On August 1, 2024, Altair Engineering Inc (ALTR, Financial) released its 8-K filing for the second quarter of 2024, showcasing a robust performance that surpassed revenue expectations.
Altair Engineering Inc is a provider of enterprise-class engineering software enabling origination of the entire product lifecycle from concept design to in-service operation. The integrated suite of software provided by the company optimizes design performance across multiple disciplines encompassing structures, motion, fluids, thermal management, system modeling, and embedded systems. It operates through two segments: Software, which includes the portfolio of software products such as solvers and optimization technology products, modeling and visualization tools, industrial and concept design tools, and others; and Client Engineering Services, which provides client engineering services to support customers. The majority of its revenue comes from the software segment.
Performance and Challenges
Altair Engineering Inc (ALTR, Financial) reported total revenue of $148.8 million for Q2 2024, a 5.4% increase from $141.2 million in Q2 2023. This exceeded the analyst estimate of $146.76 million. The software revenue, which forms the bulk of the company's income, rose by 8.1% to $135.4 million from $125.3 million in the same period last year.
Despite the positive revenue growth, the company reported a net loss of $5.1 million, an improvement from the $22.3 million net loss in Q2 2023. The net loss per share was $(0.06), better than the estimated $(0.10) per share. The reduction in net loss is a positive indicator, although the company still faces challenges in achieving profitability.
Financial Achievements
Altair's financial achievements in Q2 2024 are noteworthy. The company reported a non-GAAP net income of $14.8 million, up from $13.2 million in Q2 2023, reflecting a 12.1% increase. The non-GAAP net income per share was $0.16, compared to $0.15 in the previous year. Adjusted EBITDA also saw a slight increase to $17.3 million from $17.1 million in Q2 2023.
Key Financial Metrics
Key details from the financial statements include:
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Software Revenue | $135.4 million | $125.3 million |
| Total Revenue | $148.8 million | $141.2 million |
| Net Loss | $(5.1) million | $(22.3) million |
| Non-GAAP Net Income | $14.8 million | $13.2 million |
| Adjusted EBITDA | $17.3 million | $17.1 million |
Analysis and Outlook
Altair Engineering Inc (ALTR, Financial) has demonstrated resilience and growth in its software segment, which is crucial for its long-term success. The increase in software revenue and the reduction in net loss are positive signs. However, the company must continue to address its profitability challenges to sustain investor confidence.
Looking ahead, Altair has issued guidance for Q3 2024, projecting software revenue between $130 million and $133 million and total revenue between $145 million and $148 million. For the full year 2024, the company expects software revenue to range from $590 million to $600 million and total revenue from $648 million to $658 million.
Altair's ability to exceed revenue expectations and improve its financial metrics positions it well in the competitive software industry. Investors will be keen to see if the company can maintain this momentum and achieve its financial targets for the year.
Explore the complete 8-K earnings release (here) from Altair Engineering Inc for further details.
