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NetSuite and the NetSuite Logo are registered service marks of NetSuite Inc. (Updated as of October 26, 2012) NetSuite Corporate Overview

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Page 1: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

NetSuite and the NetSuite Logo are registered service marks of NetSuite Inc.

(Updated as of October 26, 2012)

NetSuiteCorporate Overview

Page 2: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

Cautionary Note – Forward Looking Statements

│ 2

This presentation contains “forward‐looking” statements that involve risks, uncertainties and assumptions relating to expectations, plans, and prospects including expectations relating to NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management at the time of this presentation. 

Actual results could differ materially from our current expectations as a result of many factors, including, but not limited to: the market for on‐demand services may develop more slowly than expected or than it has in the past; and adverse or unpredictable macro‐economic conditions or reduced investments in on‐demand applications and information technology spending. These and other risks and uncertainties associated with our business are described in our annual report on Form 10‐K for the period ending December 31, 2011 and any subsequently filed periodic reports on Form 10‐K or 10‐Q. 

We assume no obligation to, and do not intend to, update any forward looking statements.

Customers who purchase our services should make sure that their decisions are based on features that are currently available. Please be advised that any unreleased services or features from NetSuite referenced in this presentation or other public statements are not currently available and may not be delivered on time or at all. 

Page 3: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

• Cloud computing: The future of software

• 10+ year head‐start, not even a close #2

• ERP:  The “system of record”– ERP has largest TAM* of any business app category– Suite approach expands TAM to multiple categories

• Execution: Next‐phase initiatives succeeding– Verticalization of the suite– Moving up market and going global with OneWorld– NetSuite platform enabling partner ecosystem

Why NetSuite: For Investors

│ 3*Total Addressable Market

Page 4: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

Powers Enterprises Powers DisruptiveInnovators

• World’s most deployed cloud ERP• Used by 12,000+ organizations• Fastest growing top 10 Financial Management Solution*

• Used across approx. 100 countries

• Founded 1998• Publicly traded on NYSE:  “N”• Offices in 9 countries• 1,600+ employees• 2011 revenue: $236M 

NetSuite: Quick TakePerformanceBackground

* For North America     Source: Gartner, April 2011

Page 5: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

Mission Statement

To provide web‐based integrated business systems with the power of 

traditional applications used by the world's largest companies 

but at a fraction of the cost and complexity.

Page 6: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

NetSuite Fastest Growing FMS Vendor in North America  Last 3 Years

6

Market Share: All Software Markets, Worldwide, 2011, Published April 2012Chart created by NetSuite based on Gartner Market Share Note

Source: Gartner

‐5%

SAGE MSFT

11%

SAP

25%

84%

Last 3 Years

ORCL

29%

Page 7: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

SAP          Microsoft       Sage            Infor Exact

NetSuite Fastest Growing Top 10 Financials Vendor in North America Over  Last 3 Years

7Chart created by NetSuite based on Gartner Note:

Market Share: All Software Markets, Worldwide, 2010Published April 2011

‐20.00%

‐10.00%

0.00%

10.00%

20.00%

30.00%

40.00%

50.00%

60.00%

70.00%

80.00%

NetSuite Lawson        Oracle        Epicor Deltek

• NetSuite is growing market share the fastest among the top 10

• NetSuite is now the 8th largestFinancial Management Systems vendor by share

• NetSuite is the only pure cloud ERP vendor on this list

Source: Gartner

3 Year Cha

nge in M

arket S

hare 2008‐20

10 

Page 8: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

NetSuite Solution

Page 9: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

Today’s Businesses Struggle with an Application Hairball

│ 9

Warehousing

AccountingSupport

SFA

Web

Page 10: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

One System for Running a Business

│ 10

CEO CFO

Sales Rep/Manager

Support Manager

ShippingManager

Customers

Vendors Partners

ECOMMERCE

PSA

ERP

CRMSINGLEDATA

SOURCE

EcommerceManager

Page 11: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

Solution Overview

• NetSuite: Modular cloud business suite– ERP, CRM, PSA, ECommerce

• For mid‐size companies to large enterprises

• NetSuite OneWorld: Global management

• NetSuite OpenAir: Enterprise PSA

• SuiteCloud platform

│ 11

Page 12: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

Why Businesses Choose NetSuite:

• Last ever ERP upgrade – No “version‐lock”

• Suite eliminates application hairball

• Deploys in months not years

• Modern, evolving, flexible

• Dramatically lower IT cost

│ 12

Page 13: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

World’s #1 Global Cloud Suite

ECOMMERCE

PSA

ERP

CRMSINGLE DATASOURCE

SINGLE DATASOURCE

SINGLE DATASOURCE

We chose NetSuite OneWorld for its powerful multi‐entity consolidation functionality combined with the capability to tailor the system to meet unique business process requirements of each individual subsidiary.

Reginald Singh, CFO │ 13

Page 14: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

#1 Cloud ERP for the Enterprise

NetSuite is increasingly considered a safe choice for evaluation by many of the world's largest enterprises as they look to consolidate and revise their mid‐tier applications.

Source: Gartner, June 2011│ 14

Page 15: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

• Billions of customer requests per month

• Millions ofunique loginsper quarter

• Automated upgrades

• Redundantdatacenters

Infrastructure

Application

Developer Tools

Unlimited CustomizationEnterprise Infrastructure

│ 15

Page 16: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

Speed, Cost Efficiency and PowerUnprecedented Speed

150%+and 6 monthpayback*

Nucleus Research* Based on Nucleus Customer Case Study

• Deploying in 49 countries in less than a year

• 26 countries in less than 90 days

• $2BN+ global education leader with 40K+ employees

• Saving 35%‐70% versus deploying Oracle Applications

10% Implementation effort vs. typical ERP

50‐65% IT staff efficiency savings

20‐50% Faster financial close time

50%+ Quote to cash acceleration

ROI

Nucleus Research 2008 and 2010

Slashes IT Costs

Proven Results

Page 17: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

Best Known Brands Run NetSuiteSelects NetSuite OneWorld for business management in subsidiaries and emerging markets

5 countries in 6 weeks, 26 countries in less than 90 days, 49 countries within a year

RMDM Unit using  NetSuite OneWorld Ecommerce across its 13,000+ partners 

Selects NetSuite Ecommerce to drive online revenue

Siemens PLM is using NetSuite across 2,700+ users in 15+ countries ‐ and across 3,000+ client projects and 1,500+ products and skills

│ 17

Page 18: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

Cloud Suite of Choice for Leading BusinessesSoftware /Internet WD Manufacturing Services Etail/Retail Enterprises

Page 19: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

The Undisputed Cloud ERP Leader

│ 19

NetSuite is the most successful ERP suite SaaSprovider operating in terms of active customers, international presence and functionality offered across the product.

Source:Gartner, June 2011

Page 20: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

Market Opportunity

Page 21: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

Cloud is a Priority

│ 21

Technology affecting IT

#

Of companies plan to increase cloud spend over next 12 months

50+%Faster growth than worldwide IT market

4X

Worldwide and Regional Public IT Cloud Services 2011‐2015 Forecast, IDC, June 2011Reimagining IT: The Gartner 2011 CIO Survey, Gartner, January 2011

The ROI Of Cloud Apps, Forrester, June  2011

Page 22: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

$32B Addressable MarketCloud Growth Outstripping On‐Premise

CRM$11BERP

$21B

Forecast: Software as a Service, Worldwide, 2010‐2015, 1H11 UpdateForecast: Enterprise Software Markets, Worldwide, 2008‐2010, 2Q11 Update

Market Share: All Software Markets, Worldwide, 2010

Cloud ERP growth versus market

Total ERP Cloud ERP

16

14

12

10

8

6

4

2

0

7.9%

14.3%

% CAGR Thro

ugh

 201

5

Cloud CRM growth versus market

Total CRM Cloud CRM

16

14

12

10

8

6

4

2

0

9.5%

12.5%

% CAGR Thro

ugh

 201

5

22│

Source: Gartner

Page 23: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

NetSuite Growth vs. Market 2010 vs. 2009Financial Management Systems (FMS)

23Chart created by NetSuite based on Gartner Note: All Software Markets, Worldwide, 2010, Pub. Apr. 2011

Compares NetSuite FMS revenue growth versus overall FMS market revenue growth

WW FMS Growth: 8x

NetSuite Worldwide

50%

40%

30%

20%

10%

0%

N. America FMS Growth: 7x

NetSuite North America

40%

35%

30%

25%

20%

15%

10%

5%

0%

UK FMS Growth

NetSuite UK

50%

40%

30%

20%

10%

0%

‐10%

Australia FMS Growth: 14x

NetSuite Australia

140%

120%

100%

80%

60%

40%

20%

0%

Source: Gartner

Page 24: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

NetSuite Ecommerce Addresses Accelerating Move to Online Retail

24

Forecast: US Online Retail Forecast, 2010 To 2015

2009 2010

% change

% of total retail

% of total retail(excluding grocery)

February 2011 “US Online Retail Forecast, 2010 To 2015”

2011 2012 2013 2014 2015

11% 13% 12% 10% 10% 8% 8%

8% 8% 9% 10% 10% 11% 11%

11% 11% 12% 13% 14% 15% 15%

$259

$279

$240$218

$197$176

$157

(in billions)

Source: Forrester  Research Online  Retail Forecast , 2010 To 2015 (US) 

Page 25: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

Enterprise Opportunity

Page 26: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

The Two‐Tier Opportunity:

Source: GartnerJuly 28, 2010 ‐ A Two‐Tier ERP Suite Strategy: Is It Right for You? 

The Rise of Two‐Tier

2009 2011

60

50

40

30

20

10

0

enterprises now opting for two‐tier

26

A tiered ERP suite strategy is the use of ERP suites from different vendors in two or more levels of the organization —for example, corporate headquarters and local subsidiary operations.

48% 

Page 27: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

China Vietnam

WorldwideOperations

NetSuite’s Two‐Tier Solution

CORPORATERunning Oracle/SAP

E‐Business Suite Financials

US Operations

NetSuite CloudRunning 

NetSuite OneWorldSuiteCloudConnect

NetSuite CloudRunning 

NetSuite OneWorld

Page 28: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

Two‐Tier: Driving Business Velocity

│ 28

Mergers and Acquisitions:Cost effective ERP within subsidiaries

Divestitures:Shed legacy ERP with lean, customizable cloud ERP

Emerging Markets & Products:Rapidly deploy ERP with minimal CapEx and IT

Page 29: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

If we used a traditional enterprise ERP platform worldwide, it would require significant capital investment and a lot of resources in each country. NetSuite provides everything we need for our subsidiaries.

— Ysmael Baysa, CFO

$50B+ Revenue Jollibee Leverages NetSuite for Two‐Tier ERP

29│

Page 30: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

Enterprise Partnerships to Drive Success

│ 30

Accenture’s unmatched industry expertise and NetSuite’s sophisticated cloud leadership pave the way forward for global enterprises.

Paul DaughertyChief Technology Architect

Page 31: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

Financial Highlights

Page 32: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

Sustained Revenue Growth

32

$240.0

$220.0

$200.0

$180.0

$160.0

$140.0

$120.0

$100.0

$80.0

$60.0

$40.0

$20.0

$0.0

$ millions

2002 2003 2004 2005 2006 2007 2008 2009 2010

$3.1$8.3

$17.7

$36.4

$67.2

$108.5

$152.5

$166.5

$193.1

2011

$236.3

Page 33: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

2011 Financial Highlights

• Revenue increases 22% year‐over‐year to $236.3 million

• Operating cash flow up 99% year‐over‐year to $36.3 million

• Non‐GAAP Net Income increases 28% to $10.8 million

│ 33

Page 34: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

Q3 2012 Financial Highlights

• Revenue increases 31% year‐over‐year to $79.8 million

• Operating cash flow increases 61% year‐over‐year to $15.2 million

• Non‐GAAP Net Income increases 49% year‐over‐year to $5.7 million

│ 34

Page 35: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

2011 Financial TrendsNon‐GAAP Net Income

($ Thousands)

2007

12,000

10,000

8,000

6,000

4,000

2,000

(2,000)

(4,000)

(6,000)

(8,000)2008 2009 2010 2011

Non‐GAAP Gross Margin

2007

74%

73%

72%

71%

70%

69%

68%

67%2008 2009 2010 2011

Short‐Term Deferred Revenue($ Thousands)

2007

120,000

100,000

80,000

60,000

40,000

20,000

‐2008 2009 2010 2011

Cash Flow from Operations($ Thousands)

2007 2008 2009 2010 2011

40,000

35,000

30,000

25,000

20,000

15,000

10,000

5,000

0

(5,000)

(10,000)

Page 36: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

Recent Press Highlights• Ibex Outdoor Accelerates Sales Across Multiple Customer Touchpoints with 

NetSuite SuiteCommerce

• MRM Selects NetSuite Cloud

• Five More Top 100 VARs Join NetSuite Solution Provider Program

• World’s Most Innovative Companies Run on NetSuite

• NetSuite Integrates with WorldPay to Offer Merchants End‐to‐end Commerce

• One Instance of NetSuite OneWorld Runs IEEE's 70 Global Organizational Units

• NetSuite Announces Two‐tier ERP for Oracle

• NetSuite SuiteCommerce Furnishes Coco Republic's Digital Makeover

• Evita Peroni Bands With NetSuite SuiteCommerce to Accelerate International Expansion

• Australian Agribusiness Elders Launched Agsure Using NetSuite SuiteCommerce

│ 36

Page 37: NetSuite Corporate Overview · NetSuite’s future growth and the future growth of the cloud computing market. These statements are based on information available to NetSuite management

Why NetSuite

• Cloud computing: The future of software

• 10+ year head‐start, not even a close #2

• ERP:  The “system of record”– ERP has largest TAM* of any business app category– Suite approach expands TAM to multiple categories

• Execution: Next‐phase initiatives succeeding– Verticalization of the suite– Moving up market and going global with OneWorld– NetSuite platform enabling partner ecosystem

│ 37*Total Addressable Market