#1CONFLUENT Q2 2023 Earnings Call August 2, 2023#2Forward Looking Statements and Non-GAAP Financial Measures This presentation and the accompanying oral presentation (together, the "presentation") contain forward-looking statements including, among other things, statements regarding (i) our financial outlook, including expected revenue mix, operating margins and margin improvements, targeted or anticipated gross and operating margin levels, achievement of non-GAAP operating margin breakeven exiting the fourth quarter of fiscal 2023, improvements in unit economics, and expected revenue growth rate and efficient growth; (ii) our market and category leadership position, (iii) our expected investments in research and development and go-to-market functions; (iv) our expected capital allocation to drive efficient growth and rate and pace of investments, (v) the potential growth for Confluent Cloud; (vi) rates of Confluent Cloud consumption and demand for and retention of data streaming platforms like Confluent in the face of budget scrutiny, (vii) continued higher interest rates and macroeconomic uncertainty, as well as our expectations regarding the effects of macroeconomic pressure on our go-to-market motion and durability of our offering with customers, (viii) our pricing, our win rate and deal cycles and customer behaviors such as budget scrutiny, (ix) customer growth, retention and engagement, (x) ability for Confluent Cloud to provide cost savings for users and customers, including lower total cost of ownership, and drive greater monetization of the open source Kafka user base as a result, (xi) increased adoption of our platform and fully managed solutions for data streaming in general, (xii) dependence of businesses on data in motion, (xiii) ability for Confluent to become the central nervous system of organizations, (xiv) the degree of market acceptance of our products, (xv) growth in and growth rate of revenue, customers, remaining performance obligations, dollar-based net retention rate, and gross retention rate, (xvi) our ability to increase engagement of customers for Confluent and expand customer cohorts, (xvii) our market opportunity, (xviii) our consumption-oriented strategy, (xix) our go-to-market strategy, (xx) our product differentiation and market acceptance of our products, including over open source alternatives, (xxi) our strategy and expected results and market acceptance for our Flink offering and timing for launch that offering, (xxii) our expectations for market acceptance of stream processing, (xxiii) our ability to meet near-term an mid-term financial targets, (xxiv) our potential for value creation, (xxv) our investment priority and philosophy, (xxvi) our Chief Financial Officer transition, and (xxvii) our overall future prospects. The words "believe," "may," "will," "estimate," "continue," "anticipate," "intend," "expect," "seek," "plan," "project," "target," "looking ahead," "look to," "move into," and similar expressions are intended to identify forward-looking statements. Forward-looking statements represent our current beliefs, estimates and assumptions only as of the date of this press release and information contained in this press release should not be relied upon as representing our estimates as of any subsequent date. These forward-looking statements are subject to risks, uncertainties, and assumptions. If the risks materialize or assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. Risks include, but are not limited to: (i) our limited operating history, including in uncertain macroeconomic environments, (ii) our ability to sustain and manage our rapid growth, including following our recent restructuring, (iii) our ability to attract new customers and retain and sell additional features and services to our existing customers, (iv) inflationary conditions, economic uncertainty, recessionary risks, and exchange rate fluctuations, which have resulted and may continue to result in customer pullback in information technology spending, lengthening of sales cycles, reduced contract sizes, reduced consumption of Confluent Cloud or customer preference for open source alternatives, as well as the potential need for cost efficiency measures, (v) our ability to increase consumption of our offering, including by existing customers and through the acquisition of new customers, and successfully add new features and functionality to our offering, (vi) our ability to achieve profitability and improve margins annually, by our expected timelines or at all, (vii) our ability to operate our business and execute on our strategic initiatives following our recent restructuring, (viii) the estimated addressable market opportunity for our offering, including our Flink offering and stream processing, (ix) our ability to compete effectively in an increasingly competitive market, including achieving market acceptance over competitors and open source alternatives, (x) our ability to successfully execute our go-to-market strategy and initiatives and increase market awareness and acceptance of the benefits of our offering, including the total cost of ownership benefits of Confluent Cloud, (xi) our ability to attract and retain highly qualified personnel, which could be negatively impacted by our recent restructuring, (xii) breaches in our security measures or unauthorized access to our platform, our data, or our customers' or other users' personal data, (xiii) our reliance on third-party cloud-based infrastructure to host Confluent Cloud, and (xiv) general market, political, economic, and business conditions, including continuing impacts from the COVID-19 pandemic. These risks are not exhaustive. Further information on these and other risks that could affect Confluent's results is included in our filings with the Securities and Exchange Commission ("SEC"), including our Quarterly Report on Form 10-Q for the quarter ended March 31, 2023, and our future reports that we may file from time to time with the SEC. Additional information will be made available in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2023 that will be filed with the SEC, which should be read in conjunction with this presentation and the financial results included herein. Confluent assumes no obligation to, and does not currently intend to, update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. As a reminder, certain financial measures we use on our call today and in the presentation are expressed on a non-GAAP basis. We use these non-GAAP financial measures and other key metrics internally to facilitate analysis of our financial and business trends and for internal planning and forecasting purposes. We believe these non-GAAP financial measures, when taken collectively, may be helpful to investors because they provide consistency and comparability with past financial performance by excluding certain items that may not be indicative of our business, results of operations, or outlook. However, non-GAAP financial measures have limitations as an analytical tool and are presented for supplemental informational purposes only. They should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. A reconciliation between these GAAP and non-GAAP financial measures is included in the Appendix to this presentation.#3Jay Kreps Co-Founder and CEO CONFLUENT 3#4Organizational Update Steffan Tomlinson Confluent's CFO Rohan Sivaram Confluent's Incoming CFO#5Rohan joined Confluent in October 2020 and has built and led corporate finance, IR, treasury, and business operations. As CFO, Rohan will lead all of Confluent's finance and business technology & data teams. Previously: paloalto ✔✓Symantec Morgan Stanley Rohan Sivaram Confluent's Incoming CFO 5#6Thanks Steffan! 6#7Thanks Steffan! Wish you the very best Rohan Sivaram Confluent's Incoming CFO 7#8Total Revenue Strong Second Quarter Results $189M +36% YOY Confluent Cloud Revenue $84M +78% YOY Non-GAAP Operating Margin +24 pts YOY Note: Financials are for the period ended June 30, 2023. Refer to the slides in the section titled "GAAP to Non-GAAP Reconciliations" in the Appendix, for a reconciliation of our non-GAAP financial metrics to the most directly comparable GAAP financial measures 8#9KARKA SUMMIT 131 K KAFKA SUMMIT LONDON 2023 In-person 1,500+ Attendees 2,300+ Virtual Attendees Countries 50+ Represented 95 Speakers KAFKA SUMMIT EXPO HALL ED akty SACA 60 trybird MMM ORADICAL ververbo cymo- factor house [ROCKEY] OGO MARACAST#10KORA ENGINE The Apache Kafka® Engine Built for the Cloud 10#11DSP 2 Data Pipelines Geofencing JIL CONNECT STREAM Data Streaming Platform Real-time Analytics Data Analytics LoDynamic Pricing Streaming ETL Cyber-Security Shipment Tracking / Alerting DATA STREAMING APPLICATIONS GOVERN PROCESS loT & Telematics Customer 360 KORA: THE APACHE KAFKA ENGINE, BUILT FOR THE CLOUD ML & AI and more... SHARE 11#12DSP 2 Data Pipelines Geofencing JIL CONNECT STREAM Real-time Analytics Streaming ETL Stream Data Analytics LoDynamic Pricing Cyber-Security Shipment Tracking / Alerting DATA STREAMING APPLICATIONS GOVERN PROCESS loT & Telematics Customer 360 KORA: THE APACHE KAFKA ENGINE, BUILT FOR THE CLOUD ML & AI and more... SHARE 12#13DSP 2 Data Pipelines Geofencing JIL CONNECT STREAM Real-time Analytics Streaming ETL Connect Data Analytics LoDynamic Pricing Cyber-Security Shipment Tracking / Alerting DATA STREAMING APPLICATIONS GOVERN PROCESS loT & Telematics Customer 360 KORA: THE APACHE KAFKA ENGINE, BUILT FOR THE CLOUD ML & AI and more... SHARE 13#14Connectors 120+ Pre-Built Connectors 70+ Fully Managed Connectors Confluent.io Confluent Connector Portfolio Confluent offers 120+ pre-built connectors to help you quickly and reliably integrate with Apache Kafka. We offer Open Source / Community Connectors, Commercial Connectors, and Premium Connectors. We also have Confluent-verified partner connectors that are supported by our partners. oss / COMMUNITY / PARTNER COMMERCIAL PREMIUM Confluent Open Source / Community/ Partner Connectors Confluent supports a subset of open source software (OSS) Apache Kafka connectors, builds and supports a set of connectors in-house that are source-available and governed by Confluent's Community License (CCL), and has verified a set of Partner-developed and supported connectors. + 14#15DSP 2 Data Pipelines Geofencing JIL CONNECT STREAM Real-time Analytics Streaming ETL Govern Data Analytics LoDynamic Pricing Cyber-Security Shipment Tracking / Alerting DATA STREAMING APPLICATIONS GOVERN PROCESS loT & Telematics Customer 360 KORA: THE APACHE KAFKA ENGINE, BUILT FOR THE CLOUD ML & AI and more... SHARE 15#16Q Stream Governance Where did data come from? Where is it going? Where, when, and how was it transformed? Who can access the data? What is the current state of the stream? Is it compliant with regulatory standards? PROTECT DISCOVER NOLOGY VALIDATE PEOPLE CONNECT CLASSIFY 16#17DSP 2 Data Pipelines Geofencing JIL CONNECT STREAM Real-time Analytics Streaming ETL Process Data Analytics LoDynamic Pricing Cyber-Security Shipment Tracking / Alerting DATA STREAMING APPLICATIONS GOVERN PROCESS loT & Telematics Customer 360 KORA: THE APACHE KAFKA ENGINE, BUILT FOR THE CLOUD ML & AI and more... SHARE 17#18Flink The Emerging De Facto Standard for Stream Processing 18#19DSP 2 Data Pipelines Geofencing JIL CONNECT STREAM Real-time Analytics Streaming ETL Share Data Analytics LoDynamic Pricing GOVERN Cyber-Security Shipment Tracking / Alerting DATA STREAMING APPLICATIONS PROCESS loT & Telematics Customer 360 KORA: THE APACHE KAFKA ENGINE, BUILT FOR THE CLOUD ML & AI and more... SHARE 19#20Example: Travel N Stream Sharing We Bring Real-time to Secure Data Sharing Between Organizations and Extend the Network Effect Airports Bookings Airlines Baggage 20#21Virtuous Cycle of Data Streaming Platforms Connect Share T-J 진 Stream Q Q Govern Process 21#22DSP 2 Data Pipelines Geofencing Complete Data Streaming Platform loT & Telematics Customer 360 JIL CONNECT STREAM Real-time Analytics Data Analytics LoDynamic Pricing Streaming ETL Cyber-Security Shipment Tracking / Alerting DATA STREAMING APPLICATIONS GOVERN PROCESS KORA: THE APACHE KAFKA ENGINE, BUILT FOR THE CLOUD ML & AI and more... SHARE 22#2310:28 All Hello, let's shop! Search by Keyword or Product ID Women Products For You Men ↓↑ Sort Category ✓ Gender ✓ Eva Attractive Organza Abstarct... €425 411 with 1 Special Offer Free Delivery 5 (4) +10 more 560 Kids 97 O Electronic = Filters +6 more Multicolored Latest Mattress Pr... 689 *651 with 2 Special Offers Free Delivery 5 (5) APARA MEMOHON Customer Highlight Meesho#24Customer Highlight PolicyGenius 24#25Customer Highlight Recursion Pharmaceuticals#26Steffan Tomlinson Chief Financial Officer CONFLUENT 26#27Remaining Performance Obligations (RPO) Note: Metrics are as of period ended June 30, 2023. See Appendix for the definition of "Current RPO". RPO $791.4M +34% YOY Current RPO ~65% of RPO ~$514.8M +41% YOY 27#28Total Customers ~4,830 +17% YOY +140 QOQ Customers Customers with ≥ $100K in ARR 1,144 +33% YOY +69 QoQ Note: Metrics are as of period ended June 30, 2023. See Appendix for the definitions for "Total Customers", "Customers with $100,000 or greater in ARR" and "Customers with $1,000,000 or greater in ARR." Customers with ≥ $1M in ARR 147 +48% YOY +12 QOQ 28#29Dollar-Based Net Retention Rate (NRR) Total NRR >130% Gross Retention >90% Note: Metrics are as of period ended June 30, 2023. See Appendix for the definitions for "Dollar-Based Net Retention Rate," "Gross Retention Rate," and "Cloud NRR." Cloud NRR >140% 29#30Total Revenue $189.3M +36% YOY Note: Financials are for the quarter ended June 30, 2023. Revenue Subscription Revenue $176.5M +39% YOY 93% of Total Revenue 30#31Confluent Platform Revenue $92.9M +16% YOY 49% of Total Revenue Note: Financials are for the quarter ended June 30, 2023. Revenue by Product Confluent Cloud Revenue $83.6M +78% YOY 44% of Total Revenue +$9.9M Q/Q Confluent Cloud % New ACV Bookings >50% Greater Than 50% for the 7th Consecutive Quarter 31#32Revenue by Geography Revenue From the U.S. $113.9M +30% YOY Note: Financials are for the quarter ended June 30, 2023. 60% of Total Revenue Revenue From Outside the U.S. $75.4M +45% YOY 40% of Total Revenue 32#33Non-GAAP Gross Margins Total Gross Margin 75.0% +440 bps YoY Subscription Gross Margin 79.1% +230 bps YoY Note: Financials are for the quarter ended June 30, 2023. Refer to the slides in the section titled "GAAP to Non-GAAP Reconciliations" in the Appendix, for a reconciliation of our non-GAAP financial metrics to the most directly comparable GAAP financial measures. 33#34Other Financial Summary Non-GAAP Operating Margin Non-GAAP Net Income Per Share Free Cash Flow Margin Cash, Cash Equivalents, and Marketable Securities Weighted-Average Shares Outstanding Fully Diluted Shares Outstanding Q2'23 (9.2%), +24 pts YoY $0.00, +$0.16 YOY (18.6%), +8 pts YoY $1.85B 297.8M Basic, 339.3M Diluted 353.6M Note: Financials are as of or for the quarter ended June 30, 2023. Refer to the slides in the section titled "GAAP O Non-GAAP Reconciliations" in the Appendix, for a reconciliation of our non-GAAP financial metrics to the most directly comparable GAAP financial measures. See Appendix for the definition of "Fully Diluted Shares Outstanding." 34#351H Learnings & 2H Outlook Beginning of the Year Tough selling environment: . Additional budget scrutiny and changes in customer buying behavior, leading to sales cycle elongation 1H'23 Learnings Customers are more inclined to: • Sign shorter duration contracts • Start with smaller initial deal sizes • Consume more than commit Macro uncertainty to persist in 2H Subscription Revenue Confluent Platform (CP): • Remains resilient • Expected to outperform in 2H vs. expectations beginning the year Confluent Cloud (CC): • High NRR, product market fit, strong TCO and ROI • Expected to grow substantially faster than total revenue in 2H 35#36Total Revenue Cloud Revenue Non-GAAP Operating Margin Guidance Non-GAAP Net Income (Loss) Per Share Weighted-Average Shares Outstanding Q3'23 $193.5M-$195.5M 28%-29% YoY ~$92.2M 62% YOY ~ (10%) $(0.01)-$0.00 304M Basic 350M Diluted FY'23 $767M-$772M 31%-32% YoY N/A ~ (10%) $(0.05)-$(0.02) 300M Basic Other • Q3'23 cloud revenue: Accounts for ~47% of total revenue at the midpoint and represents sequential add of approximately $8.5M • Q4'23 cloud as a % of total revenue: 48%-50%, likely at the lower end due to factors discussed in prepared remarks and strength in Confluent Platform impacting product mix shift • Q4'23 non-GAAP operating margin: Breakeven ● FCFM breakeven timing: To roughly mirror that of non-GAAP operating margin FY'23 non-GAAP gross margin: ~74% 36#37Thank You CONFLUENT 37#38Appendix 38#39Definitions Current Remaining Performance Obligations (Current RPO): Represents the estimated amount of contracted future revenue expected to be recognized as revenue over the next 12 months. Annual Recurring Revenue (ARR): We define ARR as (1) with respect to Confluent Platform customers, the amount of revenue to which our customers are contractually committed over the following 12 months assuming no increases or reductions in their subscriptions, and (2) with respect to Confluent Cloud customers, the amount of revenue that we expect to recognize from such customers over the following 12 months, calculated by annualizing actual consumption of Confluent Cloud in the last three months of the applicable period, assuming no increases or reductions in usage rate. Services arrangements are excluded from the calculation of ARR. Prior to the first quarter of 2023, ARR with respect to Confluent Cloud customers excluded pay-as-you-go arrangements and was based on contractual commitments over the following 12 months, regardless of actual consumption. We adjusted our methodology for calculating ARR commencing with the first quarter of 2023 to incorporate actual consumption of Confluent Cloud and applied this change retroactively. Dollar-Based Net Retention Rate: We calculate our dollar-based net retention rate (NRR) as of a period end by starting with the ARR from the cohort of all customers as of 12 months prior to such period end ("Prior Period Value"). We then calculate the ARR from these same customers as of the current period end ("Current Period Value"), and divide the Current Period Value by the Prior Period Value to arrive at our dollar-based NRR. The dollar-based NRR includes the effect, on a dollar-weighted value basis, of our Confluent Platform subscriptions that expand, renew, contract, or attrit. The dollar-based NRR also includes the effect of annualizing actual consumption of Confluent Cloud in the last three months of the applicable period, but excludes ARR from new customers in the current period. Our dollar-based NRR is subject to adjustments for acquisitions, consolidations, spin-offs, and other market activity. Dollar-Based Gross Retention Rate: We calculate our dollar-based gross retention rate as of a period end by starting with the ARR from the cohort of all customers as of 12 months prior to such period end ("Prior Period Value"). We then calculate the ARR from these same customers, which includes contract contraction and attrition but excludes contract expansion, as of the current period end ("Current Period Value"). We divide the Current Period Value by the Prior Period Value to arrive at a dollar-based gross retention rate. Cloud NRR: We calculate our dollar-based NRR for Confluent Cloud using the same methodology as total dollar-based NRR, with the exception that only the ARR from Confluent Cloud consumption is included in the calculation. Total Customers: Represents the total number of customers at the end of each period. For purposes of determining our customer count, we treat all affiliated entities with the same parent organization as a single customer and include pay-as-you-go customers. Our customer count is subject to adjustments for acquisitions, consolidations, spin-offs, and other market activity. Customers with $100,000 or greater in ARR: Represents the number of customers that contributed $100,000 or more in ARR as of period end. Customers with $1,000,000 or greater in ARR: Represents the number of customers that contributed $1,000,000 or more in ARR as of period end. Fully Diluted Shares Outstanding: Represents the total number of common shares outstanding adjusted for the impact of stock options, restricted stock units, and options to purchase shares under the employee stock purchase plan determined under the treasury stock method, and excludes shares issuable upon conversion of outstanding convertible senior notes. 39#40GAAP to Non-GAAP Reconciliations (in thousands, except percentages) Total revenue Total gross profit on a GAAP basis Add: Stock-based compensation expense Add: Employer taxes on employee stock transactions Add: Amortization of acquired intangibles Non-GAAP total gross profit Non-GAAP total gross margin Subscription revenue Subscription gross profit on a GAAP basis Add: Stock-based compensation expense Add: Employer taxes on employee stock transactions Add: Amortization of acquired intangibles Non-GAAP subscription gross profit Non-GAAP subscription gross margin Q2'22 $139,407 $89,898 8,346 150 $98,394 70.6% Q2'22 $127,018 $91,410 6,018 70 $97,498 76.8% Q2'23 $189,285 $131,365 10,039 393 127 $141,924 75.0% Q2'23 $176,488 $132,300 6,914 265 127 $139,606 79.1% 40#41GAAP to Non-GAAP Reconciliations (in thousands, except percentages) Total revenue Operating loss on a GAAP basis Add: Stock-based compensation expense Add: Employer taxes on employee stock transactions Add: Amortization of acquired intangibles Add: Acquisition-related expenses Add: Restructuring and other related charges Non-GAAP operating loss Non-GAAP operating margin Q2'22 $139,407 $(117,307) 68,866 1,670 $(46,771) (33.5%) Q2'23 $189,285 $(119,368) 92,159 3,599 127 5,198 943 $(17,342) (9.2%) 41#42GAAP to Non-GAAP Reconciliations (in thousands, except percentages, share and per share data) Net loss on a GAAP basis Add: Stock-based compensation expense Add: Employer taxes on employee stock transactions Add: Amortization of acquired intangibles Add: Acquisition-related expenses Add: Restructuring and other related charges Add: Amortization of debt issuance costs Add: Income tax effects and adjustments Non-GAAP net (loss) income Non-GAAP net (loss) income per share, basic Non-GAAP net (loss) income per share, diluted Weighted-average shares used to compute net (loss) income per share, basic Weighted-average shares used to compute net (loss) income per share, diluted Q2'22 $(117,631) 68,866 1,670 946 669 $(45,480) $(0.16) $(0.16) 278,268,980 278,268,980 Q2'23 $(103,425) 92,159 3,599 127 5,198 943 950 507 $58 $0.00 $0.00 297,827,200 339,296,142 42#43GAAP to Non-GAAP Reconciliations (in thousands, except percentages) Total revenue Net cash used in operating activities Add: Capitalized internal-use software costs Add: Capital expenditures Free cash flow Free cash flow margin Q2'22 $139,407 $(33,472) (2,256) (1,184) $(36,912) (26.5%) Q2'23 $189,285 $(29,060) (5,330) (809) $(35,199) (18.6%) 43