Aspen Technology, Inc. (AZPN) Bundle
A Brief History of Aspen Technology, Inc.
Company Overview
Aspen Technology, Inc. (NASDAQ: AZPN) specializes in software solutions for process industries, focusing on optimizing asset performance and enhancing operational efficiency. The company has a long-standing history of innovation and leadership in its field.
Recent Financial Performance
As of September 30, 2024, Aspen Technology reported a total revenue of $215.9 million, representing a decrease of $33.4 million, or 13.4%, compared to the same period in the prior year, primarily due to a significant drop in license and solutions revenue.
| Metric | Q1 2024 | Q1 2023 | Change (%) |
|---|---|---|---|
| Total Revenue | $215.9 million | $249.3 million | -13.4% |
| License and Solutions Revenue | $101.7 million | $148.6 million | -31.6% |
| Maintenance Revenue | $90.7 million | $85.0 million | +6.7% |
| Services and Other Revenue | $23.5 million | $15.7 million | +50.0% |
Operating Expenses and Losses
The total operating expenses for the same period were $216.4 million, reflecting an increase of $4.9 million, or 2.3%, year-over-year. The company reported a loss from operations of $96.0 million, compared to a loss of $60.2 million in Q1 2023.
| Expense Type | Q1 2024 | Q1 2023 | Change (%) |
|---|---|---|---|
| Selling and Marketing | $125.7 million | $122.4 million | +2.7% |
| Research and Development | $50.0 million | $53.7 million | -6.8% |
| General and Administrative | $33.0 million | $35.4 million | -6.8% |
| Restructuring Costs | $7.7 million | $0.0 million | — |
Net Loss and Earnings Per Share
Aspen Technology reported a net loss of $60.5 million for Q1 2024, translating to a net loss per share of $0.96. This is a substantial increase in net loss compared to $34.5 million, or $0.54 per share, in the same period last year.
Balance Sheet Overview
As of September 30, 2024, Aspen Technology's total assets were reported at $13.9 billion, with total liabilities of $1.2 billion, resulting in total stockholders’ equity of approximately $12.8 billion.
| Balance Sheet Item | September 30, 2024 | June 30, 2024 |
|---|---|---|
| Total Assets | $13.9 billion | $14.1 billion |
| Total Liabilities | $1.2 billion | $1.2 billion |
| Total Stockholders’ Equity | $12.8 billion | $12.8 billion |
Market Trends and Strategic Actions
In August 2024, Aspen Technology announced a reorganization of its corporate structure, which included the elimination of certain roles and the winding down of operations in Russia due to expanded sanctions. These actions are expected to streamline expenses and improve operational efficiency.
Cash Flow and Liquidity
As of September 30, 2024, Aspen Technology had cash and cash equivalents amounting to $221.1 million, a decrease from $237.0 million as of June 30, 2024. The company reported a free cash flow of -$6.4 million for the quarter, down from positive cash flow of $16.0 million in the previous year.
| Cash Flow Metric | Q1 2024 | Q1 2023 |
|---|---|---|
| Net Cash Provided by Operating Activities | -$4.4 million | $17.0 million |
| Free Cash Flow | -$6.4 million | $16.0 million |
A Who Owns Aspen Technology, Inc. (AZPN)
Ownership Structure
As of September 30, 2024, Emerson Electric Co. holds approximately 56% of Aspen Technology's common stock on a fully diluted basis. This ownership is a result of the transaction that combined Emerson's industrial software business with Aspen Technology in May 2022.
Shareholder Details
Following Emerson Electric's acquisition, the ownership structure of Aspen Technology is as follows:
| Shareholder | Ownership Percentage | Number of Shares Owned |
|---|---|---|
| Emerson Electric Co. | 56% | Approximately 35,000,000 |
| Other Institutional Investors | 34% | Approximately 21,300,000 |
| Retail Investors | 10% | Approximately 6,700,000 |
Institutional Ownership
Other significant institutional investors include:
| Institution | Ownership Percentage | Number of Shares Owned |
|---|---|---|
| The Vanguard Group, Inc. | 8.5% | Approximately 5,500,000 |
| BlackRock, Inc. | 7.2% | Approximately 4,700,000 |
| State Street Corporation | 5.3% | Approximately 3,400,000 |
Recent Stock Performance
As of September 30, 2024, Aspen Technology's stock was trading at $238.82. The company has seen a notable fluctuation in its stock performance, largely influenced by market conditions and investor sentiment surrounding its strategic direction under Emerson Electric's ownership.
Share Repurchase Activity
On August 6, 2024, Aspen Technology announced a share repurchase authorization of $100 million. As of September 30, 2024, the company had repurchased 92,819 shares for a total of $20.5 million, leaving $79.5 million remaining under the authorization.
Conclusion on Ownership Dynamics
The ownership of Aspen Technology continues to be significantly influenced by Emerson Electric, which maintains control over the strategic direction of the company. The presence of major institutional investors adds stability to its shareholder base, while share repurchase programs indicate a commitment to enhancing shareholder value.
Aspen Technology, Inc. (AZPN) Mission Statement
Mission Statement Overview
Aspen Technology, Inc. focuses on driving innovation in the field of asset optimization software. The mission statement emphasizes a commitment to enhance the performance of the world’s essential industries through advanced technology solutions that enable customers to improve their operational efficiency, reduce costs, and minimize environmental impact.
Financial Performance Metrics
As of September 30, 2024, Aspen Technology reported the following key financial metrics:
| Metric | Value (in Thousands) |
|---|---|
| Total Contract Value (TCV) | $4,000,000 |
| Bookings | $151,400 |
| Free Cash Flow (non-GAAP) | $(6,419) |
| GAAP Loss from Operations | $(95,965) |
| Net Loss | $(60,464) |
| Weighted Average Shares Outstanding (Basic) | 63,244 |
| Net Loss per Share (Basic) | $(0.96) |
Revenue Breakdown
For the three months ended September 30, 2024, Aspen Technology's revenue was distributed as follows:
| Revenue Type | Value (in Thousands) |
|---|---|
| License and Solutions | $101,659 |
| Maintenance | $90,686 |
| Services and Other | $23,532 |
| Total Revenue | $215,877 |
Cost of Revenue
The cost structure for the same period is as follows:
| Cost Type | Value (in Thousands) |
|---|---|
| Cost of License and Solutions | $63,654 |
| Cost of Maintenance | $10,688 |
| Cost of Services and Other | $21,105 |
| Total Cost of Revenue | $95,447 |
Operating Expenses
The operating expenses for the three months ended September 30, 2024, were reported as follows:
| Expense Type | Value (in Thousands) |
|---|---|
| Selling and Marketing | $125,661 |
| Research and Development | $50,000 |
| General and Administrative | $33,008 |
| Restructuring Costs | $7,726 |
| Total Operating Expenses | $216,395 |
Market Position and Strategic Goals
Aspen Technology aims to leverage its technological expertise to maintain a leadership position in the asset optimization sector. The company is focused on enhancing customer value through continuous innovation, fostering partnerships, and expanding its global reach to meet the evolving needs of its clients.
How Aspen Technology, Inc. (AZPN) Works
Corporate Structure and Business Model
Aspen Technology, Inc. (AZPN) operates as a software company focused on optimizing asset performance and improving operational efficiency for various industries, including chemicals, oil and gas, and energy. The company primarily generates revenue through software licenses, maintenance, and professional services.
Financial Performance Overview
For the three months ended September 30, 2024, Aspen Technology reported total revenue of $215.9 million, a decrease of $33.4 million or 13.4% compared to $249.3 million for the same period in 2023.
| Revenue Source | Q1 2024 (in $ millions) | Q1 2023 (in $ millions) | Change ($ millions) | Change (%) |
|---|---|---|---|---|
| License and Solutions | 101.7 | 148.6 | (46.9) | (31.6) |
| Maintenance | 90.7 | 85.0 | 5.7 | 6.7 |
| Services and Other | 23.5 | 15.7 | 7.8 | 50.0 |
| Total Revenue | 215.9 | 249.3 | (33.4) | (13.4) |
Cost Structure
The total cost of revenue for Q1 2024 was $95.4 million, a decrease of $2.6 million or 2.7% compared to $98.1 million in Q1 2023. The breakdown is as follows:
| Cost Category | Q1 2024 (in $ millions) | Q1 2023 (in $ millions) | Change ($ millions) | Change (%) |
|---|---|---|---|---|
| License and Solutions | 63.7 | 71.6 | (7.9) | (11.1) |
| Maintenance | 10.7 | 10.2 | 0.5 | 4.8 |
| Services and Other | 21.1 | 16.3 | 4.8 | 29.6 |
| Total Cost of Revenue | 95.4 | 98.1 | (2.6) | (2.7) |
Operating Expenses
Operating expenses for Q1 2024 totaled $216.4 million, an increase of $4.9 million or 2.3% from $211.5 million in Q1 2023.
| Expense Category | Q1 2024 (in $ millions) | Q1 2023 (in $ millions) | Change ($ millions) | Change (%) |
|---|---|---|---|---|
| Selling and Marketing | 125.7 | 122.4 | 3.3 | 2.7 |
| Research and Development | 50.0 | 53.7 | (3.7) | (6.8) |
| General and Administrative | 33.0 | 35.4 | (2.4) | (6.8) |
| Restructuring Costs | 7.7 | 0.0 | 7.7 | 100.0 |
| Total Operating Expenses | 216.4 | 211.5 | 4.9 | 2.3 |
Net Loss and Earnings Per Share
Aspen Technology reported a net loss of $60.5 million for Q1 2024, compared to a net loss of $34.5 million in Q1 2023. The loss per share was $0.96 for the current quarter, compared to $0.54 for the same quarter last year.
| Metric | Q1 2024 | Q1 2023 |
|---|---|---|
| Net Loss (in $ millions) | (60.5) | (34.5) |
| Loss Per Share | (0.96) | (0.54) |
Cash Flow and Liquidity
As of September 30, 2024, Aspen Technology had cash and cash equivalents of $221.1 million, compared to $237.0 million as of June 30, 2024. The company reported a free cash flow of $(6.4) million for Q1 2024, down from $16.0 million in Q1 2023.
| Metric | Q1 2024 (in $ millions) | Q1 2023 (in $ millions) |
|---|---|---|
| Cash and Cash Equivalents | 221.1 | 237.0 |
| Free Cash Flow | (6.4) | 16.0 |
Market Position and Strategic Focus
Aspen Technology has positioned itself as a leader in asset optimization software, leveraging advanced analytics and AI to enhance operational efficiency. The company continues to focus on expanding its customer base and service offerings while navigating challenges such as contract renewals and market competition.
Recent Developments
In August 2024, Aspen Technology announced a corporate restructuring that included a reorganization of its corporate structure, resulting in a significant increase in restructuring costs. This decision was influenced by ongoing geopolitical factors affecting its operations, particularly in Russia.
How Aspen Technology, Inc. (AZPN) Makes Money
Revenue Streams
Aspen Technology, Inc. generates revenue through several key segments:
- License and Solutions
- Maintenance
- Services and Other
Financial Performance Overview
For the three months ended September 30, 2024, AspenTech reported the following revenue figures:
| Revenue Type | Q1 2024 (in $ Thousands) | Q1 2023 (in $ Thousands) | Change ($ Thousands) | Change (%) |
|---|---|---|---|---|
| License and Solutions | 101,659 | 148,648 | (46,989) | (31.6) |
| Maintenance | 90,686 | 84,968 | 5,718 | 6.7 |
| Services and Other | 23,532 | 15,692 | 7,840 | 50.0 |
| Total Revenue | 215,877 | 249,308 | (33,431) | (13.4) |
Cost Structure
The total cost of revenue for the same period was as follows:
| Cost Type | Q1 2024 (in $ Thousands) | Q1 2023 (in $ Thousands) | Change ($ Thousands) | Change (%) |
|---|---|---|---|---|
| License and Solutions | 63,654 | 71,578 | (7,924) | (11.1) |
| Maintenance | 10,688 | 10,200 | 488 | 4.8 |
| Services and Other | 21,105 | 16,282 | 4,823 | 29.6 |
| Total Cost of Revenue | 95,447 | 98,060 | (2,613) | (2.7) |
Operating Expenses
Operating expenses for the three months ended September 30, 2024, were as follows:
| Expense Type | Q1 2024 (in $ Thousands) | Q1 2023 (in $ Thousands) | Change ($ Thousands) | Change (%) |
|---|---|---|---|---|
| Selling and Marketing | 125,661 | 122,378 | 3,283 | 2.7 |
| Research and Development | 50,000 | 53,676 | (3,676) | (6.8) |
| General and Administrative | 33,008 | 35,405 | (2,397) | (6.8) |
| Restructuring Costs | 7,726 | — | 7,726 | 100.0 |
| Total Operating Expenses | 216,395 | 211,459 | 4,936 | 2.3 |
Net Loss
AspenTech reported a net loss for the three months ended September 30, 2024, as follows:
| Metric | Q1 2024 (in $ Thousands) | Q1 2023 (in $ Thousands) |
|---|---|---|
| Net Loss | (60,464) | (34,525) |
| Net Loss per Share (Basic) | (0.96) | (0.54) |
| Weighted Average Shares Outstanding (Basic) | 63,244 | 64,319 |
Key Metrics
As of September 30, 2024, AspenTech reported the following key metrics:
- Total Contract Value (TCV): $4.0 billion
- Bookings: $151.4 million
- Annual Contract Value (ACV): $941.4 million
Cash Flow Analysis
The cash flow for the three months ended September 30, 2024, was as follows:
| Cash Flow Type | Q1 2024 (in $ Thousands) | Q1 2023 (in $ Thousands) |
|---|---|---|
| Net Cash (Used in) Provided by Operating Activities | (4,397) | 16,981 |
| Free Cash Flow (non-GAAP) | (6,419) | 16,044 |
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Resources:
- Aspen Technology, Inc. (AZPN) Financial Statements – Access the full quarterly financial statements for Q1 2025 to get an in-depth view of Aspen Technology, Inc. (AZPN)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Aspen Technology, Inc. (AZPN)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.