TROY – Due to high stock-based compensation expenses caused by the company’s initial public stock offering, Altair Engineering Inc. reported a loss of $29.6 million or 59 cents a share in the third quarter of 2017, compared to net income of $314,000 or 1 cent a share in the third quarter of 2016.
Revenue was $84.9 million, up 9 percent from $78.1 million a year earlier. The Troy-based company develops software and services for modeling, simulation, and high-performance computing, and also has subsidiaries in LED lighting and engineering services.
For the nine months, the loss was $39.1 million or 78 cents a share, compared to net income of $4.3 million or 7 cents a share in the first nine months of 2016. Revenue for the period was $243.5 million, up from $230.4 million a year earlier.
“We delivered a strong performance in the third quarter with software product revenue increasing 13% from a year ago to $63.2 million and total revenue increasing 9% to $84.9 million,” said James Scapa, Altair founder, chairman, and CEO. “Equally important, we continue to shift our revenue mix toward software products where we achieve our highest gross margins, ultimately driving higher operating margins for the overall enterprise. During the third quarter we expanded our relationships with existing customers and broadened our reach with enhanced and new technology, including technologies from our acquisition of Runtime on September 28, which expands our market opportunity in the dynamic high-performance computing market. We reached another milestone for the company with the completion of our initial public offering. By further strengthening our balance sheet and providing additional resources to pursue our growth strategy, we believe we are well positioned to capture share and enhance our leadership in simulation-driven design, while further driving new opportunities in high-performance computing, as well as IoT and analytics.”
The stock-based compensation expense for the company was $25.3 million for the quarter and $39.3 million for the year. Altair also released an “adjusted earnings before interest, taxes, depreciation and amortization” that excluded the stock compensation expense, taxes and interest. It was $7 million for the quarter, down from $7.3 million a year earlier.
The company said software product revenue was $63.2 million for the quarter, up 13 percent from $55.8 million a year earlier.
The company issued an outlook for fourth quarter revenue between $86.8 million and $88.4 million, and adjusted EBITDA of between $7.4 million and $9 million.
To listen to a replay of the company’s conference call, dial (855) 859-2056 in the United States or (404) 537-3406 elsewhere, using the pass code 8985778.
More at www.altair.com.