nms communications corporation investor summary may 2008

NMS Communications CorporationInvestor Summary

May 2008

www.nmscommunications.com www.livewiremobile.comSlide 2

Safe Harbor Statement

This presentation may contain projections or other forward-looking statements regarding future events or the future financial performance of the company. While these statements represent management’s current judgment on the future direction of the business, actual results may differ materially from any future performance suggested in the company’s forward-looking statements. We refer you to the documents that the company files from time to time with the Securities and Exchange Commission. These documents contain and identify important factors that could cause the actual results to differ materially from those contained in our projections or forward-looking statements.

www.nmscommunications.com www.livewiremobile.com

Rev Run rate exiting FY08 $30 Million Long-Term Revenue Growth 40% + Accelerated Shift to Managed Services Model Non-GAAP Profitability 4Q 2008

$66M Business TTM w/ Gross Margins > 65% & Contribution Margins > 20%

25 Year History, Products Deployed in > 110 Countries Technology Leadership & VAS Market Growth Drive Demand

NMSS Two Businesses Sum of parts greater than whole

NMS Communications Corp. at a Glance

www.livewiremobile.com

A Subsidiary of NMS Communications

the leading provider ofmobile personalization services

An integrated suite of music and video personalization services delivered from a single vendor

Slide 5

mobile personalization market

$10.7B in 2008 growing to $17.5B in 2012

Source: Juniper Research

$6.7B

$2.8 B

$3.3B

$4.7 B

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000

$16,000

$18,000

2007 2008 2009 2010 2011 2012

Ringback Tones

Full Track Subscription

Full Track Download

Ringtones & Realtones

0

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,000

9,000,000

10,000,000

Jan-06

Mar-06

May-06

Jul-06

Sep-06

Nov-06

Jan-07

Mar-07

May-07

Jul-07

Sep-07

Nov-07

Jan-08

Mar-08

May-08

0

50,000,000

100,000,000

150,000,000

200,000,000

250,000,000

Total Subs Ringback Subs

Ringback SubscribersRingback Subs: 8.8M

Total Subs Passed: 213M

groove mobile acquisition

● Triples market size from $3B to $10B in 2008

● Accelerates business plan in 2008– Managed services rev > than

50% & accelerates LiveWire Mobile profitability to 4Q 2008

● Combined service offering meets growing market demand

● Adds significant customers and content partnerships

● Paid $14.5 million in cash

strategic fit

Fu

ll-t

rack

V

ideo

Rin

gto

ne

Platform

Service

Management

Storefront

Management

Customer Touch PointOperator

RelationshipOwning storefront +

multiple services expands revenue / sub

Oth

er A

pp

s

Rin

gb

ack

expanded operator service reach

Ringback Tones

Ringtones

Full Track Downloads

Full Track Subscription

$ 0.50

$ 0.25

$ 0.25

$ 1.50

Avg Vendor Share Per Sub / Per Month

Operator Services

Ringback Tones

Before Today

Total $2.00 (one –time) $2.50 /month

value proposition

● An integrated suite of music and video personalization services delivered from a single vendor

● For subscribers, they get– Easy access to all related content– High value targeted offers– To focus on their favorite icons

or brands

● For operators, they get– Increased service usage and adoption

Make more $ !!– More effective marketing to their

subscribers– A simplified business relationship Save

$ !!

customers and partnerships

OperatorCustomers

ContentPartners

Handset Partners

12

www.nmscommunications.com

NMS Communications

Slide 13

www.nmscommunications.com Slide 14

NMS Communications Market Focus

VAS - Enhanced Services/Applications Technology leader New application areas emerging

Mobile Highest growth area for VAS (>ARPU)

Video/Multi-media Central to next wave of applications +

investmentAsia – Global Innovation Leader Approach: Fast TTM w/New Apps “Applications Driven” Offerings

Landline

WirelessTriple-play

Broadband

VoiceSMS

Mobile Video Services


Business Model

Application Components

Servers, App Platforms

Ser

vice

s

Core Technologies• Mobile Video technology• Media Processors: boards + HMP• Signaling, protocols, global approvals• ATCA MRFP platform

• VXML servers• Application-specific Gateway Server• Signaling Server

• MobileTV• VideoSMS• VideoPortal

SI’sNEPs

Service Providers / Enterprises

Enabling NEPS and Systems Integrators to deliver Value Added Services quickly and efficiently –

3 ways to win emerging apps

Slide 15


NMS Communications Performance

Slide 16

Market Challenges Low end substitution Industry Consolidation China 3G Delays

Growth Drivers New Design Wins Mobile Subscriber Growth & VAS Demand Mobile broadband (3G and beyond) R&D investment 18% growing to 20% +

Continued Strength in Margins > 65% Gross Margin > 20% Contribution Margin


Financial Overview


(non-GAAP) $s M Long-TermFY'06 FY'07 Q1' 08 Exit FY'08 Model

Revenues $ 8.9 $ 13.2 $ 5.2 $30M 100%Run Rate

Gross Margin 4.6 4.1 3.1Gross Margin % 52% 31% 60% 68-72%

OPEXSG&A 6.5 8.6 2.7 30-33%R&D 7.5 4.8 1.6 17-20%

Total Opex 14.0 13.4 4.3 49-52%Profitable

Contribution Margin $ (9.4) $ (9.3) $ (1.2) Run Rate 17-22%

LiveWire Mobile


NMS Communications Platforms

(non-GAAP) $s M Long-TermFY'06 FY'07 Q1' 08 Model

Revenues $ 87.1 $ 69.2 $ 14.0 100%


OPEXSG&A 14.1 15.1 3.6 18-20%R&D 13.4 12.7 3.5 19-21%

Total Opex 27.6 27.8 7.1 39-42%

Contribution Margin 32.1$ 20.3$ 2.5$ 25-28%


(non-GAAP) $s M Long-TermFY'06 FY'07 Q1' 08 Model

Revenues $ 96.0 $ 82.5 $ 19.2 100%


OPEXSG&A 39.9 37.0 8.9 30-33%R&D 21.5 17.8 5.1 18-20%

Total Opex 61.4 54.8 13.9 48-51%

Restructuring 5.5 0.0 0.4

Operating Income (Loss) $ (2.8) $ (2.6) $ (1.5) 17-21%

NMS Communications Corp


(In $Millions except DSO and Inventory Turns)

Dec '06 Dec '07 Mar '08

Cash & Securities $32.3 $30.2 $10.4

Inventory $3.6 $2.7 $2.9

Accounts Receivable $13.3 $13.6 $11.7

Other Assets $20.2 $21.1 $36.7

Total Assets $69.3 $67.6 $61.7

Liabilities $14.3 $17.1 $15.8

Deferred Revenue $4.4 $3.4 $2.6

Stockholders' Equity $50.6 $47.1 $43.2

Total Liab. & S.E. $69.3 $67.6 $61.7

DSO with Deferred Revenue 55 Days 51 Days 55 Days

Inventory Turns with Deferred Inventory 8.5X 9.9X 9.6X

Balance Sheet


Q2 & FY ’08 Guidance

Guidance as of May 12, 2008:

Q208 revenues to be flat-to-up modestly from the first quarter.

Modest operating loss for Q208 on a non-GAAP basis primarily due to an estimated restructuring charge of approximately $1.2 million

LiveWire Mobile to exit 2008 with a revenue run rate in excess of $30 million. NMS Communications business to generate full year 2008 revenues that are modestly down from 2007.

The overall Company to deliver modest profitability on a non-GAAP basis for the full year 2008, not including the estimated restructuring of approximately $1.6 million. LiveWire Mobile to reach profitability on a non-GAAP basis in the fourth quarter of 2008.


Investment Summary

LiveWire Mobile Rapid growth… accelerated business model shift…profitability

in 4Q 2008

NMS Communications Highly Profitable… modest revenue decline near term and

modest growth long-term

Corporate Separating the two businesses to better serve distinct markets

and to enhance shareholder value

nms communications corporation investor summary may 2008

Documents

mobile personalization

video personalization

future performance

future direction

future events

business plan

managed services rev

future financial performance