~ Revenues of $458.9 million ~

~ GAAP Diluted Earnings Per Share of $2.11 ~

Ubiquiti Inc. (NYSE:UI) ("Ubiquiti" or the "Company") today announced its financial results for the first quarter fiscal 2022, ended September 30, 2021.

First Quarter Fiscal 2022 Financial Summary

Revenues of $458.9 million
GAAP diluted EPS of $2.11
Repurchased 130,994 shares of common stock at an average price of $299.64 per share

Additional Financial Highlights

The Company repurchased and retired 30,937 shares of common stock between October 1, 2021 and November 4, 2021 at an average price of $299.94. As of November 4, 2021, the Company had $269.6 million available under the stock repurchase program announced in May 2020, as disclosed in the Form 8-K filed on May 8, 2020.
The Company's Board of Directors declared a $0.60 per share cash dividend payable on November 22, 2021 to shareholders of record at the close of business on November 15, 2021.

Financial Highlights ($, in millions, except per share data)

Income statement highlights	F1Q22	F4Q21	F1Q21
Revenues	458.9	477.9	473.5
Service Provider Technology	112.1	163.5	157.4
Enterprise Technology	346.8	314.4	316.1
Gross profit	209.5	230.7	228.1
Gross Profit (%)	45.6%	48.3%	48.2%
Total Operating Expenses	47.8	47.9	38.2
Income from Operations	161.7	182.8	189.9
GAAP Net Income	132.2	154.3	156.5
GAAP EPS (diluted)	2.11	2.46	2.46
Non-GAAP Net Income	132.8	154.9	157.1
Non-GAAP EPS (diluted)	2.12	2.47	2.47

Ubiquiti Inc. Revenues by Product Type (In thousands) (Unaudited)
	Three Months Ended September 30,
	2021		2020
Service Provider Technology	$	112,141	$	157,461
Enterprise Technology	346,773		316,072
Total revenues	$	458,914	$	473,533


Ubiquiti Inc. Revenues by Geographical Area In thousands) (Unaudited)
	Three Months Ended September 30,
	2021		2020
North America	$	209,073	$	220,880
Europe, the Middle East and Africa	172,643		179,180
Asia Pacific	42,939		41,945
South America	34,259		31,528
Total revenues	$	458,914	$	473,533

Income Statement Items

Revenues

Revenues for the first quarter fiscal 2022 were $458.9 million, representing a decrease from the prior quarter and the comparable prior year period of 4.0% and 3.1% respectively. The decline in revenue over both periods was primarily driven by our Service Provider segment. Overall, revenues for the prior quarter and the comparable prior year period were negatively impacted by inability to fulfill demand due to the global component supply shortage and increasing logistics delays and costs.

Gross Margins

During the first quarter fiscal 2022, gross profit was $209.5 million. GAAP gross margin of 45.6% decreased 2.5% versus the comparable prior year period GAAP gross margin of 48.2% and decreased 2.6% versus the prior quarter GAAP gross margin of 48.3%. The decline in gross profit margin for both periods was primarily driven by higher shipping costs and, to a lesser extent, changes in product mix. General transportation costs have increased materially, and we continue to incur additional costs on top of these general costs to expedite shipments.

Research and Development

During the first quarter fiscal 2022, research and development ("R&D") expenses were $32.1 million. This reflects an increase as compared to R&D expenses of $25.8 million in the comparable prior year period and an increase as compared to R&D expenses of $31.0 million in the prior quarter. The increase in R&D expenses as compared to prior quarter and the comparable prior year period was primarily driven by higher employee related expenses, higher depreciation and amortization expense and higher professional and service-related fees.

Sales, General and Administrative

The Company's sales, general and administrative ("SG&A") expenses for the first quarter fiscal 2022 were $15.7 million. This reflects an increase as compared to the SG&A expenses of $12.4 million in the comparable prior year period and a decrease as compared to the SG&A expenses of $17.0 million in the prior quarter. The increase in SG&A costs as compared to the comparable prior year period was primarily due to webstore-related service fees and increased marketing expenses. The decrease in SG&A costs compared to the prior quarter was primarily due to lower professional fees, partially offset by webstore-related service fees and higher marketing expenses.

Net Income and Earnings Per Share

During the first quarter fiscal 2022, GAAP net income was $132.2 million and non-GAAP net income was $132.8 million. This reflects a decrease in GAAP net income and non-GAAP net income from the comparable prior year period of 15%, primarily driven by a decrease in revenues and lower gross margin. First quarter fiscal 2022 GAAP earnings per diluted share was $2.11 and non-GAAP earnings per diluted share was $2.12. This reflects a decrease in GAAP and non-GAAP earnings per diluted share from the comparable prior year period of 13.4%.

Global Component Supply

During the three months ended September 30, 2021, we continued to experience a disruption in our supply chain as a result of the COVID-19 pandemic and the global shortage of available components. The current environment has resulted in our inability to fulfill customer orders and has increased our cost base as we have incurred, and we continue to incur, additional costs to expedite deliveries of components and services. Our future results are dependent on our ability to procure components and services and we expect the Company's results to be negatively impacted until the ongoing supply chain and logistics issues caused by the global component supply shortage and the COVID-19 pandemic are resolved.

About Ubiquiti Inc.

Ubiquiti Inc. is focused on democratizing network technology on a global scale — aggregate shipments of over 130 million devices play a key role in creating networking infrastructure in over 200 countries and territories around the world. Our professional networking products are powered by our UISP and UniFi software platforms to provide high-capacity distributed Internet access and unified information technology management, respectively.

Ubiquiti and the U logo are trademarks or registered trademarks of Ubiquiti and/or its affiliates in the United States and other countries. For more information, please visit www.ui.com.

Safe Harbor for Forward Looking Statements

Certain statements in this press release are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements other than statements of historical fact including words such as "look", "will", "anticipate", "believe", "estimate", "expect", "forecast", "consider" and "plan" and statements in the future tense are forward looking statements. The statements in this press release that could be deemed forward-looking statements include statements regarding the impact of COVID-19, global component supply, logistics related costs and delays and our intentions to pay quarterly cash dividends and any statements or assumptions underlying any of the foregoing.

Forward-looking statements are subject to certain risks and uncertainties that could cause our actual future results to differ materially or cause a material adverse impact on our results. Potential risks and uncertainties include, but are not limited to, the impact of public health problems, such as COVID-19, and U.S. tariffs on results; fluctuations in our operating results; varying demand for our products due to the financial and operating condition of our distributors and their customers, and our distributors' inventory management practices; political and economic conditions and volatility affecting the stability of business environments, economic growth, currency values, commodity prices and other factors that may influence the ultimate demand for our products in particular geographies or globally; impact of counterfeiting and our ability to contain such impact; our reliance on a limited number of distributors; inability of our contract manufacturers and suppliers to meet our demand; our dependence on chipset suppliers for chipsets without a short-term alternative; as we move into new markets competition from certain of our current or potential competitors who may be more established in such markets; our ability to keep pace with technological and market developments; success and timing of new product introductions by us and the performance of our products generally; our ability to effectively manage the significant increase in our transactional sales volumes; we may become subject to warranty claims, product liability and product recalls; that a substantial majority of our sales are into countries outside the United States and we are subject to numerous U.S. export control and economic sanctions laws; costs related to responding to government inquiries related to regulatory compliance; our reliance on certain key members of our management team, including our founder and chief executive officer, Robert J. Pera; adverse tax-related matters such as tax audits, changes in our effective tax rate or new tax legislative proposals; whether the final determination of our income tax liability may be materially different from our income tax provisions; the impact of any intellectual property litigation and claims for indemnification; litigation related to U.S. securities laws; and economic and political conditions in the United States and abroad. We discuss these risks in greater detail under the heading "Risk Factors" and elsewhere in our Annual Report on Form 10-K for the year ended June 30, 2021, and subsequent filings filed with the U.S. Securities and Exchange Commission (the "SEC"), which are available at the SEC's website at www.sec.gov. Copies may also be obtained by contacting the Ubiquiti Inc. Investor Relations Department, by email at IR@ui.com or by visiting the Investor Relations section of the Ubiquiti Inc. website, http://ir.ui.com.

Given these uncertainties, you should not place undue reliance on these forward-looking statements. Also, forward-looking statements represent our management's beliefs and assumptions only as of the date made. Except as required by law, Ubiquiti Inc. undertakes no obligation to update information contained herein. You should review our SEC filings carefully and with the understanding that our actual future results may be materially different from what we expect.

Ubiquiti Inc. Condensed Consolidated Statements of Operations and Comprehensive Income (In thousands, except per share data) (Unaudited)
	Three Months Ended September 30,
	2021			2020
Revenues	$	458,914		$	473,533
Cost of revenues	249,451			245,417
Gross profit	209,463			228,116
Operating expenses:
Research and development	32,051			25,813
Sales, general and administrative	15,714			12,350
Total operating expenses	47,765			38,163
Income from operations	161,698			189,953
Interest expense and other, net	(3,815		)	(3,917		)
Income before income taxes	157,883			186,036
Provision for income taxes	25,733			29,527
Net income	$	132,150		$	156,509
Net income per share of common stock:
Basic	$	2.11		$	2.46
Diluted	$	2.11		$	2.46
Weighted average shares used in computing net income per share of common stock:
Basic	62,519			63,612
Diluted	62,561			63,673

Ubiquiti Inc. Reconciliation of GAAP Net Income to Non-GAAP Net Income (In thousands, except per share data) (Unaudited)
	Three Months Ended
	September 30, 2021			June 30, 2021			September 30, 2020
Net Income	$	132,150		$	154,332		$	156,509
Stock-based compensation:
Cost of revenues	22			22			28
Research and development	570			554			510
Sales, general and administrative	218			188			202
Tax effect of Non-GAAP adjustments	(191		)	(181		)	(174		)
Non-GAAP net income	$	132,769		$	154,915		$	157,075
Non-GAAP diluted EPS	$	2.12		$	2.47		$	2.47

Shares outstanding (Diluted)	62,561			62,761			63,673
Weighted-average shares used in Non-GAAP diluted EPS	62,561			62,761			63,673

Use of Non-GAAP Financial Information

To supplement our condensed consolidated financial results prepared under generally accepted accounting principles, or GAAP, we use non-GAAP measures of net income and earnings per diluted share that are adjusted to exclude certain costs, expenses and gains such as stock-based compensation expense, litigation settlement, BEC fraud recovery, impairment of cost-based investment and the tax effects of these non-GAAP adjustments.

Reconciliations of the adjustments to GAAP results for the periods presented are provided above. In addition, an explanation of the ways in which management uses non-GAAP financial information to evaluate its business, the substance behind management's decision to use this non-GAAP financial information, material limitations associated with the use of non-GAAP financial information, the manner in which management compensates for those limitations, and the substantive reasons management believes that this non-GAAP financial information provides useful information to investors is included under the paragraphs below.

Usefulness of Non-GAAP Financial Information to Investors

We believe that the presentation of non-GAAP net income and non-GAAP earnings per diluted share provides important supplemental information regarding non-cash expenses, significant items that we believe are important to understanding our financial, and business trends relating to our financial condition and results of operations. Non-GAAP net income and non-GAAP earnings per diluted share are among the primary indicators used by management as a basis for planning and forecasting future periods and by management and our board of directors to determine whether our operating performance has met specified targets and thresholds. Management uses non-GAAP net income and non-GAAP earnings per diluted share when evaluating operating performance because it believes that the exclusion of the items described below, for which the amounts or timing may vary significantly depending upon the Company's activities and other factors, facilitates comparability of the Company's operating performance from period to period. We have chosen to provide this information to investors so they can analyze our operating results in the same way that management does and use this information in their assessment of our business and the valuation of our Company.

About our Non-GAAP Net Income and Non-GAAP Earnings per Diluted Share

We compute non-GAAP net income and non-GAAP earnings per diluted share by adjusting GAAP net income and GAAP earnings per diluted share to remove the impact of certain adjustments and the tax effect of those adjustments. Items excluded from net income for the periods presented, are:

Stock-based compensation expense
Tax effect of non-GAAP adjustments, applying the principles of ASC 740

These non-GAAP measures are not in accordance with, or an alternative to, GAAP and may be materially different from other non-GAAP measures, including similarly titled non-GAAP measures used by other companies. The presentation of this additional information should not be considered in isolation from, as a substitute for, or superior to, net income or earnings per diluted share prepared in accordance with GAAP. Non-GAAP financial measures have limitations in that they do not reflect certain items that may have a material impact upon our reported financial results.

For more information on the non-GAAP adjustments, please see the table captioned "Reconciliation of GAAP Net Income to non-GAAP Net Income" included in this press release.

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Ubiquiti Inc. Reports First Quarter Fiscal 2022 Financial Results