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Investor PresentationNovember 2015
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Safe Harbor
This presentation and the inf ormation contained herein (including any inf ormation that may be incorporated by ref erence) is prov ided f or inf ormational purposes only and should not be construed as an of f er,
commitment, promise or obligation on behalf of New Relic, Inc. (“New Relic”) to sell securities or deliv er any product, mater ial, code, f unctionality or other f eature. Any inf ormation prov ided hereby is proprietary to
New Relic and may not be replicated or disclosed without New Relic’s express written permission.
Such inf ormation may contain f orward-looking statements within the meaning of f ederal securities laws. Any statement that is not a historical f act or ref ers to expectations, projections, f uture plans, objectiv es,
estimates, goals, or other characterizations of f uture ev ents is a f orward-looking statement. These f orward-looking statements can of ten be identif ied as such because the context of the statement will include
words such as “believ es,” “anticipates,” “expects” or words of similar import. Forward-looking statements contained in this presentation include, but are not limited to, statements concerning New Relic's f uture
f inancial perf ormance, growth prospects, ability to attract and retain customers, ability to execute on its product strategy and ability to successf ully expand in its existing markets and into new markets.Actual
results may dif f er materially from those expressed in these f orward-looking statements, which speak only as of the date hereof , and are subject to change at any time without notice. Existing and prospectiv e
inv estors, customers and other third parties transacting business with New Relic are cautioned not to place undue reliance on this f orward-looking inf ormation. The achiev ement or success of the matters cov ered
by such f orward-looking statements are based on New Relic’s current assumptions, expectations and belief s and are subject to substantial risks, uncertainties, assumptions and changes in circumstances that
may cause the actual results, perf ormance or achiev ements to dif f er materially from those expressed or implied in any f orward-looking statement. Further inf ormation on f actors that could af f ect such f orward-
looking statements is included in the f ilings New Relic makes with the SEC f rom time to time. Copies of these documents may be obtained by v isiting New Relic’s Inv estor Relations website
at http://ir.newrelic.com or the SEC’s website at www.sec.gov . New Relic assumes no obligation and does not intend to update these f orward-looking statements, except as required by law. New Relic makes no
warranties, expressed or implied, in this presentation or otherwise, with respect to the inf ormation prov ided.
New Relic's f iscal y ear ends March 31. This presentation includes certain non-GAAP f inancial measures as def ined by the SEC rules. These non-GAAP f inancial measures are in addition to, and not as a
substitute f or or superior to, measures of f inancial perf ormance prepared in accordance with GAAP. There are a number of limitations related to the use of these non-GAAP f inancial measures v ersus their
nearest GAAP equiv alents. For example, other companies may calculate non-GAAP f inancial measures dif f erently or may use other measures to ev aluate their perf ormance, all of which could reduce the
usef ulness of New Relic's non-GAAP f inancial measures as tools f or comparison. As required by Regulation G, New Relic has prov ided a reconciliation of those measures to the most directly comparable GAAP
measures, which is av ailable in the appendix.
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NEW RELIC HIGHLIGHTS
Intuitive Products Deliver Ease-
of-Use, Strong Results and
High Adoption
Built on 100% SaaS,
Multi-Tenant Cloud Platform with
Enterprise-Grade Security
Integrated Software Analytics
Cloud for Developers,
IT and Business Users
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STRONG FINANCIAL PERFORMANCE
• Land and expand model driven by increasing penetration of the enterprise and expanding product portfolio
• Recurring revenue model with industry leading revenue retention metrics
• Growing, multibillion dollar market opportunity
$11.7
$29.7
$63.2
$110.4
$175.0
FY12 FY13 FY14 FY15 FY16E
Note: FY16 Revenue Based on Midpoint of Guidance
Historical Revenue ($MM)Q2’13 Q2’16
$6.6M Revenue $42.9M
3,847 Paid Business Accounts 12,840
~$7,600Revenue per Average
Paid Business Account~$13,600
<25$100K+ Subscription
/Year Customers>250
1 # of Paid Products 5
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software
business
Every business
is becoming a
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Rules of the Game Have Changed: Modern Software is Different But to support this transformation, IT is under the gun
Yesterday’s Software
Development Team
App
• Back-Office Applications
• Periodic Releases, Static
• On-Premise
Single Code Base
One LanguageOperations Team
Data Deluge
Modern Software
Multiple Components
Multiple, Dispersed Development
Teams • Customer-facing Applications –
higher stakes
• Fast, Iterative Release Cycles
• Modern Stack: Cloud, Mobile
• Real-Time
Multi-language ApplicationsRuby/ Node.js/ Java/ .NET/ PHP/ Python
Private CloudPublic Cloud
Multiple interfaces mobile, tablet, browser
App
Security
Operations Teams
Digital Business Managers
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ENTER SOFTWARE ANALYTICS
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Software Analytics is the category of analytics
that gathers metrics in real-time from live production
software and transforms them into actionable data
010000100101001001010100101010100101000000001010
0101010110000010101000000010101010111110101010101
0111111010101010000101100100100101010101001010101
00101111101001010100101000001010101011101111111110
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Businesses Requires Software Analytics to Answer:
BusinessOutcome
ApplicationPerformance
CustomerExperience
How are customers engaging?
What is the page load time to
initial experience?
Am I open for business?
Is the application working?
How is my business doing?
What changes influence
business success?
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Application performance
Customer experience
Business outcome
NRDB
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2007 2015
>500,000+ Users
>12,000 Paid Business Accounts
Our History of Innovation and Growth
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New Relic’s Integrated Full-Stack Solution
Software Data
Collect
New Relic Cloud
DatabaseStore
Analyze
Servers Mobile Plugins Brow ser Apps
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How New Relic Works
We collect 700+ Billion
data points each day
New Relic Agent is
inserted into app code
Transaction events are
collected and sent to New
Relic Data Cloud
Brow ser
Web Server Back-end Server
New Relic
Data Cloud
Mobile
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Same Data Many Use Cases
IT operations
Developers
SecurityFinance
Sales
Marketing
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Creating a Global Movement - #customerlove
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New Economy Disruptors and Enterprises are Solving the Problem
Disruptors Large Global Enterprises
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New Relic is All In on SaaS
Isolate IT
complexity
Rapid Deployment:
value in hours
Continuous Release
Cycles
New Relic SaaS Service
and Business Model Is the Foundation
SaaSSpeed to innovation, low TCO, enterprise-grade security
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We Take Security Seriously
Service Compliance (Not Just The Data Center)
• TRUSTe, SOC2 Type II, SSA-16, US/UE Safe Harbor
• Regular 3rd party security assessments
Mature Security Program
• Dedicated security team from Amazon, Intuit, Mozilla, PwC
• Go beyond SSA-16: audit our own apps, infrastructure and network
• Published Cloud Security Alliance questionnaire
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INVESTING TO CAPITALIZE ON SOFTWARE ANALYTICS OPPORTUNITY
SIGNIFICANT OPERATING LEVERAGE WITH GROWING SCALE
INCREASING ENTERPRISE PENETRATION
LAND AND EXPAND MODEL
GROSS MARGINS OF 80%+
STRONG REVENUE GROWTH
NEW RELIC FINANCIAL HIGHLIGHTS
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$12$30
$63
$110
$175
FY12 FY13 FY14 FY15 FY16E
Historical Revenue ($MM) Historical Quarterly Revenue ($MM)
RAPID REVENUE GROWTH
Note: FY16 Revenue Based on Midpoint of Guidance
$12
$14
$17
$20
$23
$25
$29
$33
$38
$43
Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16
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2,000
2,500
3,000
3,500
4,000
4,500
5,000
5,500
Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16
Paid Business Accounts > $5K in Annual Subscription Revenue
Please refer to Appendix for definition of Paid Business Accounts
Land: Increasing focus on high-value accountsINCREASING FOCUS ON HIGH-VALUE ACCOUNTS
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Growing with a customer’s
environment
Expanding across
business units
Expanding product
footprint
EXPANSION VECTORS WITHIN INSTALLED BASE
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5/13/2011 9/27/2011 3/5/2012 7/24/2012 5/30/2013 3/31/2015FY12 FY13 FY14
Current Products Evaluating
Number of APM Subscriptions Annual Subscription Value
16xRepeat Purchaser Since Initial Subscription Purchase in 2011
FY12 FY13 FY14FY15 FY15
Internet Company
GROWING WITH A CUSTOMER’S ENVIRONMENT
FY16
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Product Usage
December
2013
September
2014
March 2015 September
2015
Annual Subscription Value
September 2014
Added
March 2015
Committed
Increase
Travel Company
EXPANDING PRODUCT FOOTPRINT
December 2013
September 2015
Added
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Number of APM Subscriptions
Current Products
Annual Subscription Value
11/21/121/29/143/31/2015
>50x Increase in #
Subscriptions
FY13 FY15FY14
Evaluating
FY13 FY15FY14 FY16 FY16
Media Company
EXPANDING ACROSS BUSINESS UNITS
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50%
75%
100%
125%
150%
Jun-13 Sep-13 Dec-13 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15
STRONG EXPANSION RATES
26
100%
Do
lla
r-B
as
ed
Ne
t E
xp
an
sio
n R
ate
s
See Appendix for an explanation of how we calculate Dollar-Based Net Expansion rate
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0% 25% 50% 100%75%
% of Ending MRR by segment
% of Total paid business accounts by segment
11%
35%
16%
28%
73%
37%
Enterprise(1000+ employees)
Mid-Market(100-1000 employees)
SMB(0-100 employees)
SUCCESS ACROSS ALL CUSTOMER SEGMENTS
Developer
Data as of September 30, 2015
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STEADY GROWTH OF LARGE PAID BUSINESS ACCOUNTS
Note: Annualized subscription revenue calculated as quarterly revenue multiplied by 4 for each quarterly period. See Appendix for an explanation of how we define a Paid Business Account
0
300
Jun-13 Sep-13 Dec-13 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15
Fiscal Quarter
Paid Business Accounts > $100k in Annual Subscription Revenue
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Annualized
Su
bscrip
tion R
eve
nu
e / A
ve
rage P
aid
Bu
sin
ess A
cco
un
tP
aid
Busin
ess A
ccounts
ADDING CUSTOMERS AT HIGHER AVERAGE REVENUES
$6,000
$8,000
$10,000
$12,000
$14,000
3,000
5,000
7,000
9,000
11,000
13,000
Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16
Annualized
Su
bscrip
tion R
eve
nu
e / A
ve
rage P
aid
Bu
sin
ess A
cco
un
tP
aid
Busin
ess A
ccounts
12,840
6,634
$13,585
$7,649
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LARGE INTERNATIONAL CUSTOMER FOOTPRINT
50%50%
FY2015 Paid
Business Accounts by Region
66%
34%
FY2015 Revenue
By Region
US
International
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INCREASED SCALE DELIVERING OPERATING LEVERAGE
Expenses as a Percentage of Revenue (%)
31
Note: Metrics are Non-GAAP and exclude stock-based compensation, litigation and acquisition-related expenses. See Appendix for reconciliation. FY16 Based on
Midpoint of Guidance.
91% 89% 90%76%
36%23% 24%
20%
16%
17% 14%
18%
16%
16% 17%
19%
159%
146% 144%133%
126%
0%
50%
100%
150%
200%
FY12 FY13 FY14 FY15 FY16E
S&M R&D G&A COGS
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(% of Revenue) FY’14 FY’15
Gross Margin 83% 81%
Sales & Marketing 90% 76%
Research &
Development24% 20%
General &
Administrative14% 18%
Operating Margin (44%) (33%)
LT Target *
78% – 82%
35% – 38%
15% – 18%
7% – 9%
20% – 25%
LONG-TERM TARGET OPERATING MODEL
Note: Metrics are Non-GAAP and exclude stock-based compensation, amortization of purchased intangibles, litigation and acquisition-related expenses. See Appendix for reconciliation.
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GROWTH STRATEGIES
Deliver great products that delight customers
Increase value for existing customers so they expand
Drive sales growth by building a strong brand
33
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Number of Paid Business AccountsWe define the number of paid business accounts at the end of any particular period as the number of accounts at the end of th e period as identified by a
unique account identifier for which we have recognized revenue on the last day of the period indicated.
A single organization or customer may have multiple paid business accounts for separate divisions, segments, or subsidiaries
Dollar-Based Net Expansion RateOur dollar-based net expansion rate compares our recurring subscription revenue from customers from one period to the next. We m easure our dollar-based
net expansion rate on a monthly basis because many of our customers change their subscriptions more frequently than quarterly or annually.
To calculate our annual dollar-based net expansion rate, we first establish the base period monthly recurring revenue from all our customers at the end of a month. This represents the revenue we would contractually expect to receive from those customers over the following month, wi thout any increase or reduction in any of their subscriptions.
We then (i) calculate the actual monthly recurring revenue from those same customers at the end of that following month; then (ii) divide that following month’s
recurring revenue by the base month’s recurring revenue to arrive at our monthly net expansion rate; then (iii) calculate a quarterly net expansion rate by compounding the net expansion rates of the three months in the quarter; and then (iv) calculate our annualized net expansion rate by compounding our quarterly net expansion rate over an annual period
APPENDIX - DEFINITIONS
34
New Relic Confidential | 35The company has not reconciled any of the non-GAAP measures referenced above to the most comparable GAAP measure in its long-term target non-GAAP operating model because
certain items are out of the company's control and/or cannot be reasonably predicted. Accordingly, a reconciliation is not av ailable without unreasonable effort.
NON-GAAP TO GAAP RECONCILIATION
($000s, Except for %) FY12 FY13 FY14 FY15
Gross Profit (GAAP) 9,759 24,586 52,394 88,589
Stock-Based Compensation 11 212 159 591
Amortization of Purchased Intangibles 400
Amortization of Stock-Based Compensation in Software Development 54 179
Gross Profit (Non-GAAP) 9,770 24,798 52,607 89,759
Gross Margin (Non-GAAP) 83.8% 83.6% 83.3% 81.3%
Cost of Goods Sold (GAAP) 1,904 5,078 10,780 21,802
Stock-Based Compensation 11 212 159 591
Amortization of Purchased Intangibles 400
Amortization of Stock-Based Compensation in Software Development 54 179
Cost of Goods Sold (Non-GAAP) 1,893 4,866 10,567 20,631
Sales & Marketing (GAAP) 10,748 28,365 58,156 89,162
Stock-Based Compensation 143 2,060 1,373 5,108
Amortization of Purchased Intangibles 25
Sales & Marketing (Non-GAAP) 10,605 26,305 56,783 84,029
Research & Development (GAAP) 4,300 8,565 16,496 24,024
Stock-Based Compensation 126 1,620 1,425 2,055
Research & Development (Non-GAAP) 4,174 6,945 15,071 21,969
General & Administrative (GAAP) 2,180 10,053 17,178 25,319
Stock-Based Compensation 323 4,794 3,263 3,912
Litigation Expenses 0 154 5,135 1,322
Amortization of Purchased Intangibles 75
Transaction Costs Related to Acquisition 71
General & Administrative (Non-GAAP) 1,857 5,105 8,780 19,939
Operating Loss (GAAP) ($7,469) ($22,397) ($39,436) ($49,916)
Stock-Based Compensation 603 8,686 6,220 11,666
Litigation Expenses 0 154 5,135 1,322
Amortization of Purchased Intangibles 500
Transaction Costs Related to Acquisition 71
Amortization of Stock-Based Compensation in Software Development 54 179
Operating Loss (Non-GAAP) (6,866) (13,557) (28,027) (36,178)
Operating Margin (Non-GAAP) (58.9%) (45.7%) (44.4%) (32.8%)