ATOMOS LIMITED — AGM Information 2022

Nov 24, 2022

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November 2022 Atomos AGM: Company Update

Trevor Elbourne Chief Executive Officer James Cody Chief Financial Officer

ATOMOS: a global leader in video tech

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SOLVING CUSTOMER PROBLEMS FOR OVER 12 YEARS

GLOBAL LEADER IN PROVIDING MUST-HAVE TOOLS FOR CONTENT CREATORS . STARTED BY INVENTING THE MONITOR-RECORDER

• Founded in 2010 with vision to democratise high quality video content creation

• • Unique ability to partner with dominant industry players across major camera and video fields

• Large customer base >450,000 products shipped

• Consistent revenue growth – 45% CAGR since inception

• Internal ethos based around ‘product-first’ approach; solving end-customer problems

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Revenue FY17 - FY22
Revenue ($M)
79
73
54
45
36
30 31
28
15
6
3
1
FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22
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Ninja Shinobi Shogun SUMO
Connect: Shogun Zato Ninja C L O U D S T U D I O
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FY22 in Review

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SECOND HALF CHALLENGES WEIGHED ON FULL YEAR RESULT

A$m	FY22	FY21
Revenue	73.3	78.6	• Change from product-focused marketing led to sharp dropin 3rd quarter sales
Gross Profit Margin	39%	48%	• Actions taken at end of year to convert inventory to cash impacted margin
Reported EBITDA	(5.1)	8.2	• Earnings were further impacted by growth in cost base(since reversed)
Non-recurring items	5.7	(0.5)	• Reported EBITDA included significant non-recurring items
Underlying EBITDA	0.6	7.7
Inventory	28.8	16.6	• Growth in inventory beyond requirements

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FY22 in Review

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LAUNCHED NEW PRODUCTS & SERVICES DESPITE DIFFICULT YEAR

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Challenges
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• Misalignment between sales and marketing led to:

• A sharp fall in 3[rd] quarter sales

• A build up of inventory beyond requirements as a result

• Growth in cost base also adversely affected performance

• Change in CEO & subsequent legal claim

• End of year sales initiatives to convert builtup inventory into cash impacted margin

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Solid Base now in place

• Cost base corrections to right size business moving forward

• Experienced leadership team now in place with the business part way through a reorganisation

• Marketing now reporting to Chief Sales Officer for better sales and marketing alignment

• Experienced Global Marketing Director appointed

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Exceptional New Product Portfolio

• Successfully launched new Series 2 ‘connected’ products in 4Q22

• Successful BETA launch of Atomos Cloud

• Launch of remaining Series 2 products to further consolidate new connected workflow & cloud strategy

• Balance sheet impacted but new Series 2 & cloud products provide good foundations for future growth

4

Huge Opportunities for growth

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IDENTIFYING OUR CUSTOMERS

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Studio & broadcasting
Monitor recorder market
AMS
25
Total market is much larger
125
Institutions & venues 150
Influencers & freelance creators
323 326 $610m
72
3
32 40
AMS AMS
63
Brands using video
Institutions & venues
58
Brands using video
Studio & broadcasting
Influencers & freelance creators 5
AMS
ATOMOS’ share of segment
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SIGNIFICANT GROWTH OPPORTUNITY

Atomos is entering new markets for streaming, remote collaboration and cloud-based production which will significantly increase its TAM beyond monitor recorders

MONITOR RECORDER TAM

Atomos has ~12% of the market Very low share of the largest segment, Institutions & venues Overall market is forecast to grow at 12% CAGR 21-31 baseline growth for AMS

Greater penetration in all segments will deliver above market growth

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Looking Forward – Products and Services

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NEW PRODUCTS CLOUD SERVICES AND ECOMMERCE TO DRIVE FUTURE GROWTH

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Atomos Cloud Series 2 Products eCommerce
Services
A collection of easy-to- Cloud connected Atomos devices bundled
use cloud-based versions of Atomos’ with cloud-services
collaboration tools market-leading monitor subscription available for
accessible directly from recorders direct purchase with
Series 2 products innovative flexible
payment options
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New Era for Atomos Products

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POWERING NEW GENERATION OF VIDEO COLLABORATION

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Atomos Cloud Studio
+
Series 2 Devices
Powering the ability to collaborate
in real-time with
anyone ,
will
anywhere , anytime
revolutionalise content creation
The ability for creators to get their
content to their audience in almost
real-time will be game changing
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Ninja
More to come!
Camera-to-Cloud
Shogun
Video
Sources
Zato
Video
C L O U D S T U D I O
Streaming
Live
Production
Video
Sharing
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New Era for Atomos Products

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• PARTNERS LIKE ADOBE HELPING DRIVE DEMAND FOR ATOMOS PRODUCTS AND SERVICES

Atomos Cloud Studio

• +

• 20+ million Adobe Create Cloud subscribers now have a reason to consider an Atomos product

• Hundreds of new cameras now part of the Frame.IO ecosystem via an Atomos product

Large increase (+50%) in daily number of video files uploaded to Frame.IO reported immediately after system went live & sustained

• 50 units of Series 2 products now in use by Frame.IO sales teams for customer trials

• Sundance File Festival deploying 30 Shogun Connect devices at Jan ‘23 festival

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Atomos Cloud Studio

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ATOMOS CLOUD STUDIO WILL REVOLUTIONISE LIVE PRODUCTION

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Outside Broadcast Vans –
Legacy Live Production
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Traditional Live Production

• Not scalable

• Very expensive

• Complicated

• Restrictive set of expensive cameras suitable for use

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SIMPLIFY
Easier
Cheaper
Much Wider
Appeal
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Eliminate adoption barriers

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Atomos Cloud Studio –
Live Production
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Atomos Live Production

• Scalable (cloud based)

• Cost effective (SaaS model)

• Simple to setup and use (everything controlled from intuitive iPad app)

• Flexible – use ANY camera via ATOMOS monitor/recorder or use iPhone

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Atomos Cloud Studio

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MASS APPEAL OF ATOMOS LIVE PRODUCTION

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Atomos Cloud
Studio
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GAME CHANGER

Enormous simplicity enables mass-appeal opportunities iPhones iPad With nothing more than two , an and an Atomos Cloud subscription, anyone can . . do a live production. Anywhere Anytime

Social events

Corporate Houses of Worship Live Performances

Grass-roots sports

Schools

This technology will allow anyone to host their own live pay-per-view events using ATOMOS live production services

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Direct to customer

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ROLLOUT OF ATOMOS ECOMMERCE ON TRACK

Website partner for eCommerce solution engaged and development well progressed

Payment platform partner selected Innovative buy-now-pay-later partner selected

Third party logistics partners engaged

On schedule to launch eCommerce on redesigned Atomos website Jan 2023

Experienced D2C expert leading rollout of Atomos eCommerce solution

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Improved delivery of marketing

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BETTER MARKETING CHANNELS TO CUSTOMERS

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Focus on digital and social

Heavy use of digital platforms like YouTube to target customers. Content marketing to include hosting events that showcase our connected products, engaging directly with our partners and customers

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No more expensive tradeshows

No more big and expensive tradeshows where it’s difficult to measure success. Attend more focused events that have a smaller footprint that focus more directly on our connected products and cloud services

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New website

With the launch of eCommerce, fully utilise our website as a powerful marketing tool which engages our customers and clearly explains use cases which solve problems for the market segments they belong to. New website will also provide customer data

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Products & Services Outlook

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Atomos is building products and services that are at the forefront of new collaboration workflows. These new products and services will fuel growth for the next 5+ years.

• Leverage proven Atomos fundamentals:

• Deep tech expertise , great product design , brand equity , partnerships with industry leaders

• New Atomos Cloud Studio will place Atomos at forefront of the future of video content creation

• New Series 2 products powering these new workflows

• Improve marketing with customer data, segmentation and targeting to increase marketing spend ROI

• Efficient digital marketing campaigns for new cloud studio services and D2C

• Complete organization restructure and cost base reduction

• Balance sheet improvement from working capital reduction – leveraging strong inventory position

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Financial Outlook

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BUILDING A BETTER BUSINESS

Managing Global Market Headwinds

Sales are very volatile in the current environment reflecting global economic uncertainty

Transform business from being circa $73m revenue breakeven (FY22) to circa $60m to break even

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Lower Operating Costs

• Reorganization underway

• Complete review of all operating cost lines

• Fixed annual costs reduced by circa $10m (30%) by end of FY23

Strong focus on profitability

This will enable the business to conserve cash in the face of these circumstances

The Result will be a much stronger business well positioned to take advantage of the enormous opportunities ahead

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Leverage Strong Inventory Position

• Avoid large additional spend on production

• Suppliers to hold components on our behalf

• Total inventory level run-rate ~$15m by end FY23 (42% reduction)

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