Ansoft Corporation Third Quarter Earnings Increase 48%

PITTSBURGH—(BUSINESS WIRE)—February 13, 2007— Ansoft Corporation (NASDAQ: ANST) today announced financial results for its third quarter of fiscal 2007 ended January 31, 2007. All references to share and per share information, except shares authorized, included in this press release have been adjusted to reflect the two-for-one stock split effected in the form of a stock dividend that was declared on March 7, 2006 and distributed on May 9, 2006.

Revenue for the third quarter totaled $22.7 million, an increase of 16% compared to $19.7 million reported in the previous fiscal year's third quarter.

On a generally accepted accounting principles (GAAP) basis, net income for the third quarter was $6.3 million, or $0.24 per diluted share representing a 48% increase when compared to GAAP net income of $4.3 million, or $0.16 per diluted share in the previous fiscal year's third quarter. GAAP net income for the current fiscal year's third quarter included a tax benefit of $1.1 million, or $0.04 per diluted share for the US Research and Development Tax Credit enacted by Congress retroactive to January 1, 2006 in December 2006.

GAAP net income for the third quarter includes employee stock-based compensation expense of $0.6 million, or $0.02 per diluted share. The previous fiscal year's third quarter net income did not include employee stock-based compensation expense.

Additionally, GAAP net income for the third quarter includes acquisition related amortization of $0.3 million, or $0.01 per diluted share. This compares to acquisition related amortization of $0.4 million, or $0.01 per diluted share in the previous fiscal year's third quarter.

"We had an excellent quarter with particularly strong revenue growth in our high-performance product line and in both domestic and international markets," said Nicholas Csendes, Ansoft's President and CEO. "For the fourth quarter, we expect continued revenue growth of around 10-15%."

Ansoft is a leading developer of high-performance electronic design automation (EDA) software. Engineers use Ansoft software to design state-of-the-art electronic products, such as cellular phones, internet access devices, broadband networking components and systems, integrated circuits (ICs), printed circuit boards (PCBs), automotive electronic systems and power electronics. Ansoft markets its products worldwide through its own direct sales force and has comprehensive customer-support and training offices throughout North America, Asia and Europe.

This press release contains forward-looking statements including those related to revenue growth for the current fiscal year that are made pursuant to the safe harbor provisions of the Private Securities Litigation Act of 1995. These forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties that could cause actual results to differ materially, including, but not limited to, management's ability to forecast revenues and control expenses and the amount, timing and structure of software licenses.

For further information regarding risks and uncertainties associated with Ansoft's business, please refer to the "Management's Discussion and Analysis of Financial Condition and Results of Operations" section of Ansoft's SEC filings, including, but not limited to, its annual report on Form 10-K and quarterly reports on Form 10-Q, copies of which may be obtained at Ansoft's website at

All information in this release is as of February 13, 2007. Ansoft undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in the Company's expectations.
                          ANSOFT CORPORATION

(In thousands, except per share amounts)

Three months ended Nine months ended
January 31, January 31,
2007 2006 2007 2006
--------- -------- -------- --------
License $13,147 $11,251 $32,270 $27,194
Service and other 9,584 8,404 28,290 25,279
--------- -------- -------- --------
Total revenue 22,731 19,655 60,560 52,473
Costs of revenue
License 164 135 425 368
Service and other 403 368 1,096 1,019
--------- -------- -------- --------
Total cost of revenue 567 503 1,521 1,387
Gross profit 22,164 19,152 59,039 51,086
Operating Expenses
Sales and marketing 8,030 8,013 23,646 22,477
Research and development 5,016 4,188 14,572 12,377
General and administrative 1,451 1,122 4,075 3,692
Amortization 290 370 982 1,108
--------- -------- -------- --------
Total operating expenses 14,787 13,693 43,275 39,654
--------- -------- -------- --------
Income from operations 7,377 5,459 15,764 11,432
Net realized loss on sale of
securities - - - (2)

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