ANSYS(ANSS)2024-11-06 21:32Revenue and Financial Performance - Q3 2024 revenue reached $601.9 million, a 31% increase compared to Q3 2023[2] - Total revenue for Q3 2024 was $601.9 million, a 31.2% increase compared to Q3 2023[14] - Total revenue for Q3 2024 increased to $601.892 million, up 31.2% from $458.795 million in Q3 2023[21] - Americas revenue for Q3 2024 reached $306.5 million, representing 50.9% of total revenue, a 40.4% increase YoY[14] - EMEA revenue for Q3 2024 was $137.0 million, accounting for 22.8% of total revenue, with a 12.7% YoY growth[14] - Asia-Pacific revenue for Q3 2024 totaled $158.4 million, making up 26.3% of total revenue, with a 33.2% YoY increase[14] - Direct revenue as a percentage of total revenue increased to 74.6% in Q3 2024, up from 73.5% in Q3 2023[14] - Subscription lease revenue for Q3 2024 was $194.3 million, representing 32.3% of total revenue and an 87.6% increase compared to Q3 2023[13] - Maintenance revenue for Q3 2024 was $306.7 million, accounting for 51% of total revenue[13] - Software licenses revenue grew 70.5% to $276.948 million in Q3 2024 compared to $162.422 million in Q3 2023[21] - Net income for Q3 2024 rose to $128.192 million, a 131% increase from $55.502 million in Q3 2023[21] - Operating income for Q3 2024 increased 131% to $161.538 million from $69.816 million in Q3 2023[21] - Non-GAAP operating income for Q3 2024 was $275.447 million, representing 45.8% of revenue[31] - Gross profit margin improved to 88.5% in Q3 2024 from 85.8% in Q3 2023[31][32] - Total GAAP gross profit is $1,263,592 thousand, representing 86.3% of revenue[34] - Non-GAAP gross profit is $1,334,223 thousand, representing 91.1% of revenue[34] - GAAP operating income for the nine months ended September 30, 2023 is $293,135 thousand, representing 20.0% of revenue[34] - Non-GAAP operating income for the nine months ended September 30, 2023 is $539,698 thousand, representing 36.8% of revenue[34] - GAAP net income for the nine months ended September 30, 2023 is $225,650 thousand, with diluted EPS of $2.58[34] - Non-GAAP net income for the nine months ended September 30, 2023 is $423,991 thousand, with diluted EPS of $4.85[34] Earnings and Profitability - GAAP diluted earnings per share for Q3 2024 was $1.46, while non-GAAP diluted earnings per share was $2.58[2] - Diluted EPS for Q3 2024 was $1.46, up 128% from $0.64 in Q3 2023[21] - Net income for Q3 2024 rose to $128.192 million, a 131% increase from $55.502 million in Q3 2023[21] - Operating income for Q3 2024 increased 131% to $161.538 million from $69.816 million in Q3 2023[21] - Non-GAAP operating income for Q3 2024 was $275.447 million, representing 45.8% of revenue[31] - Gross profit margin improved to 88.5% in Q3 2024 from 85.8% in Q3 2023[31][32] - Total GAAP gross profit is $1,263,592 thousand, representing 86.3% of revenue[34] - Non-GAAP gross profit is $1,334,223 thousand, representing 91.1% of revenue[34] - GAAP operating income for the nine months ended September 30, 2023 is $293,135 thousand, representing 20.0% of revenue[34] - Non-GAAP operating income for the nine months ended September 30, 2023 is $539,698 thousand, representing 36.8% of revenue[34] - GAAP net income for the nine months ended September 30, 2023 is $225,650 thousand, with diluted EPS of $2.58[34] - Non-GAAP net income for the nine months ended September 30, 2023 is $423,991 thousand, with diluted EPS of $4.85[34] Contract Value and Deferred Revenue - Annual Contract Value (ACV) for Q3 2024 was $540.5 million, an 18% increase compared to Q3 2023[2] - Deferred revenue and backlog as of September 30, 2024, stood at $1,463.8 million[2] - Current deferred revenue and backlog as of September 30, 2024, was $902.8 million, up from $774.2 million in the same period last year[15] - Total deferred revenue and backlog reached $1.46 billion as of September 30, 2024, compared to $1.21 billion in the same period last year[15] - Annual Contract Value (ACV) includes annualized value of maintenance, subscription lease contracts, and perpetual licenses[22] - A $300,000 subscription lease contract contributes $100,000 to ACV annually over its 3-year term[25] Cash Flow and Investments - Operating cash flows for Q3 2024 were $174.2 million, an 8.4% increase compared to Q3 2023[5] - Net cash provided by operating activities for the nine months ended September 30, 2024 is $537,767 thousand, compared to $484,400 thousand for the same period in 2023[35] - Unlevered operating cash flows for the nine months ended September 30, 2024 is $567,805 thousand, compared to $512,281 thousand for the same period in 2023[35] - Cash and short-term investments as of September 30, 2024, stood at $1.30 billion, up from $860.4 million at the end of 2023[19] - Stockholders' equity increased to $5.83 billion as of September 30, 2024, from $5.39 billion at the end of 2023[20] Expenses and Costs - Research and development expenses increased 7.4% to $132.320 million in Q3 2024 from $123.223 million in Q3 2023[21] - Stock-based compensation expense for the nine months ended September 30, 2023 is $158,533 thousand, representing 10.7% of revenue[34] - Expenses related to business combinations for the nine months ended September 30, 2023 is $77,002 thousand, representing 5.3% of revenue[34] Risks and Challenges - Potential risks from the proposed transaction with Synopsys, including regulatory approvals, business disruptions, and long-term stock value uncertainty[48] - Macroeconomic challenges such as inflation, recessionary conditions, and equity market volatility impacting operations[48] - Geopolitical risks including trade sanctions, export controls, and impacts from conflicts in the Middle East and Russia-Ukraine[48] - Cybersecurity threats and potential breaches affecting proprietary technology and customer data[48] - Revenue volatility due to multi-year subscription contracts and reliance on high renewal rates[48] - Uncertainty in income tax estimates and changes in tax laws across operating jurisdictions[50] - Investments in global sales, marketing, and acquisitions, with potential impacts from integration challenges and indebtedness[50] - Operational disruptions from remote work transitions and reliance on third-party infrastructure[50] - Plans for future capital spending and potential higher R&D costs[50] Acquisitions and Regulatory Approvals - Ansys and Synopsys received foreign direct investment approvals for the proposed acquisition, with the transaction expected to close in the first half of 2025[3] - Regulatory filings and documentation related to the Synopsys transaction available on SEC and company websites[51][53] Currency and Market Impact - Currency fluctuations had an adverse impact on Q3 2024 revenue, with a $133 thousand negative effect[17]