Financial Highlights and Margin Progression slide image

Financial Highlights and Margin Progression

Non-GAAP Adjusted Expense Amounts Reconciliation. (in $ millions) 2U 20 Marketing & Sales IPO 2019 2020 2021 2022E $ % % % % % Technology and Content Development IPO 2019 2020 2021 2022E % % $ % $ % $ % GAAP expense 54.1 65% 342.4 60% 390.2 50% 456.1 49% 419.6 43% GAAP expense 19.5 23% 115.5 20% 155.9 20% 179.0 19% 180.4 18% Depreciation & amortization 0.3 0% 15.5 3% 18.9 2% 18.6 2% 27.6 3% Depreciation & amortization 3.7 4% 49.8 71.4 9% 9% 81.1 9% 82.5 8% Stock-based compensation 0.2 0% 7.0 1% 8.2 1% 6.7 1% 3.9 0% Stock-based compensation 0.2 0% 8.2 1% 12.0 2% 11.8 1% 6.5 1% Other* 0% 0% 0% 0% 0% Other* 0% 0% - 0% 0.4 0% 0.5 0% Non-GAAP adj expense 53.6 65% 319.9 56% 363.1 47% 430.8 46% 388.1 40% Non-GAAP adj expense 15.6 19% 57.5 10% 72.5 9% 85.7 9% 90.9 9% Servicing & Support IPO 2019 2020 2021 2022E General and Administrative IPO 2019 2020 2021 2022E % % % % % % % $ % % $ % GAAP expense 22.7 27% 98.9 17% 125.9 16% 138.5 15% 146.0 15% GAAP expense 14.8 18% 131.0 23% 173.5 22% 208.6 19% 205.7 21% Depreciation & amortization 0.2 0% 2.7 0% 3.2 0% 3.0 0% 2.9 0% Stock-based compensation Other* 0.4 0% 8.9 2% 14.4 2% 15.4 2% 8.6 1% Depreciation & amortization Stock-based compensation 0.1 0% 1.9 0% 3.0 0% 5.7 9% 6.6 1% 1.7 2% 27.3 5% 47.5 6% 63.7 1% 59.6 6% 0% 0% 0% 0% Other* 0% 18.2 3% 16.5 0% Non-GAAP adj expense 22.1 27% 87.3 15% 108.3 14% 120.1 13% 134.5 14% Non-GAAP adj expense 13.0 16% 83.6 15% 106.5 2% 25.0 14% 114.2 0% 21.8 9% 2% 117.7 12% *Includes transaction and integration expense, restructuring-related expense and stockholder activism and litigation-related expense. 19
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