Altair Engineering (ALTR) Tops Q4 EPS by 12c, Beats on Revenues; Offers FY18 Revenue Outlook Above Consensus

Note: EPS may not be comparable

Altair Engineering (NASDAQ: ALTR) reported Q4 EPS of $0.18, $0.12 better than the analyst estimate of $0.06. Revenue for the quarter came in at $89.9 million versus the consensus estimate of $87.56 million.

Fourth Quarter 2017 Financial Highlights

• Software product revenue was $67.9 million, an increase of 11% from $61.1 million for the fourth quarter of 2016.
• Total revenue was $89.9 million, an increase of 8% compared to $82.8 million for the fourth quarter of 2016.
• Net loss was $(60.3) million, compared to net income of $5.9 million for the fourth quarter of 2016. The fourth quarter of 2017 included the impact of $8.0 million in non-cash stock-based compensation expenses as well as $56.6 million in tax expenses, substantially due to the recording of a valuation allowance on the U.S. deferred tax assets from the exercise and expected exercise of a significant number of non-qualified stock options, and to a lesser degree as a result of recent tax reform. Diluted net loss per share was $(1.03), based on 58.7 million diluted weighted average common shares outstanding, compared to diluted net income per share of $0.10 for the fourth quarter of 2016, based on 58.8 million diluted weighted average common shares outstanding.
• Adjusted EBITDA was $8.4 million, compared to $10.6 million for the fourth quarter of 2016. Adjusted EBITDA represents net (loss) income adjusted for income tax expense, interest expense, interest income and other, depreciation and amortization, stock-based compensation expense, restructuring charges, asset impairment charges and other special items as determined by management.
• Non-GAAP net income was $12.6 million, compared to $6.9 million for the fourth quarter of 2016. Non-GAAP net income per share was $0.18, based on 68.2 million diluted weighted average common shares outstanding, compared to $0.12 for the fourth quarter of 2016, based on 58.8 million diluted weighted average common shares outstanding. Non-GAAP net income excludes stock-based compensation, amortization of intangible assets related to acquisitions and certain tax adjustments.
• Cash flow from operations was an outflow of $(1.4) million, compared to an inflow of $23 thousand for the fourth quarter of 2016.
• Free cash flow, which consists of cash flow from operations less capital expenditures, was $(4.5) million compared to $(4.7) million for the fourth quarter of 2016.

GUIDANCE:

Altair Engineering sees FY2018 revenue of $362-366 million, versus the consensus of $359.24 million.

For earnings history and earnings-related data on Altair Engineering (ALTR) click here.

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