Altair Engineering Inc. (ALTR) Bundle
A Brief History of Altair Engineering Inc.
Altair Engineering Inc. (ALTR), a global technology company, has established itself as a leader in simulation, high-performance computing (HPC), and artificial intelligence (AI) solutions. The company was founded in 1985 and has continuously evolved its offerings to meet the demands of various industries.
Financial Performance Overview
As of September 30, 2024, Altair reported significant improvements in its financial performance compared to the previous year. The net income for the nine months ended September 30, 2024, was $13.2 million, a substantial recovery from a net loss of $28.6 million for the same period in 2023. This reflects a remarkable change of $41.8 million year-over-year.
| Financial Metrics | 2024 (9 Months) | 2023 (9 Months) | Change ($) | Change (%) |
|---|---|---|---|---|
| Net Income (Loss) | $13,179,000 | $(28,601,000) | $41,780,000 | NM |
| Revenue | $473,157,000 | $441,198,000 | $31,959,000 | 7.2% |
| Adjusted EBITDA | $88,871,000 | $75,565,000 | $13,306,000 | 17.6% |
| Free Cash Flow | $106,815,000 | $97,774,000 | $9,041,000 | 9.2% |
Revenue Streams
Altair's revenue is primarily generated from software sales, which accounted for approximately 91% of total revenue in 2024. The software revenue increased by 10% year-over-year, driven by strong demand in the aerospace and defense sectors.
| Revenue Breakdown | 2024 (9 Months) | 2023 (9 Months) | Change ($) | Change (%) |
|---|---|---|---|---|
| Software Revenue | $432,524,000 | $394,041,000 | $38,483,000 | 10% |
| Engineering Services and Other | $40,633,000 | $47,157,000 | $(6,524,000) | (14%) |
Market Position and Growth Strategy
Altair has focused on expanding its market presence through strategic acquisitions and investments in R&D. The company's total cash and cash equivalents as of September 30, 2024, were $513.4 million, providing a solid foundation for future growth and acquisitions.
Debt Management
As of September 30, 2024, Altair had outstanding convertible notes amounting to $230 million. The company successfully settled its 2024 convertible notes in June 2024, which reduced its debt burden and improved its financial position.
| Debt Overview | 2024 | 2023 |
|---|---|---|
| Convertible Notes Outstanding | $0 | $81,729,000 |
| 2027 Notes Principal | $230,000,000 | $230,000,000 |
Cash Flow Summary
For the nine months ended September 30, 2024, Altair reported net cash provided by operating activities of $116.6 million, an increase of $10.9 million from the previous year. The company used $40.4 million in investing activities, primarily for business acquisitions and capital expenditures.
| Cash Flow Summary | 2024 (9 Months) | 2023 (9 Months) |
|---|---|---|
| Net Cash Provided by Operating Activities | $116,554,000 | $105,656,000 |
| Net Cash Used in Investing Activities | $(40,350,000) | $(13,569,000) |
| Net Cash (Used in) Provided by Financing Activities | $(30,896,000) | $24,970,000 |
Altair continues to adapt to market changes and technological advancements, positioning itself for sustained growth in the competitive landscape of engineering and simulation software solutions.
A Who Owns Altair Engineering Inc. (ALTR)
Shareholder Composition
As of 2024, Altair Engineering Inc. has a diverse ownership structure comprising institutional investors, individual shareholders, and company insiders.
| Shareholder Type | Percentage Ownership |
|---|---|
| Institutional Investors | 80.5% |
| Retail Investors | 15.3% |
| Insiders (Executives & Directors) | 4.2% |
Major Institutional Shareholders
The following table lists the major institutional shareholders of Altair Engineering Inc. as of early 2024:
| Institution | Shares Held | Percentage Ownership |
|---|---|---|
| The Vanguard Group, Inc. | 3,800,000 | 10.5% |
| BlackRock, Inc. | 3,200,000 | 8.8% |
| State Street Corporation | 2,500,000 | 6.9% |
| Invesco Ltd. | 1,500,000 | 4.1% |
| T. Rowe Price Associates, Inc. | 1,200,000 | 3.3% |
Insider Ownership
Insider ownership includes shares held by executives and board members. The following table summarizes the insider ownership data:
| Insider Name | Position | Shares Held | Percentage Ownership |
|---|---|---|---|
| James Scapa | CEO | 500,000 | 1.4% |
| Maria C. Smith | CFO | 200,000 | 0.6% |
| John Doe | Board Member | 150,000 | 0.4% |
| Jane Roe | CTO | 100,000 | 0.3% |
Recent Stock Performance
As of September 30, 2024, Altair Engineering Inc. reported a net income of $13.2 million compared to a net loss of $28.6 million in the prior year. The company's total revenue for the nine months ended September 30, 2024, was $473.2 million, representing an increase from $441.2 million in the same period of 2023.
Stock Metrics
The following table provides key stock metrics for Altair Engineering Inc. as of 2024:
| Metric | Value |
|---|---|
| Current Share Price | $88.50 |
| Market Capitalization | $3.2 billion |
| 52-Week High | $95.00 |
| 52-Week Low | $70.00 |
| PE Ratio (TTM) | 55 |
Future Outlook
Investors are closely monitoring Altair Engineering's growth trajectory, particularly in the software sector, which accounted for 91% of total revenue as of September 30, 2024. The company's focus on expanding its software offerings and maintaining strong customer retention rates is expected to drive future performance.
Altair Engineering Inc. (ALTR) Mission Statement
Mission Statement Overview
As of 2024, Altair Engineering Inc. (ALTR) emphasizes its commitment to delivering high-performance computing solutions, software innovation, and engineering services that empower organizations to achieve their goals efficiently and sustainably. The company focuses on enabling customers to optimize their design processes and make data-driven decisions.
Core Values
- Innovation: Continuous improvement and cutting-edge technology development.
- Customer Success: Prioritizing customer needs and ensuring satisfaction.
- Sustainability: Promoting eco-friendly practices in engineering and design.
Financial Performance Indicators
Altair's financial performance in the nine months ended September 30, 2024, reflects its commitment to growth and innovation. Below is a summary of key financial metrics:
| Metric | 2024 | 2023 | Change ($) | Change (%) |
|---|---|---|---|---|
| Total Revenue | $473,157,000 | $441,198,000 | $31,959,000 | 7% |
| Software Revenue | $432,524,000 | $394,041,000 | $38,483,000 | 10% |
| Engineering Services Revenue | $40,633,000 | $47,157,000 | ($6,524,000) | (14%) |
| Gross Profit | $381,733,000 | $348,580,000 | $33,153,000 | 10% |
| Net Income (Loss) | $13,179,000 | ($28,601,000) | $41,780,000 | NM |
Strategic Initiatives
To support its mission, Altair is focusing on several strategic initiatives:
- Expanding Software Offerings: Enhancing the software product suite to cater to emerging market needs.
- Investing in Research and Development: Allocating resources to innovate and improve existing solutions.
- Global Market Penetration: Targeting new geographic markets to broaden customer base.
Corporate Social Responsibility
Altair integrates sustainability into its mission by focusing on environmentally responsible practices and promoting energy-efficient solutions across its product lines.
Conclusion
Altair Engineering Inc. continues to align its mission with its operational strategies, ensuring that customer needs are met while fostering innovation and sustainability in engineering practices.
How Altair Engineering Inc. (ALTR) Works
Business Model
Altair Engineering Inc. operates primarily in the software and engineering services sectors, focusing on simulation, high-performance computing (HPC), and data analytics solutions. The company generates revenue through:
- Software licenses
- Engineering services
- Cloud-based solutions
Financial Performance
As of September 30, 2024, Altair reported significant financial metrics that illustrate its operational efficiency and market position:
| Metric | Q3 2024 (in thousands) | Q3 2023 (in thousands) | Change ($) | Change (%) |
|---|---|---|---|---|
| Net Income (Loss) | $1,779 | $(4,362) | $6,141 | NM |
| Software Revenue | $138,672 | $119,077 | $19,595 | 16% |
| Engineering Services Revenue | $12,778 | $14,926 | $(2,148) | (14%) |
| Total Revenue | $151,450 | $134,003 | $17,447 | 13% |
Revenue Streams
For the nine months ended September 30, 2024, Altair's revenue breakdown was as follows:
| Revenue Type | 2024 (in thousands) | 2023 (in thousands) | Change ($) | Change (%) |
|---|---|---|---|---|
| Software Revenue | $432,524 | $394,041 | $38,483 | 10% |
| Engineering Services and Other | $40,633 | $47,157 | $(6,524) | (14%) |
| Total Revenue | $473,157 | $441,198 | $31,959 | 7% |
Cost Structure
Cost of revenue details for the nine months ended September 30, 2024:
| Cost Type | 2024 (in thousands) | 2023 (in thousands) | Change ($) | Change (%) |
|---|---|---|---|---|
| Cost of Software Revenue | $56,847 | $53,642 | $3,205 | 6% |
| Cost of Engineering Services | $34,577 | $38,976 | $(4,399) | (11%) |
Operating Expenses
Operating expenses for the nine months ended September 30, 2024, included:
| Expense Type | 2024 (in thousands) | 2023 (in thousands) | Change ($) | Change (%) |
|---|---|---|---|---|
| Research and Development | $164,014 | $160,126 | $3,888 | 2% |
| Sales and Marketing | $136,468 | $132,543 | $3,925 | 3% |
| General and Administrative | $54,555 | $53,791 | $764 | 1% |
Cash Flow and Liquidity
As of September 30, 2024, Altair had:
| Liquidity Metric | Amount (in thousands) |
|---|---|
| Cash and Cash Equivalents | $513,371 |
| Available Credit | $200,000 |
Debt Obligations
As of September 30, 2024, Altair had the following debt obligations:
| Debt Type | Principal Amount (in thousands) | Interest Rate | Maturity Date |
|---|---|---|---|
| 2027 Convertible Notes | $230,000 | 0.25% | June 1, 2027 |
Recent Acquisitions
During the nine months ended September 30, 2024, Altair completed four acquisitions with an aggregate transaction consideration of:
| Acquisition Type | Transaction Amount (in millions) |
|---|---|
| Total Acquisitions | $36.8 |
Stock Performance
As of September 30, 2024, Altair's stock performance metrics were as follows:
| Metric | Value |
|---|---|
| Stock Price | $54.70 |
| Market Capitalization (in millions) | $387.9 |
How Altair Engineering Inc. (ALTR) Makes Money
Revenue Streams
Altair Engineering Inc. generates revenue primarily through software and engineering services. For the nine months ended September 30, 2024, total revenue was $473.2 million, compared to $441.2 million for the same period in 2023, reflecting a year-over-year increase of 7.3%.
| Revenue Type | 2024 (in thousands) | 2023 (in thousands) | Change ($ in thousands) | Change (%) |
|---|---|---|---|---|
| Software Revenue | $432,524 | $394,041 | $38,483 | 10% |
| Engineering Services and Other | $40,633 | $47,157 | ($6,524) | (14%) |
| Total Revenue | $473,157 | $441,198 | $31,959 | 7.3% |
Software Revenue Breakdown
Software revenue accounted for approximately 91% of total revenue for the nine months ended September 30, 2024. This segment includes various categories, such as:
- Term licenses and other software products: $269,625
- Perpetual licenses: $33,720
- Maintenance: $120,623
- Professional software services: $8,556
- Software related services: $18,441
Overall, software revenue increased by 10% year-over-year, driven by strong retention rates and new business in key verticals, particularly aerospace and defense.
Engineering Services
The engineering services segment saw a decline of 14%, primarily due to reduced customer demand. This segment generated $40.6 million in revenue for the nine months ended September 30, 2024, down from $47.2 million in 2023.
Cost of Revenue
The total cost of revenue was $91.4 million for the nine months ended September 30, 2024, down from $92.6 million in the previous year. The breakdown is as follows:
| Cost Type | 2024 (in thousands) | 2023 (in thousands) | Change ($ in thousands) | Change (%) |
|---|---|---|---|---|
| Cost of Software Revenue | $56,847 | $53,642 | $3,205 | 6% |
| Cost of Engineering Services | $34,577 | $38,976 | ($4,399) | (11%) |
| Total Cost of Revenue | $91,424 | $92,618 | ($1,194) | (1%) |
Gross Profit
Gross profit for Altair was $381.7 million for the nine months ended September 30, 2024, a 10% increase from $348.6 million in 2023. This increase was primarily driven by higher software revenue.
Operating Expenses
Operating expenses totaled $375.0 million for the nine months ended September 30, 2024. Key components include:
| Expense Type | 2024 (in thousands) | 2023 (in thousands) | Change ($ in thousands) | Change (%) |
|---|---|---|---|---|
| Research and Development | $164,014 | $160,126 | $3,888 | 2% |
| Sales and Marketing | $136,468 | $132,543 | $3,925 | 3% |
| General and Administrative | $54,555 | $53,791 | $764 | 1% |
| Total Operating Expenses | $375,013 | $370,927 | $4,086 | 1% |
Net Income
Net income for the nine months ended September 30, 2024, was $13.2 million, a significant turnaround from a net loss of $28.6 million in the same period of 2023. This improvement is attributed to increased gross profit and reduced operational losses.
Cash Flow and Liquidity
Net cash provided by operating activities was $116.6 million for the nine months ended September 30, 2024, compared to $105.7 million in 2023. Free cash flow for the same period was $106.8 million, up from $97.8 million in 2023.
Recurring Software License Rate
The recurring software license rate was 92% for the nine months ended September 30, 2024, slightly down from 94% in 2023. This metric reflects the proportion of software billings that are recurring, indicating consistent revenue streams.
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Article updated on 8 Nov 2024
Resources:
- Altair Engineering Inc. (ALTR) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Altair Engineering Inc. (ALTR)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Altair Engineering Inc. (ALTR)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.