For guidance ANSYS expects revenue in the next quarter to be between $68 million and $69 million, compared with $62 million in the quarter just completed. For the year ANSYS expects revenue in the range of $252 to $257 million, compared to $158 million in 2005. These projections include the impact of the Fluent acquisition.
For guidance Autodesk expects that net revenues for the third quarter of fiscal 2007 to be between $450 million and $460 million. This compares to $450 million in the quarter just completed and to $439 million in the third quarter of 2005. For fiscal year 2007 net revenues are expected to be between $1.82 billion and $1.85 billion.
As a result of the ongoing review of stock option grant practices, Autodesk is not providing EPS guidance at this time. The company did indicate that spending levels for the year have not changed. However, the company believes that spending in the third quarter will increase by approximately $10 million sequentially, in part as a result of the $5 million of spend for growth initiatives which was planned for the second quarter of fiscal 2007 but did not occur.
Thibault de Tersant, Dassault Systemes Executive Vice President and CFO, stated, “Business activity was strong in the second quarter and we continue to see stronger activity for the second half despite some potential signs of softening of the economic environment globally. Therefore, on a constant currency basis, we are raising our 2006 revenue growth objective to about 27-28%, compared to our previous assumption of 25-26%, reflecting higher expected activity of about €15 million for the full year, including the second quarter overachievement. At the same time, we are reconfirming our operating margin objective and increasing our EPS objective slightly.”
For the 2006 third quarter, Dassault has set a revenue objective of about 280 to 285 million euros, representing a year-over-year growth rate of 36% to 38% in constant currencies.
ESI-Group did not provide any guidance.
Moldflow CEO Roland Thomas said, “As we head into fiscal 2007, we are encouraged that the actions we have taken over the course of fiscal 2006 have put us in the position to again move towards our target operating model. We believe our historically strong Design Analysis Solutions business will return to a more normalized growth rate as we work with our customers to produce new technologies as well as increase our local presence throughout South America, Asia and Eastern Europe, three important growth markets.”
During the quarterly conference call Moldflow said it would be providing guidance only on a yearly basis. Moldflow expects revenue for full fiscal 2007 year to grow in the range of 5% to 7% when compared to fiscal 2006.
MSC Software did not provide any guidance.
PTC’s revenue forecast for the fourth quarter of fiscal 2006 is between $217 million and $225 million. This compares to $217 million in the quarter just reported. For the fiscal year ending September 30, 2006, PTC expects revenue to be between $826 million and $834 million.
UGS did not provide a forecast.
MCADCafé.com currently tracks the financial performance of multiple public companies in the Mechanical CAD market. Eight (8) companies were chosen for the author's May 8, 2003 Commentary. Four of these companies (Autodesk, Dassault Systemes, PTC and EDS PLM Solutions -- now UGS a privately held company) represented approximately 85 percent of the total revenue in this grouping, and each of these four companies offers a wide array of software and services products across the entire design to manufacturing space. The remaining four public companies (ANSYS, Moldflow, MSC.Software and Tecnomatix) offered specialized software/services products in specific MCAD niches and together they created the remaining 15 percent of the total group-of-8's revenue. Indeed, these latter four companies frequently partner with the initial four to provide end-customers with broader solution suites. Tecnomatix has been acquired by UGS and hence has been removed from this report
It should also be noted that the companies have different business models. IBM, both direct and through Business Partners, is the exclusive marketing and sales arm for Dassault Systems high end product lines: CATIA, Enovia and Delmia. The IBM channel also carries SmarTeam solutions in a non-exclusive basis. IBM records the end user revenue and pays DS a royalty of approximately 50%. DS subsidiary SolidWorks is sold through value added resellers. Autodesk sells its products overwhelmingly through valued added resellers. The other MCAD vendors sell mostly on a direct basis. Direct sales result in greater percentage of end user revenue recognition but also involve higher cost of sales and risk.
UGS annual revenues are right there at similar levels as the world's other MCAD revenue leaders Autodesk, Dassault and PTC. For purposes of our discussion, we considered the revenues from the remaining public companies (ANSYS, ESI Group, Moldflow, and MSC.Software) to be 100% MCAD.
Geopolitical and Economic Commentary:
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