Acacia Communications (ACIA) 8-K Regulation FD Disclosure

Investor Presentation

March 16, 2017

Exhibit 99.1

Copyright

©

2017

–

All

Rights

Reserved

–

Acacia

Communications,

Inc.

I

Connecting

at

the

Speed

of

Light®

2

Safe Harbor Statement

This presentation may contain forward-looking statements that involve substantial risks and uncertainties. All statements, other

than statements of historical facts, contained in this presentation, including statements regarding our strategy, future

operations, future financial position, future revenues, projected costs, prospects, plans and objectives of management, are

forward-looking statements. The words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,”

“target,” “potential,” “will,” “would,” “could,” “should,” “continue,” and similar expressions are intended to identify forward-

looking statements, although not all forward-looking statements contain these identifying words.

We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements, and you should

not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans,

intentions and expectations disclosed in the forward-looking statements we make. The forward-looking statements contained in

this presentation reflect our current views with respect to future events, and we assume no obligation to update any forward-

looking statements.

Forward-looking statements represent our management’s beliefs and assumptions only as of the date of the preliminary

prospectus, and our actual future results may be materially different from what we expect. We have included important factors

in the cautionary statements included in the Form 10-K for the twelve month period ended December 31, 2016 and other

documents we have filed with the SEC, particularly in the Risk Factors section, that we believe could cause actual results or

events to differ materially from the forward-looking statements that we make. Except as required by law, we assume no

obligation to update these forward-looking statements publicly, or to update the reasons why actual results could differ

materially from those anticipated in the forward-looking statements, even if new information becomes available in the future.

Non-GAAP Financial Measures

This presentation includes measures defined by the SEC as non-GAAP financial measures.  We believe that these non-GAAP

financial measures can provide useful supplemental information to investors when read in conjunction with our reported results.

Reconciliations of these non-GAAP financial measures to their closest GAAP measures are available in the Appendix to this

presentation and descriptions of these non-GAAP financial measures can be find in our earnings release with respect to our

fourth quarter and full year 2016 results.

Copyright

©

2017

–

All

Rights

Reserved

–

Acacia

Communications,

Inc.

I

Connecting

at

the

Speed

of

Light®

3

Acacia at a Glance

Maynard, MA

(headquarters)

Holmdel, NJ

Mountain View

& San Jose, CA

Ontario, Canada

Limerick, Ireland

Brondby, Denmark

High Wycombe, UK

Bangalore, India

Shenzhen, China

Founded in 2009

45% of employees

hold a Ph.D

1

or other advanced degree

>$1M revenue

per employee

1

1. As of December 31, 2016

290 employees

1

Copyright

©

2017

–

All

Rights

Reserved

–

Acacia

Communications,

Inc.

I

Connecting

at

the

Speed

of

Light®

4

Our Mission

SILICONIZATION

OF

OPTICAL

INTERCONNECT

Deliver silicon-based interconnects that transform cloud and communication networks by

simplifying

these networks, digitizing

numerous complex analog functions, and providing

significant improvements in speed, capacity and power consumption

Copyright

©

2017

–

All

Rights

Reserved

–

Acacia

Communications,

Inc.

I

Connecting

at

the

Speed

of

Light®

5

We believe our approach -

leveraging

silicon -

is causing disruption in the

industry

Strong financial performance

–

Year-over-year growth in revenue and

profitability

–

Improved non-GAAP

gross margins to 48% in

Q4’16 from 42% in Q1’16

Continued progress with customer and

revenue diversification

–

Four 10% customers in Q4’16 for the first

time, including one hyper-scale cloud and

content provider

–

Increased revenue from newer customers to

35% of revenue in Q4’16 from 14% of revenue

in Q1’16

Executing to our Growth Strategy

10%

14%

26%

1 This is a “non-GAAP financial measure” as defined in Regulation G under the Securities Exchange Act of 1934, as amended, and

reconciliation of such non-GAAP financial measure to the most directly comparable financial measure calculated and presented in

accordance

with

U.S.

GAAP

is

provided

in

the

Appendix

to

this

presentation.

Descriptions

of

this

non-GAAP

financial

measure

can

be found in the company’s earnings release with respect to its fourth quarter and full year 2016 results." If this presentation will be

handed out, need to add Appendix and GAAP to non-GAAP reconciliation.

0

100

200

300

400

500

600

2014

2015

2016

Revenue Growth

81%

CAGR

0

20

40

60

80

100

120

140

160

2014

2015

2016

Non-GAAP NET INCOME

1

193%

CAGR

Copyright

©

2017

–

All

Rights

Reserved

–

Acacia

Communications,

Inc.

I

Connecting

at

the

Speed

of

Light®

6

Increased Data and

Video Consumption

Growth in Mobile and

4GLTE/5G Communications

Proliferation of

Cloud Services

Adoption of the

“Internet of Things”

Changing

Traffic Patterns

Traffic Demand is Growing for Traditional Carriers

and Web 2.0 Content Providers

Bandwidth and Network Capacity

Source: Predicts 2016: PaaS Innovation

Continues Unabated 10 December 2015

Source: Cisco VNI Global IP Traffic Forecast

2015-2020

Copyright

©

2017

–

All

Rights

Reserved

–

Acacia

Communications,

Inc.

I

Connecting

at

the

Speed

of

Light®

7

Key Market Segments

100G+

1

1.

Source: LightCounting

2.

Source: Sept 2016 ACG Research

8%

CAGR

9%

CAGR

32%

CAGR

Copyright

©

2017

–

All

Rights

Reserved

–

Acacia

Communications,

Inc.

I

Connecting

at

the

Speed

of

Light®

8

+

=

> 1 billion transistors

> 50 photonic functions

Silicon PIC

DSP ASIC

BGA

PIC

Driver

TIA

Ball Grid Array

(BGA) under

development

Copyright

©

2017

–

All

Rights

Reserved

–

Acacia

Communications,

Inc.

I

Connecting

at

the

Speed

of

Light®

9

Sky

100G

Metro

Denali

400G

ULH/Metro

Multi-core

Mouna Kea

100G

ULH

K2

40G

ULH

Everest

100G

LH

Si PIC

Rapid Pace of Innovation

2011

2012

2013

2014

2015

Strong and diverse portfolio of patents and intellectual property

2014

2016

Meru

200G

Metro

2016

Optical Performance, Low Power, Rich Feature Set

Pico

1.2T

DCI/Metro/LH

Multi-core

BGA

:

Stepping stone

towards DSP+PIC in

single package

Copyright

©

2017

–

All

Rights

Reserved

–

Acacia

Communications,

Inc.

I

Connecting

at

the

Speed

of

Light®

10

Family of products meet needs of

network operators

–

Compact, low-power industry-

standard interfaces

–

Integration in silicon

Announced CFP2-ACO and industry’s first

CFP2-DCO module

Integrates easily into all classes of

Communication Equipment

High yield / lower cost manufacturing

driven by CMOS process

Silicon

Coherent

PIC

Dual-core

DSP

100G MSA

100G CFP-DCO

400G Module

200G CFP2-DCO

1st

Metro

1st

1st

First-to-Market Products

Blending High Performance, Scale and Cost-Efficiency

We believe we are the first to introduce to the market:

Inter-

Data

Center

Long

Haul

Copyright

©

2017

–

All

Rights

Reserved

–

Acacia

Communications,

Inc.

I

Connecting

at

the

Speed

of

Light®

11

Our Growth Strategy

Increased

Investment in all

Networks –

Focused on 100G

and Higher

Expansion

Opportunity

with Existing

Customers

Expand

Customer

Base –

Driven

by Network

Equipment

Transformation

Grow into

Adjacent

Markets

Continued

Innovation

Copyright

©

2017

–

All

Rights

Reserved

–

Acacia

Communications,

Inc.

I

Connecting

at

the

Speed

of

Light®

12

Expanding coherent applications

Sub

LH

Metro

Inter-DC

5G

Provide low total cost of ownership

Acacia: Technology innovation and vertical integration

driving cost and power reductions

DCO/ACO gaining share in coherent market

Use of Acacia modules enables a faster time to market

than use of individual components

Acacia DCO: CFP

CFP2

400G OIF

Cloud and content providers looking to disaggregate

Avoid being locked-in to single vendor

Looking for best and lowest cost solutions

Voyager platform within TIP is one example

–

“white box” solution based on AC400

Autonomous and secure networks

Adding intelligence, performance metrics, encryption

Increasing value by continued innovation

Trends and Accomplishments

Riding Moore’s Law

Power/100G (W)

~40%/year reduction

2017

¹

2019

¹

DCO

ACO

Non-Pluggable

1

Source: LightCounting

Copyright

©

2017

–

All

Rights

Reserved

–

Acacia

Communications,

Inc.

I

Connecting

at

the

Speed

of

Light®

13

Expanding Coherent Markets

Markets

that

may

benefit

from

low

power

DSP

and

SiPh

technology

Units

Long-Haul

Metro

Inter DC

Intra DC

5G, Access

New Markets

A-CFP2

400G OIF

DSP+PIC

Tb plus

CFP

AC400

D-CFP2

Today

Future

Time

Reducing Power, Size

and Cost through

Siliconization

Copyright

©

2017

–

All

Rights

Reserved

–

Acacia

Communications,

Inc.

I

Connecting

at

the

Speed

of

Light®

14

New Generation Optical Interconnect Company

Bringing together the best of semiconductor and optical

Challenges

Fractured supply

base

Many material

choices

Low margin and

profitability

Too many SKUs

Strengths

High growing

markets

Critical for global

bandwidth

expansion

Challenges

Lower ASP

R&D

investment

Strengths

Fast pace of

innovation

High barrier to

entry

High volume

CMOS process

High margin and

profitability

Semiconductor

Optical

Copyright

©

2017

–

All

Rights

Reserved

–

Acacia

Communications,

Inc.

I

Connecting

at

the

Speed

of

Light®

15

Disruptive Silicon Technologies

Intel Microprocessor

Broadcom Ethernet PHY

Qualcomm Mobile Chipset

Acacia Interconnect Chipset

Copyright

©

2017

–

All

Rights

Reserved

–

Acacia

Communications,

Inc.

I

Connecting

at

the

Speed

of

Light®

16

Percent of Revenue

(Non-GAAP Basis)

Gross Profit Margin

36%

39%

47%

42%

47%

47%

48%

48% - 50%

Research & Development

19%

16%

13%

18%

14%

11%

12%

17% - 19%

Sales, General & Administrative

5%

5%

4%

5%

5%

4%

4%

6% - 8%

Operating Margin

12%

18%

29%

19%

28%

32%

32%

23% - 27%

Tax Rate (on Profit Before Tax)

16%

25%

11%

10%

11%

6%

16%

9% - 12%

Net Income Margin

10%

14%

26%

17%

25%

30%

27%

21% - 25%

2014A

(Audited)

Q4

2016A

Target

Range

Q1

2016A

2015A

(Audited)

Q2

2016A

2016A

(Audited)

Q3

2016A

Long-Term Financial Goals

These long-term financial goals are forward-looking, are subject to significant uncertainties and contingencies and are based upon assumptions with respect to future decisions, which are subject to

change. Actual results will vary and those variations may be material.  For discussion of some of the important factors that could cause these variations, please consult the “Risk Factors” section of the

Form 10-K for the fiscal year ended December 31, 2016, that we have filed with the SEC.  These long-term financial goals include “non-GAAP financial measures” as defined in Regulation G under the

Securities Exchange Act of 1934, as amended, and reconciliations of such historical non-GAAP financial measures to their most directly comparable financial measures calculated and presented in

accordance with U.S. GAAP are provided in the Appendix to this presentation.  Acacia Communications has not reconciled the forward-looking non-GAAP measures included in these long-term

financial goals because the expected tax benefits derived from any disqualifying dispositions of equity awards during the periods included in these long-range goals cannot be reasonably calculated or

predicted at this time and, accordingly, a reconciliation is not available without unreasonable effort.  Descriptions of the non-GAAP financial measures included in these long-term financial goals can

be found in the company’s earnings release with respect to its fourth quarter and full year 2016 results. 

Appendix

Copyright

©

2017

–

All

Rights

Reserved

–

Acacia

Communications,

Inc.

I

Connecting

at

the

Speed

of

Light®

18

Reconciliation of GAAP to Non-GAAP

2014

2015

2016

Non-GAAP Gross Profit;Non-GAAP Gross Profit

Margin

Gross profit

$52,676

$93,706

$220,987

Stock-based compensation

17

75

1,629

Non-GAAP gross profit

$52,693

$93,781

$222,616

Non-GAAP gross profit margin

36.0%

39.2%

46.5%

Non-GAAP R&D Expenses

GAAP research and development expenses

$28,471

$38,645

$75,696

Stock-based compensation

258

561

12,347

Non-GAAP research and development expenses

$28,213

$38,084

$63,349

Non-GAAP SG&A Expenses

GAAP selling, general and administrative expenses

$6,615

$13,124

$27,676

Stock-based compensation

132

189

6,769

Non-GAAP selling, general and administrative expenses

$6,483

$12,935

$20,907

Non-GAAP Operating Expenses

GAAP operating expenses

$35,194

$51,769

$103,397

Stock-based compensation

390

750

19,116

Non-GAAP operating expenses

$34,804

$51,019

$84,281

Non-GAAP Income from Operations

(Loss) income from operations

$17,482

$41,937

$117,590

Stock-based compensation

407

825

20,745

Non-GAAP income from operations

$17,889

$42,762

$138,335

(in thousands)

Year Ended

December 31,

Copyright

©

2017

–

All

Rights

Reserved

–

Acacia

Communications,

Inc.

I

Connecting

at

the

Speed

of

Light®

19

Reconciliation of GAAP to Non-GAAP

2014

2015

2016

Non-GAAP Net Income

Net (loss) income

$13,520

$40,520

$131,577

Stock-based compensation

407

825

20,745

Change in fair value of preferred stock warrant liability

483

2,154

3,361

Reversal of valuation allowance

–

(11,142)

0

Tax effect of excluded items

–

(47)

(32,324)

Non-GAAP net income

$14,410

$32,310

$123,359

Non-GAAP Effective Tax Rate

GAAP Effective Tax Rate

17.8%

(1.8%)

(14.8%)

Total adjustments to GAAP provision for income taxes

(0.9%)

26.3%

25.9%

Non-GAAP effective tax rate

16.9%

24.5%

11.1%

Year Ended

December 31,

(in thousands)