Company Performance - Simulations Plus, Inc. reported third-quarter fiscal 2025 adjusted earnings of 45 cents per share, a 66.7% increase year over year, surpassing the Zacks Consensus Estimate of 26 cents per share [1] - Quarterly revenues increased by 10% year over year to $20.4 million, driven by growth in software and services, along with a $2.4 million contribution from the Pro-ficiency acquisition [2] - Organic revenue fell by 4%, primarily due to reduced QSP/QST software sales and a decline in biosimulation services revenue [3] Strategic Developments - The company underwent a strategic reorganization, transitioning to a functionally-driven operating model to streamline operations and focus on high-growth areas [4] - Simulations Plus announced a $1 million investment in Nurocor, a cloud-based software company, as part of its Corporate Development Initiative targeting early-stage technology companies [5] Market Outlook - The clinical trial technology and services sector was estimated at $25.7 billion in 2024, with a projected CAGR of 15.5% from 2025 to 2030, driven by the adoption of digital health technologies [6] - Despite macroeconomic challenges, the company is committed to innovation, focusing on integrating AI-driven capabilities across its product lines [7] Financial Details - The gross margin for the quarter was 64%, down from 71.5% in the prior-year quarter, attributed to a $2 million rise in cost of revenues [16] - Total operating expenses increased by 667% to $87.3 million due to a one-time non-cash impairment charge of $77.2 million [17] - Cash and short-term investments as of May 31, 2025, were $28.5 million, up from $21.5 million as of February 28, 2024 [18] Guidance Revision - The company revised its fiscal 2025 revenue guidance to between $76 million and $80 million, down from the previous estimate of $90-$93 million [21] - Adjusted earnings per share are now expected to be in the range of 93 cents to $1.06, a decrease from the earlier projection of $1.07 to $1.20 [22]

Financial Data and Key Metrics Changes - Third quarter revenue increased by 10% to $20.4 million, including a $2.4 million contribution from the Proficiency acquisition, while organic revenue declined by 4% due to lower software and biosimulation services revenue [5][21] - Diluted EPS loss was $3.35, including a non-cash impairment expense of $77.2 million, compared to a profit of $0.15 last year; adjusted diluted EPS was $0.45 compared to $0.27 last year [6][27] - Adjusted EBITDA was $7.4 million, or 37% of revenue, compared to $5.6 million, or 30% of revenue last year [6][27] Business Line Data and Key Metrics Changes - Software revenue grew by 6%, representing 62% of total revenue, while services revenue increased by 17%, representing 38% of total revenue [21] - The ADMET Predictor platform grew by 8% year over year, while the QSV QST biosimulation platform declined by 39% year over year [12][14] - Proficiency contributed $400,000 in revenue for the quarter and $4.4 million on a trailing twelve-month basis [15] Market Data and Key Metrics Changes - The clinical operations space is facing headwinds due to market disruptions affecting clinical trial initiations and commercialization budgets, impacting revenue outlook for fiscal year 2025 and into 2026 [7][10] - The biopharma market has been challenging, with large pharma facing patent expirations and pricing pressures, while biotech companies are experiencing a pullback in available capital [10] Company Strategy and Development Direction - The company is committed to its clinical operations and medical communications businesses, focusing on leveraging AI technologies to improve clinical operational efficiencies [8][9] - A strategic reorganization was implemented to transition to a functionally driven operating model, aimed at enhancing client engagement and streamlining operations [18][20] - The company plans to roll out new AI-driven initiatives across its product suite, including enhancements to the GastroPlus platform [31][35] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about long-term prospects for biosimulation growth and the use of AI in clinical operations, despite current market headwinds [29][30] - The company anticipates modest improvement in fiscal year 2026 compared to fiscal year 2025, with expectations of flat organic revenue growth [31] - Management highlighted the importance of adapting to client needs and market conditions to optimize performance [51] Other Important Information - The company ended the quarter with $28.5 million in cash and short-term investments, remaining well-capitalized with no debt [28] - The total gross margin for the quarter was 64%, down from 71% in the prior year, primarily due to increased costs of revenues [24] Q&A Session Summary Question: What is driving the margin erosion next quarter? - Management indicated that the reorganization and expense structure changes will impact future margins, with a revenue step down affecting fourth quarter margins [38][40] Question: Can you provide more color on the renewal rates drop? - Management noted that renewal rates were impacted by client consolidations and site closures, but historically, renewal rates have been maintained in the 90% to 95% range [41][43] Question: Are clients becoming more comfortable with the new FDA guidance? - Management stated that while the FDA's announcement is significant, it will take time for clients to translate this into actionable steps, and the environment remains cautious [46][48] Question: What has been the biggest headwind recently? - Management highlighted that multiple uncertainties are causing clients to be cautious in their spending decisions, rather than a single factor [50] Question: What are the expectations for R&D investment moving forward? - Management indicated a commitment to balancing R&D investment with the goal of improving EBITDA, with opportunities for increased spending in AI development [82] Question: Will product development pacing change with AI initiatives? - Management confirmed that while there will be more frequent updates, the regulatory environment may limit how often clients can adopt new features [90]

Financial Performance - The company's Q3 2025 revenue reached $20.4 million, a 10% increase compared to $18.5 million in Q3 2024[4] - Adjusted EBITDA margin for Q3 2025 was 37%, up from 30% in Q3 2024[4] - Diluted EPS for Q3 2025 was $(3.35), while adjusted diluted EPS was $0.45[4] - Trailing Twelve Months (TTM) revenue for Q3 2025 was $80.4 million, a 20% increase from $67.0 million in Q3 2024[5] - The company is guiding for total revenue between $76 million and $80 million for fiscal year 2025, representing a growth of 9% to 14%[38] Software Segment - Overall software revenue grew by 6% in Q3 2025 and 16% for TTM[7] - Pro-ficiencyTM software revenue contribution was below expectations[7] - TTM revenue for Pro-ficiencyTM was $4.4 million[7] Services Segment - Overall services revenue grew by 17% in Q3 2025 and 27% for TTM[10] - Total backlog for services was $20.7 million, with over 91% expected to be converted to revenue within 12 months[10] - TTM revenue for Med Comm services was $7.3 million[10]

Core Insights - Nebius Group N.V. reported a first-quarter 2025 adjusted net loss of $92.5 million, which is 19% wider than the loss of $77.6 million from the previous year [1] - The company's revenues increased significantly by 385% year over year to $55.3 million, primarily driven by growth in its core artificial intelligence (AI) business [1] Business Overview - Nebius operates an AI cloud platform designed for intensive workloads, supported by in-house developed software and hardware, with R&D hubs in Europe, North America, and Israel [2] - The company has distinct brands, including Avride for autonomous driving technology and TripleTen, a leading edtech platform for tech career reskilling [2] Financial Performance - The adjusted EBITDA loss for the first quarter was $62.6 million, an improvement from the $70.9 million loss in the same quarter last year [4] - Sales, general, and administrative expenses rose by 29% year over year to $66.1 million [4] - As of March 31, 2025, the loss from operations was $129.5 million, compared to a loss of $82.9 million in the prior year [4] Balance Sheet and Cash Flow - As of March 31, 2025, Nebius had $1,447 million in cash and cash equivalents, down from $2,449.6 million as of December 31, 2024 [5] Future Outlook - The company is optimistic about its momentum heading into the second quarter of 2025, reaffirming its full-year ARR guidance of $750 million to $1 billion and overall revenue guidance of $500 million to $700 million [6] - Although adjusted EBITDA is expected to remain negative for the full year, Nebius aims to achieve positive adjusted EBITDA in the second half of 2025 [6] - The capital expenditure forecast for 2025 has been raised to approximately $2 billion from the previous estimate of $1.5 billion [7] Market Performance - Nebius currently holds a Zacks Rank 3 (Hold) and its shares have surged 66.6% over the past six months, outperforming the Zacks Internet - Software and Services industry's growth of 26.2% [8]

Core Insights - Simulations Plus, Inc. has launched DILIsym 11, enhancing its quantitative systems toxicology platform for improved drug-induced liver injury prediction, particularly with pediatric representation and an advanced T-cell model [1][2][3] Group 1: Product Enhancements - DILIsym 11 introduces significant enhancements, including pediatric modeling to assess liver toxicity risk in children, which is a notable advancement in predictive toxicology [3][5] - The new T-cell module offers deeper insights into CD8+ T-cell-mediated liver damage, alongside improved simulations for bile acid-related and cholestatic liver injuries [5][6] - The platform is recognized as a regulatory-grade simulation tool, having been reviewed by the FDA's DILI team, which underscores its clinical relevance [4][6] Group 2: Financial Performance - Simulations Plus reported a 23% year-over-year revenue increase to $22.4 million, driven by demand for its software and services, with contributions from the recently acquired Pro-ficiency business units [7][9] - The company anticipates revenues between $90 million and $93 million for fiscal 2025, reflecting a 28-33% increase from fiscal 2024, with Pro-ficiency expected to add $15-$18 million [9] Group 3: Market Context - Despite the positive performance of Simulations Plus, the broader biopharmaceutical sector faces financial challenges, impacting research and development investments [8] - The company is positioned to gain traction in the market as it continues to innovate in biosimulation and predictive modeling, which is critical for improving drug safety [6][8]

Core Viewpoint - Blackbaud, Inc. reported strong first-quarter 2025 results with non-GAAP EPS of 96 cents, exceeding estimates and showing a year-over-year increase, despite a decline in total revenues due to the divestiture of EVERFI [1][2]. Financial Performance - Non-GAAP EPS for Q1 2025 was 96 cents, surpassing the Zacks Consensus Estimate by 6.7% and increasing 3.2% year over year [1]. - Total revenues decreased 3.1% year over year to $270.7 million, primarily due to the divestiture of EVERFI, but still exceeded the Zacks Consensus Estimate by 0.9% [1][2]. - GAAP recurring revenue declined 2.8% to $264.1 million, accounting for 97.6% of total revenue [2]. - Non-GAAP organic revenues increased by 5.8% on a reported basis and 5.9% on a constant-currency basis year over year [4]. - Non-GAAP gross margin was 61.2%, slightly down from 61.4% a year ago, while total operating expenses fell 4.9% to $135.4 million [4]. Profitability Metrics - GAAP operating margin increased by 370 basis points to 7.5%, and non-GAAP operating margin rose by 270 basis points to 28.6% [5]. - Non-GAAP adjusted EBITDA margin was reported at 34.3% [5]. Balance Sheet and Cash Flow - As of March 31, 2025, total cash and equivalents were $456.6 million, down from $809.5 million at the end of 2024, while total debt increased to $1.2 billion from $1.1 billion [6]. - Cash provided by operating activities was $1.4 million, a significant decrease from $64.6 million in the prior-year quarter, with non-GAAP adjusted free cash outflow of $12.3 million compared to a free cash flow of $51.3 million in the previous year [7]. Share Buyback and Future Outlook - Blackbaud repurchased around 4% of its outstanding shares in Q1 2025, aligning with its plan to buy back 3% to 5% of shares [9]. - The company reaffirmed its 2025 guidance, projecting GAAP revenues between $1.115 billion and $1.125 billion, with non-GAAP adjusted EBITDA margin expected in the range of 34.9-35.9% [10][11]. Recent Developments - Blackbaud has been actively supporting disaster relief efforts and showcased innovations in corporate giving at the YourCause Corporate Social Impact Summit [12]. - The company introduced Blackbaud Integrated Payments, enhancing its payment processing capabilities [13]. - Blackbaud also launched Optimized Donation Forms for users in Canada and published its 2024 Trends in Giving report [14].

Core Insights - ANSYS, Inc. reported first-quarter 2025 earnings of $1.64 per share, missing the Zacks Consensus Estimate by 6.3%, but showing an 18% year-over-year increase [1] - Revenues of $504.9 million also missed estimates by 4.6%, yet grew 8.2% year over year on a reported basis and 9.9% on a constant currency basis, driven by growth in maintenance, service, and subscription lease revenues [1] Financial Performance - Subscription lease revenues accounted for 19.2% of total revenues, increasing 4% year over year at constant currency to $96.9 million [4] - Perpetual licenses revenues, making up 12.5% of total revenues, decreased 2.9% at constant currency to $63 million [4] - Maintenance revenues, which comprised 64.2% of total revenues, rose 13.9% year over year at constant currency to $324.4 million [5] - Service revenues increased 22.5% at constant currency to $20.4 million [5] - Total deferred revenues and backlog reached $1,627.7 million, up 18.9% year over year [6] Regional Performance - The Americas contributed 45.6% to revenues, with a year-over-year increase of 10.5% at constant currency to $230.4 million [6] - EMEA contributed 23.5% to revenues, with a 2.6% increase at constant currency to $118.9 million [6] - Asia-Pacific contributed 30.8% to revenues, with a 15% increase at constant currency to $155.7 million [6] Operating Metrics - Non-GAAP gross margin improved by 30 basis points year over year to 91.2% [7] - Total operating expenses rose 5.3% year over year to $373.4 million, primarily due to increased selling, general and administrative, and research and development expenses [7] - Non-GAAP operating margin increased by 130 basis points to 33.5% from 32.2% in the prior-year quarter [9] Balance Sheet and Cash Flow - As of March 31, 2025, cash and short-term investments totaled $1.8 billion, up from $1.5 billion as of December 31, 2024 [10] - Long-term debt was $754.3 million, showing a slight increase from the previous quarter [10] - Cash from operations increased by 41% to $398.9 million from $282.8 million in the prior-year quarter [10] Acquisition Update - Ansys and Synopsys announced a $35 billion acquisition deal, with Ansys shareholders set to receive $197 in cash and 0.3450 Synopsys shares per ANSS share [2] - The deal has received regulatory clearance from multiple jurisdictions, including the Israeli Competition Authority and the U.K. Competition and Markets Authority [3] - The acquisition is expected to close in the first half of 2025, and Ansys has suspended its earnings calls and guidance due to the pending acquisition [3]

Core Insights - Cadence Design Systems (CDNS) reported strong first-quarter 2025 results, with non-GAAP EPS of $1.57, exceeding estimates by 5.4% and showing a year-over-year increase of 34.2% [1] - Revenues reached $1.242 billion, surpassing estimates by 0.3% and increasing 23% year over year, driven by robust demand for solutions [2] Financial Performance - The company ended the quarter with a backlog of $6.4 billion and current-remaining performance obligations of $3.2 billion, indicating stable customer investment in next-generation designs [3] - Management upgraded its 2025 revenue outlook to $5.15-$5.23 billion, reflecting an 11.8% growth from the previous year, with non-GAAP EPS expected between $6.73 and $6.83, a 12.2% increase [5] Segment Performance - Product & Maintenance revenues, accounting for 89.5% of total revenues, rose 21.7% year over year to $1.11 billion, while Services revenues increased 36.5% to $131 million [6] - Core EDA, Intellectual Property (IP), and Systems Design & Analysis contributed 71%, 14%, and 15% to total revenues, respectively, with the Systems Design & Analysis segment seeing a 50% revenue increase [7] Strategic Developments - The Cadence.ai portfolio is gaining traction, with over 1000 tapeouts year to date and a partnership expansion with NVIDIA to enhance AI solutions [4] - Recent acquisitions, including BETA CAE and Secure-IC, are expected to bolster the company's offerings in design and IP solutions [9][10][11] Margin and Cash Flow - Non-GAAP gross margin contracted slightly to 88.4%, while non-GAAP operating margin expanded to 41.7% [12] - The company generated an operating cash flow of $487 million and free cash flow of $464 million, with plans for $175 million in share repurchases in the second quarter [14] Outlook - For Q2 2025, revenues are estimated between $1.25-$1.27 billion, with non-GAAP EPS anticipated between $1.55 and $1.61 [16][17] - The company expects to utilize at least 50% of its free cash flow for share repurchases in 2025 [15]