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Silicom Connectivity Solutions De - risked Exponential Growth Powering the Core. Accelerating AI Inference. Investor Presentation - July 29, 2026
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Safe Harbor Guidelines & Legal Notes The information presented today contains forward-looking statements within the meaning of applicable securities laws. Such statements may include, but are not limited to, Silicom's market opportunities, technology developments, industry trends, financial outlook, and future growth. Those statements are based on management's current beliefs, expectations and assumptions, which may be affected by subsequent business, political, environmental, regulatory, economic and other conditions, and are subject to known and unknown risks and uncertainties and other factors many of which are outside Silicom's control, which might cause actual results to differ materially from expectations expressed or implied in the forward- looking statements, and which include, but are not limited to, changes in demand for networking and data-center technologies, industry transitions toward cloud and disaggregated networking architectures, the pace of adoption of artificial intelligence infrastructure and other emerging technologies, supply chain conditions, geopolitical developments affecting Israel and the Middle East, and other risks described in Silicom's filings with the U.S. Securities and Exchange Commission, including its most recent Form 20-F. Consequently, you are cautioned not to rely on these forward-looking statements. Silicom does not undertake to update any forward-looking statements as a result of new information or future events or developments except as may be required by law. Financial information as presented herein, may be considered "non-GAAP financial measures" under Regulation G and related reporting requirements promulgated by the SEC as they apply to Silicom. Please refer to Silicom's disclosure documents filed or furnished with the SEC, including Silicom's Annual Reports on Form 20-F and/or quarterly reports on Form 6-K, for a reconciliation of non-GAAP measures to the most directly comparable GAAP measures. Silicom provides such non-GAAP data to investors as supplemental data and not in substitution of or replacement for, GAAP measures. 2
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The Investment Thesis: Foundation and Asymmetric Upside 3 The Unshakeable Foundation (The Core Business): A proven execution platform with four decades of IP development and engineering. Supported by a loyal Tier-1 customer base enabling scalable growth trajectory. The Asymmetric Upside (The Targeted Portfolio): We have leveraged our foundational IP to secure entry into high-growth, transformative markets. Strategic Upside: AI Infrastructure Support ($80-100B Market) - A dominant upside opportunity leveraging our core strengths. Emerging Upside: Post-Quantum Cryptography ($3-4B Market) - An emerging, high-potential upside driven by mandatory global upgrades. White-Label Switching ($2-3B Market) - A natural, low-lift utilization of our existing core expertise.
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Core Engine Telemetry: Accelerating Momentum & Visibility 4 Fortress Balance Sheet Forward Visibility (Design Wins) Major Design Wins in 2025 Major Design Wins already achieved in the first half of 2026 Annual targeted Design Wins (valid for 2026 and beyond) Resilient core business demand is driven by an exceptional Design Win momentum, securing continuous double-digit growth Explosive Revenue Growth YoY Growth (Q2 2026) YoY Growth (H1 2026) Projected YoY Growth (Q3 2026) Working Capital & Marketable Securities (~$19 per share) Debt Shareholders Equity Total Liquidity
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Powering the Network Edge and Data Center 5 Server Adapters Smart Platforms (Edge/uCPE) Smart Cards & FPGAs Rapid development based on leading Intel and Broadcom Ethernet controllers. Intelligent, programmable processing. A range of selection: from entry- level to robust rack-mounted units. Fast customization process tailored to highly specific customer needs. Integrated critical bypass functionality ensures traffic continuity during server failures. Essential for High-Frequency Trading (HFT) and Cybersecurity via superior low-latency performance. Offloads intensive tasks like data encryption and packet capture from the core server CPU. Deployed for SD-WAN, SASE, and NFV via industry-wide hardware/software decoupling. Deep Intel relationship yields tens of reference designs for unmatched time-to-market.
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Server Adapters & Smart Cards Smart Platforms (Edge Solutions) The competitors Focused predominantly on major accounts, forcing customers into a limited selection of rigid, standard off-the-shelf cards. Mass-market vendors often mandate inflexible delivery terms and inconsistent BOM selection, struggling to guarantee strictly locked hardware lifecycles or support flexible VMI models. The competitors Winning Against Competition: Agility, Customization, & Strategic Partnerships 6 Executes a fast, efficient path to customized hardware solutions, giving customers exactly what they need - rather than forcing a one-size-fits-all approach. Targets accounts of all sizes with a massive product portfolio, flexibility and attention. Leverages deep technical, business, and market relationships directly with primary CPU giants (e.g., Intel, Broadcom, Marvell). This advantage ensures optimized platform architecture & significantly faster time-to-market. Executes a fast, efficient path to customized hardware solutions.
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The Flywheel of Lock-In: Building Embedded Long-Term Revenue 7 Phase 1: The Qualification Process (Technical Precision) Silicom secures the business through rigorous technical evaluation and testing. We must conclusively prove hardware superiority and total reliability before commercial deployment. Phase 2: The Design Win (The Multi-Year Lock-In) Once qualified, our products become deeply embedded into the customer’s core infrastructure or appliance/server-based systems. The Financial Impact: This initiates a 3-5 year lifespan where the OEM triggers continuous purchases for the entire deployment period, creating a highly sticky, recurring revenue stream. Phase 3: Synergistic Scaling (Accelerating Velocity) Our technology is sold outward using our partners' massive market presence, generating exponentially higher sales velocity than direct-to-market strategies.
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The Multiplier: AI Inference at Scale 8 The Inevitable Shift: AI economics are permanently shifting from centralized, multi-billion-dollar training environments to massive, fragmented inference-driven deployments. The Financial Reality: Inference infrastructure is definitively expected to represent the majority of long-term AI compute spend worldwide. The TAM Expansion: Expanding well beyond traditional hyperscalers to specialized platforms. ~$ 80 - 100 B ~$ 50 - 60 B AI - Inference hardware/chip TAM by 2027 AI - Inference hardware/chip TAM by 2030
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The Two Main Bottlenecks Starving AI Inference 9 Standard networking infrastructure simply cannot support AI inference at scale. This restricts data flow across chips, cards, and servers, leaving incredibly expensive compute hardware sitting idle. THE PHYSICAL LIMIT The Latency Wall LLMs advance via weekly algorithmic breakthroughs, while ASICs are locked into 3+ year hardware cycles. Brilliant ML optimizations are delayed because today’s custom chips aren’t wired to run them efficiently. THE TIME LIMIT The Hardware Lottery IDLE IDLE IDLE Software Velocity (Weekly) THE HARDWARE LOTTERY ASIC Hardware Cycles (3-Year Steps) LATENCY WALL
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The Solution: Silicom's Adaptive Hardware Architecture 10 Ultra-Low Latency Networking (Shattering the Wall) High-performance Inference-Specific NIC (AI-NIC) solutions based on FPGAs or leading high-performance COTS chips. Designed specifically to bypass standard routing delays. Real-Time Co-Design (Beating the Lottery) FPGAs act as a reconfigurable extension of software rather than fixed hardware constraints. Empowers customers to co-design software stacks, novel ML optimizations, and compute hardware in near real-time.
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AI Inference: Execution, Traction, and Realities 11 Decades of expertise in high-performance FPGA design and Tier-1 networking provides Silicom with the definitive right to win in this new architecture. Execution Node Execution Node Mass Deployment Ready • First production orders received for delivery in 2026 . • Driving Proof of Concept (PoC) efforts targeting primarily Tier - 1 hyperscalers . Execution Node Next - Gen Solution Development • Order secured for the development and initial deliveries of a completely new, bespoke inference - specific solution. Execution Node Customized AI - NIC • Orders received for customization and initial deliveries of our Customized AI - NIC solution.
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Emerging Upside: Post-Quantum Cryptography (PQC) 12 The Threat Vector: The "Harvest now, decrypt later" reality is forcing immediate adoption across global government and finance sectors. The Market Reality: A $3-4B TAM by 2030 fueled by growing security risks and regulatory pressure, not technology cycles. The Silicom Advantage: • One of the only mature, end-to-end hardware-based PQC accelerator solutions currently available. • Our FPGA-based architecture allows for flexible remote updates as complex quantum standards continuously evolve. Traction: Already selected by three leading customers for early deployments, feeding a robust pipeline. Current Market $1-1.5B 2030 TAM $3-4B
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White-Label Switching (WLS) 13 The Market Disruption ($2-3B TAM): Intense cost pressures and a demand for flexibility are driving network operators away from proprietary hardware toward disaggregated, white-label solutions - mirroring previous structural shifts in servers and storage. A natural, low-lift utilization of our deep core expertise to capture share from entrenched proprietary incumbents. Leveraging Core DNA: • IP , operational know-how, and Tier-1 customer relationships are directly transferable to switching. • Silicom is already an established, trusted supplier of white-label networking platforms. Traction: • First design win for a family of switches secured with a leading cybersecurity leader. • First production orders to be fulfilled during 2026.
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The Synthesis: A Unique Investment Profile 14 The Foundation: An established core hardware business with decades of expertise, building strong customer relationships and securing long-term commitments. The Upside: The core business fully funds and derisks our targeted expansion into tectonic industry shifts. We are positioned perfectly at the physical bottleneck of the AI data center, unlocking an unmatched, venture-style exponential upside within a mature, public market execution platform. Emerging Upside: PQC White-Label Switching The Core Engine: Four Decades of Tier-1 Trust, Fortress Balance Sheet, 50+% Annual Growth.