#1Mercury Systems FY19 Investor Day Presentation November 6, 2018 Nasdaq MarketSite New York, NY © 2018 Mercury Systems, Inc. + + mercury systemsTM INNOVATION THAT MATTERS ™ 1#2Forward-looking safe harbor statement This presentation contains certain forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995, including those to fiscal 2019 business performance and beyond and the Company's plans for growth and improvement in profitability and cash flow. You can identify these statements by the use of the words "may," "will," "could," "should," "would," "plans," "expects," "anticipates," "continue," "estimate," "project," "intend," "likely," "forecast," "probable," "potential," and similar expressions. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected or anticipated. Such risks and uncertainties include, but are not limited to, continued funding of defense programs, the timing and amounts of such funding, general economic and business conditions, including unforeseen weakness in the Company's markets, effects of any U.S. Federal government shutdown or extended continuing resolution, effects of continued geopolitical unrest and regional conflicts, competition, changes in technology and methods of marketing, delays in completing engineering and manufacturing programs, changes in customer order patterns, changes in product mix, continued success in technological advances and delivering technological innovations, changes in, or in the U.S. Government's interpretation of, federal export control or procurement rules and regulations, market acceptance of the Company's products, shortages in components, production delays or unanticipated expenses due to performance quality issues with outsourced components, inability to fully realize the expected benefits from acquisitions and restructurings, or delays in realizing such benefits, challenges in integrating acquired businesses and achieving anticipated synergies, increases in interest rates, changes to cyber-security regulations and requirements, changes in tax rates or tax regulations, changes to generally accepted accounting principles, difficulties in retaining key employees and customers, unanticipated costs under fixed-price service and system integration engagements, and various other factors beyond our control. These risks and uncertainties also include such additional risk factors as are discussed in the Company's filings with the U.S. Securities and Exchange Commission, including its Annual Report on Form 10-K for the fiscal year ended June 30, 2018. The Company cautions readers not to place undue reliance upon any such forward-looking statements, which speak only as of the date made. The Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made. Use of Non-GAAP (Generally Accepted Accounting Principles) Financial Measures In addition to reporting financial results in accordance with generally accepted accounting principles, or GAAP, the Company provides adjusted EBITDA, adjusted income, adjusted EPS, free cash flow, organic revenue and acquired revenue which are non-GAAP financial measures. Adjusted EBITDA, adjusted income, and adjusted EPS exclude certain non-cash and other specified charges. The Company believes these non-GAAP financial measures are useful to help investors better understand its past financial performance and prospects for the future. However, these non-GAAP measures should not be considered in isolation or as a substitute for financial information provided in accordance with GAAP. Management believes these non-GAAP measures assist in providing a more complete understanding of the Company's underlying operational results and trends, and management uses these measures along with the corresponding GAAP financial measures to manage the Company's business, to evaluate its performance compared to prior periods and the marketplace, and to establish operational goals. A reconciliation of GAAP to non-GAAP financial results discussed in this presentation is contained in the Appendix hereto. © 2018 Mercury Systems, Inc. 2#3Agenda ● ● Strategy & Business Update - Mark Aslett President & CEO Value Creation Blueprint Financial Update Q&A © 2018 Mercury Systems, Inc. INNOVATION THAT MATTERS ™ 3#4Pioneering a next generation defense electronics company... • Proven high-tech commercial business model for A&D • Secure sensor and safety critical processing subsystems Serving defense Prime contractor outsourcing needs ● Deployed on 300+ programs with 25+ Prime contractors 24% FY14-18 revenue CAGR • 51% FY14-18 adj. EBITDA CAGR • Ranked 27th on Fortune's 100 Fastest-Growing Companies list • Defense industry's highest Glassdoor employee ratings ...to address the industry's challenges and opportunities © 2018 Mercury Systems, Inc. 4#5Strategy delivering above average growth and profitability 1 2 3 4 5 6 7 Focused on Core Markets Acquired New Capabilities Increased IR&D Spend Trusted Domestic Manufacturing Transformed Go To Market Model Built Scalable M&A Platform © 2018 Mercury Systems, Inc. Destination Employer Focused on economic core - aerospace and defense electronics Expanded addressable market and moved up value chain High tech R&D investment level for aerospace and defense electronics Built trusted RF, digital and custom microelectronics manufacturing Solution sales and strategic account management Significant in-house origination, execution and integration capabilities Defense electronics destination employer and acquirer of choice LO 5#6● ● Acquisitions have transformed Mercury into a commercial... Aerospace and Defense Electronic Subsystem Acquired capabilities significantly expanded addressable market • Accelerates customer ● supply chain transformation ● Moved up the value chain Model facilitates greater customer outsourcing Disintermediate traditional product-level competitors Low-risk, content expansion organic growth strategy • Future M&A opportunities CAUTION © 2018 Mercury Systems, Inc. MUSTMINSTALLED FAN ASSEMBLY SURFACE FACING UP FOR PROPPER OPERATION MISSION PROCESSING MISSION PROCESSING SAFETY & SECURITY IP SECURE STORAGE SENSOR PROCESSING SENSOR PROCESSING SENSOR PROCESSING SENSOR PROCESSING DIGITIZATION DIGITIZATION RF RF RF RF THEMIS GERMANE ces= LIT THEMIS ECHOTEK CORP SYSTEMS Represents carve-out acquisition from Microsemi Corp. LNNX MERCURY RUL GERMANE D MICRONETICS Delta Microwave Microsemi Computer Systems, Inc. SYSTEMS DOKOR ELECTRONICS Microsemi olol Microsemi ...provider of secure sensor and safety-critical processing subsystems KOR ELECTRONICS 6#7We are deployed on 300+ programs with 25+ Primes C41 Sensor & Effector Mission Systems snc SIERRA NEVADA CORPORATION SAIC JLTV F-16 © 2018 Mercury Systems, Inc. TET Stormbreaker F-15 S Aerospace & Defense Platform and Systems Electronics Content WIN-T KC-46 A330 MRTT LOCKHEED MARTIN Reaper/Gorgon Stare C-130 PGK Raytheon Triton 3 communications Global Hawk NORTHROP GRUMMAN MALD-J HT Patriot ww-3000 Badger/Buzzard Paveway GENERAL ATOMICS THALES DRS BAE SYSTEMS & BOEING® Aegis Aegis SEWIP SM2/3/6 AIRBUS HARRIS® 7#8Mercury continues to deliver strong financial results ,21%, YoY 209 FY14 27% YoY 247 FY14 Revenue ($M) 24% CAGR 235 FY15 T 269 270 Bookings ($M) 23% CAGR FY15 FY16 FY17 © 2018 Mercury Systems, Inc. 409 299 444 493 FY18 564 .64%. YOY GAAP Income ($M) .24% YoY (4.1) FY14 FY15 22 14.4 19.7 44 FY16 FY17 Adj. EBITDA ($M) 24.9 51% CAGR 56 93 40.9 FY18 115 .48% YOY (0.13) FY14 23% YoY 0.38 GAAP EPS ($) FY14 0.44 0.56 FY15 FY16 FY17 Adj. EPS ($) 39% CAGR 0.82 0.58 0.96 1.15 0.86 FY16 FY17 FY18 FY14 FY15 FY16 FY17 FY18 FY15 FY16 FY17 Notes: For the fiscal year ended June 30, 2018. Bookings as reported in the Company's earnings announcement on July 31, 2018. Other figures as reported in the Company's Form 10-K for the fiscal year ended June 30, 2018. CAGR figures for the period FY2014-2018. See reconciliation of GAAP to non-GAAP financial measures tables in Management's Discussion and Analysis of Financial Condition and Results of Operations in the Form 10-K. Numbers are rounded. Per share data is presented on a fully diluted basis. As of Q1 FY19, the Company has revised its definition of adjusted EBITDA to incorporate other non-operating adjustments, net, which incudes gains or losses on foreign currency measurement and fixed assets sales and disposals among other adjustments. FY18 1.42 FY18 8#9Six major trends shaping the defense industry CEE) $ A © 2018 Mercury Systems, Inc. Political Dysfunction: Budget Control Act and repeated Continuing Resolutions disrupting DoD budget process and spending Increased Defense Spending Cycle: Rising interest rates, healthcare and social spending remain issues; MilPer expense growth, aging military platforms' O&M costs rising Defense Procurement Reform: Firm-fixed-price contracts changing economics and industry competitive dynamics despite increased defense spending Innovation Challenges: Increasing headcount but recruitment challenges and aging workforce; Relatively low IR&D requires focused investment and greater outsourcing DoD needs more domestically-produced technology Leverage high-tech commercial investment and innovation; Address supply chain globalization and need for trust and assurance Challenging Global Security Environment: Resurgent Russia, Chinese militarization and power projection, ISIS, North Korean threat, Middle East instability 9#10The Bipartisan Budget Deal of 2018 provides a significant near-term impulse to defense spending... $800 $750 $700 $650 $600 $550 $500 $450 Actual funding (Base) Actual funding (Base + OCO) 564 499 581 Topline Base Authorization Budget vs. BCA Caps (Discretionary BA, Current $B) 522 © 2018 Mercury Systems, Inc. 606 Administration 2019 Base + OCO request Administration 2019 Base request FY18 Bipartisan Budget Deal 671 598 685 617 701 628 714 648 Budget Control Act 2011 (Base) 2021 727 2016 2017 2018 2019 2020 2015 Notes: Budget and BCA Caps represent the 051 account (DoD), FY18 is estimate based on Bipartisan Budget Deal Sources: CBO, CRS, OMB, DOD Green Book, House FY18 Concurrent Budget Resolution, FY18 & FY19 Defense Appropriations bills, RSAdvisors research & analysis ...and suggests the beginning of a new defense upcycle 662 Defense Budget CAGR 2018-2023 2.0% 2017-2023 3.4% 2015 - 2023 3.5% 2022 742 676 2023 10#11Mercury's vision is to be the... Leading commercial provider of secure sensor and safety-critical processing subsystems © 2018 Mercury Systems, Inc. B 11#12Business model built for speed, innovation and affordability... INTEGRATION Traditional COTS Product Integration Classified Prime/Gov't IP Proprietary Middleware Operating System Vendor A COTS © 2018 Mercury Systems, Inc. Vendor B COTS 36+ months Time to Market Vendor C COTS Government Less Time Less Risk Lower Initial Cost Lower Lifecycle Cost Mercury Pre-integrated Embedded Subsystem(s) Classified Prime/Gov't IP Application-Ready Software Toolkit Open Middleware Embedded Security Safety-Certified Processor Hardware 12 months Time to Market Primes ...as customers seek outsourced pre-integrated subsystems 12#13Only high-tech commercial company with the technology... Highest Performance Processing & RFM Secure Sensor and Safety-Critical Processing Solutions 2010131 01110101 aranceh © 2018 Mercury Systems, Inc. ACQUIRE DIGITIZE SPEED SWAP PROCESS Best Size, Weight & Power with State-of-the-Art Cooling Technology STORAGE EXPLOIT SOFTWARE PRE-INTEGRATED SUBSYSTEMS Open Software for Low Risk Integration and Investment Protection SAFETY SECURITY DISSEMINATE Highest Safety Design Assurance Levels (DAL) Industry-leading Embedded Security 2 ...and domain expertise for secure sensor and safety-critical processing 13#14Our trusted devices and systems can fulfill all platform... Trusted Multi-chip Devices Rugged Enterprise Servers BUTIT Safety-certified Mission and Platform © 2018 Mercury Systems, Inc. +1 ## Management Subsystems Secure Sensor Processing Subsystems Secure Rugged Rackmount Servers SHE Bebe APPS Secure Blade Servers ...processing needs for demanding aerospace and defense applications 14