SecureWorks : Q2 Fiscal 24 Performance Review Presentation

Q2 Fiscal 2024 Performance Review

September 7, 2023

//Secureworks/Confidential - Limited External Distribution

Disclaimers

Non-GAAP

This presentation includes information about the Company's non-GAAP revenue, non-

GAAP gross margin, non-GAAP Taegis Subscription Solutions revenue, non-GAAP Taegis Subscription Solutions gross profit, non-GAAP Taegis Subscription Solutions gross margin, non-GAAP Managed Security Services revenue, non-GAAP Managed Security Services gross profit, non-GAAP Managed Security Services gross margin, non-GAAP subscription revenue, non-GAAP professional services revenue, non-GAAP subscription gross profit, non-GAAP subscription gross margin, non-GAAP professional services gross profit, non-GAAP professional services gross margin, non-GAAP research and development expenses, non-GAAP sales and marketing expenses, non-GAAP general and administrative expenses, non-GAAP operating income (loss), non-GAAP net income (loss), non-GAAP earnings (loss) per share and adjusted EBITDA, which are non-GAAP financial measures provided as a supplement to the results provided in accordance with accounting principles generally accepted in the United States of America ("GAAP"). A reconciliation of each of the foregoing non-GAAP financial measures to the most directly comparable GAAP financial measure is provided below for each of the fiscal periods indicated.

Operating Metrics

The Company defines annual recurring revenue (ARR) as the value of its subscription contracts as of a particular date. Because the Company uses recurring revenue as a leading indicator of future annual revenue, it includes operational backlog. Operational backlog is defined as the recurring revenue associated with pending contracts, which are contracts that have been sold but for which the service period has not yet commenced.

2

//Secureworks/Confidential - Limited External Distribution

Special Note on Forward

Looking Statements

Statements in this material that relate to future results and events are

forward-looking statements and are based on SecureWorks Corp.'s

current expectations. These forward-looking statements include, but are not limited to, the statements in this presentation with respect to the Company's expectations regarding revenue, GAAP net loss per share, and non-GAAP net loss per share for the second quarter of fiscal 2024, and revenue, GAAP net loss, GAAP net loss per share, non-GAAP net loss, non-GAAP net loss per share, Adjusted EBITDA, cash flow from operations, capital expenditures, Taegis Revenue, Taegis annual recurring revenue, and Other MSS annual recurring revenue for full year fiscal 2024, all of which reflect the Company's current analysis of existing trends and information. In some cases, you can identify these statements by such forward-looking words as

"anticipate," "believe," "could," "estimate," "expect," "intend," "confidence," "may," "plan," "potential," "should," "will" and "would," or similar expressions. Actual results and events in future periods may

differ materially from those expressed or implied by these forward- looking statements because of a number of risks, uncertainties and other factors, including those discussed in SecureWorks Corp.'s periodic reports filed with the Securities and Exchange Commission. These forward-looking statements speak only as of the date of this presentation. SecureWorks Corp. assumes no obligation to update its forward-looking statements.

Q2 Fiscal 2024	SOLID RESULTS:

Strong MDR Growth:

Performance Highlights

• Taegis ARR grew to $276 million, now representing ~90% of Total ARR
• Taegis Q1 Revenue of $66 million +55% y/y
• Taegis Non-GAAP Gross Margin of 70.7%
• Total Q1 Revenue of $93 million
• Adjusted EBITDA of $(10) million

• Taegis ARR growth of 37% y/y
• Added 500 Taegis customers y/y, a 33% increase, to end Q2 at 2,000 customers
• Taegis ARPC of $135k
• Partnered with EY to launch their Intelligent Extended Detection & Response (IXDR), powered by Taegis XDR
• Announced integrated partnership with Akamai's Enterprise Application Access module, a leading zero trust network access solution
• Delivered Taegis platform capabilities, expanding our automation of investigations and alert triage, directly benefitting our customers by minimizing the time between detection and executing a response

3

//Secureworks/Confidential - Limited External Distribution

Continued Strong XDR Growth Rates

Taegis Annual Recurring Revenue

• Taegis ARR of $276M
• 2,000 Taegis customers
• Taegis 90% of total ARR

+37% y/y

$276M

+33% y/y

$201M

$101M

$33M

Q2 FY 21Q2 FY 22Q2 FY 23Q2 FY 24

4

//Secureworks/Confidential - Limited External Distribution

Q2 Fiscal 2024

Consolidated

GAAP

Results

($ in millions)

* Individual items may differ due to rounding of individual components.

	2Q24	2Q23	Change
Taegis Subscription Solutions	66.4	42.8	55.2%
Managed Security Services	10.4	47.5	(78.1)%
Subscription	76.8	90.3	(14.9)%
Professional Services	16.1	25.9	(37.6)%
Total Revenue	92.9	116.1	(20.0)%
Taegis Subscription Solutions	45.7	27.3	67.5%
GM % of Revenue	68.8%	63.7%	510 bps
Managed Security Services	1.0	29.0	(96.4)%
GM % of Revenue	10.1%	61.0%	-5090 bps
Subscription	46.7	56.3	(16.9)%
GM % of Revenue	60.8%	62.3%	-150 bps
Professional Services	6.2	10.3	(40.4)%
GM % of Revenue	38.2%	40.0%	-180 bps
Total Gross Margin	52.9	66.6	(20.6)%
GM % of Total Revenue	56.9%	57.3%	-40 bps
R&D	28.2	33.6	(16.1)%
S&M	31.2	40.9	(23.7)%
G&A	20.4	24.3	(16.1)%
Reorganization & other related charges	14.2	-	N/A
Operating Expenses	94.1	98.9	(4.8)%
OpEx % of Revenue	101.2%	85.1%	1610 bps
Operating Loss	(41.2)	(32.2)	27.6%
OpLoss % of Revenue	(44.3)%	(27.8)%	-1650 bps
Interest & Other (Net)	(0.6)	0.1	(586)%
I&O % of Revenue	(0.7)%	0.1%	-800 bps
Income Tax Expense (Benefit)	(9.4)	(7.4)	(25.3)%
Effective Tax Rate	22.6%	23.0%
Net Loss	(32.4)	(24.7)	30.9%
NL % of Revenue	(34.8)%	(21.3)%	-1350 bps

* See supplemental slides in Appendix for reconciliation of GAAP to Non-GAAP measures.

5

//Secureworks/Confidential - Limited External Distribution