Slides
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1 Q2-25 Earnings August 13, 2025 Benny Eppstein CEO Hadar Rahav CFO
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2 SAFE HARBOR PROVISION This conference call will contain forward-looking statements. Forward-looking statements in the conference call involve several risks and uncertainties, including, but not limited, to the Company's statements about its momentum, strategic direction and goals, market position and trajectory, future execution and delivery of value to customers, strengthening its core customer base, development of and enh ancing strategic partnerships and expected benefits from collaborations, the success of new technologies, including AI, to, among other things , enhance automation, pipeline, opportunities and customer engagements, demand for its products and solutions, including AI capabilities, trends in the market, innovation, expanding its business, the expected benefits of its AI-driven assurance solutions, its expectations with respect to gross margins, research and development and sales and marketing expenses, its expectations regarding grants from the Israel Innovation Authority, expectations regarding the impact of foreign exchange rates and potential tariffs, expectations regarding the growth and conv ergence of 5G and AI, its ability to deliver consistent value while driving operational excellence and long-term shareholder returns and its full-year 2025 revenue guidance and future growth and profitability. The Company does not undertake to update forward-looking statements. The full safe harbor provisions, including risks that could cause actual results to differ from these forward-looking statements, are outlined in today’s press release and the Company's SEC filings.
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3 NON-GAAP FINANCIAL MEASURES In this conference call, management will refer to certain non-GAAP financial measures, which are provided to enhance the user's overall understanding of the Company's financial performance. By excluding non-cash stock-based compensation that has been expensed in accordance with ASC Topic 718, financial income (expenses) related to acquisitions, and amortization of intangible assets related to acquisitions, non-GAAP results provide information helpful in assessing RADCOM's core operating performance and evaluating and comparing the results of operations consistently from period to period. The presentation of this additional information is not meant to be considered a substitute for the corresponding financial measures prepared in accordance with generally accepted accounting principles. Investors are encouraged to review the reconciliations of GAAP to non-GAAP financial measures included in the quarter's earnings release, available on our website, www.radcom.com. In this conference call, management will refer to certain non-GAAP financial measures, which are provided to enhance the user's overall understanding of the Company's financial performance. By excluding non-cash stock-based compensation that has been expensed in accordance with ASC Topic 718, financial income (expenses) related to acquisitions, and amortization of intangible assets related to acquisitions, non-GAAP results provide information helpful in assessing RADCOM's core operating performance and evaluating and comparing the results of operations consistently from period to period. The presentation of this additional information is not meant to be considered a substitute for the corresponding financial me asures prepared in accordance with generally accepted accounting principles. Investors are encouraged to review the reconciliations of GAAP to n on-GAAP financial measures included in the quarter's earnings release, available on our website, www.radcom.com.
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4 AGENDA Business performance and company strategy Benny Eppstein Chief Executive Officer Financial results and performance Hadar Rahav Chief Financial Officer Q&A 1 2 3
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5 TODAY’S SPEAKERS Benny Eppstein Chief Executive Officer Hadar Rahav Chief Financial Officer
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6 Benny Eppstein Chief Executive Officer Business performance and company strategy
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7 Q2-25: 19.3% REVENUE INCREASE AND IMPROVED PROFITABILITY $17.7M Quarterly Revenue 19.3% YoY increase 19.5% Operating Margin 4.1% YoY increase Operating Margin (Non-GAAP)* Improved profitability $101.6M $2.6M Positive cash flow Cash Generation (No debt) Ended Q2-25 with record-high cash and bank deposits New Quarterly Revenue Record * Non-GAAP . See reconciliation tables in slide 22.
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8 COMPANY STRATEGY Ongoing R&D Investment Partnership Activity Key Target Markets ▪ Continuing our investment in R&D ▪ Advancing our development in agentic AI (agent-to-agent and multi-model workflows) ▪ Our initial partnership announcements have generated customer interest ▪ Involved in several POCs in the lab for our high-capacity user plane analytics ▪ Potential to expand our addressable market and drive deeper customer engagements ▪ Remain focused on our key markets, North America, Japan, and EMEA ▪ Currently engaged in field trials with Tier 1 operators and executing multiple proof-of- concepts
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9 KEY CUSTOMERS ▪ Largest wireless network in North America ▪ Won industry recognition for the best network ▪ Ranked number one in 5G reliability and coverage across 15 major U.S. cities by OpenSignal Source: Boost Mobile PR, May 13, 2025 Source: Ookla State of the Mobile Union Report
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10 KEY CUSTOMERS (CONT’D) ▪ Grown to over 9 million subscribers ▪ Recognized by industry peers in the second Cloud-Native Te lco Market Perception Study Source: TelecomTV Cloud-Native Telco Market Perception Survey
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11 TELECOM INDUSTRY TRENDS Accenture's 2025 Technology Vision 84% of telco executives agree that AI agents will reinvent how their organizations are building and operating their digital infrastructures. Dell’Oro Group: Mobile Core Network & Multi-Access Edge Computing Quarterly Report A 6% growth in the mobile core market is projected through to 2029. And in Q1 alone, operators added 145 million new 5G subscriptions globally, bringing the total to 2.4 billion.
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12 GO-TO-MARKET ACTIVITIES Network X1 2 Knowledge 2025 DTW 3 4 FutureNet World
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13 MOONSHOT CATALYST WINS The TM Forum is a global organization that brings together telecom operators and technology providers to address common industry challenges and establish standards. We participated in several award-winning innovation programs. Our intelligent assurance was leveraged to accelerate the launch of new services for consumers, as well as enhance their overall customer experience and ensure the delivery of mission-critical applications on demand for first responders using satellite communications.
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14 STRATEGY BUILT ON THREE PILLARS Deliver value and elevate customer satisfaction through automation, real-time visibility, and proactive assurance1 2 3 Grow our customer base by leveraging our advanced AI and agent-based technologies Expand our assurance offering and continue pioneering innovation through our strategic partnerships
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15 Q2-2025: KEY HIGHLIGHTS Integration with ServiceNow to Automate Service and Complaint Resolution for Telecom Operators Accelerated profitability, with non-GAAP* operating income for Q2-2025 increasing by more than 50% y-o-y Record-high cash and short-term bank deposits of $101.6 million, with no debt NVIDIA collaboration is gaining traction, running POCs with multiple operators Q2-2025 Reaffirming our full-year 2025 revenue guidance, projecting year-over-year growth of 15% to 18%, with a midpoint of $71.1 million. * Non-GAAP . See reconciliation tables in slide 22.
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16 Hadar Rahav Chief Financial Officer Financial results and performance
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17 Q2 Revenue $17.7 million Q2 Non-GAAP Gross Margin 76.2% Q2 Non-GAAP* Operating Profit $3.4 million Q2 Non-GAAP Operating Margin 19.5% Q2 GAAP Diluted EPS $0.15 Q2 Non-GAAP Diluted EPS $0.25 Q2 2025 Financial Highlights ▪ Record revenue, representing 19.3% growth y-o-y, on track for another year of double-digit growth in FY2025 ▪ Achieved our highest operating profitability in years, despite currency headwinds Q2 2025 Results Q2 Revenue historical trend ($M) Non-GAAP Operating Margin historical trend (%) 11.1 12.4 14.8 17.7 Q2/2022 Q2/2023 Q2/2024 Q2/2025 * Non-GAAP . See reconciliation tables in slide 22.
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18 Balance Sheet & Cash Flow ▪ Positive cash flow of $2.6M for Q2/25 ▪ Ending Q2 2025 with the highest cash level & bank deposits of $101.6M ▪ No debt Cash and Bank Deposits As of ($M) Cash Flow historical trend ($M) 2.2 0.4 0.8 2.6 Q2/2022 Q2/2023 Q2/2024 Q2/2025 77.7 82.2 94.7 101.6 2022 2023 2024 Q2/2025
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19 7.2% 14.4% 11.9% 18.2% 18% FY2021 FY2022 FY2023 FY2024 FY2025 FY2025 Revenue Outlook Five-year historical trend and FY2025 outlook ($M) Revenue growth Y-o-Y growth (percentage) Expects 16.5% guidance midpoint 18% 15% 40.3 46.1 51.6 61 71.1 FY2021 FY2022 FY2023 FY2024 FY2025 (Guidance midpoint) ▪ Reaffirming FY 2025 revenue growth outlook of 15% - 18% YoY with midpoint of 16.5% ▪ Driven by a strong sales funnel, robust customer engagement, and ongoing market shifts toward intelligent, automated, real-time assurance
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20 CONSOLIDATED STATEMENTS OF OPERATIONS (GAAP) (In thousands of U.S. dollars, except per share data) 2025 2024 2025 2024 Revenues 17,658 $ 14,801 $ 34,249 $ 28,924 $ Cost of revenues 4,367 $ 3,794 $ 8,45 9 $ 7,545 $ Gross profit 13,291 $ 11,007 $ 25,790 $ 21,379 $ Gross profit % 75% 74% 75% 74% Research and development, gross 4,964 $ 4,621 $ 9,713 $ 9,214 $ Less - royalty-bearing participation - $ 180 $ 25 $ 389 $ Research and development, net 4,964 $ 4,441 $ 9,688 $ 8,825 $ Sales and marketing 4,936 $ 4,325 $ 9, 800 $ 8,610 $ General and administrative 1,651 $ 1,361 $ 3,100 $ 3,374 $ Total operating expenses 11,551 $ 10,127 $ 22,588 $ 20,809 $ Operating income 1,740 $ 880 $ 3,20 2 $ 570 $ Financial income, net 793 $ 854 $ 1,913 $ 1,959 $ Income before taxes on income 2,533 $ 1,734 $ 5,115 $ 2,529 $ Taxes on income (95) $ (27) $ (237) $ (60) $ Net income 2,438 $ 1,707 $ 4,878 $ 2,469 $ Basic net income per ordinary share 0.15 $ 0.11 $ 0.30 $ 0.16 $ Diluted net income per ordinary share 0.15 $ 0.11 $ 0.29 $ 0.16 $ Three months ended June 30, Six months ended June 30,
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21 CONSOLIDATED STATEMENTS OF OPERATIONS (NON-GAAP) (In thousands of U.S. dollars, except per share data) (1) Amounts exclude non-cash stock-based compensation expenses, financial income (expenses), acquisition-related expenses and amortization of intangible assets related to acquisitions. (1) Amounts exclude non-cash stock-based compensation expenses, financial income (expenses), acquisition-related expenses and amortization of intangible assets related to acquisitions. 2025 2024 2025 2024 Revenues 17,658$ 14,801$ 34,249$ 28,924$ Cost of revenues 4,211$ 3,639$ 8,148$ 7,250$ Gross profit 13,447$ 11,162$ 26,101$ 21,674$ Gross profit % 76% 75% 76% 75% Research and development, gross 4,536$ 4,096$ 8,826$ 8,152$ Less - royalty-bearing participation -$ 180$ 25$ 389$ Research and development, net 4,536$ 3,916$ 8,801$ 7,763$ Sales and marketing 4,325$ 3,811$ 8,538$ 7,563$ General and administrative 1,150$ 1,159$ 2,179$ 2,333$ Total operating expenses 10,011$ 8,886$ 19,518$ 17,659$ Operating income 3,436$ 2,276$ 6,582$ 4,015$ Financial income, net 814$ 888$ 1,940$ 2,030$ Income before taxes on income 4,250$ 3,164$ 8,522$ 6,045$ Taxes on income (95)$ (27)$ (237)$ (60)$ Net income 4,155$ 3,137$ 8,285$ 5,985$ Basic net income per ordinary share 0.26$ 0.20$ 0.51$ 0.39$ Diluted net income per ordinary share 0.25$ 0.20$ 0.50$ 0.38$ Three months ended June 30, Six months ended June 30, NON-GAAP (1)
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22 RECONCILIATION BETWEEN GAAP & NON-GAAP CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands of U.S. dollars, except per share data) 2025 2024 2025 2024 (Unaudited) (Unaudited) (Unaudited) (Unaudited) GAAP gross profit 13 ,291 11 ,007 25 ,790 21 ,379 Stock-based compensation 10 0 99 19 9 18 3 Amortization of intangible assets 56 56 11 1 11 2 Non-GAAP gross profit 13 ,447 11 ,162 26 ,100 21 ,674 GAAP Research and development, net 4,964 4,441 9,688 8,825 Stock-based compensation 42 8 52 5 88 7 1,062 Non-GAAP Research and development, net 4,536 3,916 8,801 7,763 GAAP Sales and marketing 4,936 4,325 9,800 8,610 Stock-based compensation 58 3 48 5 1,205 98 9 Amortization of intangible assets 28 29 57 58 Non-GAAP sales and marketing 4,325 3,811 8,538 7,563 GAAP general and administrative 1,651 1,361 3,100 3,374 Stock-based compensation 50 1 20 2 92 1 1,041 Non-GAAP general and administrative 1,150 1,159 2,179 2,333 GAAP total operating expenses 11 ,551 10 ,127 22 ,588 20 ,809 Stock-based compensation 1,512 1,212 3,013 3,092 Amortization of intangible assets 28 29 57 58 Non-GAAP total operating expenses 10 ,011 8,886 19 ,518 17 ,659 GAAP operating lncome 1,740 88 0 3,202 57 0 Stock-based compensation 1,612 1,311 3,212 3,275 Amortization expenses 84 85 16 8 17 0 Non-GAAP operating income 3,436 2,276 6,582 4,015 June 30, Three months ended Six months ended June 30,
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23 RECONCILIATION BETWEEN GAAP & NON-GAAP CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands of U.S. dollars, except per share data) 2025 2024 2025 2024 (Unaudited) (Unaudited) (Unaudited) (Unaudited) GAAP income before taxes 2,533 1,734 5,11 5 2,529 Stock-based compensation 1,612 1,311 3, 212 3,275 Amortization of intangible assets 84 85 168 170 Financial expenses 21 34 27 71 Non-GAAP income before taxes 4,250 3,164 8,522 6,045 GAAP net income 2,438 1,707 4,878 2,469 Stock-based compensation 1,612 1,311 3, 212 3,275 Amortization of intangible assets 84 85 168 170 Financial expenses 21 34 27 71 Non GAAP net income 4,155 3,137 8,28 5 5,985 GAAP Net income per diluted share 0.15 0.11 0.29 0.16 Stock-based compensation 0.10 0.08 0 .20 0.21 Amortization of intangible assets (*) 0.01 0.01 0.01 Financial expenses (*) (*) (*) (*) Non GAAP Net income per diluted share 0.25 0.20 0. 50 0.38 Weighted average number of shares used to compute diluted net loss per share 16,711,789 15,978,799 16,686,397 15,922,855 Three months ended Six months ended June 30, June 30,
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24 CONSOLIDATED BALANCE SHEETS (In thousands of U.S. dollars, except per share data) As of June 30, 2025 As of December 31, 2024 Cash and cash equivalents 21,910 $ 19,243 $ Short-term bank deposits 79,722 $ 75,429 $ Trade receivables, net 18,603 $ 19,038 $ Inventories 1,218 $ 1,667 $ Other accounts receivable and prepaid expenses 1,993 $ 1,819 $ Total Current Assets 123,446 $ 117,196 $ Severance pay fund 3,243 $ 2,985 $ Other long-term receivables 3,053 $ 3,484 $ Property and equipment, net 889 $ 879 $ Goodwill and intangible assets, net 2,440 $ 2,609 $ Operating lease right-of-use assets 3,314 $ 3,421 $ Total Non-Current Assets 12,939 $ 13,378 $ Total Assets 136,385 $ 130,574 $ Trade payables 3,689 $ 2,45 7 $ Deferred revenues and advances from customers 4,807 $ 6,848 $ Employee and payroll accruals 6,106 $ 7,175 $ Operating lease liabilities 1,026 $ 966 $ Other liabilities and accrued expenses 9,171 $ 10,463 $ Total Current Liabilities 24,799 $ 27,909 $ Accrued severance pay 4,330 $ 3,868 $ Operating lease liabilities 2,520 $ 2,438 $ Other liabilities and accrued expenses 656 $ 683 $ Total Non-Current Liabilities 7,506 $ 6,989 $ Total Liabilities 32,305 $ 34 ,898 $ Shareholders' Equity 104,080 $ 95,676 $ Total Liabilities and Shareholders' Equity 136,385 $ 130,574 $
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THANK YOU All rights reserved. This presentation contains proprietar y information of RADCOM Ltd. Without the express prior written permission of RADCOM Ltd., no part of the conte nts hereof may be used for any other purpose, disclosed to persons or f irms outside the recipient company, or reproduced by any means. RADCOM L td reserves the right, at its sole disc retion, to make changes at any time in its technical information, specifications, and s ervices.