#1Second Quarter Fiscal Year 2020 Financial Results Mark Aslett President and CEO Michael Ruppert Executive Vice President and CFO January 28, 2020, 5:00 pm ET © 2020 Mercury Systems, Inc. mercury systems. ↓ Conference call: Dial (877) 303-6977 in the USA and Canada, (760) 298-5079 in all other countries Webcast login at www.mrcy.com/investor Webcast replay available by 7:00 p.m. ET January 28, 2020 23 INNOVATION THAT MATTERSⓇ#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 relating to the acquisitions described herein and to fiscal 2020 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 interest rate swaps or other cash flow hedging arrangements, 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 discussed in the Company's fili with the U.S. Securities and Exchange Commission, including its Annual Report on Form 10-K for the fiscal year ended June 30, 2019. 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. © 2020 Mercury Systems, Inc. 2#3Introduction ● ● ● ● Record revenue, backlog and profitability Positive industry environment; defense appropriations bill approved Business model performing extremely well Investing to support organic growth while delivering record results Raising total FY20 revenue, adjusted EBITDA and adjusted EPS guidance • Now expect 13-14% organic revenue growth for FY20 © 2020 Mercury Systems, Inc. 3#4Financial highlights ● ● ● ● Q2 FY20 vs. Q2 FY19 Bookings up 21% Record backlog up 39% Record revenue up 22% Organic revenue (¹) up 12% GAAP net income up 27% Record adjusted EBITDA up 16% Record Op cash of $32.1M; up 27% FCF of $20.7M; 48% adj. EBITDA ● © 2020 Mercury Systems, Inc. ● LTM Q2 FY20 vs. LTM Q2 FY19 Record bookings up 27% Record backlog up 39% Record revenue up 26% Organic revenue(¹) up 16% Record GAAP net income up 84% Record adjusted EBITDA up 19% Record Op cash of $108.6M; up 51% FCF of $71.8M; 46% adj. EBITDA Notes: (1) Organic revenue represents total company revenue excluding net revenue from acquisitions for the first four full quarters since the entities' acquisition date (which excludes any intercompany transactions). After the completion of four fiscal quarters, acquired businesses are treated as organic for current and comparable historical periods. 4#5Pioneered next-generation defense electronics company ● ● ● Making commercial technologies profoundly more accessible to A&D Transformational business model at intersection of high tech and A&D Fueled by internal R&D 4-5x industry average* Highly innovative trusted, secure mission-critical technologies Growth capital investments 2-3x industry norms* Developing sensor processing and C41 subsystems far more quickly and affordably Industry-leading secure computing solutions Developed and produced in trusted domestic facilities by a highly-cleared workforce Challenging global security environment leading to increased defense spending Strategy and model aligned with DoD priorities and procurement reform DoD now focused on accelerating and fielding innovative capabilities - - - * Internal R&D and capital investment expressed as a percentage of total company revenue © 2020 Mercury Systems, Inc. LO 5#6Favorable growth environment driving improved results ● ● Sensor and effector mission systems (SEMS) revenue up 24% YoY, C41 up 22% Substantial growth in estimated lifetime value of top 30 programs and pursuits Growth driven by content expansion and market penetration Benefiting from significant wave of sensor and C41 modernization Favorable trends – delayering, flight to quality, outsourcing, taking share Tracking 100+ active programs, top programs growing faster than total revenue © 2020 Mercury Systems, Inc. 6#7Growth strategy update ● ● ● ● ● Created low-risk content expansion in capabilities and addressable markets Acquired capabilities drove Tier 2 subsystems provider transformation Expanding in core sensor and effector mission systems market C41 market expansion: C31 and platform/mission management Uniquely positioned to provide DoD trusted, secure microelectronics solutions Investing $15M to expand scope of existing microelectronics business Completed West coast RF facility buildout and consolidation Integration of prior acquisitions progressing well; APC integration on track © 2020 Mercury Systems, Inc. 7#8Strategy delivering above-average growth and profitability ● Continuing to invest across the business to support organic growth Using M&A to expand capabilities, access and penetrate adjacent markets Cost and revenue synergies contributing to strong financial performance Investing in trusted, secure Innovation that Matters® for aerospace and defense • Destination employer attracting, retaining and engaging best possible talent ● © 2020 Mercury Systems, Inc. 8#9Business outlook and summary Plan to continue generating shareholder value: 1. Drive 10% average organic revenue growth supplemented by strategic M&A 2. Invest in people, new technologies, facilities, manufacturing assets, business systems 3. Enhance margin, quality, on-time delivery and working capital 4. 5. Grow revenues faster than operating expenses to improve operating leverage Fully integrate acquired businesses to generate cost and revenue synergies Expect double-digit revenue and profitability growth, strong cash flow © 2020 Mercury Systems, Inc. 9#10Q2 FY20 vs. Q2 FY19 In $ millions, except percentage and per share data Bookings Book-to-Bill Backlog 12-Month Backlog Revenue Organic Revenue Growth (¹) Gross Margin Operating Expenses Selling, General & Administrative Research & Development Amortization/Restructuring/Acquisition GAAP Net Income Effective Tax Rate GAAP EPS Weighted Average Diluted Shares Adjusted EPS (2) Adj. EBITDA (2) % of revenue Q2 FY19 $173.2 1.09 $522.0 389.1 $159.1 11% 44.6% $51.0 27.8 16.2 7.0 $12.4 26.6% $0.26 47.7 $0.47 $37.0 23.2% Q2 FY20(3) $209.6 1.08 $25.3 $18.2 49% $727.5 521.8 $193.9 12% 45.6% $67.7 32.8 24.7 10.2 $15.7 24.6% $0.29 55.0 $0.54 $42.8 22.1% $32.1 $20.7 48% Change 21% 39% 22% 1.0 pts 33% 27% 12% 15% 16% Operating Cash Flow Free Cash Flow (²) % of Adjusted EBITDA Notes: (1) Organic revenue represents total company revenue excluding net revenue from acquisitions for the first four full quarters since the entities' acquisition date (which excludes any intercompany transactions). After the completion of four fiscal quarters, acquired businesses are treated as organic for current and comparable historical periods. (2) Non-GAAP, see reconciliation table. (3) Effective as of July 1, 2019, the Company's fiscal year has changed to the 52-week or 53-week period ending on the Friday closest to the last day of June. All references in this presentation to the second quarter of fiscal 2020 are to the quarter ended December 27, 2019, to the third quarter of fiscal 2020 are to the quarter ending March 27, 2020 and to fiscal 2020 are to the fiscal year ending July 3, 2020. © 2020 Mercury Systems, Inc. 27% 14% 10