Canonsburg-based software simulation company Ansys Inc. is seeing plenty of opportunities to grow its automotive customers as the vehicle-making industry looks to electrify its offerings and test autonomous driving solutions. Using simulation software from Ansys (NASDAQ: ANSS) can meet many of these needs, the company said.
Ansys' automotive customers accounted for over $65 million or 16% of its annual contract value during its third quarter, down one percentage point from the same time a year ago. The company's total annual contract value reached $409 million during the quarter, up 12% from a year ago.
"The automotive industry is looking at technologies like electrification, and they're recognizing that they need to make investments to be able to move more aggressively, and consider the future of their product lines and how they're going to evolve their product line," Ajei Gopal, Ansys CEO, said during the company's Q3 earnings call Thursday. "In autonomy, whilst it's true that full-fledged autonomy people are recognizing is a more difficult problem to solve. … They're facing pressures to start to think differently. And that's where simulation comes in. So we have an opportunity to continue to monetize those relationships and to continue to support our customers. And that's, I think, where we see strength in automotive."
Gopal said the company's automotive customers are continuing to see value in Ansys' support teams. Additionally, Ansys has found that many of these customers are retaining internal combustion engineers for electric vehicle development.
"Automotive was a strong quarter in [Europe, Middle East and Africa]," Nicole Anasenes, Ansys chief financial officer, said during the call. "There were several seven-figure sales to automotive companies really focused on things that Ajei mentioned; electrification and autonomous vehicles. But the high-tech industry was also an area of strength in Q3, which was an element of the performance around [Europe, Middle East and Africa]."
Ansys' total revenue for the quarter reached $472.5 million, an increase of 7% year-over-year. It posted a net income of over $95 million and earnings per share of $1.10 during the same time period.
