NMS Communications CorporationInvestor Summary
May 2008
www.nmscommunications.com www.livewiremobile.comSlide 2
Safe Harbor Statement
This presentation may contain projections or other forward-looking statements regarding future events or the future financial performance of the company. While these statements represent management’s current judgment on the future direction of the business, actual results may differ materially from any future performance suggested in the company’s forward-looking statements. We refer you to the documents that the company files from time to time with the Securities and Exchange Commission. These documents contain and identify important factors that could cause the actual results to differ materially from those contained in our projections or forward-looking statements.
www.nmscommunications.com www.livewiremobile.com
Rev Run rate exiting FY08 $30 Million Long-Term Revenue Growth 40% + Accelerated Shift to Managed Services Model Non-GAAP Profitability 4Q 2008
$66M Business TTM w/ Gross Margins > 65% & Contribution Margins > 20%
25 Year History, Products Deployed in > 110 Countries Technology Leadership & VAS Market Growth Drive Demand
NMSS Two Businesses Sum of parts greater than whole
NMS Communications Corp. at a Glance
www.livewiremobile.com
A Subsidiary of NMS Communications
the leading provider ofmobile personalization services
An integrated suite of music and video personalization services delivered from a single vendor
Slide 5
mobile personalization market
$10.7B in 2008 growing to $17.5B in 2012
Source: Juniper Research
$6.7B
$2.8 B
$3.3B
$4.7 B
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
$16,000
$18,000
2007 2008 2009 2010 2011 2012
Ringback Tones
Full Track Subscription
Full Track Download
Ringtones & Realtones
0
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
7,000,000
8,000,000
9,000,000
10,000,000
Jan-06
Mar-06
May-06
Jul-06
Sep-06
Nov-06
Jan-07
Mar-07
May-07
Jul-07
Sep-07
Nov-07
Jan-08
Mar-08
May-08
0
50,000,000
100,000,000
150,000,000
200,000,000
250,000,000
Total Subs Ringback Subs
Ringback SubscribersRingback Subs: 8.8M
Total Subs Passed: 213M
groove mobile acquisition
● Triples market size from $3B to $10B in 2008
● Accelerates business plan in 2008– Managed services rev > than
50% & accelerates LiveWire Mobile profitability to 4Q 2008
● Combined service offering meets growing market demand
● Adds significant customers and content partnerships
● Paid $14.5 million in cash
strategic fit
Fu
ll-t
rack
V
ideo
Rin
gto
ne
Platform
Service
Management
Storefront
Management
Customer Touch PointOperator
RelationshipOwning storefront +
multiple services expands revenue / sub
Oth
er A
pp
s
Rin
gb
ack
expanded operator service reach
Ringback Tones
Ringtones
Full Track Downloads
Full Track Subscription
$ 0.50
$ 0.25
$ 0.25
$ 1.50
Avg Vendor Share Per Sub / Per Month
Operator Services
Ringback Tones
Before Today
Total $2.00 (one –time) $2.50 /month
value proposition
● An integrated suite of music and video personalization services delivered from a single vendor
● For subscribers, they get– Easy access to all related content– High value targeted offers– To focus on their favorite icons
or brands
● For operators, they get– Increased service usage and adoption
Make more $ !!– More effective marketing to their
subscribers– A simplified business relationship Save
$ !!
customers and partnerships
OperatorCustomers
ContentPartners
Handset Partners
12
www.nmscommunications.com
NMS Communications
Slide 13
www.nmscommunications.com Slide 14
NMS Communications Market Focus
VAS - Enhanced Services/Applications Technology leader New application areas emerging
Mobile Highest growth area for VAS (>ARPU)
Video/Multi-media Central to next wave of applications +
investmentAsia – Global Innovation Leader Approach: Fast TTM w/New Apps “Applications Driven” Offerings
Landline
WirelessTriple-play
Broadband
VoiceSMS
Mobile Video Services
www.nmscommunications.com
Business Model
Application Components
Servers, App Platforms
Ser
vice
s
Core Technologies• Mobile Video technology• Media Processors: boards + HMP• Signaling, protocols, global approvals• ATCA MRFP platform
• VXML servers• Application-specific Gateway Server• Signaling Server
• MobileTV• VideoSMS• VideoPortal
SI’sNEPs
Service Providers / Enterprises
Enabling NEPS and Systems Integrators to deliver Value Added Services quickly and efficiently –
3 ways to win emerging apps
Slide 15
www.nmscommunications.com
NMS Communications Performance
Slide 16
Market Challenges Low end substitution Industry Consolidation China 3G Delays
Growth Drivers New Design Wins Mobile Subscriber Growth & VAS Demand Mobile broadband (3G and beyond) R&D investment 18% growing to 20% +
Continued Strength in Margins > 65% Gross Margin > 20% Contribution Margin
www.nmscommunications.com www.livewiremobile.comSlide 17
Financial Overview
www.nmscommunications.com www.livewiremobile.com
(non-GAAP) $s M Long-TermFY'06 FY'07 Q1' 08 Exit FY'08 Model
Revenues $ 8.9 $ 13.2 $ 5.2 $30M 100%Run Rate
Gross Margin 4.6 4.1 3.1Gross Margin % 52% 31% 60% 68-72%
OPEXSG&A 6.5 8.6 2.7 30-33%R&D 7.5 4.8 1.6 17-20%
Total Opex 14.0 13.4 4.3 49-52%Profitable
Contribution Margin $ (9.4) $ (9.3) $ (1.2) Run Rate 17-22%
LiveWire Mobile
www.nmscommunications.com www.livewiremobile.com
NMS Communications Platforms
(non-GAAP) $s M Long-TermFY'06 FY'07 Q1' 08 Model
Revenues $ 87.1 $ 69.2 $ 14.0 100%
Gross Margin 59.6 48.1 9.6Gross Margin % 68% 69% 69% 65-68%
OPEXSG&A 14.1 15.1 3.6 18-20%R&D 13.4 12.7 3.5 19-21%
Total Opex 27.6 27.8 7.1 39-42%
Contribution Margin 32.1$ 20.3$ 2.5$ 25-28%
www.nmscommunications.com www.livewiremobile.com
(non-GAAP) $s M Long-TermFY'06 FY'07 Q1' 08 Model
Revenues $ 96.0 $ 82.5 $ 19.2 100%
Gross Margin 64.1 52.2 12.8Gross Margin % 67% 63% 67% 67-70%
OPEXSG&A 39.9 37.0 8.9 30-33%R&D 21.5 17.8 5.1 18-20%
Total Opex 61.4 54.8 13.9 48-51%
Restructuring 5.5 0.0 0.4
Operating Income (Loss) $ (2.8) $ (2.6) $ (1.5) 17-21%
NMS Communications Corp
www.nmscommunications.com www.livewiremobile.com
(In $Millions except DSO and Inventory Turns)
Dec '06 Dec '07 Mar '08
Cash & Securities $32.3 $30.2 $10.4
Inventory $3.6 $2.7 $2.9
Accounts Receivable $13.3 $13.6 $11.7
Other Assets $20.2 $21.1 $36.7
Total Assets $69.3 $67.6 $61.7
Liabilities $14.3 $17.1 $15.8
Deferred Revenue $4.4 $3.4 $2.6
Stockholders' Equity $50.6 $47.1 $43.2
Total Liab. & S.E. $69.3 $67.6 $61.7
DSO with Deferred Revenue 55 Days 51 Days 55 Days
Inventory Turns with Deferred Inventory 8.5X 9.9X 9.6X
Balance Sheet
www.nmscommunications.com www.livewiremobile.com
Q2 & FY ’08 Guidance
Guidance as of May 12, 2008:
Q208 revenues to be flat-to-up modestly from the first quarter.
Modest operating loss for Q208 on a non-GAAP basis primarily due to an estimated restructuring charge of approximately $1.2 million
LiveWire Mobile to exit 2008 with a revenue run rate in excess of $30 million. NMS Communications business to generate full year 2008 revenues that are modestly down from 2007.
The overall Company to deliver modest profitability on a non-GAAP basis for the full year 2008, not including the estimated restructuring of approximately $1.6 million. LiveWire Mobile to reach profitability on a non-GAAP basis in the fourth quarter of 2008.
www.nmscommunications.com www.livewiremobile.comSlide 23
Investment Summary
LiveWire Mobile Rapid growth… accelerated business model shift…profitability
in 4Q 2008
NMS Communications Highly Profitable… modest revenue decline near term and
modest growth long-term
Corporate Separating the two businesses to better serve distinct markets
and to enhance shareholder value
www.nmscommunications.com www.livewiremobile.com