Investor Relations News Releases

Image

Altair Announces Fourth Quarter 2019 Financial Results

February 27, 2020 at 4:05 PM EST
2019 Fourth Quarter Software Product Revenue Increased 27% year-over-year

TROY, Mich., Feb. 27, 2020 (GLOBE NEWSWIRE) -- Altair (Nasdaq:ALTR), a global technology company providing solutions in product development, high-performance computing and data analytics, today released its financial results for the fourth quarter ended December 31, 2019.

“We continue to execute on our vision of transforming product design and customer decision making by leveraging simulation, data analytics and high-performance computing,” said James Scapa, Founder, Chairman and Chief Executive Officer of Altair.  “Our core simulation and optimization technologies performed well during the quarter and we remain highly encouraged by strong demand for our SimSolid product, which continues to have one of the fastest new product ramps in our history.  As we enter 2020, we continue to see macro headwinds in our automotive end market and given the potential impact of the Coronavirus on our customers we anticipate a more modest start to the year.  However, we remain confident that our diversification across multiple verticals and products positions the company well to achieve above market growth over the long-term.”

“Software product revenue exceeded our expectations in the fourth quarter and our year over year growth rate accelerated sequentially to 27%,” said Howard Morof, Chief Financial Officer of Altair.

Fourth Quarter 2019 Financial Highlights

  • Software product revenue was $101.2 million, an increase of 27% from $79.9 million for the fourth quarter of 2018.
  • Non-GAAP software product revenue was $103.4 million, an increase of 29% from $79.9 million for the fourth quarter of 2018. 
  • Total revenue was $123.9 million, an increase of 20% from $103.0 million for the fourth quarter of 2018.
  • Non-GAAP total revenue was $126.1 million, an increase of 22% from $103.0 million for the fourth quarter of 2018. 
  • Net loss was $(1.5) million, compared to net loss of $(9.0) million for the fourth quarter of 2018. Diluted net loss per share was $(0.02) based on 72.2 million diluted weighted average common shares outstanding, compared to diluted net loss per share of $(0.13) for the fourth quarter of 2018, based on 70.5 million diluted weighted average common shares outstanding.
  • Adjusted EBITDA was $12.7 million, compared to $12.9 million for the fourth quarter of 2018. 
  • Modified Adjusted EBITDA was $15.0 million, compared to $12.9 million for the fourth quarter of 2018. 
  • Non-GAAP net income was $6.9 million, compared to non-GAAP net income of $5.6 million for the fourth quarter of 2018. Non-GAAP diluted net income per share was $0.09 based on 78.0 million non-GAAP diluted common shares outstanding, compared to non-GAAP diluted net income per share of $0.07 for the fourth quarter of 2018, based on 77.7 million non-GAAP diluted common shares outstanding.
  • Free cash flow was $(0.2) million, compared to $(5.5) million for the fourth quarter of 2018.

Full Year 2019 Financial Highlights

  • Software product revenue was $366.7 million, an increase of 20% from $304.4 million for the full year 2018.
  • Non-GAAP software product revenue was $375.7 million, an increase of 23% from $304.4 million for the full year 2018.
  • Total revenue was $458.9 million, an increase of 16% from $396.4 million for the full year 2018.
  • Non-GAAP total revenue was $467.9 million, an increase of 18% from $396.4 million for the full year 2018.
  • Net loss was $(7.5) million, compared to net income of $15.5 million for the full year 2018.   Diluted net loss per share was $(0.11) based on 71.5 million diluted weighted average common shares outstanding, compared to diluted net income per share of $0.21 for the full year 2018, based on 74.9 million diluted weighted average common shares outstanding.
  • Adjusted EBITDA was $39.5 million, compared to $50.2 million for the full year 2018.
  • Modified Adjusted EBITDA was $48.5 million, compared to $50.2 million for the full year 2018. 
  • Non-GAAP net income was $24.8 million, compared to non-GAAP net income of $32.8 million for the full year 2018. Non-GAAP diluted net income per share was $0.32 based on 78.0 million non-GAAP diluted common shares outstanding, compared to non-GAAP diluted net income per share of $0.42 for the full year 2018, based on 77.7 million non-GAAP diluted common shares outstanding.
  • Free cash flow was $21.7 million, compared to $29.6 million for the full year 2018.

Business Outlook
Based on information available as of today, Altair is issuing guidance for the first quarter and full year 2020. 

     
(in millions)   First Quarter 2020     Full Year 2020  
Software Product Revenue   $ 105.0   to $ 107.0     $ 395.0   to $ 399.0  
Total Revenue   $ 129.0     $ 131.0     $ 491.0     $ 495.0  
Net Income (Loss)   $ 4.9     $ 6.3     $ (4.3 )   $ (1.5 )
Non-GAAP Net Income   $ 11.5     $ 12.9     $ 24.7     $ 27.5  
Adjusted EBITDA   $ 20.0     $ 22.0     $ 49.0     $ 53.0  

 (All figures in millions)

Conference Call Information

What: Altair’s Fourth Quarter 2019 Financial Results Conference Call
When:  Thursday, February 27, 2020
Time: 4:30 p.m. ET
Live Call:  (866) 754-5204, Domestic
  (636) 812-6621, International
Replay: (855) 859-2056, Conference ID 5031498, Domestic
  (404) 537-3406, Conference ID 5031498, International
Webcast: http://investor.altair.com  (live & replay)

Non-GAAP Financial Measures
This press release contains the following non-GAAP financial measures: Non-GAAP Software Product Revenue, Non-GAAP Total Revenue, Adjusted EBITDA, Modified Adjusted EBITDA, Non-GAAP Net Income, Non-GAAP Net Income Per Share and Free Cash Flow.

Altair believes that these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to its financial condition and results of operations. The Company’s management uses these non-GAAP measures to compare the Company’s performance to that of prior periods for trend analysis, for purposes of determining executive and senior management incentive compensation and for budgeting and planning purposes. The Company also believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing the Company’s financial measures with other software companies, many of which present similar non-GAAP financial measures to investors.

Non-GAAP software product revenue and Non-GAAP total revenue include revenue not recognized under GAAP due to acquisition accounting adjustments associated with the accounting for deferred revenue in significant business combinations.

Adjusted EBITDA represents net income adjusted for income tax expense, interest expense, interest income and other, depreciation and amortization, stock-based compensation expense, restructuring charges, asset impairment charges and other special items as identified by management and described elsewhere in this press release.

Modified Adjusted EBITDA represents Adjusted EBITDA adjusted for revenue not recognized under GAAP due to acquisition accounting adjustments associated with the accounting for deferred revenue in significant business combinations.

Non-GAAP net income excludes stock-based compensation, amortization of intangible assets related to acquisitions, revenue not recognized under GAAP due to acquisition accounting and special items as identified by management and described elsewhere in this press release.

Non-GAAP diluted common shares includes total outstanding shares plus outstanding equity awards under the Altair equity award plans.

Free cash flow consists of cash flow from operations less capital expenditures.

Company management does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude significant expenses and income that are required by GAAP to be recorded in the Company’s financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by management about which expenses and income are excluded or included in determining these non-GAAP financial measures. Altair urges investors to review the reconciliation of its non-GAAP financial measures to the comparable GAAP financial measures, which it includes in press releases announcing quarterly financial results, including this press release, and not to rely on any single financial measure to evaluate the Company’s business.

Reconciliation tables of the most comparable GAAP financial measures to the non-GAAP financial measures used in this press release are included with the financial tables at the end of this release.

About Altair
Altair is a global technology company that provides software and cloud solutions in the areas of product design and development, high-performance computing (HPC) and data analytics. Altair enables organizations across broad industry segments to compete more effectively in a connected world while creating a more sustainable future. To learn more, please visit www.altair.com.

Cautionary Language Concerning Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, our guidance for the first quarter and full year 2020, statements regarding other future periods, anticipated trends and long-term growth, and our reconciliations of projected non-GAAP financial measures.  These forward-looking statements are made as of the date of this release and are based on current expectations, estimates, forecasts and projections as well as the beliefs and assumptions of management. Words such as “expect,” “anticipate,” “should,” “believe,” “hope,” “target,” “project,” “goals,” “estimate,” “potential,” “predict,” “may,” “will,” “might,” “could,” “intend,” variations of these terms or the negative of these terms and similar expressions are intended to identify these forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond Altair’s control. Altair’s actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to, risks detailed in Altair’s quarterly and annual reports filed with the Securities and Exchange Commission as well as other documents that may be filed by the Company from time to time with the Securities and Exchange Commission. Past performance is not necessarily indicative of future results. The forward-looking statements included in this press release represent Altair’s views as of the date of this press release. The Company anticipates that subsequent events and developments will cause its views to change. Altair undertakes no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. These forward-looking statements should not be relied upon as representing Altair’s views as of any date subsequent to the date of this press release.

Media Relations
Altair
Dave Simon
248-614-2400 ext. 332
ir@altair.com

Investor Relations
The Blueshirt Group
Monica Gould
212-871-3927
Lindsay Savarese
212-331-8417
ir@altair.com

 

ALTAIR ENGINEERING INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)

    December 31,  
(in thousands)   2019     2018  
ASSETS                
CURRENT ASSETS                
Cash and cash equivalents   $ 223,117     $ 35,345  
Accounts receivable, net     104,984       96,803  
Income tax receivable     7,264       4,431  
Prepaid expenses and other current assets     17,092       17,455  
Total current assets     352,457       154,034  
Property and equipment, net     36,297       30,153  
Operating lease right of use assets     28,134        
Goodwill     233,683       210,532  
Other intangible assets, net     67,075       69,836  
Deferred tax assets     5,791       5,354  
Other long-term assets     19,708       17,288  
TOTAL ASSETS   $ 743,145     $ 487,197  
LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ EQUITY                
CURRENT LIABILITIES                
Current portion of long-term debt   $ 430     $ 331  
Accounts payable     8,585       8,357  
Accrued compensation and benefits     30,676       31,740  
Current portion of operating lease liabilities     9,141        
Other accrued expenses and current liabilities     28,603       27,039  
Deferred revenue     75,431       59,765  
Total current liabilities     152,866       127,232  
Long-term debt, net of current portion     178,238       31,417  
Operating lease liabilities, net of current portion     20,174        
Deferred revenue, non-current     8,136       6,754  
Other long-term liabilities     26,672       25,756  
TOTAL LIABILITIES     386,086       191,159  
Commitments and contingencies                
MEZZANINE EQUITY     2,352       2,352  
STOCKHOLDERS’ EQUITY                
Preferred stock ($0.0001 par value), authorized 45,000 shares, none issued and outstanding            
Common stock ($0.0001 par value)                
Class A common stock, authorized 513,797 shares, issued and outstanding 41,271 and 38,349 shares as of December 31, 2019 and 2018, respectively     4       4  
Class B common stock, authorized 41,203 shares, issued and outstanding 31,131 and 32,171 shares as of December 31, 2019 and 2018, respectively     3       3  
Additional paid-in capital     446,633       379,832  
Accumulated deficit     (82,405 )     (74,863 )
Accumulated other comprehensive loss     (9,528 )     (11,290 )
TOTAL STOCKHOLDERS’ EQUITY     354,707       293,686  
TOTAL LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ EQUITY   $ 743,145     $ 487,197  
                 

 

ALTAIR ENGINEERING INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

    For the Three Months Ended
December 31,
    For the Year Ended
December 31,
 
(in thousands, except per share data)   2019     2018     2019     2018  
Revenue                                
License   $ 64,194     $ 52,649     $ 244,321     $ 207,164  
Maintenance and other services     36,993       27,254       122,381       97,197  
Total software     101,187       79,903       366,702       304,361  
Software related services     8,941       10,073       34,576       36,945  
Total software and related services     110,128       89,976       401,278       341,306  
Client engineering services     11,722       11,200       48,987       47,852  
Other     2,027       1,835       8,650       7,221  
Total revenue     123,877       103,011       458,915       396,379  
Cost of revenue                                
License     8,139       5,585       21,285       16,119  
Maintenance and other services     10,892       7,453       38,401       29,655  
Total software *     19,031       13,038       59,686       45,774  
Software related services     6,497       6,842       25,640       26,415  
Total software and related services     25,528       19,880       85,326       72,189  
Client engineering services     9,882       9,002       39,875       38,979  
Other     1,540       1,389       7,398       4,805  
Total cost of revenue     36,950       30,271       132,599       115,973  
Gross profit     86,927       72,740       326,316       280,406  
Operating expenses:                                
Research and development *     30,498       25,844       117,510       97,592  
Sales and marketing *     27,589       22,427       106,051       80,277  
General and administrative *     21,292       28,114       82,178       79,751  
Amortization of intangible assets     3,769       2,076       14,442       7,739  
Other operating income     (370 )     (2,164 )     (2,072 )     (9,597 )
Total operating expenses     82,778       76,297       318,109       255,762  
Operating income (loss)     4,149       (3,557 )     8,207       24,644  
Interest expense     2,785       108       6,371       200  
Other income, net     (849 )     (534 )     (1,552 )     (2,580 )
Income (loss) before income taxes     2,213       (3,131 )     3,388       27,024  
Income tax expense     3,715       5,872       10,930       11,489  
Net (loss) income   $ (1,502 )   $ (9,003 )   $ (7,542 )   $ 15,535  
Income per share:                                
Net (loss) income per share attributable to common stockholders, basic   $ (0.02 )   $ (0.13 )   $ (0.11 )   $ 0.23  
Net (loss) income per share attributable to common stockholders, diluted   $ (0.02 )   $ (0.13 )   $ (0.11 )   $ 0.21  
Weighted average shares outstanding:                                
Weighted average number of shares used in computing net (loss) income per share, basic     72,227       70,548       71,544       67,468  
Weighted average number of shares used in computing net (loss) income per share, diluted     72,227       70,548       71,544       74,878  

*          Amounts include stock-based compensation expense as follows (in thousands):

    (Unaudited)  
    Three Months Ended
December 31,
    Twelve Months Ended
December 31,
 
    2019     2018     2019     2018  
Cost of revenue-software   $ 342     $ 7     $ 1,069     $ 31  
Research and development     1,306       410       2,917       740  
Sales and marketing     688       595       2,250       910  
General and administrative     608       1,114       2,292       1,658  
Total stock-based compensation expense   $ 2,944     $ 2,126     $ 8,528     $ 3,339  
                                 

 

ALTAIR ENGINEERING INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOW
(Unaudited)

    Year Ended December 31,  
(in thousands)   2019     2018  
OPERATING ACTIVITIES:                
Net (loss) income   $ (7,542 )   $ 15,535  
Adjustments to reconcile net (loss) income to net cash provided by operating activities:                
Depreciation and amortization     21,522       14,734  
Provision for bad debt     671       394  
Amortization of debt discount and issuance costs     5,663       23  
Stock-based compensation expense     8,528       3,339  
Loss (gain) on sale of assets held for sale and other     6       (4,503 )
Impairment of intangible assets           608  
Deferred income taxes     (950 )     (1,057 )
Other, net           (206 )
Changes in assets and liabilities:                
Accounts receivable     (7,901 )     (1,394 )
Prepaid expenses and other current assets     (2,396 )     204  
Other long-term assets     (2,591 )     (1,660 )
Accounts payable     (426 )     1,647  
Accrued compensation and benefits     (1,232 )     5,678  
Other accrued expenses and current liabilities     513       (6,667 )
Operating lease right of use assets and liabilities, net     102        
Deferred revenue     17,426       9,555  
Net cash provided by operating activities     31,393       36,230  
INVESTING ACTIVITIES:                
Payments for acquisition of businesses, net of cash acquired     (25,720 )     (203,438 )
Capital expenditures     (9,660 )     (6,659 )
Proceeds from sale of assets held for sale and other           6,614  
Payments for acquisition of developed technology     (473 )     (2,727 )
Other investing activities, net     14        
Net cash used in investing activities     (35,839 )     (206,210 )
FINANCING ACTIVITIES:                
Proceeds from issuance of convertible senior notes, net of underwriters' discounts and commissions     223,101        
Proceeds from issuance of Class A common stock in follow-on public offering, net of underwriters' discounts and commissions           135,572  
Borrowings under revolving commitment     96,992       37,041  
Payments on revolving commitment     (127,941 )     (6,091 )
Proceeds from issuance of common stock     1,510       2,077  
Payments for issuance costs of convertible senior notes     (1,233 )      
Payments for follow-on public offering and IPO offering costs           (556 )
Principal payments on long-term debt           (126 )
Payments for redemption of common stock           (119 )
Other financing activities     (513 )     (268 )
Net cash provided by financing activities     191,916       167,530  
Effect of exchange rate changes on cash, cash equivalents and restricted cash     342       (1,443 )
Net increase (decrease) in cash, cash equivalents and restricted cash     187,812       (3,893 )
Cash, cash equivalents and restricted cash at beginning of year     35,685       39,578  
Cash, cash equivalents and restricted cash at end of period   $ 223,497     $ 35,685  
Supplemental disclosures of cash flow:                
Interest paid   $ 664     $ 223  
Income taxes paid   $ 7,686     $ 6,735  
Supplemental disclosure of non-cash investing and financing activities:                
Issuance of common stock in connection with acquisitions   $ 7,637     $ 8,681  
Promissory notes issued and deferred payment obligations for acquisitions   $ 497     $ 1,729  
Finance leases   $ 632     $ 895  
Property and equipment in accounts payable, other accrued expenses and current liabilities, and other liabilities   $ 259     $ 330  

Financial Results

The following table provides a reconciliation of Non-GAAP net income and Non-GAAP net income per share - diluted to net (loss) income and net (loss) income per share – diluted, the most comparable GAAP financial measures:

    (Unaudited)  
    Three Months Ended
December 31,
    Twelve Months Ended
December 31,
 
(in thousands, except per share amounts)   2019     2018     2019     2018  
Net (loss) income   $ (1,502 )   $ (9,003 )   $ (7,542 )   $ 15,535  
Stock-based compensation expense     2,944       2,126       8,528       3,339  
Amortization of intangible assets     3,769       2,074       14,442       7,739  
Acquisition related deferred revenue (1)     2,250             9,000        
Special adjustments (2)           10,627       2,038       6,837  
Income tax effect of non-GAAP adjustments     (527 )     (184 )     (1,630 )     (652 )
Non-GAAP net income   $ 6,934     $ 5,640     $ 24,836     $ 32,798  
                                 
Net (loss) income per share - diluted   $ (0.02 )   $ (0.13 )   $ (0.11 )   $ 0.21  
Non-GAAP net income per share - diluted   $ 0.09     $ 0.07     $ 0.32     $ 0.42  
                                 
GAAP diluted shares outstanding:     72,227       70,548       71,544       74,878  
Non-GAAP diluted shares outstanding:     78,000       77,700       78,000       77,700  

(1) Represents revenue not recognized under GAAP due to acquisition accounting adjustments associated with the accounting for deferred revenue in significant business combinations.
(2) Includes a) nonrecurring severance expenses of $0.4 million and nonrecurring acquisition related costs of $0.6 million, for the twelve months ended December 31, 2019, and b) an impairment charge for royalty contracts resulting in $1.0 million of expenses for the twelve ended December 31, 2019.
Includes a) nonrecurring costs from the acquisition of Datawatch of $10.4 million for the three and twelve months ended December 31, 2018, b) a gain on the sale of a building of $4.4 million for the twelve months ended December 31, 2018, b) an impairment charge for royalty contracts and trade names resulting in $0.2 million and $2.8 million for the three and twelve months ended December 31, 2018, respectively and c) a non-recurring adjustment for a change in estimated legal expenses resulting in $2.0 million of income for the twelve months ended December 31, 2018.

The following table provides a reconciliation of Adjusted EBITDA and Modified Adjusted EBITDA to net (loss) income, the most comparable GAAP financial measure:

    (Unaudited)  
    Three Months Ended
December 31,
    Twelve Months Ended
December 31,
 
(in thousands)   2019     2018     2019     2018  
Net (loss) income   $ (1,502 )   $ (9,003 )   $ (7,542 )   $ 15,535  
Income tax expense     3,715       5,872       10,930       11,489  
Stock-based compensation expense     2,944       2,126       8,528       3,339  
Interest expense     2,785       108       6,371       200  
Interest income and other (1)     (893 )     9,986       (260 )     4,883  
Depreciation and amortization     5,686       3,839       21,522       14,734  
Adjusted EBITDA     12,735       12,928       39,549       50,180  
Acquisition related deferred revenue (2)     2,250             9,000        
Modified Adjusted EBITDA   $ 14,985     $ 12,928     $ 48,549     $ 50,180  
                                 

(1) Includes a) nonrecurring severance expenses of $0.4 million and nonrecurring acquisition related costs of $0.6 million, for the twelve months ended December 31, 2019, and b) impairment charges for royalty contracts resulting in $1.0 million of expense for the twelve months ended December 31, 2019
Includes a) nonrecurring costs from the acquisition of Datawatch of $10.4 million for the three and twelve months ended December 31, 2018, b) a gain on the sale of a building of $4.4 million for the twelve months ended December 31, 2018, b) impairment charges for royalty contracts and trade names resulting in $0.2 million and $2.8 million of expense for the three and twelve months ended December 31, 2018, respectively, and c) a non-recurring adjustment for a change in estimated legal expenses resulting in $2.0 million of income for the twelve months ended December 31, 2018.
(2) Represents revenue not recognized under GAAP due to acquisition accounting adjustments associated with the accounting for deferred revenue in significant business combinations.

The following table provides a reconciliation of Non-GAAP total revenue to total revenue, the most comparable GAAP financial measure:

    (Unaudited)  
    Three Months Ended
December 31,
    Twelve Months Ended
December 31,
 
(in thousands)   2019     2018     2019     2018  
Total revenue   $ 123,877     $ 103,011     $ 458,915     $ 396,379  
Acquisition related deferred revenue (1)     2,250             9,000        
Non-GAAP total revenue   $ 126,127     $ 103,011     $ 467,915     $ 396,379  
                                 

(1) Adjustment for revenue not recognized under GAAP due to acquisition accounting adjustments associated with the accounting for deferred revenue in significant business combinations.

The following table provides a reconciliation of Non-GAAP total software product revenue to total software product revenue, the most comparable GAAP financial measure:

    (Unaudited)  
    Three Months Ended
December 31,
    Twelve Months Ended
December 31,
 
(in thousands)   2019     2018     2019     2018  
Total software product revenue   $ 101,187     $ 79,903     $ 366,702     $ 304,361  
Acquisition related deferred revenue(1)     2,250             9,000        
Non-GAAP total software product revenue   $ 103,437     $ 79,903     $ 375,702     $ 304,361  
                                 

(1) Adjustment for revenue not recognized under GAAP due to acquisition accounting adjustments associated with the accounting for deferred revenue in significant business combinations.

The following table provides a recompilation of Free Cash Flow to net cash provided by operating activities, the most comparable GAAP financial measure:

    (Unaudited)  
    Three Months Ended
December 31,
    Twelve Months Ended
December 31,
 
(in thousands)   2019     2018     2019     2018  
Net cash provided by (used in) operating activities   $ 1,388     $ (4,192 )   $ 31,393     $ 36,230  
Capital expenditures     (1,540 )     (1,326 )     (9,660 )     (6,659 )
Free Cash Flow   $ (152 )   $ (5,518 )   $ 21,733     $ 29,571  
                                 

Effective January 1, 2018, we adopted Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (ASC 606). The following table sets forth selected quarterly information under ASC 606 for 2018:

    Three months ended  
    ASC 606  
(in thousands)   March 31,
2018
    June 30,
2018
    September 30,
2018
    December 31,
2018
 
Software product revenue   $ 89,670     $ 70,606     $ 64,182     $ 79,903  
Total revenue   $ 113,257     $ 93,360     $ 86,751     $ 103,011  
Net income (loss)   $ 24,684     $ (1,080 )   $ 934     $ (9,003 )
Adjusted EBITDA   $ 29,550     $ 5,303     $ 2,399     $ 12,928  

Disaggregation of revenue

The Company disaggregates its software revenue by type of performance obligation and timing of revenue recognition as follows (in thousands):

    Year Ended December 31,  
    2019     2018  
Software revenue:                
Term licenses   $ 201,881     $ 168,909  
Perpetual licenses     42,440       38,255  
Maintenance     103,699       86,150  
Professional services and other     18,682       11,047  
Total software revenue   $ 366,702     $ 304,361  
                 

Business Outlook

The following table provides a reconciliation of projected Non-GAAP net income to projected net income (loss), the most comparable GAAP financial measure:

    (Unaudited)  
    Three Months ending
March 31, 2020
    Year Ending
December 31, 2020
 
(in thousands)   Low     High     Low     High  
Net income (loss)   $ 4,900     $ 6,300     $ (4,300 )   $ (1,500 )
Stock-based compensation expense     3,200       3,200       15,500       15,500  
Amortization of intangible assets     3,800       3,800       15,000       15,000  
Income tax effect of non-GAAP adjustments     (400 )     (400 )     (1,500 )     (1,500 )
Non-GAAP net income   $ 11,500     $ 12,900     $ 24,700     $ 27,500  
                                 

The following table provides a reconciliation of projected Adjusted EBITDA to projected net income (loss), the most comparable GAAP financial measure:

    (Unaudited)  
    Three Months ending
March 31, 2020
    Year Ending
December 31, 2020
 
(in thousands)   Low     High     Low     High  
Net income (loss)   $ 4,900     $ 6,300     $ (4,300 )   $ (1,500 )
Income tax expense     4,200       4,800       6,700       7,900  
Stock-based compensation expense     3,200       3,200       15,500       15,500  
Interest expense     2,800       2,800       11,400       11,400  
Depreciation and amortization     5,700       5,700       22,700       22,700  
Interest income and other non-recurring adjustments     (800 )     (800 )     (3,000 )     (3,000 )
Adjusted EBITDA   $ 20,000     $ 22,000     $ 49,000     $ 53,000  
                                 

 

Altair_horizontal_RGB_wout_guides.jpg

 

Source: Altair Engineering Inc.

 

Be the first to know

Subscribe to our email alerts to learn more about stock, news, financials, and more!