“We are very pleased with our third quarter performance, which exceeded our expectations,” said James Scapa, Founder, Chairman and Chief Executive Officer of Altair. “During the quarter new customer activity remained relatively strong and software renewals continued to come in as expected with several significant expansions, including in the automobile and aerospace sectors. We expanded our capabilities in high performance computing and material modeling with tuck-in acquisitions and the introduction of new internally developed solutions. Our organization continues to do a great job of developing and delivering valuable technology despite macro uncertainties.”
“Software product revenue increased 13% from the third quarter of 2019 to 83% of total revenue, which drove a year over year improvement in gross margins of over 400 basis points, while our recurring license rate rose to 92%,” said Howard Morof, Chief Financial Officer of Altair. “The proactive steps we took to control costs when combined with those impacted by COVID-19, had a positive impact on our operating expenses and profitability.”
Third Quarter 2020 Financial Highlights
Software product revenue was $87.8 million compared to $77.8 million for the third quarter of 2019.
Total revenue was $106.5 million compared to $100.4 million for the third quarter of 2019.
Net loss was $8.5 million compared to net loss of $15.9 million for the third quarter of 2019. Diluted net loss per share was $0.12 based on 73.3 million diluted weighted average common shares outstanding, compared to diluted net loss per share of $0.22 for the third quarter of 2019, based on 71.8 million diluted weighted average common shares outstanding.
Adjusted EBITDA was $8.2 million, compared to $(2.3) million for the third quarter of 2019.
Non-GAAP net income was $0.4 million, compared to non-GAAP net loss of $9.8 million for the third quarter of 2019. Non-GAAP diluted net income per share was $0.00 based on 80.7 million non-GAAP diluted common shares outstanding, compared to non-GAAP diluted net loss per share of $0.13 for the third quarter of 2019, based on 77.8 million non-GAAP diluted common shares outstanding.
Free cash flow was $(7.5) million, compared to $(3.3) million for the third quarter of 2019.
