ANSYS(US:ANSS)2023-02-23 18:51Financial Data and Key Metrics Changes - Q4 2022 was the largest quarter in ANSYS's history, exceeding financial guidance across all key metrics including ACV, revenue, operating margin, and earnings per share [5][20] - Full year 2022 ACV reached $2.032 billion, surpassing the $2 billion target set in 2019, with a growth of 14% in constant currency [6][24] - Q4 total revenue was $694.7 million, growing 10% in constant currency, while full year revenue was $2.073 billion, growing 13% in constant currency [27][28] - Operating margin for Q4 was 48%, with a full year operating margin of 42% [28][29] - EPS for Q4 was $3.09, and for the full year, it was $7.99 [28][29] Business Line Data and Key Metrics Changes - Subscription lease ACV grew 18% or 24% in constant currency, crossing over $1 billion to $1.2 billion, representing 57% of total ACV for the full year [26] - Recurring ACV grew 9% or 15% in constant currency year-over-year, accounting for 81% of total ACV [26] Market Data and Key Metrics Changes - The Americas region recorded over $1 billion in ACV for the first time, contributing to strong overall performance across all regions [7] - Growth was broad-based across industries, with significant contributions from high-tech, semiconductor, aerospace, defense, and automotive sectors [6][21] Company Strategy and Development Direction - ANSYS aims for 12% constant currency ACV compounded annual growth from 2022 to 2025, with a focus on subscription leases as a key growth driver [33][34] - The company is investing in five key areas: numerics, AI and machine learning, high-performance computing, cloud and experience, and digital engineering [55][58] - Recent acquisitions are expected to enhance product offerings and address complex customer challenges, particularly in the automotive and aerospace sectors [16][48] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to achieve future milestones despite economic uncertainties, citing robust end markets and strong customer relationships [21][22] - The outlook for 2023 includes expectations for ACV growth between $2.265 billion and $2.335 billion, reflecting continued demand across customer segments [33][34] Other Important Information - ANSYS was named one of America's most responsible companies for 2023, highlighting its commitment to sustainability and efficiency [18] - The company repurchased approximately 725,000 shares for around $206 million in 2022, indicating a strong capital return strategy [31] Q&A Session Summary Question: What are the underlying drivers for growth in the aerospace and defense segment? - Management noted that aerospace customers face complex challenges, including trends in lightweighting, energy efficiency, and innovation in electric engines, contributing to robust demand [40][41] Question: Can you elaborate on the unlevered operating cash flow guidance? - Management indicated that the strong cash flow performance in 2022 reflects operational momentum, with expectations for continued growth in 2023 [42][44] Question: What are the drivers of ACV growth in 2022 and 2023? - Management highlighted broad-based growth across customer types and geographies, with significant contributions from subscription leases and acquisitions [46][49] Question: How do you view the mix of simulation being done on public cloud versus traditional setups? - Management stated that there is a clear trend towards public cloud usage for high-performance computing applications, with ongoing investments in cloud capabilities [72][74] Question: What are the drivers behind the strong performance in Germany and Japan? - Management attributed the outperformance to deep relationships with automotive customers and ongoing innovations in electronic motor design [76]