DEUTSCHE BANK PRESENTATION TELECOMMUNICATIONS CONFERENCE

Transcription

1 DEUTSCHE BANK INVESTOR MEDIA, INTERNET & PRESENTATION TELECOMMUNICATIONS CONFERENCE March 5, 2013

2 Safe Harbor Statement This presentation contains forward-looking statements that involve risks, uncertainties and assumptions. If the risks or uncertainties ever materialize or the assumptions prove incorrect, our results may differ materially from those expressed or implied by such forward-looking statements. All statements other than statements of historical fact could be deemed forward-looking, including, but not limited to, any projections of financial information; any statements about historical results that may suggest trends for our business and results of operations; any statements of the plans, strategies and objectives of management for future operations; any statements of expectation or belief regarding future events, potential markets or market size, technology developments, or enforceability of our intellectual property rights; and any statements of assumptions underlying any of the foregoing. These statements are based on estimates and information available to us at the time of this presentation and are not guarantees of future performance. Actual results could differ materially from our current expectations as a result of many factors, including but not limited to: quarterly fluctuations in our business and results of operations; our ability to address market needs and sell our applications and services successfully; the general market conditions of the rental market industry; and the effects of competition. These and other risks and uncertainties associated with our business are described in our most recent Form 10-K which was filed with the SEC on April 13, We assume no obligation and do not intend to update these forward-looking statements. In addition to U.S. GAAP financials, this presentation includes certain non-gaap financial measures. These historical and forward-looking non-gaap measures are in addition to, not a substitute for or superior to, measures of financial performance prepared in accordance with GAAP. A reconciliation between GAAP and non-gaap measures is included in the appendix to this presentation. Boingo is a registered trademark of Boingo Wireless, Inc. This presentation also contains additional trademarks and service marks of ours and of other companies. We do not intend our use or display of other companies trademarks or service marks to imply a relationship with, or endorsement or sponsorship of us by, these other companies Boingo Wireless Page 1

3 A unique Wi-Fi and DAS business built over a decade MANAGED AND OPERATED NETWORK ROAMING NETWORK SOFTWARE PLATFORM Manage and operate strategic Wi-Fi & DAS locations Long-term venue contracts Largest independent indoor DAS provider in the U.S. ~2,000 global commercial hotspot locations in the U.S., Europe and Asia Aggregate Wi-Fi networks through global partnerships 140+ operator partners in 100+ countries Operate software and billing platform Authentication technology that creates seamless network Working with carriers on Hotspot 2.0 standards to simplify carrier offload 11 Operating Systems 51 Detection & Login Methods Airports Stadiums 1,200 Network Identifiers Malls Retail QSRs 2013 Boingo Wireless Page 2

4 600,000+ global hotspots* M&O & DAS FOOTPRINT ROAMING FOOTPRINT ~2,000 global commercial hotspot locations 16 DAS locations; 5,600 nodes High-traffic, high-density locations Airports, stadiums, QSRs, malls & hot zones ~600,000 commercial locations; 140+ roaming partners ~250,000 free crowdsourced hotspots >100 countries across 6 continents Predominantly airports, cafes/retail & hotels EMEA 241,206* North America 10,445* Asia 420,672* South America 2,240* *Note: Hotspot counts include commercial locations only Boingo Wireless Page 3

5 Massive mobile data demand EXPLOSION OF MOBILE DATA TRAFFIC (Exabytes per Month) Source: Cisco Visual Network Index Boingo Wireless Page 4

6 driving small cell topology shift COVERAGE MODEL Network of large towers built for vast geographic coverage Designed for "no dropped calls" on voice services Designed for large number of light users per cell In-building penetration is challenging WHY THE SHIFT IS HAPPENING: 80% of all mobile data traffic occurs indoors 1 data customer = 100 voice customers Source: Cisco Small Cell Market Trends DENSITY MODEL Deployment of micro-cell technologies aimed at maximizing capacity in small geographies Large venues: Wi-Fi + DAS Small venues: Wi-Fi, and occasionally, Femtocell Wi-Fi has best economics: lowest cost; highest bandwidth; free and abundant spectrum 2013 Boingo Wireless Page 5

7 Cellular networks can t handle this demand DROPPED CALLS! NETWORK CONGESTION! DATA THROTTLING! TIERED DATA PLANS! SLOW DOWNLOADS! CARRIERS CHALLENGED TO ADDRESS CAPACITY CONSTRAINTS DATA DEMAND FAR OUTSTRIPS CAPACITY INDUSTRY STANDARDS FAVOR CELLULAR OFFLOAD Our objective for 2014 is that we won't do any small cell or in-building systems that don't include Wi-Fi. In addition to that (4G Networks), we ll be implementing Wi-Fi strategically as another asset to support our customers use patterns and leverage the technology that s out there today. 13x Capacity crunch 4x HOTSPOT U John Donovan, Senior Executive Vice President, 2013 Anthony Melone, CTO 2011 Mobile data traffic 4G/LTE Capacity Upgrade ncrease Source: Verizon, Cisco Visual Network Index Boingo Wireless Page 6

8 Carrier offloading is becoming a reality Signed agreement with U.S based tier 1 carrier for global roaming; implementation in market in international locations Signed national master agent agreement with tier 1 carrier for DAS networks Signed agreement with Competitive Carriers Association to provide Wi-Fi offload solutions Signed agreement with NTT DOCOMO in Japan for Wi-Fi roaming & data offload Boingo working with global carriers on Hotspot 2.0 standards to simplify offloading Anticipate future agreements with carriers for automatic handset authentication onto the Boingo network GROWTH IN SMALL CELL OFFLOAD (Exabytes per Month) Source: Cisco Visual Network Index Boingo Wireless Page 7

9 Diversified monetization platform Boingo is unique with 12 years experience in Wi-Fi and DAS and a multi-faceted monetization approach that maximizes the revenue opportunity per venue. ADVERTISING CONSUMER PAY SERVICE PROVIDER FEES WHOLESALE/ CARRIER OFFLOAD DAS Airports Stadiums Malls Retail Stores Restaurants Campuses 2013 Boingo Wireless Page 8

10 Evolving business model REVENUE COMPOSITION (1) Drivers: + Carrier offload Wholesale: ~52% Retail: ~39% Drivers: + Wi-Fi enabled devices Hybrid / consumerfree venues Carrier offload + Wholesale usage + Consumer-free venues + DAS builds Advertising & other: ~9% Drivers: + Hybrid / consumer free venues + Location-based services Note: + = positive growth driver, - = negative growth driver. (1) Based on Q revenues of $28.0 million Boingo Wireless Page 9

11 Accelerating wholesale business ROAMING / CARRIER OFFLOAD DAS Partner with carriers, telecom operators, venues and Wi-Fi providers Provide partners customers roaming access onto Boingo Wi-Fi footprint Integrate Boingo software with partner products Revenue composition: access fees and/or license fees 16 DAS networks with nearly 6,000 nodes operational, plus 2,700 planned but not built Capital deployment reimbursed by carriers Participating carriers customers provided access to cellular extension network Revenue composition: build project revenue, access fees and/or minutes of use fees 2013 Boingo Wireless Page 10

12 Stable, recurring retail platform BUSINESS OVERVIEW Access to 600,000+ global hotspots Affordable, unlimited Wi-Fi access Easy-to-use, fast connectivity Manage and operate Wi-Fi networks in airports, stadiums, arenas, malls, quickservice restaurant and retail establishments LIFETIME VALUE Customer acquisition cost of less than $10 Average subscription life of ~12 months Payback to Boingo in less than 2 months New verticals expected to drive future growth RETAIL SUBSCRIBERS CONNECTION COMPOSITION (1) (thousands) Tablet 18% 200 Laptop 44% Mobile 38% (1) Based on 2012 connects of X.X million Boingo Wireless Page 11

13 A powerful platform for advertising opportunities DISPLAY ADVERTISING SPONSORSHIPS LOCATION-BASED SERVICES Venues serve more than 1.5 billion annual visitors Advertisers can target attractive demographic audience by venue (airports, malls, etc.) High CPM based on audience + location High engagement advertising Multiple engagement advertising offerings Download an app Type in advertiser slogan capture Delivery of content and/or advertising to consumer Based on where they are Based on what they are doing online Delivery of analytic information to venues Pathing Cueing Dwell time 2013 Boingo Wireless Page 12

14 Financial performance Revenue Adjusted EBITDA (1) ($ in millions) ($ in millions) $102.5 $30.6 $94.6 $28.6 $80.4 $65.7 $18.2 $ % % % % Adjusted EBITDA margin (1) Defined as net income (loss) attributable to common stockholders plus accretion of convertible and redeemable stock, depreciation, amortization of intangible assets, interest and other income (expense), net, income taxes, stock-based compensation expense and non-controlling interests expense Boingo Wireless Page 13

15 Equity snapshot EXCHANGE NASDAQ TICKER WIFI STOCK PRICE $6.10 EQUITY MARKET CAPITALIZATION $216 MILLION ENTERPRISE VALUE $117 MILLION CASH / DILUTED SHARE $2.65 EV / TTM REVENUE (1) 1.1x EV / TTM ADJUSTED EBITDA (1) 3.8x Note: Based on equity market data as of March 1, (1) As of the period ended December 31, Boingo Wireless Page 14

16 A compelling mobile Internet business Large and rapidly growing mobile data market Unique, multi-faceted monetization platform Long-term, exclusive venue contracts Scalable technology platform Highly recurring, diversified revenue, capital efficient 2013 Boingo Wireless Page 15

17 2013 Boingo Wireless Page 16