The #1 Wireless Backhaul Specialist · PDF fileThis presentation contains statements concerning Ceragon's future prospects that are "forward ... developing nations and the ... •Potential

Proprietary and ConfidentialProprietary and Confidential

The #1 Wireless Backhaul Specialist

Investor Presentation

November 2017

Proprietary and Confidential

This presentation contains statements concerning Ceragon's future prospects that are "forward-looking statements" as defined in the Private Securities

Litigation Reform Act of 1995. Such forward-looking statements are based on the current beliefs, expectations and assumptions of Ceragon's

management. Examples of forward-looking statements include: projections of revenues, net income, gross margin, capital expenditures and liquidity,

competitive pressures, growth prospects, product development, financial resources, cost savings and other financial matters. You may identify these

and other forward-looking statements by the use of words such as "may", "plans", "anticipates", "believes", "estimates", "targets", "expects",

"intends", "potential" or the negative of such terms, or other comparable terminology. These forward-looking statements are subject to risks and

uncertainties that may cause actual results to differ materially, including risks associated with a decline in revenues; the risk of a decrease in the

amount of business coming from a certain geographic region, from which a significant portion of Ceragon’s business is generated; the risk associated

with a change in Ceragon’s gross margin as a result of changes in the geographic mix of revenues; the risk associated with the loss of a single

customer or customer group, which represents a significant portion of Ceragon’s revenues; the risk associated with Ceragon’s failure to effectively

compete with other wireless equipment providers; the risk relating to the concentration of Ceragon's business in India, Latin America, Africa, and in

developing nations and the political, economic and regulatory risks from doing business in those regions, including potential currency restrictions;

and other risks and uncertainties detailed from time to time in Ceragon's Annual Report on Form 20-F and Ceragon's other filings with the Securities

and Exchange Commission that represent our views only as of the date they are made and should not be relied upon as representing our views as of

any subsequent date. We do not assume any obligation to update any forward-looking statements.

2

Safe Harbor


• Ceragon is the leading provider of wireless backhaul solutions to mobile

operators and private networks globally

• +20 years of technology R&D driving significant barriers to entry; founded in

1996 and headquartered in Tel Aviv, Israel

• Leading market position is driven by its strong technology advantage:

• Completely vertically integrated solution from chipset to system drives unmatched

performance

• Ceragon’s solutions have been adopted by Tier 1 mobile operators and leading private

networks globally

• Strong execution has driven strong profitability and significant margin

expansion:

• 3rd consecutive year of increasing profitability

• Gross margins have increased from 25.2% to 32.3% (b)

3

Ceragon Snapshot

+140countries with systems deployed

+1,000,000 systems deployed

total customers+2,000

GLOBAL SCALE

$1.82-$4.23 52 week low/high(a)

(a) Source: Nasdaq as of 11/6/2017(b) Represents non-GAAP gross margin in FY2014 and YTD2017

~900 employees globally


• Wireless backhaul serves as an alternative to fiber-optic networks

• Critical since it is a faster and more cost effective deployment vs. fiber based deployment

• Connects approximately 50% of all backhaul networks

• Proportion of fiber vs. wireless backhaul is expected to remain fairly constant through the evolution to 5G networks

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Critical Technology to Core NetworksWireless Backhaul:

Proprietary and Confidential 5

Industry Leadership

2013 2014 2015 2016 2017 2018 2019 2020

Two separate Cores solutions

X2 Capacity, no Spectrum reuse gain, no Energy savings

*

* Based on company publications

Dual-core solutions

X4 Capacity, x2 Spectrum reuse gain, ½ Energy

Industry’s only

Octuple-core solutions

X16 Capacity, x4 Spectrum reuse gain, ⅛ Energy

Ceragon’s Multicore technology resolves

the key challenges associated with wireless backhaul deployments

Capacity | Spectrum | Energy | Real-estate

Industry’s only


• Chip design• Software design• Hardware design• Systems

6

Key to Innovation is Vertical Integration

FIBEAIR IP-20 PLATFORM

MULTICORE EVERYWHERE - IN ALL DEPLOYMENT SCENARIOS

FullVertical Integration


Avoid Bundled/Price Focused Deals

7

Best-of-Breed Strategy: Sell Customer Value

Seek Best-of-Breed Focused Deals

• Focus on service providers seeking the best

wireless backhaul solution as main factor for

vendor selection

• Focus on those customers that invest resources

to assess vendors’ ability to address their

network-specific challenges

• Most private network customers are part of this

category

• Avoid end-to-end network bundling, with no

specific vendor selection process for wireless

backhaul

• De-emphasize customers that lack the skills/

resources for thorough evaluation of wireless

backhaul vendors

• Avoid situations where price is the primary or

only factor to determine vendor selection


1720

1720

0

500

1000

1500

2000

2500

3000

3500

4000

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Amongst the top 3 vendors inthe Best of Breed segment of the Market

Source: Skylight research 2017, Ceragon estimates 2017.

Global Wireless Backhaul Market (2016) Best-of-Breed Market Segment (2016)

Bundled Deals $2.05B

Best of Breed$2.05B

USD [M]

Huawei22%

NEC18%

Ceragon16%

Ericsson12%

SIAE10%

Aviat8%

Nokia8%

Intracom, 2%Dragonwave, 2%


Global Reach and Strong Customer Base

Africa,6%

Europe,13%North America,

14%

Asia Pacific,12%

• Presence in all regions

• Purchasing decisions made both centrally and regionally

Revenue by Geography — LTM

• Over 1 million radios installed in over 140 countries

• 33% of sales with global Tier 1 operators

India39%

Africa4%

Europe13%

North America12%

Asia Pacific12%

Latin America20%


• Use competitive strengths to win a large share of most profitable opportunities in best of breed market

• Expand footprint in mobile and vertical markets worldwide

• As #1 specialist, gain share as industry shake-out continues

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Strategy

Public Safety MaritimeMobile UtilitiesWireless ISPs


10%

15%

20%

25%

30%

35%

40%

0

10

20

30

40

50

60

70

80

90

100

110

Q1:1

4

Q2:1

4

Q3:1

4

Q4:1

4

Q1:1

5

Q2:1

5

Q3:1

5

Q4:1

5

Q1:1

6

Q2:1

6

Q3:1

6

Q4:1

6

Q1:1

7

Q2:1

7

Q3:1

7

Controllable elements are well-controlled

• Deals accepted based on contribution to gross profit dollars

• Tendency toward trade-off between revenue and gross

margin

• Stringent operating expense control sustained for 2+ years

Quarter-to-quarter fluctuationscaused by factors difficult to control

• Changes in geographic mix of revenue – based on significant

variations in GM by region

• Timing of recognizing revenue for various elements of

project – based on large customers dictating delivery timing

of each element

• Seasonality (mainly Q1)

Characteristics of Operating Model

Gross profit Revenue Gross margin Opex

.

Note: Financial metrics are presented on a non-GAAP basis.

Quarterly Operating Model

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Achievements

• Trend toward improving gross margin despite

less favorable geographic revenue mix

• Stringent opex control without jeopardizing

further technology innovation

• Stable business model with sustainable level

of profitability

Track Record of Execution & Improving Profitability

.

Note: Financial metrics are presented on a non-GAAP basis.

(a)-$30

-$25

-$20

-$15

-$10

-$5

$0

$5

$10

$15

$0

$50

$100

$150

$200

$250

$300

$350

$400

2014 2015 2016 YTD 2017 Assumed RunRate

Revenue Non-GAAP Net Income

(371(349)

(294)

(245)

(300-320)

(-25)

(7)

(11) (11) (12-15)

(Net Income)(Revenue) (in millions)

12


• Majority of bank debt is related to temporary

issue to be resolved during Q4

• Expect positive cash flow in Q4

• Substantial unused borrowing capacity under

revolving credit facility

13

Strong Balance Sheet

(U.S. dollars in millions)(Unaudited)

a/o Sept. 30, 2017

Cash & cash equivalents 36.5

Bank debt 23.8

Inventory 55.9

AR 127.1

DSOs 141


THE FUTURE IS EASIERWITH MULTICORE EVERYWHERE

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CAPACITYX4

SPECTRUM REUSEX2

½ENERGY

CAPACITYX16

SPECTRUM REUSEX4

Dual-core Multicore technology

⅛ ENERGY

8-core Multicore technology

The Future is Easier with Multicore Everywhere

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Today 2020s


The Future is Easier with Multicore Everywhere

2017

E-BAND10-20Gbps

2019

W-BANDD-BAND

20-40Gbps

2020s

E-BANDV-BAND

2.5 Gbps

16


Continuing to refine focus on both offensive and defensive strategiesFormulating a Strategy to Accelerate Long-term Growth

Newsmall cell backhaul approach

Scale/diversificationin core business

5G fixed wireless access

Technology Fit/Business Risk Analysis

• Relevance to core competencies

• Potential competitive advantage

• Market size and maturity

• Market growth potential

Value Creation/Financial Risk Analysis

• Time to revenue

• Magnitude of investment required

• Inherent profitability (gross margin)

• Impact on cash flow

Seeking best risk-adjusted opportunity to generate profitable growth


Summary

Leader in premium segment of the market

Time-to-market advantage with technologically-advanced IP-20 platform

Competitive strengths provide ability to be selective, obtain major share of highest-value opportunities

Financial stability enables continuous innovation and design-to-cost investment

Targeting third consecutive year of profit improvement in 2017

Positioned to benefit from industry shake-out and network evolution to 5G


THE FUTURE IS CLOSER THAN WE THINK

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Documents

The #1 Wireless Backhaul Specialist · PDF fileThis presentation contains statements concerning Ceragon's future prospects that are "forward ... developing nations and the ... •Potential