SSNI Silver Spring Networks, Inc. (delisted)

9% Growth in Non-GAAP Revenue41% Growth in Non-GAAP Gross Profit19% Top-Line Growth in Managed Services and SaaS$9.6 Million in Positive Cash Flow from Operations

Silver Spring Networks, Inc. (NYSE: SSNI) today announced financial results for its second quarter ended June 30, 2015.

Second Quarter Results (all comparisons made are against the prior year period, unless otherwise stated)

• Non-GAAP revenue $69.1 million, up 9%.
• GAAP revenue $77.2 million, up 85%.
• Non-GAAP gross margin 42%, up 10 points.
• GAAP gross margin 26%, down 6 points.
• Non-GAAP net income $1.1 million versus a net loss of ($9.9) million.
• GAAP net loss ($16.2) million versus ($24.6) million.
• Non-GAAP diluted earnings per share $0.02 versus ($0.20) loss per share.
• GAAP loss per share ($0.32) versus ($0.51) loss per share.
• $118.6 million net cash and short-term investments balance, on $9.6 million in cash flow from operations.

“I’m pleased with our second quarter results, demonstrated by significant gross profit growth, international expansion, and strong cash flow,” said Scott Lang, Chairman, President, and Chief Executive Officer. “Our perseverance and performance has earned us the privileged position as a trusted partner to the leading energy companies around the world. Our fifth generation technology sets us apart in the world of energy and is opening an even broader set of opportunities to become the leader in smart cities and the Internet of Things.”

Business Highlights (through August 5, 2015, unless otherwise stated):

• Delivered third consecutive quarter of 40%-plus non-GAAP gross margin performance, due to growth, favorable product mix and manufacturing efficiencies.
• Selected by CPFL Energia of Brazil for its Distribution Automation project, an extension of their smart grid program to improve grid reliability in a service area covering nearly 4 million residents across CPFL’s Sao Paulo service territory.
• Began deliveries to support AusNet Services’ Advanced Metering Infrastructure within its Eastern Victoria territory.
• Booked over $20 million of software and software-related services during the second quarter.
• Selected by New Braunfels Utilities to deploy our multi-application network to support a double-play solution in its innovative smart grid and smart water programs.
• Received prestigious industry honors, including TMC and Crossfire Media’s “2015 IoT Evolution Product of the Year Award” for the Gen5/Milli 5 platform, and named as a “2015 Smart Grid Company to Watch” by Smart Grid News.
• 21.5 million cumulative network endpoints delivered from inception through June 30, 2015, up 13% from a year ago.

Conference Call

Silver Spring will host a conference call today at 1:15 pm PT (4:15 pm ET) to review its results for the Second quarter ended June 30, 2015 and its outlook for the future. During the course of this call, Silver Spring may also disclose material developments affecting its business and/or financial performance. Listeners may access the conference call live at 877-407-0832 (U.S.) or 201-689-8433 (International) or via webcast at http://ir.silverspringnet.com. A dial-in replay of the conference call will be available until August 24, 2015 and can be accessed at 877-660-6853 (domestic) or 201-612-7415 (international) passcode 13614722. An audio webcast replay of the conference call will be available for one year at http://ir.silverspringnet.com.

About Silver Spring Networks

Silver Spring Networks is a leading networking platform and solutions provider for smart energy networks. Silver Spring’s pioneering IPv6 networking platform, with over 21.5 million Silver Spring enabled devices delivered, is connecting utilities to homes and business throughout the world with the goal of achieving greater energy efficiency for the planet. Silver Spring’s innovative solutions enable utilities to gain operational efficiencies, improve grid reliability, and empower consumers to monitor and manage energy consumption. Silver Spring Networks’ customers include major utilities around the globe such as Baltimore Gas & Electric, CitiPower & Powercor, Commonwealth Edison, CPS Energy, Florida Power & Light, Jemena Electricity Networks Limited, Pacific Gas & Electric, Pepco Holdings, Progress Energy, and Singapore Power, among others. To learn more, please visit www.silverspringnet.com.

Non-GAAP and Other Financial Measures

Silver Spring believes that its results of operations under generally accepted accounting principles, or GAAP, when considered in isolation, may only provide limited insight into the performance of its business in any given period. As a result, Silver Spring manages its business, makes planning decisions, evaluates its performance and allocates resources by assessing non-GAAP measures such as non-GAAP revenue, recurring non-GAAP revenue, recurring non-GAAP revenue per endpoint, cost of non-GAAP revenue, non-GAAP gross profit (loss), non-GAAP gross margin, non-GAAP operating income (loss), non-GAAP net income (loss), non-GAAP income (loss) per share, adjusted EBITDA, and total backlog, in addition to other financial measures presented in accordance with GAAP. Silver Spring believes that these non-GAAP and other financial measures offer valuable supplemental information regarding the performance of its business, and will help investors better understand the sales volumes, and gross margin and profitability trends, as well as the cash flow characteristics, of its business. The non-GAAP measures should not be considered in isolation from, are not a substitute for, and do not purport to be an alternative to, revenue, cost of revenue, gross profit (loss), gross margin, operating loss, net income (loss), income (loss) per share or any other performance measure derived in accordance with GAAP. Silver Spring may consider whether other significant non-recurring items that arise in the future should also be excluded in calculating the non-GAAP financial measures it uses.

Non-GAAP revenue represents amounts invoiced for products for which ownership, typically evidenced by title and risk of loss, has transferred or services that have been provided to the customer, and for which payment is expected to be made in accordance with normal payment terms. Non-GAAP revenue excludes amounts for undelivered products, services to be performed in the future, and amounts paid or payable to customers. Non-GAAP revenue is initially recorded as deferred revenue and is then recognized as revenue when all revenue recognition criteria has been met under Silver Spring’s accounting policies as described in Silver Spring’s filings with the Securities and Exchange Commission. Silver Spring reconciles revenue to non-GAAP revenue by adding revenue to the change in deferred revenue in a given period.

Recurring non-GAAP revenue is non-GAAP revenue from managed services and SaaS, as well as customer support and other service offerings. Recurring non-GAAP revenue is primarily recurring in nature and includes managed services, hosting and software maintenance, and support fees, as well as one-time managed services and SaaS set up fees. Customer support and other services are provided to customers outside of managed services and SaaS offerings, and are also recurring in nature. Silver Spring reconciles recurring GAAP revenue to recurring non-GAAP revenue by adding revenue to the change in deferred revenue in a given period.

Recurring non-GAAP revenue per endpoint represents a trailing twelve-month recurring non-GAAP revenue per cumulative endpoint shipped from inception to date.

Cost of non-GAAP revenue represents the cost associated with products and services that have been delivered to the customer, excluding stock-based compensation, amortization of intangibles and acquisition-related charges. Cost of product shipments for which revenue is not recognized in the period incurred is recorded as deferred cost of revenue. Deferred cost of revenue is expensed in the statement of operations as cost of revenue when the corresponding revenue is recognized. Costs related to services are expensed in the period incurred. Silver Spring reconciles cost of revenue to cost of non-GAAP revenue by adding cost of revenue and the change in deferred cost of revenue, less stock-based compensation, amortization of intangibles and acquisition-related charges, included in cost of revenue in a given period.

Non-GAAP gross profit (loss) is the difference between non-GAAP revenue and cost of non-GAAP revenue. Non-GAAP gross margin is non-GAAP gross profit (loss) as a percentage of non-GAAP revenue.

Non-GAAP operating income (loss) represents operating income (loss) adjusted for non-GAAP revenue and cost of non-GAAP revenue and excludes expenses related to the amortization of intangible assets, stock-based compensation, acquisition-related charges, restructuring and legal settlements.

Non-GAAP net income (loss) represents net income (loss) adjusted for changes in deferred revenue and deferred cost of revenue, and excludes expenses related to the amortization of intangible assets, stock-based compensation, acquisition-related charges, income tax benefit related to acquisitions, restructuring and legal settlements.

Non-GAAP income (loss) per share represents non-GAAP net income (loss) divided by weighted average shares outstanding for the period.

Adjusted EBITDA is net income (loss) adjusted for changes in deferred revenue and deferred cost of revenue, other (income) expense, net, (benefit) provision for income taxes, depreciation and amortization, stock-based compensation, acquisition-related charges, restructuring, legal settlements and certain other items management believes affect the comparability of operating results.

Total backlog represents future product and service billings that Silver Spring expects to generate pursuant to contracts entered into with its utility customers and meter manufacturers. Total backlog includes order backlog, which represents future billings for open purchase orders and other firm commitments.

Forward-Looking Statements

This press release contains forward-looking statements that involve risks and uncertainties. These forward-looking statements include statements regarding the momentum in Silver Spring Networks’ business; future deployments; future growth; and future financial results. Statements including words such as "anticipate", "believe", "estimate" or "expect" and statements in the future tense are forward-looking statements. These forward-looking statements are preliminary estimates and expectations based on current information and are subject to business and economic risks and uncertainties that could cause actual events or actual future results to differ materially from the expectations set forth in the forward-looking statements. Important factors that could cause results to differ materially from the statements herein include: timing around customer decisions and deployment pace; dependence on a limited number of customers and key suppliers; general economic risks; specific economic risks in different geographies and among different industries; failure to maintain or increase renewals and increase business from existing customers; uncertainties around continued success in sales growth and market share gains; lengthy sales cycles with no assurances that a prospective customer will select Silver Spring’s products and services; amounts included in backlog may not result in billings or revenue; adverse publicity about, or consumer or political opposition to, the smart grid; security breaches involving smart grid products or services; the ability to integrate technology into third-party devices and Silver Spring’s relationship with third-party manufacturers; execution and customer adoption risks related to new product introductions and innovation, including our new fifth generation networking platform and products; the ability to attract and retain personnel, including members of Silver Spring’s management team; changes in strategy; technological changes that make Silver Spring’s products and services less competitive; competition, particularly from larger companies with more resources than Silver Spring; international business uncertainties; the ability to acquire and integrate other businesses; and other risk factors set forth from time to time in Silver Spring’s filings with the SEC, copies of which are available free of charge at the SEC’s website at www.sec.gov. All forward-looking statements in this press release reflect Silver Spring’s expectations as of August 5, 2015. Silver Spring undertakes no obligation, and expressly disclaims any obligation, to update any forward-looking statements in this press release in light of new information or future events. In addition, the preliminary financial results set forth in this press release are estimates based on information currently available to Silver Spring.

  SILVER SPRING NETWORKS UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data)         Three Months Ended Six Months Ended June 30, June 30,

2015

2014 2015 2014 Revenue: Product revenue $ 54,711 $ 24,751 $ 159,746 $ 52,978 Service revenue   22,456     16,856     61,061     32,858   Net revenue 77,167 41,607 220,807 85,836 Cost of revenue: Product cost of revenue 40,533 13,414 97,150 31,329 Service cost of revenue   16,678     14,781     32,246     29,651   Total cost of revenue 57,211 28,195 129,396 60,980 Gross profit 19,956 13,412 91,411 24,856 Operating expenses: Research and development 16,050 17,342 31,744 35,067 Sales and marketing 8,912 8,854 18,209 18,077 General and administrative 10,455 11,888 22,584 23,555 Restructuring   1,078     —     1,272     —   Total operating expenses   36,495     38,084     73,809     76,699   Operating (loss) income (16,539 ) (24,672 ) 17,602 (51,843 ) Other income   74     85     362     48   (Loss) income before income taxes (16,465 ) (24,587 ) 17,964 (51,795 ) Benefit (provision) for income taxes   290     (4 )   766     (603 ) Net (loss) income $ (16,175 ) $ (24,591 ) $ 18,730   $ (52,398 ) Net (loss) income per share: Basic $ (0.32 ) $ (0.51 ) $ 0.38   $ (1.09 ) Diluted $ (0.32 ) $ (0.51 ) $ 0.37   $ (1.09 ) Weighted average shares used to compute net (loss) income per share: Basic   49,862     48,315     49,586     48,006   Diluted   49,862     48,315     51,095     48,006     Non-GAAP results (in thousands, except per share data) The following tables reconcile the Company's net income (loss) and income (loss) per share as presented in its unaudited Condensed Consolidated Statements of Operations and prepared in accordance with GAAP to its non-GAAP net income (loss) and non-GAAP income (loss) per share.   Three Months Ended Six Months Ended June 30, June 30, 2015 2014 2015 2014 Net (loss) income $ (16,175 ) $ (24,591 ) $ 18,730 $ (52,398 ) Change in deferred revenue, net of foreign currency translation (8,027 ) 21,997 (88,568 ) 49,618 Change in deferred cost of revenue, net of foreign currency translation 14,488 (16,801 ) 47,004 (37,058 ) Amortization of intangibles 422 48 831 96 Stock-based compensation 8,661 9,562 15,684 20,994 Acquisition-related charges 751 — 1,486 — Income tax benefit related to Detectent acquisition (124 ) — (1,014 ) — Restructuring 1,078 — 1,272 — Legal settlements   —     (100 )   —     (100 ) Non-GAAP net income (loss) $ 1,074   $ (9,885 ) $ (4,575 ) $ (18,848 ) Non-GAAP net income (loss) per share: Basic $ 0.02   $ (0.20 ) $ (0.09 ) $ (0.39 ) Diluted $ 0.02   $ (0.20 ) $ (0.09 ) $ (0.39 ) Weighted average shares used to compute Non-GAAP net income (loss) per share: Basic   49,862     48,315     49,586     48,006   Diluted   51,390     48,315     49,586     48,006     SILVER SPRING NETWORKS, INC. UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands)       June 30, December 31, 2015 2014 (a) ASSETS Current assets: Cash and cash equivalents $ 61,760 $ 60,457 Short-term investments 56,795 60,339 Accounts receivable 41,549 54,740 Inventories 4,502 6,722 Deferred cost of revenue 197,547 29,585 Deferred tax assets 370 5,278 Prepaid expenses and other current assets   9,402     5,146   Total current assets 371,925 222,267 Property and equipment, net 12,259 12,860 Goodwill and intangible assets 15,473 8,221 Deferred cost of revenue, non-current 88,497 303,445 Deferred tax assets, non-current 25,965 354 Other long-term assets   3,828     1,047   Total assets $ 517,947   $ 548,194   LIABILITIES AND STOCKHOLDERS' DEFICIT Current liabilities: Accounts payable $ 25,365 $ 27,530 Deferred revenue 324,019 91,688 Deferred tax liability 25,807 249 Accrued and other liabilities   34,821     24,421   Total current liabilities 410,012 143,888 Deferred revenue, non-current 197,157 517,905 Deferred tax liability, non-current — 5,146 Other liabilities   15,673     15,074   Total liabilities 622,842 682,013 Total stockholders’ deficit   (104,895 )   (133,819 ) Total liabilities and stockholders’ deficit $ 517,947   $ 548,194     (a) Derived from audited consolidated financial statements   SILVER SPRING NETWORKS UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW (In thousands)           Three Months Ended Six Months Ended June 30, June 30, 2015 2014 2015 2014 OPERATING ACTIVITIES Net (loss) income $ (16,175 ) $ (24,591 ) $ 18,730 $ (52,398 )

Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities:

Deferred taxes (217 ) 499 (1,107 ) 906 Depreciation and amortization 1,953 1,467 3,902 2,933 Stock-based compensation 8,661 9,562 15,684 20,994 Other non-cash adjustments 71 23 124 125 Changes in assets and liabilities: Accounts receivable 6,340 3,285 13,641 11,586 Inventory 2,837 292 2,233 (217 ) Prepaid expenses and other assets (1,892 ) (2,370 ) (2,796 ) (3,514 ) Contingent consideration related to Detectent acquisition held in escrow — — (4,000 ) — Deferred cost of revenue 14,478 (16,969 ) 46,994 (37,335 ) Accounts payable (5,248 ) (278 ) (2,370 ) (3,402 ) Customer deposits 1,658 (3 ) 1,458 104 Deferred revenue (8,470 ) 22,428 (89,031 ) 50,103 Accrued and other liabilities   5,617     3,260     5,696     3,460   Net cash provided by (used in) operating activities   9,613     (3,395 )   9,158     (6,655 ) INVESTING ACTIVITIES Payments for business acquisition, net of cash and cash equivalents acquired — (8,750 ) (7,098 ) (8,750 ) Proceeds from sales of available-for-sale investments 7,400 (13,966 ) 7,400 — Proceeds from maturities of available-for-sale investments 3,750 37,558 7,750 42,058 Purchases of available-for-sale investments (7,567 ) (22,147 ) (11,623 ) (39,501 ) Purchases of property and equipment   (538 )   (1,956 )   (1,912 )   (3,698 ) Net cash provided by (used in) investing activities   3,045     (9,261 )   (5,483 )   (9,891 ) FINANCING ACTIVITIES Payments on capital lease obligations (346 ) (392 ) (756 ) (748 ) Proceeds from issuance of common stock, net of repurchases 131 192 2,036 4,747 Taxes paid related to net share settlement of equity awards   (1,455 )   (850 )   (3,512 )   (5,263 ) Net cash used in financing activities   (1,670 )   (1,050 )   (2,232 )   (1,264 ) Effect of exchange rate changes on cash and cash equivalents 76 — (140 ) — Net increase (decrease) in cash and cash equivalents 11,065 (13,706 ) 1,303 (17,810 ) Cash and cash equivalents - beginning of period   50,695     78,492     60,457     82,596   Cash and cash equivalents - end of period $ 61,760   $ 64,786   $ 61,760   $ 64,786     SILVER SPRING NETWORKS, INC. UNAUDITED RECONCILIATION OF NET REVENUE BETWEEN GAAP AND NON-GAAP

(in thousands, except percentages)

            Q2 Q3 Q4 Q1 Q2 YoY%

TYPE

2014 2014 2014 2015 2015 Change GAAP net revenue: Product net revenue $ 24,751 $ 16,321 $ 60,034 $ 105,035 $ 54,711 121% Service net revenue Managed services and SaaS (a) 8,584 7,546 10,569 12,974 10,608 24% Professional services   8,272   4,174   6,808   25,631   11,848 43% Total service net revenue   16,856   11,720   17,377   38,605   22,456 33% Total GAAP net revenue $ 41,607 $ 28,041 $ 77,411 $ 143,640 $ 77,167 85% % Product 59% 58% 78% 73% 71% % Service 41% 42% 22% 27% 29% Change in deferred net revenue: Change in deferred product revenue $ 17,438 $ 33,238 $ (9,991) $ (64,034) $ (10,015) Change in deferred service revenue: Managed services and SaaS 2,326 3,960 984 (419) 2,387 Professional services   2,233   5,649   1,962   (16,088)   (399) Total change in deferred service revenue   4,559   9,609   2,946   (16,507)   1,988 Total change in deferred revenue $ 21,997 $ 42,847 $ (7,045) $ (80,541) $ (8,027) Non-GAAP revenue: Product net revenue 42,189 49,559 50,043 41,001 44,696 6% Service net revenue: Managed services and SaaS (a) 10,910 11,506 11,553 12,555 12,995 19% Professional services   10,505   9,823   8,770   9,543   11,449 9% Total service net revenue   21,415   21,329   20,323   22,098   24,444 14% Total non-GAAP net revenue $ 63,604 $ 70,888 $ 70,366 $ 63,099 $ 69,140 9% % Product 66% 70% 71% 65% 65% % Service 34% 30% 29% 35% 35%

RECURRING REVENUE PER ENDPOINT

Recurring GAAP revenue (TTM) (a) 35,391 32,987 35,220 39,673 41,697 Changes in deferred revenue, net of foreign currency translations   6,179   9,688   9,284   6,851   6,912 Recurring non-GAAP revenue (TTM) (a) $ 41,570 $ 42,675 $ 44,504 $ 46,524 $ 48,609 Cumulative network endpoints delivered 19,081 19,714 20,266 20,814 21,506 Recurring GAAP revenue per endpoint delivered (a) $ 1.85 $ 1.67 $ 1.74 $ 1.91 $ 1.94 5% Recurring non-GAAP revenue per endpoint delivered (a) $ 2.18 $ 2.16 $ 2.20 $ 2.24 $ 2.26 4%  

SOLUTION

GAAP net revenue Advanced metering infrastructure $ 33,610 $ 21,417 $ 72,456 $ 112,865 $ 66,907 99% New solutions   7,997   6,624   4,955   30,775   10,260 28% Total GAAP net revenue $ 41,607 $ 28,041 $ 77,411 $ 143,640 $ 77,167 85% % Advanced metering infrastructure 81% 76% 94% 79% 87% % New solutions 19% 24% 6% 21% 13% Change in deferred net revenue Advanced metering infrastructure $ 18,113 $ 39,828 $ (12,441) $ (64,828) $ (10,976) New solutions   3,884   3,019   5,396   (15,713)   2,949 Total change in deferred net revenue $ 21,997 $ 42,847 $ (7,045) $ (80,541) $ (8,027) Non-GAAP net revenue Advanced metering infrastructure $ 51,723 $ 61,245 $ 60,015 $ 48,037 $ 55,931 8% New solutions   11,881   9,643   10,351   15,062   13,209 11% Total Non-GAAP net revenue $ 63,604 $ 70,888 $ 70,366 $ 63,099 $ 69,140 9% % Advanced metering infrastructure 81% 86% 85% 76% 81% % New solutions 19% 14% 15% 24% 19%  

GEOGRAPHY

GAAP net revenue United States $ 34,251 $ 15,700 $ 30,017 $ 122,582 $ 72,360 111% International   7,356   12,341   47,394   21,058   4,807 -35% Total GAAP net revenue $ 41,607 $ 28,041 $ 77,411 $ 143,640 $ 77,167 85% % United States 82% 56% 39% 85% 94% % International 18% 44% 61% 15% 6% Change in deferred net revenue United States $ 22,799 $ 48,248 $ 29,176 $ (66,533) $ (17,955) International   (802)   (5,401)   (36,221)   (14,008)   9,928 Total change in deferred net revenue $ 21,997 $ 42,847 $ (7,045) $ (80,541) $ (8,027) Non-GAAP net revenue United States $ 57,050 $ 63,948 $ 59,193 $ 56,049 $ 54,405 -5% International   6,554   6,940   11,173   7,050   14,735 125% Total non-GAAP net revenue $ 63,604 $ 70,888 $ 70,366 $ 63,099 $ 69,140 9% % United States 90% 90% 84% 89% 79% % International 10% 10% 16% 11% 21%  

(a) Certain amounts have been reclassified in 2014 from Professional services to Managed services and SaaS related to product support which is recurring in nature to conform to current period presentation.

  SILVER SPRING NETWORKS, INC. UNAUDITED SUPPLEMENTAL FINANCIAL INFORMATION

(in thousands, except percentages and headcount)

            Q2 Q3 Q4 Q1 Q2 YoY% CASH FLOW DATA 2014 2014 2014 2015 2015 Change Operating cash flow $ (3,395 ) $ (15,734 ) $ 13,624 $ (455 ) $ 9,613 383 % Operating cash flow - TTM 16,320 (20,545 ) (8,765 ) (5,960 ) 7,048 -57 % BALANCE SHEET DATA Cash, cash equivalents and short-term investments $ 125,321 $ 110,466 $ 120,796 $ 111,215 $ 118,555 -5 %

Deferred net revenue:

End of quarter 575,106 617,416 609,593 529,984 521,176 Less: Beginning of quarter (552,328 ) (575,106 ) (617,416 ) (609,593 ) (529,984 )

Foreign currency translation adjustment and other

  (781 )   537     778     (932 )   781   Change in deferred net revenue, net of foreign currency translation and other $ 21,997   $ 42,847   $ (7,045 ) $ (80,541 ) $ (8,027 )

Deferred cost of revenue:

End of quarter $ 313,458 $ 338,633 $ 333,030 $ 300,524 $ 286,044 Less: Beginning of quarter (296,489 ) (313,458 ) (338,633 ) (333,030 ) (300,524 ) Foreign currency translation adjustment   (168 )   69     68     (10 )   (8 ) Change in deferred cost of revenue, net of foreign currency translation $ 16,801   $ 25,244   $ (5,535 ) $ (32,516 ) $ (14,488 ) STOCK-BASED COMPENSATION Cost of goods sold $ 1,930 $ 2,770 $ 218 $ 1,723 $ 2,209 14 % Research and development 2,695 3,042 785 2,180 2,832 5 % Sales and marketing 1,754 1,783 479 1,238 1,287 -27 % General and administrative   3,183     2,881     909     1,882     2,333   -27 % $ 9,562   $ 10,476   $ 2,391   $ 7,023   $ 8,661   -9 % EMPLOYEES 639 589 576 623 640 0 % HOMES & BUSINESSES Cumulative network endpoints delivered* 19,081 19,714 20,266 20,814 21,506 13 % *Endpoints refer to communication modules in electric meters   SILVER SPRING NETWORKS UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (In thousands, except per share data and percentages)             Q2 Q3 Q4 Q1 Q2 YOY % QUARTERLY RECONCILIATION OF RESULTS 2014 2014 2014 2015 2015 Change Net revenue GAAP net revenue $ 41,607 $ 28,041 $ 77,411 $ 143,640 $ 77,167 85 % Change in deferred revenue, net of foreign currency translation   21,997     42,847     (7,045 )   (80,541 )   (8,027 ) Non-GAAP net revenue $ 63,604   $ 70,888   $ 70,366   $ 63,099   $ 69,140   9 %   Gross profit GAAP gross profit $ 13,412 $ 1,303 $ 30,178 $ 71,455 $ 19,956 49 % Change in deferred revenue, net of foreign currency translation 21,997 42,847 (7,045 ) (80,541 ) (8,027 ) Change in deferred cost of revenue, net of foreign currency translation (16,801 ) (25,244 ) 5,535 32,516 14,488 Amortization of intangible assets 48 182 140 262 260 Stock-based compensation 1,930 2,770 218 1,723 2,209 Acquisition-related charges (a)   —     —     —     11     60   Non-GAAP gross profit $ 20,586   $ 21,858   $ 29,026   $ 25,426   $ 28,946   41 % GAAP gross margin % (as a % of GAAP net revenue) 32 % 5 % 39 % 50 % 26 % Non-GAAP gross margin % (as a % of non-GAAP net revenue) 32 % 31 % 41 % 40 % 42 %   Operating (loss) income GAAP operating (loss) income $ (24,672 ) $ (37,420 ) $ 1,392 $ 34,141 $ (16,539 ) 33 % Change in deferred revenue, net of foreign currency translation 21,997 42,847 (7,045 ) (80,541 ) (8,027 ) Change in deferred cost of revenue, net of foreign currency translation (16,801 ) (25,244 ) 5,535 32,516 14,488 Amortization of intangible assets 48 299 219 409 422 Stock-based compensation 9,562 10,476 2,391 7,023 8,661 Acquisition-related charges (a) — — — 735 751 Restructuring — 1,888 (99 ) 194 1,078 Legal settlements   (100 )   —     —     —     —   Non-GAAP operating (loss) income $ (9,966 ) $ (7,154 ) $ 2,393   $ (5,523 ) $ 834   108 % GAAP operating margin % (as a % of GAAP revenue) -59 % -133 % 2 % 24 % -21 % Non-GAAP operating margin % (as a % of non-GAAP net revenue) -16 % -10 % 3 % -9 % 1 %   Adjusted EBITDA GAAP net (loss) income $ (24,591 ) $ (37,273 ) $ 501 $ 34,905 $ (16,175 ) 34 % Change in deferred revenue, net of foreign currency translation 21,997 42,847 (7,045 ) (80,541 ) (8,027 ) Change in deferred cost of revenue, net of foreign currency translation (16,801 ) (25,244 ) 5,535 32,516 14,488 Other (income) expense, net (85 ) (7 ) (68 ) (288 ) (74 ) (Benefit) provision for income taxes 4 (140 ) 959 (476 ) (290 ) Depreciation and amortization 1,467 1,771 1,763 1,949 1,953 Stock-based compensation 9,562 10,476 2,391 7,023 8,661 Acquisition-related charges (a) — — — 735 751 Restructuring — 1,888 (99 ) 194 1,078 Legal settlements   (100 )   —     —     —     —   Adjusted EBITDA $ (8,547 ) $ (5,682 ) $ 3,937   $ (3,983 ) $ 2,365   128 %   Net (loss) income GAAP net (loss) income $ (24,591 ) $ (37,273 ) $ 501 $ 34,905 $ (16,175 ) 34 % Change in deferred revenue, net of foreign currency translation 21,997 42,847 (7,045 ) (80,541 ) (8,027 ) Change in deferred cost of revenue, net of foreign currency translation (16,801 ) (25,244 ) 5,535 32,516 14,488 Amortization of intangible assets 48 299 219 409 422 Stock-based compensation 9,562 10,476 2,391 7,023 8,661 Acquisition-related charges (a) — — — 735 751 Income tax benefit related to Detectent acquisition — — — (890 ) (124 ) Restructuring — 1,888 (99 ) 194 1,078 Legal settlements   (100 )   —     —     —     —   Non-GAAP net (loss) income $ (9,885 ) $ (7,007 ) $ 1,502   $ (5,649 ) $ 1,074   111 % GAAP net margin % (as a % of GAAP revenue) -59 % -133 % 1 % 24 % -21 % Non-GAAP net margin % (as a % of non-GAAP net revenue) -16 % -10 % 2 % -9 % 2 %   GAAP (loss) income per share Basic $ (0.51 ) $ (0.77 ) $ 0.01 $ 0.71 $ (0.32 ) Diluted $ (0.51 ) $ (0.77 ) $ 0.01 $ 0.69 $ (0.32 ) Weighted average number of shares used in computation Basic 48,315 48,551 48,929 49,306 49,862 Diluted 48,315 48,551 50,191 50,899 49,862   Non-GAAP (loss) income per share Basic $ (0.20 ) $ (0.14 ) $ 0.03 $ (0.11 ) $ 0.02 Diluted $ (0.20 ) $ (0.14 ) $ 0.03 $ (0.11 ) $ 0.02 Weighted average number of shares used in computation Basic 48,315 48,551 48,929 49,306 49,862 Diluted 48,315 48,551 50,191 49,306 51,390 (a) Acquisition-related charges in 2014 were not included.

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Silver Spring Networks, Inc.Mark McKechnie, 650-839-4664Investor Relationsmmckechnie@silverspringnet.comNoel Hartzell, 650-839-4184Global Communicationsnhartzell@silverspringnet.com