8x8 : Q3FY21 Earnings Slides

Earnings Results

Third Quarter Fiscal 2021

(Ended December 31, 2020)

January 28, 2021

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Forward Looking Statements

This presentation includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Exchange Act of 1934. These statements relate to the release of new products, market demand for products, changing industry trends and competition, business strategies, future operating performance and outlook, including the economic impacts of of COVID-19 pandemic and future profitability. These forward-looking statements are predictions only, and actual events or results may differ materially from such statements depending on a variety of factors. These factors include, but are not limited to:

• Customer adoption and demand for our X-Series product line may be lower than we anticipate.
• Impact of economic downturns on us and our customers, including from the COVID-19 pandemic.
• Competitive dynamics of the UCaaS, CCaaS, CPaaS, video and other markets in which we compete may change in ways we are not anticipating.
• Third parties may assert ownership rights in our IP, which may limit or prevent our continued use of the core technologies behind our solutions.
• We may not achieve our target service revenue growth rate, or the revenue, earnings, bookings or other amounts we forecast in our guidance, for a particular quarter or for the full fiscal year of 2021.
• Our customer churn rate may be higher than we anticipate.
• Our Investments we make in marketing, channel and value-added resellers (VARs), e-commerce, new products, may not result in revenue growth.

For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" in the Forms 10-K and 10-Q filed by 8x8, Inc. with the Securities and Exchange Commission. All forward-looking statements are qualified in their entirety by this cautionary statement, and 8x8, Inc. undertakes no obligation to update publicly any forward-looking statement for any reason, except as required by law, even as new information becomes available or other events occur in the future.

Non-GAAP Measures

This presentation contains certain financial information that has not been prepared in accordance with Generally Accepted Accounting Principles (GAAP). Management uses these non-GAAP financial measures internally in analyzing the Company's financial results and believes they are useful to investors, as a supplement to GAAP measures, in evaluating the Company's ongoing operational performance. This information should not be considered a substitute for any measures derived in accordance with GAAP.

8x8 Fiscal Q3 2021 Earnings Results

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8x8 - A Leader in Cloud Communications Services

About 8x8 Inc.

● 1,600+ employees

● 15 offices in 8 countries

● 1M+ business users in

160 countries

● 16 global data centers

● 10 Support locations

● Video conferencing

● Voice conferencing

● Co-browse / screen

share

● Meeting analytics

Meetings	Voice	Contact
	Center
Video
		Messaging
		Open
	Communications
		PlatformTM

● Routing

● Analytics

● Workforce Engagement

● AI/Automation & Assist

● Collaboration

● 262 patents awarded

● NYSE: EGHT

● 1:1 messaging

● Group messaging

● Channel elevation

● Team messaging

solution aggregator

Intelligence

Messaging

Analytics

Telephony

● Native VoIP

● Cloud PBX

● Hard-phone

integration

● Native softphone

	Gartner UCaaS Magic Quadrant Leader	Gartner CCaaS Magic Quadrant Challenger	3
8x8 Fiscal Q3 2021 Earnings Results	Gartner, 2012-2020	Gartner, 2015-2020

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Financial Results vs. Guidance | Q3 Fiscal 2021

		Q3 F2021
		Guidance	Results
		(October 28, 2020)	(January 28, 2021)
	Total Revenue	$132.0 - 133.0m	$136.7m
	% Growth Y/Y	11-12%	15.3%
	Service Revenue	$124.0 - 125.0m	$127.1m
	% Growth Y/Y	12-13%	15.2%
	Pre-Tax Loss (Non-GAAP)	(~$3.0m)	($1.9m)
8x8 Fiscal Q3 2021 Earnings Results		4

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Q3 Fiscal 2021 | Business Highlights

Strong and Growing Large Deals With Annual Recurring Revenue (ARR) Greater than $100,000:

• 734 customers with Annual Recurring Revenue (ARR) > $100,000, 24% year-over-year growth
• Closed record 53 new customer deals with ARR > $100,000, 33% year-over-year growth. These deals represented 39% of new bookings for the quarter and included 34 new logo deals.

Annual Recurring Revenue (ARR):

• Total ending ARR was $494.3M and grew 20% year-over-year
• Small business customers with revenue <$50M comprised 52% of ending (ARR) and grew 12% year-over-year
• Mid-marketcustomers with revenue between $50M - $1B comprised 26% of ending (ARR) and grew 21% year-over-year
• Enterprise customers with revenue >$1B comprised 22% of ending (ARR) and grew 46% year- over-year

8x8 Fiscal Q3 2021 Earnings Results

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Q3 Fiscal 2021 | Business Highlights (continued ...)

Product Highlights:

• Contact center new bookings grew 33% year-over-year and represented 31% of total new bookings
• Included in Microsoft's Connected Contact Center for Microsoft Teams Certification program, integrating seamlessly with 8x8 Voice for Microsoft Teams' direct routing capability
• Announced partnership with Verint to bring integrated cloud workforce management applications to mid-market and enterprise businesses worldwide
• Google Verified SMS is now available through the 8x8 SMS API
• Ended the quarter with a total of 262 patents awarded

8x8 Fiscal Q3 2021 Earnings Results

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Q3 Fiscal 2021 | Business Highlights (continued ...)

Channel Momentum:

• Channel Bookings grew 64% year-over-year and represented 64% of new bookings
• 8 of top 10 new bookings from channel partners
• 1,139 active channel partners, 28% year-over-year growth

Industry Recognition:

• Named Leader in the 2020 Gartner Magic Quadrant for Unified Communications as a Service, Worldwide
• Named Challenger in the 2020 Gartner Magic Quadrant for Contact Center as a Service
• Awarded 2020 CRN UK Cloud Services Vendor of the Year
• Awarded 2020 TechTarget Archer Awards - North America - Best Channel Enablement Program

8x8 Fiscal Q3 2021 Earnings Results

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New Bookings | Customers >$100K ARR

# of Customers (cumulative)

			670	734
592	611	606
3Q20	4Q20	1Q21	2Q21	3Q21

% of New Bookings

43% 42% 39%

33% 34%

3Q20

4Q20

1Q21

2Q21

3Q21

Annual Recurring Revenue (ARR) = annualized subscription revenue and the annualized platform usage revenue for all CPaaS customers who meet a minimum revenue threshold for a period of at least 6 consecutive months.

8x8 Fiscal Q3 2021 Earnings Results

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ARR | By Customer Size

Total ARR Growth of +20% YOY with Strong Growth & Contribution

From Mid-Market & Enterprise Customers

+46%

COMBINED	yoy growth	22%
MID-MARKET		ENTERPRISE		+12%
AND
			yoy growth
ENTERPRISE			52%
+31%	+21%		SMALL				ARR By Customer Size
yoy growth	26%	BUSINESS
yoy growth		(based on company $ revenue)
		MID-MARKET					SMALL BUSINESS = <$50M
							MID MARKET = $50M - $1B
							ENTERPRISE = >$1B

Annual Recurring Revenue (ARR) = annualized subscription revenue and the annualized platform usage revenue for all CPaaS customers threshold for a period of at least 6 consecutive months. Percentages may not add up due to rounding. Customer revenue size based on 3rd

who meet a minimum revenue party sources.

8x8 Fiscal Q3 2021 Earnings Results

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Revenue | Strong Continued Increases

($ in millions)
				Total Revenue					Service Revenue
$118.6	$121.5	$121.8	$129.1	$136.7			$127.1
				7%
				6%						$120.9
							6%
	7%		7%
														$112.5	$114.2
										94%			93%		$110.4
	93%		93%				94%

3Q20		4Q20	1Q21		2Q21	3Q21	3Q20	4Q20	1Q21	2Q21	3Q21
		Service Revenue		Other Revenue						10
8x8 Fiscal Q3 2021 Earnings Results

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Revenue Per Customer | Increasingly Attractive Economics

Unit Level Customer Economics ... With Particular Strength in Larger Customers

		Mid-Market					Enterprise
				$177	$174		$185
			$51	$167	$173
$42	$43	$42	$45

3Q20

4Q20

1Q21

2Q21

3Q21

3Q20

4Q20

1Q21

2Q21

3Q21

Average Annual Service Revenue Per Customer (in thousands)

Note: Mid-Market defined as customers with annual revenues from $50M to $1B and Enterprise defined as customers with annual revenue over $1B as defined by company size. Post-reclassification of Professional Services for all quarters in fiscal 2020.

8x8 Fiscal Q3 2021 Earnings Results

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Gross Margin | Non-GAAP Margins*

66.4%	66.7%	67.7%	66.8%	66.0%

56.7%

61.3%60.9%

58.0%

59.6%

3Q20	4Q20		1Q21	2Q21	3Q21
			Gross Margin			Service Margin

• For a reconciliation of GAAP to Non-GAAP metrics, refer to the Appendix for additional information. Post-reclassification of Professional Services for all quarters in fiscal 2020.

8x8 Fiscal Q3 2021 Earnings Results

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Single Technology Platform | 8x8 R&D Innovation

Strong Continued Innovation With Large Total R&D Investment

($ in millions)				$22.4
$21.5				$20.8		$21.4
$20.3
		$8.1
	$8.4									$6.7
							$8.1
		$8.8
39%			34%	36%				31%
			39%
		43%
		36%
$13.1	$11.5		$14.3	$12.7		$14.7

3Q20

4Q20

1Q21

2Q21

3Q21

• • in bar charts represents the portion of total R&D spend that is capitalized in the period
    Non-GAAP R&D Expense on P&L * Capitalized Development Costs
• For a reconciliation of GAAP to Non-GAAP metrics, refer to the Appendix

8x8 Fiscal Q3 2021 Earnings Results

15.6%

3Q21 R&D

INVESTMENT (% of Revenue)

4.9%

3Q21 CAPITALIZED COSTS

(% of Revenue)

10.7%

3Q21 NON-GAAP (% of Revenue)

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Guidance | Q4 and Full-Year Fiscal 2021

	Q4 F2021	FY F2021
	Ending March 31, 2021	Ending March 31, 2021
Total Revenue	$138.5 - 140.5m	$526.1 - 528.1m
% Growth Y/Y	14-16%	18%
Service Revenue	$130.8 - 131.8m	$493.0 - 494.0m
% Growth Y/Y	16-17%	19%
Pre-Tax Loss (Non-GAAP)	(~$0.8m)	(~$13.7m)

Guidance as of January 28, 2021. Refer to Forward Looking Statement for a discussion of factors that could cause actual results to differ from guidance.

8x8 Fiscal Q3 2021 Earnings Results

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Investment Highlights

Compelling TAM

$60+ billion market in early innings of cloud migration

Unique Tech Platform

single cloud technology platform

Complete Cloud Offering

integrated communications, contact center, team messaging, meetings and APIs

8x8 Fiscal Q3 2021 Earnings Results

Attractive Economics

solid customer land and expand

Strong SaaS Model

subscription revenue and visibility

Multiple Growth Drivers

channel & global expansion, cross-selling of platform, analytics

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Thank you.

8x8 Fiscal Q3 2021 Earnings Results

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APPENDIX

8x8 Fiscal Q3 2021 Earnings Results

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Reconciliation of GAAP to Non-GAAP| Cost of Service Revenue

				($ in thousands, Unaudited)
		Cost of Service Revenue:	Three Months Ended December 30,
			2020	2019
	GAAP cost of service revenue	$47,044		$40,786
	Amortization of acquired intangible assets	(1,192)		(1,803)
	Stock-based compensation expense and related taxes	(2,528)		(1,648)
	Legal and regulatory costs	(62)		-
	Severance and related termination costs	(91)		(286)
	Non-GAAP cost of service revenue	$43,171		$37,049
	Non-GAAP cost of service revenue as a percentage of service revenue	34.0%		33.6%

8x8 Fiscal Q3 2021 Earnings Results

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Reconciliation of GAAP to Non-GAAP| Cost of Other Revenue

		($ in thousands, Unaudited)
Cost of Other Revenue:	Three Months Ended December 30,
	2020	2019
GAAP cost of other revenue	$13,364		$15,433
Stock-based compensation expense and related taxes	(1,196)		(903)
Acquisition and integration costs	-		(6)
Legal and regulatory costs	(71)		-
Severance and related termination costs	(69)		(287)
Non-GAAP cost of other revenue	$12,028		$14,237
Non-GAAP cost of other revenue as a percentage of other revenue	125.6%		173.5%

8x8 Fiscal Q3 2021 Earnings Results

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Reconciliation of GAAP to Non-GAAP| Research and Development

		($ in thousands, Unaudited)
Research and Development Expense:	Three Months Ended December 30,
	2020	2019
GAAP research and development	$23,702		$19,870
Stock-based compensation expense and related taxes	(8,525)		(6,236)
Acquisition and integration costs	-		(98)
Legal and regulatory costs	(295)		-
Severance and related termination costs	(203)		(452)
Non-GAAP research and development	$14,679		$13,084
Non-GAAP research and development as a percentage of revenue	10.7%		11.0%

8x8 Fiscal Q3 2021 Earnings Results

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Reconciliation of GAAP to Non-GAAP| Sales and Marketing

			($ in thousands, Unaudited)
	Sales and Marketing Expense:	Three Months Ended December 30,
		2020	2019
	GAAP sales and marketing	$63,986		$63,099
	Amortization of acquired intangible assets	(343)		(519)
	Stock-based compensation expense and related taxes	(9,575)		(5,585)
	Acquisition and integration costs	-		(2)
	Legal and regulatory costs	(365)		-
	Severance and related termination costs	(241)		(1,220)
	Non-GAAP sales and marketing	$53,462		$55,773
	Non-GAAP sales and marketing as a percentage of revenue	39.1%		47.0%

8x8 Fiscal Q3 2021 Earnings Results

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Reconciliation of GAAP to Non-GAAP| General and Administrative

		($ in thousands, Unaudited)
General and Administrative Expenses:	Three Months Ended December 30,
	2020	2019
GAAP general and administrative	$23,844		$22,547
Stock-based compensation expense and related taxes	(5,661)		(7,010)
Acquisition and integration costs	(4)		(530)
Legal and regulatory costs	(136)		22
Severance and related termination costs	(3,217)		(386)
Non-GAAP general and administrative	$14,826		$14,643
Non-GAAP general and administrative as a percentage of revenue	10.8%		12.3%

8x8 Fiscal Q3 2021 Earnings Results

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Reconciliation of GAAP to Non-GAAP| Net Loss / Per Share

($ in thousands, Unaudited)

	Net Loss:		Three Months Ended December 30,
			2020		2019
	GAAP net loss		($40,225)		($47,071)
	Adjustments:
	Amortization of acquired intangible assets		1,535		2,322
	Stock-based compensation expense and related taxes		27,485		21,382
	Acquisition and integration costs		4		636
	Legal and regulatory costs		929		(22)
	Severance and related termination costs		3,821		2,631
	Debt amortization expense		4,257		3,590
	Provision for income taxes		301		280
	Non-GAAP net loss before taxes		($1,893)		($16,252)
	Non-GAAP tax expense		301		280
	Non-GAAP net loss after taxes		($2,194)		($16,532)
	Net Loss Per Share:		2020		2019
	GAAP net loss per share - Basic and Diluted	$	(0.38)	$	(0.47)
	Non-GAAP net loss before taxes per share - Basic and Diluted	$	(0.02)	$	(0.16)
8x8 Fiscal Q3 2021 Earnings Results				23

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