Adtran : Report of the management board (2024 agm report english)

Annual general meeting 2024

Report of the management board

28 June, 2024

Cautionary note regarding forward-looking statements

FORWARD-LOOKING STATEMENTS

This presentation contains forward-looking statements that address concepts such as "believe," "assume" and "expect," anticipated revenues and earnings, assumed demand for optical network solutions, internal estimates and liquidity development. These forward-looking statements involve a number of unknown risks, uncertainties and other factors that could cause actual results to differ materially. These unknown risks, uncertainties and other factors are discussed in the "Risk report" section of Adtran Networks SE's 2023 Annual Report.

PRO FORMA CONSOLIDATED FINANCIALS

Adtran Networks SE provides the pro forma consolidated financial measures included in this presentation only as supplemental financial information to assist investors and the financial community in comparing the Group's operating results over time on a meaningful basis. Adtran Networks believes that these proforma financial measures are helpful because they do not include "non-cash expenses from the stock option programs", "goodwill amortization" and "amortization of intangible assets from business acquisitions", which are not relevant to Adtran Networks' operating results for the period indicated. In addition, one-time expenses incurred in connection with corporate transactions and restructuring measures are not included. This pro forma information has not been prepared in accordance with generally accepted accounting principles (IFRS) and should not be considered a substitute for historical information presented in accordance with IFRS.

2 2024 © ADTRAN

Welcome to the 2024 annual general meeting

Tom Stanton	Christoph Glingener	Ulrich Dopfer
Chairman & CEO	CTO	CFO
Corporate development	R&D, PLM	Accounting/Tax,
Decision Support,
Compliance	Global BD
Controlling/Risk
Operations, QM	ANS
CM, Legal, IR
Sales	Employee Board & Works
Facilities, IT, HR
Services	Council contact

3 2024 © ADTRAN

Business overview

4

M AC R O D Y N AM I C S

Slow demand in 2023, but network expansion continues

FTTH/B European market evolution in EU39 (1):

In terms of homes passed and subscribers (2012-2023)

300

	250							244
							221
Millionen	200							197
							176
							143	158
	150
				117	129		121
				106
							107
	100		91					95
							81
		54	67			51	61	70
				43
	50		30	36

16	20
-

EUR 27 + UK:

Austria, Belgium, Bulgaria, Croatia,

Cyprus, Czech Republic, Denmark,

Estonia, Finland, France, Germany,

Greece, Hungary, Ireland, Italy,

Latvia, Lithuania, Luxembourg,

Malta, Netherlands, Poland,

Portugal, Romania, Slovakia,

Slovenia, Spain, Sweden, United

Kingdom

1) EU39:

EU27 + UK
CIS	countries:	Kazakhstan,
Ukraine, +2

Iceland, Israel, North Macedonia, Norway, Serbia, Switzerland, Turkey

December	December	December	September	September	September	September	September	September	September	September	September
2012	2013	2014	2015	2016	2017	2018	2019	2020	2021	2022	2023
				FTTH/B Homes Passed - EU39			FTTH/B Subscribers - EU39	Source: FTTH Council / IDATE; September 2023

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M AR K E T O P P O R T U N I T Y

Long-term growth prospects remain intact

Global market uncertainties

Inventory optimization

Higher cost of capital

Cautious ordering behavior Inventory optimization

Short term

AI drives architecture disruption and capacity expansion Historic incentives for fiber-based broadband network rollouts The shift away from high-risk suppliers out of China Cross-selling with Adtran

v AI accelerates bandwidth demand v Billion-dollar stimulus programs

• $1.5 billion additional market potential through replacing high-risk suppliers

$60-120 million cross-selling potential

Long term

International investment cycle toward a fiber everywhere future

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T E C H N O L O G Y O V E R V I E W

From the optical core through the door

AI-driven orchestration, management and optimization

Optical platforms

		Metro WDM
5G	Access and
	aggregation platforms
Subscriber platforms			DCI
	Fiber access platforms,		Optical access and transport,
Open multi-gig PON systems,		data center interconnect,
1/10/25/100G Ethernet
Carrier Ethernet access, Wi-Fi,		advanced pluggable optics,
aggregation, network timing
routers, switches and more	assurance and monitoring,
and synchronization
		encryption and security

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I N N O V AT I O N U P D AT E

Differentiation across all our technology segments

Subscriber solutions

• Launch of latest Wi-Fi 6, 6E and 7 platforms driving growth opportunities
• Dozens of customer have adopted Intellifi, our SaaS application for cloud-managedWi-Fi

Access and aggregation solutions

• Continued to scale SDX 6330 deployments across several large service providers in EMEA
• Secured strategic software award with multi-national operator for packet edge routers

Optical networking solutions

• Launched M-Flex800 platform, an ideal fit for service providers upgrading their transport to 400 or 800 Gig
• Continued success with securing packet optical wins with traditional Adtran broadband customers

Software platforms

Added

36 Mosaic One

customers this past

quarter. We now

have 400 customers

that have adopted

Mosaic One.

Professional

services

Scalable in-region services, including planning, deployment, and maintenance

8

2024 © ADTRAN

*Source: Dell'Oro

AD T R A N V AL U E P R O P O S I T I O N

A global vendor with scale and diversity

Portfolio

differentiation

• Optical core to customer premise
• End-to-endautomation & insights
• Enhanced security and assurance

Customer

diversity

• Balanced mix of national and regional service providers, government and enterprise customers
• Growth opportunities in each segment

Geographic

diversity

• Balanced mix of U.S. and non-U.S. business
• Strong growth opportunities in focus regions

Strength in

focus markets

• Full range of R&D, pre-sales,post-sales and services support in focus regions
• Strong market share in growth products in focus regions

Broad technology spectrum and strong presence in growth markets

9 2024 © ADTRAN

Financial update

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