Enabling High Performance Wireless Connectivity - Investor Presentation March 2019

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Enabling High Performance Wireless Connectivity - Investor Presentation March 2019
Enabling High Performance
                           Wireless Connectivity

          Investor Presentation
               March 2019

NASDAQ:AIRG © Copyright 2019 Airgain, Inc. All Rights Reserved. © Copyright 2019 Airgain, Inc. All Rights Reserved.
                                                  NASDAQ:AIRG                                                         1
Enabling High Performance Wireless Connectivity - Investor Presentation March 2019
Important Caution Regarding Forward Looking Statements

This presentation contains forward-looking statements.       significantly, including based on seasonal risk factors,    represent a significant portion of our sales, and if we lose   place undue reliance on these forward looking
All statements other than statements of historical facts     which makes our future operating results difficult to       any of these customers, our sales could decrease               statements, which speak only as of the date here of, and
contained in this presentation, including statements         predict and could cause our operating results to fall       significantly; we rely on a few contract manufacturers to      we undertake no obligation to revise or update this
regarding our future operating results, financial position   below expectations or our guidance; risks and               produce and ship all of our products, a single or limited      presentation to reflect events or circumstances after the
and cash flows, our business strategy, our 2018 financial    uncertainties related to recent management changes and      number of suppliers for some components of our products        date hereof. All forward- looking statements are qualified
outlook, and plans and our objectives for future             any difficulties or delays we encounter in identifying a    and channel partners to sell and support our products,         in their entirety by this cautionary statement, which is
operations are forward-looking statements. In some           successor CEO; a slower than anticipated rollout of         and the failure to manage our relationships with these         made under the safe harbor provisions of the Private
cases, you can identify forward-looking statements by        certain customers' deployments; our products are subject    parties successfully could adversely affect our ability to     Securities Litigation Reform Act of 1995.
terms such as “believe,” “may,” “will,” “estimate,”          to intense competition, including competition from the      market and sell our products; if we cannot protect our
“continue,” “anticipate,” “plan,” “target,” “project,”       customers to whom we sell, and competitive pressures        intellectual property rights, our competitive position         This presentation also contains estimates and other
“contemplate,” “predict,” “potential,” “would,”              from existing and new companies may harm our business,      could be harmed or we could incur significant expenses         statistical data made by independent parties and by
“could,” “should,” “intend” and “expect” or the              sales, growth rates and market share; our future success    to enforce our rights; our international sales and             us relating to market size and growth and other data
negative of these terms or other similar expressions.        depends on our ability to develop and successfully          operations subject us to additional risks that can             about our industry. This data involves a number of
These statements involve known and unknown risks,            introduce new and enhanced products for the wireless        adversely affect our operating results and financial           assumptions and limitations, and you are cautioned
uncertainties and other important factors that may cause     market that meet the needs of our customers; risks that     condition; our ability to identify and consummate              not to give undue weight to such estimates. In addition,
our actual results, performance or achievements to be        we may not fully realize the benefits associated with the   strategic acquisitions, and risks associated with              projections, assumptions and estimates of our future
materially different from any future results, performance    partnerships we have entered into, or that existing         completed acquisitions adversely affecting our operating       performance and the future performance of the
or achievements expressed or implied by the forward-         partnerships may be terminated by either party; our         results and financial condition; and other risks described     markets in which we operate are necessarily
looking statements. These risks, uncertainties and other     business is characterized by short product development      in our filings with the Securities and Exchange                subject to a high degree of uncertainty and risk.
factors include, without limitation: the market for our      windows and short                                           Commission (SEC), including under the heading “Risk
antenna products is developing and may not develop as        product lifecycles; we sell to customers who are            Factors” in our Annual Report on Form 10-K and any
we expect; our operating results may fluctuate               extremely price conscious, and a few customers              subsequent filings with the SEC. You are cautioned not to

                                                                                                                                               NASDAQ:AIRG © Copyright 2019 Airgain, Inc. All Rights Reserved.                                       2
Enabling High Performance Wireless Connectivity - Investor Presentation March 2019
Who We Are

• Airgain (NASDAQ: AIRG) is a leading provider of
 advanced antenna technologies used to enable
 high performance wireless networking across a
 broad and increasing range of consumer,
 enterprise, and automotive applications.

                           >125
                         Employees        > 245             ~ 30%
2003         2016                         Patents &
                                                            Improved                  >1000                    > 250M
Founded       IPO                                        throughput over            Antenna SKUs             Wireless Devices
                         > 40%           Applications
                         Engineering                    Industry standards                                       Shipped

                                                        NASDAQ:AIRG © Copyright 2019 Airgain, Inc. All Rights Reserved.    3
Enabling High Performance Wireless Connectivity - Investor Presentation March 2019
Who We Work With

• Tier One Service Providers
• Chipset Partners
• Global OEMs & ODMs

                                            NASDAQ:AIRG © Copyright 2019 Airgain, Inc. All Rights Reserved.   4
Enabling High Performance Wireless Connectivity - Investor Presentation March 2019
World Class Leadership Team

                          Years Experience     Past Companies                               Experience

      Jim Sims                                                  • Chairman of the Board since November 2003
    Chairman and                35+                             • C-Level leadership experience with multi-billion dollar
Chief Executive Officer                                           public companies across the technology space

                                                                • 13 years in global sales leadership roles at Airgain
    Jacob Suen                  20+
      President                                                 • Sales, marketing, operations, and business development
                                                                  roles

                                                                • Finance and technology industry experience
    Anil Doradla
                                20+                             • Wall Street experience along with a variety of strategic
Chief Financial Officer
                                                                  and engineering roles

     Kevin Thill                                                • Deep domain expertise in antenna systems & platforms
Senior Vice President,          30+                             • Founder of Antenna Plus that grew into a multi-million
     Engineering                                                  dollar per year business

   Kathy Pearson                                                • HR leadership roles in building global organizations
Vice President, Global          20+                             • Specializes in small to mid-size growth companies across
HR and Administration                                             multiple industries

                                                                NASDAQ:AIRG © Copyright 2019 Airgain, Inc. All Rights Reserved.   5
Enabling High Performance Wireless Connectivity - Investor Presentation March 2019
Airgain’s Global Presence

                                                    Cambridge, UK          Munich, Germany
                             Chicago, IL
                                               Boston, MA
         San Diego, CA                                                                         Suzhou, China           Seoul, South Korea
                                     Kansas City, MO
            Scottsdale, AZ                                          Marrakesh, Morocco
                                           Melbourne, FL                                  Shenzhen, China
                   San Antonio, TX                                                                                   Taipei, Taiwan

Design Center
Sales/Satellite Office
Manufacturing

                                                                                    NASDAQ:AIRG © Copyright 2019 Airgain, Inc. All Rights Reserved.   6
Enabling High Performance Wireless Connectivity - Investor Presentation March 2019
Solid Financial Execution and Strong Momentum

                                                                                                                         3 Consecutive Quarters of
        Double Digit YoY Growth                            Return to Consistent Profitability
                                                                                                                             Record Revenue

         Annual Revenue ($M)                                    2018 Adjusted EBITDA ($M)                            2018 Revenue by Quarter ($M)

                                  $60.6
                                                                                                                                       $15.8
                      $49.5                                                                                                                              $16.6
            $43.4                                                                                                              $15.0        $15.8
                                                                                                                   $13.3
                                                                                            $1.84
$27.8
                                                                               $1.04
                                                                     $.39
                                                         $-.51

2015        2016      2017        2018                    Q1          Q2         Q3          Q4                     Q1           Q2            Q3             Q4

                        *based on 2018 annual growth guidance                               NASDAQ:AIRG © Copyright 2019 Airgain, Inc. All Rights Reserved.        7
Enabling High Performance Wireless Connectivity - Investor Presentation March 2019
NASDAQ:AIRG © Copyright 2019 Airgain, Inc. All Rights Reserved.   8
Enabling High Performance Wireless Connectivity - Investor Presentation March 2019
Airgain’s Targeted Markets
    Airgain will be focusing on 3 targeted markets with an aggregated TAM in excess of $6.7B by 2022
                                                                                                                 26% CAGR

                                                      15% CAGR

       9% CAGR

     $780M                                          $1.6B                                                      $4.4B
     Consumer                                     Automotive                                                 Enterprise
(Connected Home & IoT)                             (Fleet & OEM)                                      (M2M & Industrial IoT)

                   We believe we are well positioned to take advantage of the anticipated
                                    growth in current and new markets

               Sources: ABI Research Forecasts, 2018 + Airgain ASP assumptions   NASDAQ:AIRG © Copyright 2019 Airgain, Inc. All Rights Reserved.   9
Enabling High Performance Wireless Connectivity - Investor Presentation March 2019
Airgain’s Product Markets

                         Targeted markets have increasing product diversification.
Emerging fragmentation provides more opportunity to develop more technology and sell into more applications.

              Consumer                                                  Enterprise                                                   Automotive

Gateways      Set Top Boxes        Routers &             Enterprise Access      Carrier Grade Outdoor                             Mass            Commercial Fleet
                                  Access Points               Points                 Access Points                           Transportation         Management

   Wi-Fi               Smart TV         OTT Devices
 Extenders
                                                         Smart Utilities        Kiosks        ATM Machines                 Public Safety: Law     Intelligent Warehouse
                                                                                                                         Enforcement, Fire, EMS

             Sensors          Smart Meters

                                                         IIoT / LPWAN        Wi-Fi Hotspots    Femtocells                       Auto OEM            Infotainment
  Home               Wi-Fi               IP Security
Automation         Speakers               Cameras

                                                                                                    NASDAQ:AIRG © Copyright 2019 Airgain, Inc. All Rights Reserved.       10
Complex Antenna Systems: The Next Frontier

                Competitive Advantage:
       Airgain’s expertise in system performance                                                                                            64 Element Massive

       optimization has become core to enabling
                                                                                                                                             FD-MIMO    MIMO

                      connectivity                                                                                                                 DU

                                                                                                                              5G

                                                                                    802.11ax

                                                           802.11ac

                                802.11n                                                            Antenna design becomes the most critical
                                                                                                    element in optimizing wireless systems –
                                                                      Significant
     802.11b/g                                                                                    especially with smaller enclosures and much
                                                                 wireless performance
                                                                                                             more complex designs
                                  Wireless performance        enhancements rely on better
  Chipsets key for wireless     improvement via chipsets           antenna systems
performance – antennas were       becomes more limited
an afterthought in the design
           process

                                                                                  NASDAQ:AIRG © Copyright 2019 Airgain, Inc. All Rights Reserved.                11
NASDAQ:AIRG © Copyright 2019 Airgain, Inc. All Rights Reserved.   12
What We Do
                               • High end custom engineering shop
                               • IP and system performance expertise
                               • Each design is high volume

              Custom Engineering /
                                                                      Standard Product Market
            Mass Manufacturing Market
•   3-6 month design cycle                            •   Up to 6 month design cycle
•   Manufacturing 1-5m units                          •   Manufacturing 5-10k units
•   Life cycle 2-4 years                              •   Life cycle 4-5 years

                                                             NASDAQ:AIRG © Copyright 2019 Airgain, Inc. All Rights Reserved.   13
How We Do It

               Antenna    Simulation                                   System
Engineering                               Custom                                                      Validation
               Design &    & Initial                                 Throughput
  Review                                Integration                                                   & Quality
              Placement     Testing                                  Optimization

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NASDAQ:AIRG © Copyright 2019 Airgain, Inc. All Rights Reserved.   15
Driver 1: 802.11 Wi-Fi

Drivers of the Wi-Fi Revolution                                                        Today in the US alone:
 •   Accelerating broadband speeds                                                       • Carriers serve 94M homes, with bandwidth now
 •   Demand for increased throughput                                                       providing up to 1 GB Wi-Fi access points /
 •   Increasing number of devices used concurrently                                        gateways with 4-12 antennas each
 •   More indoor and outdoor applications                                                • Potential subscriber units to be upgraded: 233M*

                  Sources: 1-CableLabs / 2-Wi-Fi Findings by D-Link, September 2014
                  3-Cisco Router Switch Blog, October 17 / 4-ITU Report M.2410-0, November 2017   NASDAQ:AIRG © Copyright 2019 Airgain, Inc. All Rights Reserved.   16
Driver 2: 5G Market Opportunities

New 5G market opportunities
•   New product cycles = more system designs                                               25%              Network Traffic
•   New applications = new business opportunities                                                    Projected by 2023*
•   New spectrum = more antennas needed

Highly integrated designs require close relationship with OEM and
Chipset Vendors

Custom solutions and Performance focus align Airgain’s strategy
and strength as a Performance and Integration leader

                 New Applications                                              New Spectrum

       Small Cell                 5G Fixed Wireless    Massive MIMO              Sub 6GHz                           mmWave
    Indoor and Outdoor                Point-to-Point    Beamforming

                    *ABI Research, 2018                               NASDAQ:AIRG © Copyright 2019 Airgain, Inc. All Rights Reserved.   17
NASDAQ:AIRG © Copyright 2019 Airgain, Inc. All Rights Reserved.   18
Growth Opportunities

    Strategic M&A                                  Manage Fragmented Markets
Highly scalable platform for                     Cross-over opportunities within Consumer,
     inorganic growth                                   Enterprise, and Automotive

                        Execute Against Verticals
              Diversified, broad base of blue chip customers driving
             consistent revenue growth, with long product lifecycles

                                                   NASDAQ:AIRG © Copyright 2019 Airgain, Inc. All Rights Reserved.   19
NASDAQ:AIRG © Copyright 2019 Airgain, Inc. All Rights Reserved.   20
Revenues

                                            Quarterly Revenue ($M)

                                                                             $60.6

                                                    $49.5                     $16.6
                           $43.4
                                                        $12.8

                             $12.6                                            $15.8
$27.8                                                   $12.4

 $9.3                        $12.4
                                                                              $15.0
                                                        $13.0
 $6.7
                             $9.9
 $6.1                                                                                                      $15.0 -
                                                        $11.3                 $13.3
 $5.7                        $8.5                                                                          15.25

2015                        2016                        2017                  2018                         2019
                                                                                                        (Projected)

                                            Q1     Q2           Q3    Q4

    *based on 2018 annual growth guidance                            NASDAQ:AIRG © Copyright 2019 Airgain, Inc. All Rights Reserved.   21
GAAP Financial Model

     December FY           2016    Q1 2017   Q2 2017   Q3 2017   Q4 2017    2017     Q1 2018    Q2 2018     Q3 2018     Q4 2018       2018

         Sales            $43.4M   $11.3M    $13.0M    $12.4M    $12.8M    $49.5M    $13.3M      $15.0M      $15.8M      $16.6M     $60.6M

     Gross Profit
                          44.4%    47.0%     47.0%     48.2%     46.0%     47.1%     46.6%       44.1%       43.5%       41.4%       43.7%
      % of Sales

  Operating Expenses      $15.8M   $4.9M     $6.2M     $5.8M     $5.4M     $22.3M    $7.4M       $10.3M      $6.6M       $5.7M      $29.9M

 Op Ex as a % of Sales    36.4%    43.2%     48.0%     46.6%     42.3%     45.1%     55.3%       68.5%       41.5%       34.6%       49.3%

Operating Income (Loss)   $3.4M    $0.4M     -$0.1M    $0.2M     $0.5M     $1.0M     -$1.2M      -$3.7M      $0.4M       $1.2M       -$3.3M

   Operating Margin       7.9%      3.8%     -1.0%      1.6%      3.9%     2.0%       -8.7%      -24.4%       2.8%        6.8%       -5.6%

                                                                               NASDAQ:AIRG © Copyright 2019 Airgain, Inc. All Rights Reserved.   22
First Quarter 2019 Guidance

   December FY          2016       2017                2018                      Q1 2019 Guidance

       Sales           $43.4M      $49.5M             $60.6M                       $15.0-$15.25M

    Gross Profit                                                              Up Sequentially from Q4
                       44.4%       47.1%               43.7%
     % of Sales                                                                       2018

Operating Expenses     $15.8M      $22.3M             $29.90M

OpEx as a % of Sales   36.4%       45.1%               49.3%

 Operating Income      $3.4M       $1.0M              -$3.39M

 Operating Margin      7.9%        2.0%                -5.6%

     GAAP EPS          $0.40       $0.11               -$0.27                    Break Even - $0.01

  Non-GAAP EPS                     $0.31               $0.22                        $0.04 - $0.05

                                            NASDAQ:AIRG © Copyright 2019 Airgain, Inc. All Rights Reserved.   23
Contact

Anil Doradla
CFO

Anthony Mariucci
IR Contact
investors@airgain.com

Airgain, Inc.
3611 Valley Centre Drive
Suite 150
San Diego, CA 92130

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