPS by the end of 2017FinancingCash, plus debt up to 475 millionClosingBy the end of 2016 subject to regulatory approvals andinContact shareholder vote50
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Desktop Guidance Voice Of the Customer Customer Journey Telephony Network Servers ACD IVR Dialer Web . . RingCentral, 8x8, Cisco, Vonage PBX . Click to edit Master title Click to edit text Click to edit Master title Click to edit text 24 . Click to edit Master title Click to edit text
