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Gigamon (GIMO) Investor Overview
As of January 29, 2015
2Ā©2015 Gigamon Inc. All rights reserved.
Safe Harbor Statement
Any forward-looking indication of plans for products is preliminary and all future release dates are tentative and subject to change.
Any future release of products or planned modifications to product capability, functionality, or features are subject to ongoing evaluation by Gigamon, and may or may not
be implemented and should not be considered firm commitments by Gigamon and should not be relied upon in making purchasing decisions.
This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of
1934. Forward-looking statements generally relate to future events or our future financial or operating performance. In some cases, you can identify forward-looking
statements because they contain words such as "may," "will," "should," "expects," "plans," "anticipates," "could," "intends," "target," "projects," "contemplates," "believes,"
"estimates," "predicts," "potential" or "continue" or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans or
intentions. Forward-looking statements in this presentation include, but are not limited to, our expectations that the market for our products will continue to grow and
develop; and our expectations regarding product developments and enhancements and adoption of those products by our customers. Our expectations and beliefs
regarding these matters may not materialize, and actual results in future periods are subject to risks and uncertainties that could cause actual results to differ materially from
those projected. These risks include our ability to continue to deliver and improve our products and successfully develop new products; customer acceptance and purchase
of our existing products and new products; our ability to retain existing customers and generate new customers; the market for network traffic visibility solutions not
continuing to develop; competition from other products and services; and general market, political, economic and business conditions.
The forward-looking statements contained in this presentation are also subject to other risks and uncertainties, including those more fully described in our filings with the
Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended December 28, 2013 and our Quarterly Report on Form 10-Q for the
most recent quarterly period. The forward-looking statements in this presentation are based on information available to Gigamon as of the date hereof, and Gigamon
disclaims any obligation to update any forward-looking statements, except as required by law.
This presentation includes certain non-GAAP financial measures as defined by the SEC. As required by Regulation G, we have provided a reconciliation of those measures
to the most directly comparable GAAP measures, which is available in the appendix.
3Ā©2015 Gigamon Inc. All rights reserved.
ā€¢ Enabling disruptive network change
ā€¢ Broad software-centric solution
ā€¢ Industry leading capabilities
ā€¢ Large underpenetrated market
ā€¢ Compelling business model
Investment Highlights
$46
$68
$97
$140
$157
2010 2011 2012 2013 20142010 2011 2012 2013 2014
Revenue
($ Millions)
4Ā©2015 Gigamon Inc. All rights reserved.
Powerful Market Drivers in IT
Visible traffic
Agile networks
Improved ROI
Centralized management
Reduced complexity
5Ā©2015 Gigamon Inc. All rights reserved.
Third Party Applications,
SDN Controller Integration, etcā€¦
Applications & Tools Infrastructure,
User Community
* APIs, GigaVUE-OS on white box subject to future availability
Unified Visibility Fabricā„¢
Traffic
Intelligence
Visibility
Fabric Nodes
(Pervasive visibility across
physical, virtual, remote
sites, and future SDN
production networks)
Fabric
Services Flow MappingĀ®
Fabric Control
(Management)
Applications
Inline Bypass
GigaVUE-HD8 GigaVUE-HD4 GigaVUE-HB1
GigaVUE-HC2
HSeries
TASeries
GigaVUE-TA1
GigaVUE-OS
on white box*
VirtualVisibility
GigaVUE-VM
TAPs
G-TAP
G-TAP A Series
G-TAP BiDi
Embedded TAPs
GSeries
GigaVUE-2404
GigaVUE-420
G-SECURE-0216
De-duplication
Packet Slicing
FlowVUEā„¢
Masking
GTP Correlation
Header Stripping
NetFlow Generation
Tunneling
SSL Decryption
Adaptive Packet Filtering
GigaVUE-FM
Clustering
API
API
API
API
API
6Ā©2015 Gigamon Inc. All rights reserved.
AS OF Q4 2014
Enterprise
A broad spectrum of brand-name customers
Gigamon Customers Today
TECHNOLOGY INDUSTRIAL RETAIL
FINANCE HEALTHCARE & INSURANCE GOVERNMENT
50 of the Top 100 Global SPs
Service Providers
1600+ End Customers 65+ of the Fortune-100
7Ā©2015 Gigamon Inc. All rights reserved.
58X as of Q4 2014 - Top 25 Gigamon customers at the time of IPO (June 2013)
Seed and Grow
2006 2007 2008 2009 2010 2011 2012 2013 2014
Top 25 Customers Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
1 Service Provider
2 Enterprise
3 Service Provider
4 Enterprise
5 Enterprise
6 Service Provider
7 Service Provider
8 Service Provider
9 Enterprise
10 Service Provider
11 Service Provider
12 Enterprise
13 Enterprise
14 Enterprise
15 Enterprise
16 Service Provider
17 Service Provider
18 Service Provider
19 Enterprise
20 Enterprise
21 Enterprise
22 Enterprise
23 Service Provider
24 Enterprise
25 Service Provider
= Initial purchase
8Ā©2015 Gigamon Inc. All rights reserved.
Our Market and TAM: Into the Future
Visibility Fabricā„¢
$2-3bn
The Network
Upgrade Cycle
3G ļƒ  4G
LTE / VoLTE
Applications Designed
for the Cloud
Internet
of Things
9Ā©2015 Gigamon Inc. All rights reserved.
Growth Enablers
The power of our
SOLUTION
The strength of our
POSITION
Our unrealized
POTENTIAL
The market
DEMAND
The VALUE
we deliver$
Financial Overview
11Ā©2015 Gigamon Inc. All rights reserved.
Compelling Financial Performance
$16
$19
$24
$18
$23
$29
$32
$20
$23
$26
$37
$6
$7
$8
$8
$9
$10
$11
$12
$12
$13
$14
2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14
= Product = Service
Quarterly Revenue
($ Millions)
Geography (% revenue)
End-Customer Vertical (% bookings)
APACā€¦
EMEA
17%
AMERICAS
78%
SERVICEā€¦
GOVERNMEā€¦
ENTERPRISE
73%
12Ā©2015 Gigamon Inc. All rights reserved.
14% 15% 16%
2%
15%
23%
20%
-10%
-5%
5%
17%
2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14
Note: See appendix for reconciliation of non-GAAP operating expenses and non-GAAP operating margin.
Investing for Profitable Growth
Non-GAAP Operating Expenses
($ Millions)
$4 $4 $5 $5 $6 $6 $8 $8 $9 $9 $9
$9
$9
$12 $12
$13 $13
$15 $15
$17 $17 $18
$2
$3
$3 $3
$3 $3
$3 $4
$3 $3
$3
2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14
R&D S&M G&A
Non-GAAP Operating Margin
13Ā©2015 Gigamon Inc. All rights reserved.
Long-Term Target Model (Non-GAAP)
2013 2014 Q4ā€™14 Target Model
Gross Margin 81% 77% 77% 75 ā€“ 77%
R&D 18% 22% 17% 15 ā€“ 16%
S&M 38% 43% 36% 29 ā€“ 31%
G&A 9% 9% 7% 5%
Operating Margin 16% 4% 17% 23 ā€“ 28%
Thank You
15Ā©2015 Gigamon Inc. All rights reserved.
Non-GAAP Reconciliation Q212 - 2013 ($ Millions)
Q2ā€™12 Q3ā€™12 Q4ā€™12 Q1ā€™13 Q2ā€™13 Q3ā€™13 Q4ā€™13 2013
Revenue $22.5 $25.7 $31.9 $25.8 $ 32.4 $39.0 $43.1 $140.3
GAAP gross profit $17.9 $20.6 $25.0 $20.4 $ 23.6 $31.2 $34.3 $109.5
Share-based compensation expense and related taxes 0.0 0.1 0.0 0.0 3.0 0.3 0.4 3.8
Non-GAAP gross profit $17.9 $20.7 $25.1 $20.5 $ 26.6 $31.5 $34.7 $113.3
% non-GAAP gross margin 80% 81% 79% 79% 82% 81% 81% 81%
GAAP research and development $ 3.6 $ 4.8 $ 5.4 $ 5.7 $ 17.1 $ 9.0 $10.3 $ 42.1
Share-based compensation expense and related taxes (0.0) (0.3) (0.2) (0.3) (11.3) (2.5) (2.6) (16.7)
Non-GAAP research and development $ 3.5 $ 4.5 $ 5.2 $ 5.4 $ 5.8 $ 6.5 $ 7.7 $ 25.4
GAAP sales and marketing $ 9.1 $10.0 $12.1 $12.4 $ 26.1 $15.5 $18.0 $ 72.0
Share-based compensation expense and related taxes (0.1) (0.5) (0.3) (0.4) (13.3) (2.7) (2.6) (19.0)
Non-GAAP sales and marketing $ 9.0 $ 9.5 $11.7 $12.0 $ 12.9 $12.7 $15.4 $ 53.0
GAAP general and administrative $ 2.7 $ 3.7 $ 3.9 $ 3.5 $ 12.7 $ 4.7 $ 4.7 $ 25.6
Share-based compensation expense and related taxes (0.5) (0.8) (0.7) (0.8) (9.5) (1.5) (1.5) (13.4)
Non-GAAP general and administrative $ 2.2 $ 3.0 $ 3.2 $ 2.7 $ 3.2 $ 3.2 $ 3.2 $ 12.2
GAAP operating income (loss) $ 2.5 $ 2.1 $ 3.7 $ (1.2) $(32.3) $ 2.1 $ 1.2 $ (30.2)
Share-based compensation expense and related taxes (0.6) (1.7) (1.3) (1.6) (37.1) (7.1) (7.2) (52.9)
Non-GAAP operating income (loss) $ 3.1 $ 3.8 $ 4.9 $ 0.4 $ 4.7 $ 9.1 $ 8.4 $ 22.7
% non-GAAP operating margin 14% 15% 16% 2% 15% 23% 20% 16%
16Ā©2015 Gigamon Inc. All rights reserved.
Non-GAAP Reconciliation 2014 ($ Millions)
Q1ā€™14 Q2ā€™14 Q3ā€™14 Q4ā€™14 2014
Revenue $ 31.8 $34.9 $39.3 $51.3 $157.1
GAAP gross profit $ 23.2 $27.0 $30.3 $39.2 $119.7
Share-based compensation expense and related taxes 0.5 0.5 0.4 0.3 1.7
Non-GAAP gross profit $ 23.7 $27.5 $30.7 $39.5 $121.4
% non-GAAP gross margin 75% 79% 78% 77% 77%
GAAP research and development $ 10.9 $10.9 $10.1 $10.9 $ 42.8
Share-based compensation expense and related taxes (3.0) (2.1) (1.3) (2.2) (8.5)
Non-GAAP research and development $ 7.9 $ 8.8 $ 8.8 $ 8.7 $ 34.3
GAAP sales and marketing $ 18.2 $19.6 $17.9 $20.4 $ 76.1
Share-based compensation expense and related taxes (3.0) (2.4) (1.1) (1.9) (8.4)
Non-GAAP sales and marketing $ 15.2 $17.2 $16.9 $18.5 $ 67.6
GAAP general and administrative $ 6.0 $ 4.4 $ 5.2 $ 5.0 $ 20.7
Share-based compensation expense and related taxes (2.1) (1.1) (2.0) (1.6) (6.8)
Non-GAAP general and administrative $ 3.9 $ 3.4 $ 3.3 $ 3.4 $ 13.9
GAAP operating income (loss) $(11.9) $ (7.8) $ (3.0) $ 2.9 $ (19.9)
Share-based compensation expense and related taxes (8.6) (6.0) (4.8) (6.0) (25.5)
Non-GAAP operating income (loss) $ (3.3) $ (1.8) $ 1.8 $ 8.9 $ 5.6
% non-GAAP operating margin -10% -5% 5% 17% 4%
17Ā©2015 Gigamon Inc. All rights reserved.
Gap in Data Volume and Relevancy
Big Data
% of Data
Consumable
by Tools
Broad & General ļƒ  Focused & Specific
Tools
Infrastructure
1Gb ļƒ  10Gb ļƒ  40Gb ļƒ  100Gb
Network &
Applications
Infrastructure
$
$
$
18Ā©2015 Gigamon Inc. All rights reserved.
Why Our Customers Buy a Visibility Fabricā„¢
Global Petrochemical Company
Without
GIMO
With
GIMO Saving
Management probes 25 8
Total cost $6.2M $3.0M 52%
GIMO percentage of deal 33%
One of the Nationā€™s Largest Electric Utility Providers
Without
GIMO
With
GIMO Saving
Management probes 39 21
Total cost $7.1M $5.1M 29%
GIMO percentage of deal 24%
19Ā©2015 Gigamon Inc. All rights reserved.
Production Network
Network
Management
Application
Performance
Security
ToolsGigamon Visibility Fabricā„¢ Solution
Private Cloud
SDN
Sources: 1 IDC 2015 market projections. 2 IDC 2015 market projections (Firewall; IPS; IDS; UTM)
The Agnostic Solution
$3.3bn(*1)
$3.1bn(*1)
$1.8bn(*2)
$8.1B tool market
adjacency
Conservative 25%
capture of wallet
Incremental to TAM
calculation:
ā€¢ Recording
ā€¢ Analytics
ā€¢ Inline Security
Incremental to TAM
calculation:
ā€¢ Network TAPs
ā€¢ Virtual TAPs
ā€¢ Software licenses
Deployed 10Gb &
40Gb ports
Number of SPAN &
Mirror ports
Ingress ports into
Visibility Fabric
Visibility Fabric
port premium
20Ā©2015 Gigamon Inc. All rights reserved.
The Competitive Landscape
Intelligence
Control
Scale
SolutionValue
Traditional TAP &
Aggregation
Approach
Traditional
Switch
Approach
Visibility
Fabricā„¢
Approach
Nexus Data
Broker (NDB)

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Gigamon 1Q15 Investor Relations Presentation

  • 1. Gigamon (GIMO) Investor Overview As of January 29, 2015
  • 2. 2Ā©2015 Gigamon Inc. All rights reserved. Safe Harbor Statement Any forward-looking indication of plans for products is preliminary and all future release dates are tentative and subject to change. Any future release of products or planned modifications to product capability, functionality, or features are subject to ongoing evaluation by Gigamon, and may or may not be implemented and should not be considered firm commitments by Gigamon and should not be relied upon in making purchasing decisions. This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements generally relate to future events or our future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as "may," "will," "should," "expects," "plans," "anticipates," "could," "intends," "target," "projects," "contemplates," "believes," "estimates," "predicts," "potential" or "continue" or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans or intentions. Forward-looking statements in this presentation include, but are not limited to, our expectations that the market for our products will continue to grow and develop; and our expectations regarding product developments and enhancements and adoption of those products by our customers. Our expectations and beliefs regarding these matters may not materialize, and actual results in future periods are subject to risks and uncertainties that could cause actual results to differ materially from those projected. These risks include our ability to continue to deliver and improve our products and successfully develop new products; customer acceptance and purchase of our existing products and new products; our ability to retain existing customers and generate new customers; the market for network traffic visibility solutions not continuing to develop; competition from other products and services; and general market, political, economic and business conditions. The forward-looking statements contained in this presentation are also subject to other risks and uncertainties, including those more fully described in our filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended December 28, 2013 and our Quarterly Report on Form 10-Q for the most recent quarterly period. The forward-looking statements in this presentation are based on information available to Gigamon as of the date hereof, and Gigamon disclaims any obligation to update any forward-looking statements, except as required by law. This presentation includes certain non-GAAP financial measures as defined by the SEC. As required by Regulation G, we have provided a reconciliation of those measures to the most directly comparable GAAP measures, which is available in the appendix.
  • 3. 3Ā©2015 Gigamon Inc. All rights reserved. ā€¢ Enabling disruptive network change ā€¢ Broad software-centric solution ā€¢ Industry leading capabilities ā€¢ Large underpenetrated market ā€¢ Compelling business model Investment Highlights $46 $68 $97 $140 $157 2010 2011 2012 2013 20142010 2011 2012 2013 2014 Revenue ($ Millions)
  • 4. 4Ā©2015 Gigamon Inc. All rights reserved. Powerful Market Drivers in IT Visible traffic Agile networks Improved ROI Centralized management Reduced complexity
  • 5. 5Ā©2015 Gigamon Inc. All rights reserved. Third Party Applications, SDN Controller Integration, etcā€¦ Applications & Tools Infrastructure, User Community * APIs, GigaVUE-OS on white box subject to future availability Unified Visibility Fabricā„¢ Traffic Intelligence Visibility Fabric Nodes (Pervasive visibility across physical, virtual, remote sites, and future SDN production networks) Fabric Services Flow MappingĀ® Fabric Control (Management) Applications Inline Bypass GigaVUE-HD8 GigaVUE-HD4 GigaVUE-HB1 GigaVUE-HC2 HSeries TASeries GigaVUE-TA1 GigaVUE-OS on white box* VirtualVisibility GigaVUE-VM TAPs G-TAP G-TAP A Series G-TAP BiDi Embedded TAPs GSeries GigaVUE-2404 GigaVUE-420 G-SECURE-0216 De-duplication Packet Slicing FlowVUEā„¢ Masking GTP Correlation Header Stripping NetFlow Generation Tunneling SSL Decryption Adaptive Packet Filtering GigaVUE-FM Clustering API API API API API
  • 6. 6Ā©2015 Gigamon Inc. All rights reserved. AS OF Q4 2014 Enterprise A broad spectrum of brand-name customers Gigamon Customers Today TECHNOLOGY INDUSTRIAL RETAIL FINANCE HEALTHCARE & INSURANCE GOVERNMENT 50 of the Top 100 Global SPs Service Providers 1600+ End Customers 65+ of the Fortune-100
  • 7. 7Ā©2015 Gigamon Inc. All rights reserved. 58X as of Q4 2014 - Top 25 Gigamon customers at the time of IPO (June 2013) Seed and Grow 2006 2007 2008 2009 2010 2011 2012 2013 2014 Top 25 Customers Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 1 Service Provider 2 Enterprise 3 Service Provider 4 Enterprise 5 Enterprise 6 Service Provider 7 Service Provider 8 Service Provider 9 Enterprise 10 Service Provider 11 Service Provider 12 Enterprise 13 Enterprise 14 Enterprise 15 Enterprise 16 Service Provider 17 Service Provider 18 Service Provider 19 Enterprise 20 Enterprise 21 Enterprise 22 Enterprise 23 Service Provider 24 Enterprise 25 Service Provider = Initial purchase
  • 8. 8Ā©2015 Gigamon Inc. All rights reserved. Our Market and TAM: Into the Future Visibility Fabricā„¢ $2-3bn The Network Upgrade Cycle 3G ļƒ  4G LTE / VoLTE Applications Designed for the Cloud Internet of Things
  • 9. 9Ā©2015 Gigamon Inc. All rights reserved. Growth Enablers The power of our SOLUTION The strength of our POSITION Our unrealized POTENTIAL The market DEMAND The VALUE we deliver$
  • 11. 11Ā©2015 Gigamon Inc. All rights reserved. Compelling Financial Performance $16 $19 $24 $18 $23 $29 $32 $20 $23 $26 $37 $6 $7 $8 $8 $9 $10 $11 $12 $12 $13 $14 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 = Product = Service Quarterly Revenue ($ Millions) Geography (% revenue) End-Customer Vertical (% bookings) APACā€¦ EMEA 17% AMERICAS 78% SERVICEā€¦ GOVERNMEā€¦ ENTERPRISE 73%
  • 12. 12Ā©2015 Gigamon Inc. All rights reserved. 14% 15% 16% 2% 15% 23% 20% -10% -5% 5% 17% 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 Note: See appendix for reconciliation of non-GAAP operating expenses and non-GAAP operating margin. Investing for Profitable Growth Non-GAAP Operating Expenses ($ Millions) $4 $4 $5 $5 $6 $6 $8 $8 $9 $9 $9 $9 $9 $12 $12 $13 $13 $15 $15 $17 $17 $18 $2 $3 $3 $3 $3 $3 $3 $4 $3 $3 $3 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 R&D S&M G&A Non-GAAP Operating Margin
  • 13. 13Ā©2015 Gigamon Inc. All rights reserved. Long-Term Target Model (Non-GAAP) 2013 2014 Q4ā€™14 Target Model Gross Margin 81% 77% 77% 75 ā€“ 77% R&D 18% 22% 17% 15 ā€“ 16% S&M 38% 43% 36% 29 ā€“ 31% G&A 9% 9% 7% 5% Operating Margin 16% 4% 17% 23 ā€“ 28%
  • 15. 15Ā©2015 Gigamon Inc. All rights reserved. Non-GAAP Reconciliation Q212 - 2013 ($ Millions) Q2ā€™12 Q3ā€™12 Q4ā€™12 Q1ā€™13 Q2ā€™13 Q3ā€™13 Q4ā€™13 2013 Revenue $22.5 $25.7 $31.9 $25.8 $ 32.4 $39.0 $43.1 $140.3 GAAP gross profit $17.9 $20.6 $25.0 $20.4 $ 23.6 $31.2 $34.3 $109.5 Share-based compensation expense and related taxes 0.0 0.1 0.0 0.0 3.0 0.3 0.4 3.8 Non-GAAP gross profit $17.9 $20.7 $25.1 $20.5 $ 26.6 $31.5 $34.7 $113.3 % non-GAAP gross margin 80% 81% 79% 79% 82% 81% 81% 81% GAAP research and development $ 3.6 $ 4.8 $ 5.4 $ 5.7 $ 17.1 $ 9.0 $10.3 $ 42.1 Share-based compensation expense and related taxes (0.0) (0.3) (0.2) (0.3) (11.3) (2.5) (2.6) (16.7) Non-GAAP research and development $ 3.5 $ 4.5 $ 5.2 $ 5.4 $ 5.8 $ 6.5 $ 7.7 $ 25.4 GAAP sales and marketing $ 9.1 $10.0 $12.1 $12.4 $ 26.1 $15.5 $18.0 $ 72.0 Share-based compensation expense and related taxes (0.1) (0.5) (0.3) (0.4) (13.3) (2.7) (2.6) (19.0) Non-GAAP sales and marketing $ 9.0 $ 9.5 $11.7 $12.0 $ 12.9 $12.7 $15.4 $ 53.0 GAAP general and administrative $ 2.7 $ 3.7 $ 3.9 $ 3.5 $ 12.7 $ 4.7 $ 4.7 $ 25.6 Share-based compensation expense and related taxes (0.5) (0.8) (0.7) (0.8) (9.5) (1.5) (1.5) (13.4) Non-GAAP general and administrative $ 2.2 $ 3.0 $ 3.2 $ 2.7 $ 3.2 $ 3.2 $ 3.2 $ 12.2 GAAP operating income (loss) $ 2.5 $ 2.1 $ 3.7 $ (1.2) $(32.3) $ 2.1 $ 1.2 $ (30.2) Share-based compensation expense and related taxes (0.6) (1.7) (1.3) (1.6) (37.1) (7.1) (7.2) (52.9) Non-GAAP operating income (loss) $ 3.1 $ 3.8 $ 4.9 $ 0.4 $ 4.7 $ 9.1 $ 8.4 $ 22.7 % non-GAAP operating margin 14% 15% 16% 2% 15% 23% 20% 16%
  • 16. 16Ā©2015 Gigamon Inc. All rights reserved. Non-GAAP Reconciliation 2014 ($ Millions) Q1ā€™14 Q2ā€™14 Q3ā€™14 Q4ā€™14 2014 Revenue $ 31.8 $34.9 $39.3 $51.3 $157.1 GAAP gross profit $ 23.2 $27.0 $30.3 $39.2 $119.7 Share-based compensation expense and related taxes 0.5 0.5 0.4 0.3 1.7 Non-GAAP gross profit $ 23.7 $27.5 $30.7 $39.5 $121.4 % non-GAAP gross margin 75% 79% 78% 77% 77% GAAP research and development $ 10.9 $10.9 $10.1 $10.9 $ 42.8 Share-based compensation expense and related taxes (3.0) (2.1) (1.3) (2.2) (8.5) Non-GAAP research and development $ 7.9 $ 8.8 $ 8.8 $ 8.7 $ 34.3 GAAP sales and marketing $ 18.2 $19.6 $17.9 $20.4 $ 76.1 Share-based compensation expense and related taxes (3.0) (2.4) (1.1) (1.9) (8.4) Non-GAAP sales and marketing $ 15.2 $17.2 $16.9 $18.5 $ 67.6 GAAP general and administrative $ 6.0 $ 4.4 $ 5.2 $ 5.0 $ 20.7 Share-based compensation expense and related taxes (2.1) (1.1) (2.0) (1.6) (6.8) Non-GAAP general and administrative $ 3.9 $ 3.4 $ 3.3 $ 3.4 $ 13.9 GAAP operating income (loss) $(11.9) $ (7.8) $ (3.0) $ 2.9 $ (19.9) Share-based compensation expense and related taxes (8.6) (6.0) (4.8) (6.0) (25.5) Non-GAAP operating income (loss) $ (3.3) $ (1.8) $ 1.8 $ 8.9 $ 5.6 % non-GAAP operating margin -10% -5% 5% 17% 4%
  • 17. 17Ā©2015 Gigamon Inc. All rights reserved. Gap in Data Volume and Relevancy Big Data % of Data Consumable by Tools Broad & General ļƒ  Focused & Specific Tools Infrastructure 1Gb ļƒ  10Gb ļƒ  40Gb ļƒ  100Gb Network & Applications Infrastructure $ $ $
  • 18. 18Ā©2015 Gigamon Inc. All rights reserved. Why Our Customers Buy a Visibility Fabricā„¢ Global Petrochemical Company Without GIMO With GIMO Saving Management probes 25 8 Total cost $6.2M $3.0M 52% GIMO percentage of deal 33% One of the Nationā€™s Largest Electric Utility Providers Without GIMO With GIMO Saving Management probes 39 21 Total cost $7.1M $5.1M 29% GIMO percentage of deal 24%
  • 19. 19Ā©2015 Gigamon Inc. All rights reserved. Production Network Network Management Application Performance Security ToolsGigamon Visibility Fabricā„¢ Solution Private Cloud SDN Sources: 1 IDC 2015 market projections. 2 IDC 2015 market projections (Firewall; IPS; IDS; UTM) The Agnostic Solution $3.3bn(*1) $3.1bn(*1) $1.8bn(*2) $8.1B tool market adjacency Conservative 25% capture of wallet Incremental to TAM calculation: ā€¢ Recording ā€¢ Analytics ā€¢ Inline Security Incremental to TAM calculation: ā€¢ Network TAPs ā€¢ Virtual TAPs ā€¢ Software licenses Deployed 10Gb & 40Gb ports Number of SPAN & Mirror ports Ingress ports into Visibility Fabric Visibility Fabric port premium
  • 20. 20Ā©2015 Gigamon Inc. All rights reserved. The Competitive Landscape Intelligence Control Scale SolutionValue Traditional TAP & Aggregation Approach Traditional Switch Approach Visibility Fabricā„¢ Approach Nexus Data Broker (NDB)