#1Third Quarter Fiscal Year 2020 Financial Results Mark Aslett President and CEO Michael Ruppert Executive Vice President and CFO April 28, 2020, 5:00 pm ET mercury systems. © 2020 Mercury Systems, Inc. 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 April 28, 2020 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 epidemics and pandemics such as COVID, 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 industrial security and 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 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, 2019, and as updated by the Company's Current Report on Form 8-K filed on April 28, 2020. 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#3Our COVID-19 response ● ● ● Created COVID-19 response team with four key goals to guide decision-making 1. Protect the health, safety and livelihoods of employees 2. Reduce and mitigate operational and financial risks in business 3. Continue to deliver on commitments to customers and shareholders 4. Continue mission-critical work to support ongoing security of U.S. DHS classification as critical infrastructure enabling U.S. facilities to operate All employees who can work from home are doing so Adjusted workplace conditions to improve physical distancing and safety © 2020 Mercury Systems, Inc. 3#4Strong Q3 results despite challenges ● ● ● ● ● Q3 FY20 vs. Q3 FY19 Record bookings up 32% Record backlog up 38% Record revenue up 19% Organic revenue(¹) up 11% Record GAAP net income up 67% Record adjusted EBITDA up 21% Op cash of $30.1M; up 15% FCF of $19.2M; 41% adj. EBITDA ● © 2020 Mercury Systems, Inc. ● ● ● ● ● ● LTM Q3 FY20 vs. LTM Q3 FY19 Record bookings up 29% Record backlog up 38% Record revenue up 20% Organic revenue (¹) up 11% Record GAAP net income up 62% Record adjusted EBITDA up 13% Record Op cash of $112.4M; up 16% FCF of $71.8M; 44% 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#5Protecting health, safety and livelihoods of employees... ● ● ● ● Continued to pay hourly employees in California sites temporarily shut down ● Committed to do same at facilities that may be closed as crisis continues • Created $1M relief fund for employees experiencing financial burdens Increased overtime pay to 2x regular rate; adjusted sick-leave policies Maintaining previous fiscal-year guidance reflecting confidence in business Expect double-digit revenue (13-14% organic) and adj. EBITDA growth for FY20 ...while delivering on our commitments to shareholders © 2020 Mercury Systems, Inc. 5#6Business conditions remain robust COVID-19 not expected to have near-term impact on defense spending Brief delays in order approval and flow; no fundamental demand change Benefiting from significant wave of sensor and C41 modernization Healthy demand in weapons, space, avionics, mission computing • Favorable trends - delayering, flight to quality, outsourcing • Investments in people, processes, technologies, manufacturing paying off Closely monitoring supply chain to mitigate risk, minimize impact Significant efforts to increase physical distancing inside facilities Confident in ability to deliver against FY20 goals and objectives ● ● ● ● ● © 2020 Mercury Systems, Inc. 6#7Business outlook and summary Low single-digit CAGR in overall defense spending forecast unchanged • Potential risks for CR in GFY21; crowding out of defense spending by stimulus • Continue delivering organic revenue growth higher than industry average rate Strong balance sheet to supplement growth with strategic M&A Plan to continue generating shareholder value: - Drive 10% average organic revenue growth supplemented by strategic M&A Invest in people, new technologies, facilities, manufacturing assets, business systems Enhance margin, quality, on-time delivery and working capital Grow revenues faster than operating expenses to improve operating leverage Fully integrate acquired businesses to generate cost and revenue synergies Continuing to diligently work to reduce and mitigate risk Expect double-digit revenue and profitability growth, strong cash flow ● ● ● - - © 2020 Mercury Systems, Inc. 7#8Q3 FY20 vs. Q3 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 (2²) Adj. EBITDA (2) % of revenue Q3 FY19 $189.7 1.09 $558.2 367.3 $174.6 31% 42.3% $51.8 27.4 17.4 6.9 $14.1 27.5% $0.29 48.0 $0.49 $38.8 22.2% $26.2 $19.2 49% Q3 FY20(3) $250.3 1.20 $769.8 544.8 $208.0 11% 44.9% $67.0 34.0 25.0 8.0 $23.6 18.5% $0.43 55.1 $0.60 $47.1 22.6% $30.1 $19.2 41% Change 32% 38% 19% 2.6 pts 29% 67% 48% 22% 21% 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 third quarter of fiscal 2020 are to the quarter ended March 27, 2020, and to the fourth quarter and full fiscal 2020 are to the fiscal year ending July 3, 2020. © 2020 Mercury Systems, Inc. 15% 8