NETGEAR® Powering Extraordinary Experiences Investor Day NOV 17 2025 . Welcome to GEAR Investor 2025 Agenda Transformation 01 02 Enterprise Consumer 03 04 Financials Q&A 05 OR Demos Safe Harbor Disclosure This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including, among others, statements regarding NETGEAR's strategy, transformation plans, business outlook, financial targets, market opportunities, and future operating performan ...

Financial Data and Key Metrics Changes - For Q3 2025, revenue was $184.6 million, up 8.2% sequentially and 0.9% year over year, exceeding guidance [19] - Non-GAAP gross margin reached a record 39.6%, an increase of 850 basis points year over year and 180 basis points sequentially [25] - Non-GAAP operating income was $3.8 million, resulting in a non-GAAP operating margin of 2.1%, an improvement of 120 basis points year over year [29] Business Line Data and Key Metrics Changes - The enterprise segment generated $90.8 million in revenue, up 9.9% sequentially and 15.7% year over year, driven by strong demand for Pro AV managed switches [20] - Home networking revenue was $72.6 million, down 6.6% year over year but up 7.6% sequentially, with share growth in Wi-Fi 7 routers and mesh systems [21][15] - Mobile segment revenue was $21.1 million, down 20.7% year over year but up 3.3% sequentially, benefiting from high-end product adoption [21] Market Data and Key Metrics Changes - The enterprise segment's gross margin was 51%, up 630 basis points year over year, reflecting strong demand for managed switches [26] - The home networking segment's gross margin improved to 27.7%, up 590 basis points year over year, aided by a better product mix [27] - The mobile segment achieved record non-GAAP gross margins of 31%, an increase of 1,270 basis points year over year [26] Company Strategy and Development Direction - The company is undergoing a transformation aimed at long-term growth and profitability, with a focus on operational efficiency and capitalizing on market opportunities [4][6] - A new website was launched to reflect the rebranding of the commercial business to NETGEAR Enterprise, distinguishing it from consumer offerings [8] - The company plans to report on two segments going forward: NETGEAR Enterprise and NETGEAR Consumer, integrating mobile products into both segments [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the transformation efforts, noting that profitability milestones are being achieved ahead of expectations [6][18] - The company anticipates continued strong demand for enterprise products, although supply constraints may limit growth potential in the short term [31] - For Q4 2025, revenue guidance is set between $170 million and $185 million, with expectations of slight reductions in operating expenses [31][32] Other Important Information - The company repurchased $20 million of common stock during the quarter, reflecting a commitment to returning value to shareholders [6][30] - The annual recurring revenue (ARR) reached $37.9 million, growing 17.2% year over year, with 560,000 recurring subscribers at the end of Q3 [24] Q&A Session Summary Question: What is the gross margin headwind for Q4? - The main headwind is related to DDR4 memory pricing, affecting all segments but more acutely felt in home networking [35] Question: What factors could influence revenue guidance? - Supply constraints and the success of the Q4 holiday promotional period are key factors that could impact revenue [36] Question: What is the company's position regarding TP-Link? - There is significant government scrutiny around TP-Link, which may benefit NETGEAR as customers recognize it as a trusted U.S.-based partner [40] Question: What should investors be mindful of for 2026? - Seasonality in the consumer business and ongoing investments for growth are important considerations for shaping models for 2026 [42] Question: Can you elaborate on the enterprise networking and security integration? - The company aims to provide enterprise-level reliability with a simple user interface, focusing on software differentiation and recurring revenue [60]