Investor deck november 2017 final

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<ul><li><p>1Contains proprietary and confidential information owned by Synacor, Inc. / 2017 Synacor, Inc.</p><p>DRIVING GROWTH IN ATTRACTIVE DIGITAL MARKETS </p><p>N O V E M B E R 2 0 1 7</p><p>1</p></li><li><p>2</p><p>SAFE HARBOR</p><p>"Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995: This presentation contains forward-looking statements concerning </p><p>Synacors expected financial performance as well as Synacors strategic and operational plans. The achievement or success of the matters covered by such </p><p>forward-looking statements involves risks, uncertainties and assumptions. If any such risks or uncertainties materialize or if any of the assumptions prove </p><p>incorrect, the company's results could differ materially from the results expressed or implied by the forward-looking statements the company makes. </p><p>Synacor is under no obligation to, and expressly disclaims any such obligation to, update or alter forward-looking statements, whether as a result of new </p><p>information, future events, or otherwise.</p><p>The risks and uncertainties referred to above include - but are not limited to - risks associated with: execution of Synacors plans and strategies; the loss of a </p><p>significant customer; the companys ability to obtain new customers; expectations regarding consumer taste and user adoption of applications and </p><p>solutions; developments in Internet browser software and search advertising technologies; developments in display advertising technologies and practices; </p><p>general economic conditions; expectations regarding the company's ability to timely expand the breadth of services and products or introduction of new </p><p>services and products; consolidation within the cable and telecommunications industries; changes in the competitive dynamics in the market for online </p><p>search and display advertising; the risk that security measures could be breached and unauthorized access to subscriber data could be obtained; potential </p><p>third party intellectual property infringement claims; and the price volatility of Synacors common stock.</p><p>Further information on these and other factors that could affect the company's financial results is included in filings it makes with the Securities and </p><p>Exchange Commission from time to time, including the section entitled "Risk Factors" in the company's most recent Form 10-K filed with the SEC. These </p><p>documents are available on the SEC Filings section of the Investor Information section of the company's website at </p></li><li><p>3</p><p>INVESTMENT HIGHLIGHTS</p><p>A Transformation Story with Multiple Profitable Growth Avenues</p><p>STRONG OPPORTUNITIES FOR </p><p>GROWTH</p><p>RECURRING AND FEE-BASED REVENUE </p><p>MASSIVE TRANSFORMATION</p><p>ON A PATH:</p><p> 3 YEARS (2019)</p><p> $30M EBITDA</p><p> $300M REVENUE</p><p>SEASONED MANAGEMENT</p><p>TEAM</p><p>3</p></li><li><p>4</p><p>PORTALS EMAIL ANDCOLLABORATION</p><p>MULTIPLATFORM VIDEO</p><p>CLOUD ID </p><p>ENGAGING CONSUMERS</p><p>ADVERTISING</p></li><li><p>5</p><p>OUR MISSION</p><p>We enable our customers to better engage </p><p>with their consumers</p><p>5</p></li><li><p>6</p><p>TWO PRIMARY SOURCES OF REVENUE</p><p>SEARCH AND ADVERTISING RECURRING AND FEE-BASED</p><p>Advanced Portal </p><p>Experiences</p><p>Email/Collaboration Video Platform/Cloud IDAdvertising Solutions</p></li><li><p>7</p><p>MULTI-PLATFORM PORTAL EXPERIENCES DESIGNED FOR ENGAGEMENT AND MONETIZATION</p><p>Personalized, curated, and relevant content experience that drives engagement and reinforces ISP brand across devices</p><p> Modern design, stream-based experience</p><p> Hundreds of thousands of articles and videos</p><p> Push notification for breaking news</p><p> Flexible and customizable for customer needs</p><p> Monetization through integration with Synacor Media</p></li><li><p>8</p><p>Complete advertising platform:</p><p> Strong Monetization Search, display, video and mobile Direct, programmatic, network</p><p> Publisher and Portal Network Operated and managed portals Publisher platform</p><p> Targeting Expertise Proprietary and third-party data Ad Ops and Analytics</p><p>Hundredsof Publishers</p><p>SYNACOR MEDIA: COMPELLING AD PLATFORM AT SCALE</p><p>200MUniques</p><p>35M+Broadband Households</p></li><li><p>9</p><p>SEARCH &amp; ADVERTISING GROWTH OPPORTUNITY </p><p> Launch AT&amp;T</p><p> Win new portal customers</p><p> Programmatic growth</p><p> Grow publisher reach and products</p><p> Expand mobile monetization</p><p>Digital Ad Spending</p><p>12%</p><p>$72BTotal Market</p><p>Source: eMarketer, growth for 2016 2020Total Market for 2016</p><p>9</p></li><li><p>10</p><p>EMAIL &amp; COLLABORATIONOPEN, SECURE, PRIVATE PRODUCT SUITE</p><p>10</p><p> Powering ~500M mailboxes </p><p>one of the largest providers </p><p>of white label email in the world</p><p> Open source, on-prem software, and as a </p><p>fully managed &amp; hosted solution </p><p> Unmatched migration </p><p>&amp; hosting capability</p><p> Serving service providers, </p><p>government agencies, and </p><p>business enterprises globally</p></li><li><p>11</p><p>EMAIL &amp; COLLABORATION GROWTH OPPORTUNITY </p><p> Open source program to monetize ~400 million existing mailboxes </p><p> Open Source Support subscription</p><p> Suite Plus (e.g. backup, admin tools) </p><p> Grow government customer base focusing on security &amp; privacy</p><p> Leverage partner community to accelerate feature development and grow sales</p><p>Market Growth</p><p>24%</p><p>$19BTotal Market</p><p>11Source: Radicati, growth for 2016 2020Total Market for 2016</p></li><li><p>12</p><p>VIDEO PLATFORM/CLOUD IDEND-TO-END VIDEO AND IDENTITY MANAGEMENT PLATFORM</p><p> Ability to authenticate nearly all Pay TV households in US</p><p> Selected to provide Cloud ID Authentication for HBO Go </p><p> Supported deployment of Apples Single Sign-On platform</p><p> Participating with CTAM &amp; OATC on industry standards</p><p> Debuted end-to-end TVE and OTT solutions for GVTC and Consolidated</p><p>12</p></li><li><p>13</p><p>VIDEO PLATFORM/CLOUD ID GROWTH OPPORTUNITY</p><p> Win new video platform customers</p><p> Win new content provider customers</p><p> Extend Cloud-ID into new verticals and geographies</p><p>Online OTT &amp; Video Revenue</p><p>28%</p><p>$37BTotal Market</p><p>13Source: Digital TV Research, 2010 2020Total Market for 2016</p></li><li><p>14</p><p>BLUE-CHIP CUSTOMERS AND PARTNERS</p><p>Advertising and Content Partners</p><p>Command and Simulation Solutions</p><p>Chile</p><p>120 Service Providers, 1,000 Government Agencies, 2,500 Businesses, 1,000 Publishers</p><p>ADVERTISING</p></li><li><p>15</p><p> Win new portal and email service provider customers</p><p> Win government email customers</p><p> Win content providers</p><p> Launch AT&amp;T</p><p> Programmatic Growth</p><p> Expand mobile monetization</p><p>4-PILLAR GROWTH AGENDA BUILT ON OPERATING DISCIPLINE</p><p>Increase value for existing customers by optimizing consumer experience &amp; </p><p>monetization</p><p>Innovate on Synacor-as-a-platform for advanced </p><p>services</p><p>Win new customers in current and related </p><p>verticals</p><p>Extend product portfolio into international and </p><p>enterprise</p><p>CLEAR STRATEGY FOR PROFITABLE REVENUE GROWTH</p><p> Grow Open Source Support adoption</p><p> Explore Cloud ID into new verticals</p><p> Leverage partner community to accelerate email feature development</p><p> Win customers in new geographies</p><p>BUILT ON OPERATING DISCIPLINE</p></li><li><p>16</p><p>SYNACORS 3/30/300 PATHTARGETING $300M IN REVENUES AND $30M IN EBITDA IN 2019</p><p>Revenue, $Millions Adjusted EBITDA*, $Millions</p><p>*Please refer to the appendix for information regarding the reconciliation of GAAP net loss to adjusted EBITDA for twelve months ended December 31, 2015 and </p><p>December 31, 2016 and for guidance for twelve months ending December 31, 2017. Guidance is as of November 14, 2017.</p><p>INVESTING ~$10M BETWEEN 2H16 1H17 TO DEVELOP AND DEPLOY FOR A MAJOR CUSTOMER</p><p>$110.2$127.4 </p><p>$140 - $145</p><p>~$300 </p><p>2015 2016 2017G 2019G</p><p>$7.6 </p><p>$3.2 $0.8 - $2.8 </p><p>~$30</p><p>2015 2016 2017G 2019G</p></li><li><p>17</p><p>INVESTMENT HIGHLIGHTS</p><p>A Transformation Story with Multiple Profitable Growth Avenues</p><p>STRONG OPPORTUNITIES FOR </p><p>GROWTH</p><p>RECURRING AND FEE-BASED REVENUE </p><p>MASSIVE TRANSFORMATION</p><p>ON A PATH:</p><p> 3 YEARS (2019)</p><p> $30M EBITDA</p><p> $300M REVENUE</p><p>SEASONED MANAGEMENT</p><p>TEAM</p><p>17</p></li><li><p>18</p><p>THANK YOU</p></li><li><p>19</p><p>APPENDIX</p></li><li><p>20</p><p>ADJUSTED EBITDA RECONCILIATION</p><p>2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 2016 Q1 2017 Q2 2017</p><p>Revenue 110,245 30,260 30,476 31,721 34,916 127,373 26,540 31,216</p><p>Net (loss) income (3,474) (1,565) (2,757) (3,365) (3,053) (10,740) (6,656) (3,276)</p><p>Provision (benefit) for income taxes 239 144 260 379 436 1,219 446 309</p><p>Interest expense 245 68 84 75 91 318 87 114</p><p>Other (income) expense 16 (2) (242) 38 248 42 (6) (67)</p><p>Depreciation and amortization 6,901 2,098 2,270 2,414 2,453 9,235 2,184 2,224</p><p>Stock-based compensation 3,115 737 687 680 667 2,771 647 676</p><p>Loss in equity interest 73 - - - - - - -</p><p>Capitalized software impairment - - - - 334 334 - 256</p><p>Acquisition costs 478 - - - - - - -</p><p>Adjusted EBITDA 7,593 1,480 302 221 1,176 3,179 (3,298) 236</p><p>Q3 2017</p><p>36,269</p><p>261</p><p>127(99)</p><p>2,596</p><p>-</p><p>-</p><p>1,832</p><p>244</p><p>605</p><p>-</p><p>Gain on sale of investment - -- - - - - - (1,902)</p></li><li><p>21</p><p>FISCAL 2017 AND Q3 2017 GUIDANCE RECONCILIATION*</p><p>Fiscal 2017 Guidance: Revenue for the full year of 2017 is now expected to be within the range of $140 million to $145 million. The Company expects to report a net loss in the range of $9.1 million to $11.4 million and adjusted EBITDA in the range of $0.8 million to $2.8 million, which excludes stock-based compensation expense of $2.5 million to $2.6 million, depreciation and amortization of $9.6 million to $9.8 million, gain on investment of $1.9 million and tax, interest expense, capitalized software impairment, and other income and expense of $1.7 million. </p><p>Q4 2017 Guidance: Revenue for the fourth quarter of 2017 is projected to be in the range of $46.0 million to $51.0 million. The Company expects to report net income of ($1.8) million to $0.5 million and adjusted EBITDA of $2.0 million to $4.0 million, which excludes stock-based compensation expense of $0.6 million to $0.7 million, depreciation and amortization of $2.6 million to $2.8 million, and tax, interest expense and other income and expense of $0.3 million.</p><p>*Guidance is as of November 14, 2017.</p></li></ul>