2016 Annual Report

Netscout Systems, Inc. (NASDAQ: NTCT)

In today's fast-paced and connected world, there can be no "off." To ensure 24x7x365 "uptime," companies must respond swiftly and effectively to both dynamic changes and increasing levels of complexity in their network and broader technology infrastructures. NetScout Systems has been helping its customers rise to these challenges for more than three decades. NetScout's range of service assurance and cybersecurity solutions are used by thousands of customers around the world to monitor, troubleshoot and protect their networks and the applications and services that traverse them. Leading service providers and enterprises rely on NetScout's analytics to organize, contextualize and inform them on each and every interaction that happens over their networks. The Company's patented, proprietary software captures terabytes of network traffic and instantaneously transforms it into actionable, operational and business intelligence via intuitive dashboards, timely reports and detailed drill downs. NetScout's solutions shine a brighter light on the end-user exerience by highlighting performance trends, pinpointing problematic issues, and identifying and helping to remediate security risks. As a result, NetScout's technology is enabling customers to make better, more informed decisions that can result in a better experience for their end users, increased ROI on network and broader IT initiatives, enhanced security and the achievement of technology, financial and business objectives.

Financial Highlights

1Free cash flow defined as cash flow provided by operating activities less purchases of fixed and intangible assets

*Includes ~$24m in one-time payments related to the acquisition of the Danaher Communications Business and ~$17 million associated with the timing of reimbursements owed to NetScout by Danaher Corporation

The pro forma results on both a GAAP and non-GAAP basis for fiscal years 2015 and 2016 assume that the acquisition of the Danaher Communications Business was completed on April 1, 2014. A reconciliation of each non-GAAP metric with the applicable GAAP metric is available on page R-1.