Altair(ALTR)2022-05-07 13:23Financial Data and Key Metrics Changes - Total billings for Q1 2022 were 159.8 million, reflecting a year-over-year growth of 6.4% [22] - Adjusted EBITDA for Q1 2022 was 3.6 million, but excluding a one-time payment, it was 33.5 million in Q1 2021 [26] Business Line Data and Key Metrics Changes - Software product revenue for Q1 2022 was $140.9 million, an increase of 8.8% year-over-year [7][22] - Software revenue constituted 88.2% of total revenue in Q1 2022, compared to 86.3% in the prior year [8][24] - Recurring software license rate remained high at 93% for Q1 2022, compared to 92% for the full year 2021 [8][22] Market Data and Key Metrics Changes - Growth was observed across all three geographic regions, with particular strength in technology and banking, financial services, and insurance verticals [7] - The company experienced strong software billings, although services and other billings decreased due to declines in the CES business [22] Company Strategy and Development Direction - The company is focused on delivering high-value products and expertise to enhance customer efficiency and competitiveness through computational science and AI [6] - Recent acquisitions of Powersim and World Programming are aimed at expanding Altair's technology offerings in power electronics and data analytics [9][10] - The integration of World Programming's technology is expected to enhance Altair's data science solutions and provide significant cross-sell opportunities [12][53] Management's Comments on Operating Environment and Future Outlook - Management acknowledged macroeconomic challenges, including supply chain disruptions and inflation, but expressed confidence in the company's robust business momentum [6] - The outlook for Q2 2022 includes expected software product revenue growth of 11.5% to 14.5% year-over-year [27] - Management remains optimistic about the company's ability to navigate economic uncertainties, citing strong technology offerings and business model [19] Other Important Information - The company released its Simulation 2022 software suite, which includes significant updates and new features aimed at enhancing customer capabilities [14][16] - The company is committed to sustainability and community involvement, as highlighted in its updated Sustainability Report [20] Q&A Session Summary Question: What changes are being observed in Europe regarding projects or budgets? - Management noted limited exposure to Russia and some stagnation in Eastern Europe, but overall, operations in the rest of Europe remain relatively normal [32] Question: What are the integration plans for World Programming? - Currently, World Programming operates in a standalone mode, but integration efforts are underway, particularly in the go-to-market strategy [34][35] Question: How is SimSolid performing? - SimSolid continues to grow rapidly, with ongoing development and customer engagement, making it a strong lead product in the market [41][43] Question: Why is guidance for the full year remaining flat despite strong Q1 results? - The flat guidance is primarily due to currency headwinds impacting revenue expectations [45] Question: What cross-sell opportunities exist for World Programming? - Significant cross-sell opportunities are identified in the banking and financial services market, as well as within the traditional manufacturing customer base [53][54]