Benefits of Operating an On-Premises Infrastructure

2. Cloud Options and Advantages IDC Whitepaper Cases for Operator-Owned and Managed Infrastructure: Interviews with Twitter, Intel IT & PFN Michael McNerney Vice President Marketing Supermicro Better Faster Greener™ © 2022 Supermicro

3. 7/28/2022 Better Faster Greener™ © 2022 Supermicro 3 IDC interviewed 3 leading enterprises about how they are leveraging owned enterprise cloud infrastructure to improve control, cost and predictability of their business.

4. Natalya Yezhkova Research VP Infrastructure Systems, Platforms, and Technologies • July 2022 • Benefits of Operating On-premises Infrastructure

5. Customer satisfaction Operational efficiency Innovation Sustainability Financial metrics Employee productivity IT is a fundamental enabler for achieving business goals Running Modern Enterprise Requires Solid IT Infrastructure Strategy “It’s not that we use technology, we live technology.” -- Godfrey Riggio, a director of experimental documentary films Top business priorities On-premises Colocation Off- premises

6. Thinking about your workload infrastructure in the next two years, in what environments do you expect your workloads will run? $63.0B $75.2B 0% 1% 2% 3% 4% 5% 6% 7% $56 $58 $60 $62 $64 $66 $68 $70 $72 $74 $76 $78 2021 2022 2023 2024 2025 2026 Spending ($B) Enterprise Infrastructure, On-premises Deployment Environments, $B Spending ($B) Y/Y 2021-2016 CAGR: 3.6% On-premises Compute and Storage Infrastructure Source: Chart on the left: Repatriation of Workloads from Shared to Dedicated Infrastructure Environments Update: More Focus on Operational Side, IDC #US47961422, March 2022 Chart on the right: IDC’s Worldwide Enterprise Infrastructure Tracker: Buyer and Cloud Deployment, June 2022 22% 23% 28% 29% 37% Off Premises non-cloud Public Cloud Hosted Private Cloud On Premises non-cloud On Premises Private Cloud n=2,235

7. Thinking about your workloads which currently run in the public cloud (fully or partially), do you expect any of them will be repatriated and moved to private cloud or non-cloud infrastructure in the next two years? Workload Mobility Is Becoming a Norm Source: Repatriation of Workloads from Shared to Dedicated Infrastructure Environments Update: More Focus on Operational Side, IDC #US47961422, March 2022 Primary reasons why workloads will be repatriated from the public cloud 6% 10% 13% 71% Don't know Will run in hybrid environment using public cloud and private cloud/non- cloud IT infrastructure Will run fully in public cloud Will move into private cloud or non-cloud environment 8% 10% 13% 14% 15% 18% 26% 27% 33% Lack of enterprise features in public cloud offerings Dissatisfaction with public cloud customer service Regulatory compliance issues Bandwidth issues IT consolidation efforts Performance issues Data privacy concerns Pricing of public cloud services is too high/unpredictable Data security concerns WEGHTED AVERAGE ACROSS ALL WORKLOADS

8. Interviews With Three Technology Companies Operating Their Own IT Infrastructure Efficiency and Sustainability Cost and Flexibility Infrastructure Control and Performance Predictability

9. Intel: Efficiency and Sustainability One of the largest technology companies in the world. Core expertise: infrastructure component design and manufacturing. Big focus on sustainability. IT operations: 16 datacenter sites with 56 datacenter modules, more than 380,000 servers, 787 petabytes of storage capacity, and more than 725,000 network ports. About 95% of the servers are used for chip design, 3% are used for traditional enterprise and office workloads, and the remaining 2% are used in the manufacturing computing space, which includes fabrication and assembly test manufacturing plants. "[Disaggregated architecture] serves two purposes. One is business advantage: it reduces the amount of money you need to upgrade; you only pay for what you want to upgrade to realize the value. And the second one is significant ewaste reduction: if you look at a 3U chassis, nearly 82% of the weight of the material you don’t need to change." Infrastructure management experience: • Efficiency through AI-based automation • Training IT managers for engineering approach to infrastructure management Benefits of operating own IT infrastructure: Utilization of disaggregated architecture which drives Future IT plans: • Further cost reduction • More automation • More predictability Cost Savings Reduction in ewaste Green Computing

10. Twitter: Cost and Flexibility One of the largest social network providers. Operates three datacenters, hundreds of thousands of servers and multiple petabytes of storage in the United States. All datacenters are hosted in colocation facilities, but the company operates and manages its own compute and storage infrastructure. The company also utilizes public cloud resources for certain workloads and data (e.g., cold storage) and targets to achieve close integration between its own dedicated and shared cloud IT resources. “…On-prem will still be the backbone of our service… We can tailor our hardware solutions to fit what we need and strip out what we don't need and make that pretty cost effective. We can do things like that we wouldn't normally be able to do with just an off-the-shelf solution or in the cloud without paying extra money for it." Infrastructure management experience: • Ongoing collaboration between technical teams within Twitter and with datacenter operators • Working with internal customers to assess technical needs Benefits of operating own IT infrastructure: Future IT plans: • Better integration between on-prem and public cloud solutions • Ability to move workloads back and forth Cost Savings Hardware optimization for workloads Adequate security and data privacy

11. Preferred Networks: Infrastructure Control and Performance Scalability An eight-year-old company that designs and develops one of the most powerful supercomputers in the world, based in Japan. Primary business is developing and implementing projects requiring deep learning techniques. The company also has expertise in robotics, pharma, and other business domains. PFN built its own supercomputer with a GPU cluster, which currently housing 2,000 GPUs. PFN also designs and maintains its own storage tuned to needs of deep learning workloads. "We have a subsidiary … and they use plenty of computing power [in public cloud]. If we open the door of our own infrastructure to them, it will be good for our business because we have a fast accelerator, we can provide more stable and predictable GPU resources … we can provide a predictable facility to the subsidiary." - Yusuke Doi, VP of Computing Infrastructure at PFN Infrastructure management experience: • Rule-based automation • Constant monitoring of resource utilization by user role Benefits of operating own IT infrastructure: Future IT plans: • At least, double the number of on-premises server deployments in the next five years • Better infrastructure control Cost Savings Stable and predictable performance

12. Key Takeaways • Optimization for core workloads • Cost • Control • Flexibility • Predictability Common reasons organizations keep investing in on-premises IT infrastructure: • Security/data privacy • Sustainability …and also: • Workload needs • More advanced IT automation • Right skillset and training • Integration of resources from multiple IT environments Important considerations when investing in on-premises IT infrastructure: • Trusted partner ecosystem …and also:

13. IDC.com linkedin.com/company/idc twitter.com/idc blogs.idc.com © IDC Natalya Yezhkova Research VP Infrastructure Systems, Platforms, and Technologies nyezhkova@idc.com +1-508-935-4281 @nyezhkova

14. Cloud Options and Advantages IDC Whitepaper Cases for Operator-Owned and Managed Infrastructure: Interviews with Twitter, Intel IT & PFN Michael McNerney Vice President Marketing Supermicro Better Faster Greener™ © 2022 Supermicro

16. Cloud Decision Process 7/28/2022 Better Faster Greener™ © 2022 Supermicro 16 Outsourcing Decision • Compliance • Cost • Performance Strategic Decision • Competitive Advantage • Competitive Threats • Opportunity Cost Management Applications Data Middleware O/S Virtualization Servers Storage Networking Datacenter On-Prem Management Applications Data Middleware O/S Virtualization Servers Storage Networking Datacenter Colocation Management Applications Data Middleware O/S Virtualization Servers Storage Networking Datacenter IaaS Management Applications Data Middleware O/S Virtualization Servers Storage Networking Datacenter PaaS Management Applications Data Middleware O/S Virtualization Servers Storage Networking Datacenter SaaS Owned Rented

17. Cloud Costs 7/28/2022 Better Faster Greener™ © 2022 Supermicro 17 “Cost is always a dominant factor in IT investment decisions” 1 AZ16 The Cost of Cloud, a Trillion Dollar Paradox “If You’re Operating at Scale, the Cost of Cloud Can at Least Double your Infrastructure Bill”1 “Walmart said its [hybrid] cloud system has saved the company between 10% and 18% in annual cloud spending and has helped reduce cloud outages” “A survey in ZDNet of 300 IT leaders revealed that 37% of organizations said incremental and unpredictable costs are a top concern.”

18. Cloud Costs Versus Cloud Pricing 7/28/2022 Better Faster Greener™ © 2022 Supermicro 18 “AWS’ operating margin widened to 35.3% from 29.8% in the fourth quarter” You cannot compete w/ the AWS Cost Structure but Can you Compete w/ the Price Structure? 0% of Industry Sectors Operate at or above 35% operating margin according to NYU Stern School of Business Top 50 public software companies that use cloud infrastructure are losing about $100 billion of market value because cloud costs are eating into margins compared to if they ran their IT infrastructure themselves.1 1 AZ16 The Cost of Cloud, a Trillion Dollar Paradox

19. Cloud Repatriation 7/28/2022 Better Faster Greener™ © 2022 Supermicro 19 70% of Enterprises Interviewed by IDC are moving workloads back from Public Cloud IDC’s 1H21 Servers and Storage Workloads Survey

20. Cloud Workload Performance & Efficiency 7/28/2022 Better Faster Greener™ © 2022 Supermicro 20 Management Applications Data Middleware O/S Virtualization Servers Storage Networking Datacenter On-Prem Management Applications Data Middleware O/S Virtualization Servers Storage Networking Datacenter Colocation Management Applications Data Middleware O/S Virtualization Servers Storage Networking Datacenter IaaS Management Applications Data Middleware O/S Virtualization Servers Storage Networking Datacenter PaaS Management Applications Data Middleware O/S Virtualization Servers Storage Networking Datacenter SaaS Owned Rented Business Operations Business Automation Core Business Workloads

21. On-Prem Cloud Performance Advantage 7/28/2022 Better Faster Greener™ © 2022 Supermicro 21 Mean Workload Performance versus Optimized Workload Performance Intel Operates 16 Datacenters with 380,000 Servers. • 95% of the infrastructure is dedicated to one workload - chip design • A cloud exactly optimized for Intel Chip Design Delivers Superior Performance and Efficiency • 71% more capacity per rack than average datacenter • 45%-65% Capex Savings Twitter Operates 3 Datacenters Hundreds of Thousands of Servers “… off-the-shelf solutions are going to be more expensive because they are more versatile and more general-purpose “we need systems that can be tailored specifically to our needs.” PFN Develops and Operates AI Deep Learning Solutions “Cost [of on-premises infrastructure] is one of the benefits, and the other is performance.”

22. Optimized Performance - Universal GPU System 7/28/2022 Better Faster Greener™ © 2022 Supermicro 22 • Flexibility: Support Any CPU/GPU Architectures (Nvidia, AMD, Intel) • Future Proof Support Today and Tomorrows GPUs (500/700W) • Air or Liquid Cooled • Dedicated High Performance Storage per GPU • Dedicated High Performance Networking per GPU, up 400G • GPU Direct Storage • GPU Direct Memory (RDMA) 4U 4XGPU System Optimized for AI Training

23. Broadest Portfolio of IT Infrastructure Building Blocks Build Optimized Clouds with Systems and Solutions Specifically Designed for the Workload 7/28/2022 Better Faster Greener™ © 2022 Supermicro Cloud Optimized 23 Accelerated Computing (AI) 5G Edge IoT Embedded Storage Server Building Blocks Twin Density Serviceability SuperBlade Efficiency Manageability Rackmount Standard Flexible • Motherboards • Chassis Networking

24. Deliver Convenience of Public Cloud with On-Prem Efficiencies 7/28/2022 Better Faster Greener™ © 2022 Supermicro 24 Turn-Key Data Center • Accelerate Your Deployment • Leverage Proven Tier-1 DC Best Practices • Best in Class Functionality: Automation, Free Air, Liquid, 400G, RDMA, NVMe-oF Optimized Cloud Architecture • Proven Cloud Scale Design Experts • Validation and Benchmarking • White Glove Service Management Applications Data Middleware O/S Virtualization Servers Storage Networking Datacenter DIY On-Prem Datacenter Individual Systems Integrated and Optimized Systems Pre-Tested and Validated Total Cloud Solution Management Applications Data Middleware O/S Virtualization Servers Storage Networking Datacenter

25. 7/28/2022 Better Faster Greener™ © 2022 Supermicro 25 Rack Plug and Play - Total IT Solutions Delivering Pre-Defined and Pre-Tested Completely Integrated On-Prem Cloud @ Scale Design Assembly Configuration Logistics Testing Application Analysis Node Assembly BIOS Config Asset Labeling & Docs Multi-Vendor Interop Power Cooling Design Rack & Stack Firmware Mgmt Crating Full Rack Burn- in and QA BOM Creation Cable & Labeling Switch & IP Addresses Air-Ride Delivery Full Rack Test Report Rack Layout Networking and Power (PDU) OS & Customer Image White Glove Services Performance Report Total IT Solution Integration Process Management Applications Data Middleware O/S Virtualization Servers Storage Networking Datacenter On-Prem Cloud

27. For more information, please visit us at www.supermicro.com/on-prem-cloud Thank You

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