Inovalon : June 2021 Investor Presentation

Inovalon

Investor Presentation

June 2021

Cautionary Note Regarding Forward-Looking Statement

Certain statements contained in this presentation constitute forward-looking statements within the meaning of, and are intended to be covered by the safe harbor provisions of, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements contained in this presentation other than statements of historical fact, including but not limited to the roll-out of any product or capability, the timing, performance characteristics and utility of any such product or capability, and the impact of any such product or capability on the healthcare industry, future results of operations and financial position, business strategy and plans, market growth, and objectives for future operations, are forward-looking statements. The words "believe," "may," "see," "will," "estimate," "continue," "anticipate," "assume," "intend," "expect," "project," "look forward," "promise" and similar expressions are intended to identify forward-looking statements. Forward-looking statements in this presentation include, but are not limited to, statements regarding expectations about future business plans, prospective performance and opportunities, strategies and business plans, expectations regarding future results, expectations regarding the size of our datasets, expectations regarding implementation timeframes, our ability to meet financial guidance for the second quarter and full year 2021, expectations regarding future contract wins, our ability to pay down outstanding indebtedness, expectations regarding interest payments and rates, expectations regarding tax rates, expectations regarding and/or estimates of ACV and TCV, statements with respect to visibility, revenue retention, recurring revenue, including ACV and TCV, and the impact of the COVID-19 pandemic on our business and operations. Inovalon has based these forward-looking statements largely on its current expectations and projections about future events and trends that may affect financial condition, results of operations, business strategy, short-term and long-term business operations and objectives, and financial needs as of the date of this presentation. These forward- looking statements are subject to a number of risks, uncertainties, and assumptions, which could cause the future events and trends discussed in this presentation not to occur and could cause actual results to differ materially and adversely from those anticipated or implied in the forward-looking statements.

These risks, uncertainties, and assumptions include, among others: the effects and potential effects of the COVID-19 pandemic on our business, cash flow, liquidity and results of operations due to, among other things, effects on the economy generally and on our customers, including the possible effects of significant rising unemployment, the inability of consumers to timely pay our customers and the resulting potential inability of our customers to pay the fees under our contracts on time or in full; the delay in the contracting for services by our customers as a result of the COVID-19 pandemic; potential other delays in the sales cycle for new customers and products; and other unforeseen impacts on our customers and potential customers and on our employees that could have a negative impact on us; the Company's ability to continue and manage growth, including successfully integrating acquisitions; ability to grow the customer base, retain and renew the existing customer base and maintain or increase the fees and activity with existing customers; the effect of the concentration of revenue among top customers; the ability to innovate new services and adapt platforms and toolsets; the ability to successfully implement growth strategies, including the ability to expand into adjacent verticals, such as direct to consumer, growing channel partnerships, expanding internationally and successfully pursuing acquisitions; the ability to successfully integrate our acquisitions and the ability of the acquired business to perform as expected; the successful implementation and adoption of new platforms and solutions, including the Inovalon ONE® Platform, ScriptMed® Cloud, Clinical Data Extraction as a Service (CDEaaS™), Natural Language Processing as a Service (NLPaaS™), Elastic Container Technology (ECT™), Consumer Health Gateway™, InfectionWatch™, Inovalon DataStream™ API, Healthcare Data Lake, and the Telehealth configuration of the Inovalon ONE® Platform; the possibility of technical, logistical or planning issues in connection with the Company's investment in and successful deployment of the Company's products, services and technological advancements; the ability to enter into new agreements with existing or new platforms, products and solutions in the timeframes expected, or at all; the impact of pending M&A activity in the managed care industry, including potential positive or negative impact on existing contracts or the demand for new contracts; the effects of and costs associated with compliance with regulations applicable to the Company, including regulations relating to data protection and data privacy; the effects of changes in tax laws in the jurisdictions in which we operate; the ability to protect the privacy of customers' data and prevent security breaches; the effect of competition on the business; the timing, size and effect of business realignment and restructuring charges; and the efficacy of the Company's platforms and toolsets. Additional information is also set forth in the Company's Annual Report on Form 10-K for the year ended December 31, 2020, filed with the SEC on February 17, 2021, included under Part I, Item 1A, "Risk Factors," and in subsequent filings with the SEC. In addition, graphics, images or illustrations pertaining to or demonstrating our products, data, services and/or technology that may be used herein are intended for illustrative purposes only unless otherwise noted. The Company is under no duty to, and disclaims any obligation to, update any of these forward-looking statements after the date of this presentation or conform these statements to actual results or revised expectations, except as required by law.

Non-GAAP Financial Measures: This presentation contains certain non-GAAP measures. These non-GAAP measures are in addition to, not a substitute for or necessarily superior to, measures of financial performance in accordance with U.S. GAAP. The GAAP measure most closely comparable to each non-GAAP measure used or discussed, and a reconciliation of the differences between each non-GAAP measure and the comparable GAAP measure, is available herein and within our public filings with the SEC. All data provided is as of December 31, 2020 unless stated otherwise.

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Contents

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Inovalon at a Glance and

Key Q1 2021 & FY 2021 Highlights

Overview of Inovalon

Historical & Financial Guidance

Closing

Appendix

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A Leading Vertical Provider of

Cloud-Based Platforms Empowering

Data-Driven Healthcare

Origins:	1998
NASDAQ:	INOV
Employees:	1,900
Revenue:	FY20: $668 Million
FY21E: $759 Million
Adj. EBITDA:	FY20: $231 Million
FY21E: $270 Million
Market Cap:	$5 Billion
Headquarters:	Bowie, MD

Containing and Informed by

the Real-World Data of:

336+ Million

Patients

1+ Million

Providers

580,000+

Clinical Facilities

62+ Billion

Medical Events

Supporting 1,000s of Customers Including:

25 Top 25 U.S. of 25 Health Plans

25	Top-25 Global
Pharma
of 25
Companies
24	Top 25 U.S.
Healthcare
of 25	Provider
	Systems

Note: 2021 Revenue and Adjusted EBITDA numbers are presented at respective guidance midpoints. Market Cap as of June 11, 2021.

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Q1 2021

Financial

Highlights

During Q1 2021, Inovalon's revenue increased 15% year-over-year to $177.2 million, inclusive of $158.0 million from subscription-based platform revenue, reflecting 89% of total revenue, and an increase of 15% year-over-year. New sales ACV increased 81% year-over-year to $82.1 million, and Platform new sales ACV (excluding services) increased

120% year-over-year to $63.8 million. Adjusted EBITDA was $58.6 million, an increase of 23% year-over-year, and Adjusted EBITDA margin increased 230 basis points year-over-year to 33.1%.

Revenue of		Significant
	$177.2M		Profitabilityof
	Representing		$58.6M
	Revenue Growth of		Adjusted EBITDA, or a
	15%		33.1%
	Year-over-year		Adjusted EBITDA Margin
Cash & Cash		Platform
Equivalents Increased		New Sales ACV of
to $128.6M		$63.8M
	3.19x		120%
With Net Debt Ratio Improving		Representing Growth of
to
			Year-over-year

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