Q4 2024 Aspen Technology Inc Earnings Call Transcript
Key Points
- Aspen Technology Inc (AZPN) delivered a strong fourth quarter, showcasing the benefits of their innovation and focused execution.
- The company achieved 9.4% year-over-year ACV growth and 3.5% sequential growth in Q4.
- The Digital Grid Management (DGM) suite grew by approximately 40% in fiscal 2024, contributing significantly to overall growth.
- The company saw strong traction on cost savings in the second half of fiscal 2024, leading to a favorable expense outcome for the full year.
- Aspen Technology Inc (AZPN) continues to make good progress in its commercial relationship with Emerson, expecting further benefits in fiscal 2025 and beyond.
- Free cash flow was slightly below guidance at $335 million for fiscal 2024.
- The company announced a workforce reduction of approximately 5% in the first quarter of fiscal 2025, including actions related to their exit from Russia.
- Aspen Technology Inc (AZPN) is exiting the Russian market, resulting in a write-off of approximately $35 million in ACV.
- The Manufacturing & Supply Chain suite experienced the most pronounced impact from the extended downturn in chemicals.
- The macro environment remains dynamic, with cautious customer spending expected to continue in fiscal 2025.
Good day. Thank you for standing by. Welcome to Aspen Techâs fourth-quarter 2024 earnings conference call. (Operator Instructions) Please note that the conference is being recorded.
I will now hand the conference over your speaker host, Brian Denyeau. Please go ahead.
Thank you, Olivia. Good afternoon, everyone, and thank you for joining us to discuss our financial results for the fourth-quarter of fiscal 2024 ending June 30, 2024. With me on the call today are Antonio Pietri, Aspen Techâs President and CEO; and Dave Baker, Aspen Techâs CFO.
Please note we have posted an earnings presentation on our IR website. This includes an explanation regarding the impact of ASC Topic 606 on our financial results. It also includes definitions of annual contract value, or ACV, bookings and free cash flow, among other metrics. We ask that investors refer to this presentation in conjunction with todayâs call.
Starting on slide 2, I want to take this opportunity to remind you that our remarks today will
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