Artificial Intelligence

Altair Announces Third Quarter 2022 Financial Results

Published

11 months ago

November 3, 2022

TROY, Mich., Nov. 03, 2022 (GLOBE NEWSWIRE) — Altair (Nasdaq: ALTR), a global leader in computational science and artificial intelligence (AI), today released its financial results for the third quarter ended September 30, 2022.

“Altair had a solid third quarter, showing exceptional momentum despite significant macro-economic uncertainty, led by double digit growth in billings on a constant currency basis and strong demand across all geographies,” said James Scapa, founder, chairman and chief executive officer of Altair. “Our dedicated global teams continue to push forward with outstanding technology developments and applications.”

“We’re very pleased with the third quarter, continuing the success we had in the first half of the year,” said Matt Brown, chief financial officer of Altair. “Our third quarter revenue was at the high end of our guidance range, despite significant currency headwinds, while our profitability exceeded our expectations. These strong results give us the confidence to raise our full year 2022 guidance in constant currency.”

Third Quarter 2022 Financial Highlights

Software product revenue was $103.8 million compared to $102.3 million for the third quarter of 2021, an increase of 1.4% in reported currency and 10.1% in constant currency
Total revenue was $119.4 million compared to $121.3 million for the third quarter of 2021, a decrease of 1.6% in reported currency and an increase of 6.3% in constant currency
Net loss was $(33.2) million compared to $(8.1) million for the third quarter of 2021. Diluted net loss per share was $(0.42) based on 79.2 million diluted weighted average common shares outstanding, compared to diluted net loss per share of $(0.11) for the third quarter of 2021, based on 75.8 million diluted weighted average common shares outstanding. Net loss margin was -27.9% compared to -6.7% for the third quarter of 2021
Non-GAAP net income was $4.3 million, compared to non-GAAP net income of $9.6 million for the third quarter of 2021, a decrease of 55.7%. Non-GAAP diluted net income per share was $0.05 based on 88.1 million non-GAAP diluted common shares outstanding, compared to non-GAAP diluted net income per share of $0.12 for the third quarter of 2021, based on 81.1 million non-GAAP diluted common shares outstanding
Adjusted EBITDA was $6.8 million compared to $14.8 million for the third quarter of 2021, a decrease of 54.0%. Adjusted EBITDA margin was 5.7% compared to 12.2% for the third quarter of 2021
Cash provided by operating activities was $8.5 million, compared to $0.9 million for the third quarter of 2021
Free cash flow was $5.2 million, compared to $(0.5) million for the third quarter of 2021.

Business Outlook

Based on information available as of today, Altair is issuing the following guidance for the fourth quarter and full year 2022:

(in millions)	Fourth Quarter 2022								Full Year 2022
Software Product Revenue		$	126.0		to	$	131.0			$	488.0		to	$	493.0
Total Revenue		$	143.0			$	148.0			$	555.0			$	560.0
Net Loss		$	(15.0	)		$	(12.1	)		$	(70.3	)		$	(67.4	)
Non-GAAP Net Income		$	15.5			$	17.8			$	63.8			$	66.0
Adjusted EBITDA		$	22.0			$	25.0			$	92.0			$	95.0
Net Cash Provided by Operating Activities										$	23.0			$	27.0
Free Cash Flow										$	14.0			$	18.0

The following table provides a reconciliation of 2022 Full Year guidance to the last guidance provided in August:

	(Unaudited)
	Full Year 2022
(in millions)	Midpoint of Guidance in August		Increase/ (Decrease)		Currency Fluctuations from Prior Guidance			Midpoint of Guidance in November
Software Product Revenue	$	492.5	$	4.2	$	(6.2	)	$	490.5
Total Revenue	$	560.5	$	3.7	$	(6.7	)	$	557.5
Adjusted EBITDA	$	94.0	$	1.0	$	(1.5	)	$	93.5

Conference Call Information

What:		Altair’s Third Quarter 2022 Financial Results Conference Call
When:		Thursday, November 3, 2022
Time:		5 p.m. ET
Webcast:		http://investor.altair.com (live & replay)

Non-GAAP Financial Measures

This press release contains the following non-GAAP financial measures: Non-GAAP Net Income, Non-GAAP Net Income Per Share, Adjusted EBITDA, Free Cash Flow, Non-GAAP Gross Profit and Non-GAAP Operating Expense.

Altair believes that these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to its financial condition and results of operations. The Company’s management uses these non-GAAP measures to compare the Company’s performance to that of prior periods for trend analysis, for purposes of determining executive and senior management incentive compensation and for budgeting and planning purposes. The Company also believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing the Company’s financial measures with other software companies, many of which present similar non-GAAP financial measures to investors.

Non-GAAP net income excludes stock-based compensation, amortization of intangible assets related to acquisitions, restructuring charges, asset impairment charges, non-cash interest expense, other special items as identified by management and described elsewhere in this press release, and the impact of non-GAAP tax rate to income tax expense, which approximates our tax rate excluding discrete items and other specific events that can fluctuate from period to period.

Non-GAAP diluted common shares as defined starting with Q1 2022, includes the diluted weighted average shares outstanding per GAAP regardless of whether the Company is in a loss position. All periods presented will be adjusted to align with this new definition.

Adjusted EBITDA represents net 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 identified by management and described elsewhere in this press release.

Free cash flow consists of cash flow from operations less capital expenditures.

Non-GAAP gross profit represents gross profit adjusted for stock-based compensation expense, restructuring expense and other special items as identified by management and described elsewhere in this press release.

Non-GAAP operating expense represents operating expense excluding stock-based compensation expense, amortization, restructuring charges, asset impairment charges and other special items as identified by management and described elsewhere in this press release.

Company management does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude significant expenses and income that are required by GAAP to be recorded in the Company’s financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by management about which expenses and income are excluded or included in determining these non-GAAP financial measures. Altair urges investors to review the reconciliation of its non-GAAP financial measures to the comparable GAAP financial measures, which it includes in press releases announcing quarterly financial results, including this press release, and not to rely on any single financial measure to evaluate the Company’s business.

Reconciliation tables of the most comparable GAAP financial measures to the non-GAAP financial measures used in this press release are included with the financial tables at the end of this release.

About Altair

Altair is a global leader in computational science and artificial intelligence (AI) that provides software and cloud solutions in simulation, high-performance computing (HPC), data analytics and AI. Altair enables organizations across all industries to compete more effectively and drive smarter decisions in an increasingly connected world – all while creating a greener, more sustainable future. To learn more, please visit www.altair.com.

Cautionary Language Concerning Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, our guidance for the fourth quarter and full year 2022, our statements regarding our expectations for 2022, and our reconciliations of projected non-GAAP financial measures. These forward-looking statements are made as of the date of this release and are based on current expectations, estimates, forecasts and projections as well as the beliefs and assumptions of management. Words such as “expect,” “anticipate,” “should,” “believe,” “hope,” “target,” “project,” “goals,” “estimate,” “potential,” “predict,” “may,” “will,” “might,” “could,” “intend,” variations of these terms or the negative of these terms and similar expressions are intended to identify these forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond Altair’s control. Altair’s actual results could differ materially from those stated or implied in our forward-looking statements due to a number of factors, including but not limited to, the risks detailed in Altair’s quarterly and annual reports filed with the Securities and Exchange Commission as well as other documents that may be filed by the Company from time to time with the Securities and Exchange Commission. Past performance is not necessarily indicative of future results. The forward-looking statements included in this press release represent Altair’s views as of the date of this press release. The Company anticipates that subsequent events and developments will cause its views to change. Altair undertakes no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. These forward-looking statements should not be relied upon as representing Altair’s views as of any date subsequent to the date of this press release.

Media Relations
Altair
Dave Simon
248-614-2400 ext. 332
[email protected]

Investor Relations
The Blueshirt Group
Monica Gould
212-871-3927
[email protected]


ALTAIR ENGINEERING INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS

	September 30, 2022			December 31, 2021
(In thousands)	(Unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	311,853		$	413,743
Accounts receivable, net		119,921			137,561
Income tax receivable		10,465			9,388
Prepaid expenses and other current assets		23,492			27,529
Total current assets		465,731			588,221
Property and equipment, net		38,938			40,478
Operating lease right of use assets		32,627			28,494
Goodwill		455,211			370,178
Other intangible assets, net		86,080			99,057
Deferred tax assets		7,605			8,495
Other long-term assets		38,736			28,352
TOTAL ASSETS	$	1,124,928		$	1,163,275
LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable	$	6,235		$	6,647
Accrued compensation and benefits		37,036			42,307
Current portion of operating lease liabilities		9,996			9,933
Other accrued expenses and current liabilities		50,686			122,226
Deferred revenue		94,523			93,160
Convertible senior notes, net		—			199,705
Total current liabilities		198,476			473,978
Operating lease liabilities, net of current portion		23,466			19,550
Deferred revenue, non-current		22,017			12,872
Convertible senior notes, net		305,158			—
Other long-term liabilities		40,282			42,894
TOTAL LIABILITIES		589,399			549,294
Commitments and contingencies
MEZZANINE EQUITY		—			784
STOCKHOLDERS’ EQUITY:
Preferred stock ($0.0001 par value), authorized 45,000 shares, none issued and outstanding		—			—
Common stock ($0.0001 par value)
Class A common stock, authorized 513,797 shares, issued and outstanding 52,377 and 51,524 shares as of September 30, 2022, and December 31, 2021, respectively		5			5
Class B common stock, authorized 41,203 shares, issued and outstanding 27,745 shares as of September 30, 2022, and December 31, 2021		3			3
Additional paid-in capital		715,736			724,226
Accumulated deficit		(133,642	)		(102,087	)
Accumulated other comprehensive loss		(46,573	)		(8,950	)
TOTAL STOCKHOLDERS’ EQUITY		535,529			613,197
TOTAL LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ EQUITY	$	1,124,928		$	1,163,275


ALTAIR ENGINEERING INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
(in thousands, except per share data)	2022			2021			2022			2021
Revenue
License	$	67,245		$	67,603		$	256,102		$	230,630
Maintenance and other services		36,520			34,686			105,453			100,758
Total software		103,765			102,289			361,555			331,388
Software related services		6,706			7,650			23,143			23,229
Total software and related services		110,471			109,939			384,698			354,617
Client engineering services		7,355			10,060			22,414			31,005
Other		1,525			1,308			4,676			5,760
Total revenue		119,351			121,307			411,788			391,382
Cost of revenue
License		2,579			4,694			11,386			13,706
Maintenance and other services		13,025			11,770			38,628			35,368
Total software *		15,604			16,464			50,014			49,074
Software related services		5,240			5,707			16,739			17,560
Total software and related services		20,844			22,171			66,753			66,634
Client engineering services		5,835			7,982			18,390			25,163
Other		1,230			1,348			3,892			5,072
Total cost of revenue		27,909			31,501			89,035			96,869
Gross profit		91,442			89,806			322,753			294,513
Operating expenses:
Research and development *		48,781			35,839			138,352			112,872
Sales and marketing *		39,244			30,589			114,042			94,568
General and administrative *		24,677			22,196			72,613			67,983
Amortization of intangible assets		6,571			4,432			18,682			13,924
Other operating income, net		(2,835	)		(1,324	)		(9,383	)		(2,526	)
Total operating expenses		116,438			91,732			334,306			286,821
Operating (loss) income		(24,996	)		(1,926	)		(11,553	)		7,692
Interest expense		1,566			3,037			2,851			8,998
Other expense, net		2,107			124			26,082			1,667
Loss before income taxes		(28,669	)		(5,087	)		(40,486	)		(2,973	)
Income tax expense		4,579			3,022			15,008			4,424
Net loss	$	(33,248	)	$	(8,109	)	$	(55,494	)	$	(7,397	)
Loss per share:
Net loss per share attributable to common stockholders, basic	$	(0.42	)	$	(0.11	)	$	(0.70	)	$	(0.10	)
Net loss per share attributable to common stockholders, diluted	$	(0.42	)	$	(0.11	)	$	(0.70	)	$	(0.10	)
Weighted average shares outstanding:
Weighted average number of shares used in computing net loss per share, basic		79,207			75,750			79,205			75,226
Weighted average number of shares used in computing net loss per share, diluted		79,207			75,750			79,205			75,226

* Amounts include stock-based compensation expense as follows (in thousands):

	(Unaudited)
	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2022		2021		2022		2021
Cost of revenue – software	$	2,332	$	1,411	$	6,265	$	3,791
Research and development		10,243		3,894		26,580		11,223
Sales and marketing		7,806		3,673		22,505		10,800
General and administrative		2,329		1,955		7,174		5,415
Total stock-based compensation expense	$	22,710	$	10,933	$	62,524	$	31,229

	(Unaudited)
	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2022		2021		2022		2021
Employee stock-based compensation plans	$	15,490	$	10,194	$	43,622	$	29,009
Equity issued in connection with acquisitions		7,220		739		18,902		2,220
Total stock-based compensation expense	$	22,710	$	10,933	$	62,524	$	31,229


ALTAIR ENGINEERING INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOW (Unaudited)

	Nine Months Ended September 30,
(In thousands)	2022			2021
OPERATING ACTIVITIES:
Net loss	$	(55,494	)	$	(7,397	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization		24,092			19,355
Provision for credit loss		183			330
Amortization of debt discount and issuance costs		1,330			8,513
Stock-based compensation expense		62,524			31,229
Deferred income taxes		4			(510	)
Gain on mark-to-market adjustment of contingent consideration		(7,482	)		—
Expense on repurchase of convertible senior notes		16,621			—
Other, net		153			40
Changes in assets and liabilities:
Accounts receivable		13,859			26,770
Prepaid expenses and other current assets		1,906			(7,612	)
Other long-term assets		3,134			(5,018	)
Accounts payable		(270	)		(2,432	)
Accrued compensation and benefits		(3,639	)		481
Other accrued expenses and current liabilities		(48,698	)		483
Deferred revenue		18,311			(8,638	)
Net cash provided by operating activities		26,534			55,594
INVESTING ACTIVITIES:
Payments for acquisition of businesses, net of cash acquired		(134,130	)		(5,472	)
Capital expenditures		(6,721	)		(6,811	)
Other investing activities, net		(10,322	)		(628	)
Net cash used in investing activities		(151,173	)		(12,911	)
FINANCING ACTIVITIES:
Proceeds from issuance of convertible senior notes, net of discounts and commissions		224,265			—
Repurchase of convertible senior notes		(192,422	)		—
Proceeds from employee stock purchase plan contributions		6,549			2,110
Repurchase and retirement of common stock		(4,387	)		—
Proceeds from the exercise of common stock options		2,840			2,059
Payments of debt issuance costs		(1,523	)		—
Proceeds from private placement of common stock		—			200,000
Payments on revolving commitment		—			(30,000	)
Other financing activities		(170	)		(434	)
Net cash provided by financing activities		35,152			173,735
Effect of exchange rate changes on cash, cash equivalents and restricted cash		(12,142	)		(1,951	)
Net (decrease) increase in cash, cash equivalents and restricted cash		(101,629	)		214,467
Cash, cash equivalents and restricted cash at beginning of year		414,012			241,547
Cash, cash equivalents and restricted cash at end of period	$	312,383		$	456,014
Supplemental disclosure of cash flow:
Interest paid	$	296		$	344
Income taxes paid	$	6,818		$	8,077
Supplemental disclosure of non-cash investing and financing activities:
Property and equipment in accounts payable, other current liabilities and other liabilities	$	707		$	480

Financial Results

The following table provides a reconciliation of Non-GAAP net income and Non-GAAP net income per share – diluted, to net loss and net loss per share – diluted, the most comparable GAAP financial measures:

	(Unaudited)
	Three Months Ended September 30,						Nine Months Ended September 30,
(in thousands, except per share amounts)	2022			2021			2022			2021
Net loss	$	(33,248	)	$	(8,109	)	$	(55,494	)	$	(7,397	)
Stock-based compensation expense		22,710			10,933			62,524			31,229
Amortization of intangible assets		6,571			4,432			18,682			13,924
Non-cash interest expense		501			2,876			1,339			8,513
Restructuring expense		—			(124	)		—			4,954
Impact of non-GAAP tax rate⁽¹⁾		3,079			(366	)		(1,878	)		(10,044	)
Special adjustments and other⁽²⁾		4,657			—			22,886			—
Non-GAAP net income	$	4,270		$	9,642		$	48,059		$	41,179

Net loss per share, diluted	$	(0.42	)	$	(0.11	)	$	(0.70	)	$	(0.10	)
Non-GAAP net income per share, diluted	$	0.05		$	0.12		$	0.55		$	0.51

GAAP diluted shares outstanding		79,207			75,750			79,205			75,226
Non-GAAP diluted shares outstanding⁽³⁾		88,100			81,063			86,708			80,345

(1) The Company uses a non-GAAP effective tax rate of 26%.

(2) The three months ended September 30, 2022, includes $6.8 million currency losses on acquisition-related intercompany loans and a $2.2 million gain from a mark-to-market adjustment of contingent consideration associated with the World Programming acquisition. The nine months ended September 30, 2022, includes $16.6 million expense on the repurchase of convertible senior notes, $13.7 million currency losses on acquisition-related intercompany loans and a $7.5 million gain from the mark-to-market adjustment of contingent consideration associated with the World Programming acquisition.

(3) The Non-GAAP diluted shares outstanding for the three and nine months ended September 30, 2021, has been changed to align with the current definition.

The following table provides a reconciliation of Adjusted EBITDA to net loss, the most comparable GAAP financial measure:

	(Unaudited)
	Three Months Ended September 30,						Nine Months Ended September 30,
(in thousands)	2022			2021			2022			2021
Net loss	$	(33,248	)	$	(8,109	)	$	(55,494	)	$	(7,397	)
Income tax expense		4,579			3,022			15,008			4,424
Stock-based compensation expense		22,710			10,933			62,524			31,229
Interest expense		1,566			3,037			2,851			8,998
Depreciation and amortization		8,273			6,175			24,092			19,355
Restructuring expense		—			(124	)		—			4,954
Special adjustments, interest income and other⁽¹⁾		2,949			(102	)		20,878			(275	)
Adjusted EBITDA	$	6,829		$	14,832		$	69,859		$	61,288

(1) The three months ended September 30, 2022, includes $6.8 million currency losses on acquisition-related intercompany loans and a $2.2 million gain from a mark-to-market adjustment of contingent consideration associated with the World Programming acquisition. The nine months ended September 30, 2022, includes $16.6 million expense on the repurchase of convertible senior notes, $13.7 million currency losses on acquisition-related intercompany loans and a $7.5 million gain from the mark-to-market adjustment of contingent consideration associated with the World Programming acquisition.

The following table provides a reconciliation of Free Cash Flow to net cash provided by operating activities, the most comparable GAAP financial measure:

	(Unaudited)
	Three Months Ended September 30,						Nine Months Ended September 30,
(in thousands)	2022			2021			2022			2021
Net cash provided by operating activities⁽¹⁾	$	8,493		$	872		$	26,534		$	55,594
Capital expenditures		(3,264	)		(1,420	)		(6,721	)		(6,811	)
Free cash flow⁽¹⁾	$	5,229		$	(548	)	$	19,813		$	48,783

(1) The nine months ended September 30, 2022, includes a $65.9 million payment in January 2022 for a legal judgement acquired in December 2021.

The following table provides a reconciliation of Non-GAAP gross profit to gross profit, the most comparable GAAP financial measure:

	(Unaudited)
	Three Months Ended September 30,						Nine Months Ended September 30,
(in thousands)	2022			2021			2022			2021
Gross profit	$	91,442		$	89,806		$	322,753		$	294,513
Stock-based compensation expense		2,332			1,411			6,265			3,791
Restructuring expense		—			(10	)		—			926
Non-GAAP gross profit	$	93,774		$	91,207		$	329,018		$	299,230
Non-GAAP gross margin		78.6	%		75.2	%		79.9	%		76.5	%

The following table provides a reconciliation of Non-GAAP operating expense to Total operating expense, the most comparable GAAP financial measure:

	(Unaudited)
	Three Months Ended September 30,						Nine Months Ended September 30,
(in thousands)	2022			2021			2022			2021
Total operating expense	$	116,438		$	91,732		$	334,306		$	286,821
Stock-based compensation expense		(20,378	)		(9,522	)		(56,259	)		(27,438	)
Amortization		(6,571	)		(4,432	)		(18,682	)		(13,924	)
Gain on mark-to-market adjustment of contingent consideration		2,178			—			7,482			—
Restructuring expense		—			114			—			(4,028	)
Non-GAAP operating expense	$	91,667		$	77,892		$	266,847		$	241,431

The following table provides our revenue and Adjusted EBITDA on a constant currency basis:

	(Unaudited)
	Three Months Ended September 30, 2022						Three Months Ended September 30, 2021		Increase/ (Decrease) %
(in thousands)	As reported		Currency changes		As adjusted for constant currency		As reported		As reported			As adjusted for constant currency
Software revenue	$	103.8	$	8.8	$	112.6	$	102.3		1.4	%		10.1	%
Total revenue	$	119.4	$	9.6	$	129.0	$	121.3		-1.6	%		6.3	%
Adjusted EBITDA	$	6.8	$	2.0	$	8.8	$	14.8		-53.9	%		-40.5	%


	(Unaudited)
	Nine Months Ended September 30, 2022						Nine Months Ended September 30, 2021		Increase/ (Decrease) %
(in thousands)	As reported		Currency changes		As adjusted for constant currency		As reported		As reported			As adjusted for constant currency
Software revenue	$	361.6	$	18.3	$	379.9	$	331.4		9.1	%		14.7	%
Total revenue	$	411.8	$	20.2	$	432.0	$	391.4		5.2	%		10.4	%
Adjusted EBITDA	$	69.9	$	4.2	$	74.1	$	61.3		14.0	%		20.9	%

Business Outlook
The following table provides a reconciliation of projected Non-GAAP net income to projected net loss, the most comparable GAAP financial measure:

	(Unaudited)
	Three Months Ending December 31, 2022						Year Ending December 31, 2022
(in thousands)	Low			High			Low			High
Net loss	$	(15,000	)	$	(12,100	)	$	(70,300	)	$	(67,400	)
Stock-based compensation expense		21,600			21,600			84,100			84,100
Amortization of intangible assets		10,100			10,100			28,800			28,800
Non-cash interest expense		400			400			1,800			1,800
Impact of non-GAAP tax rate		(1,600	)		(2,200	)		(3,500	)		(4,200	)
Special adjustments and other⁽¹⁾		—			—			22,900			22,900
Non-GAAP net income	$	15,500		$	17,800		$	63,800		$	66,000

(1) Year ending December 31, 2022, includes $16.6 million expense on the repurchase of convertible senior notes, $13.7 million currency losses on acquisition-related intercompany loans and $7.5 million gain from the mark-to-market adjustment of contingent consideration associated with the World Programming acquisition.

The following table provides a reconciliation of projected Adjusted EBITDA to projected net loss, the most comparable GAAP financial measure:

	(Unaudited)
	Three Months Ending December 31, 2022						Year Ending December 31, 2022
(in thousands)	Low			High			Low			High
Net loss	$	(15,000	)	$	(12,100	)	$	(70,300	)	$	(67,400	)
Income tax expense		3,900			4,000			18,900			19,000
Stock-based compensation expense		21,600			21,600			84,100			84,100
Interest (income) expense		(300	)		(300	)		500			500
Depreciation and amortization		11,800			11,800			35,900			35,900
Special adjustments and other⁽¹⁾		—			—			22,900			22,900
Adjusted EBITDA	$	22,000		$	25,000		$	92,000		$	95,000

The following table provides a reconciliation of projected Free Cash Flow to projected net cash provided by operating activities, the most comparable GAAP financial measure:

	(Unaudited)
	Year Ending December 31, 2022
(in thousands)	Low			High
Net cash provided by operating activities⁽¹⁾	$	23,000		$	27,000
Capital expenditures		(9,000	)		(9,000	)
Free cash flow⁽¹⁾	$	14,000		$	18,000

(1) Includes $65.9 million payment in January 2022 for legal judgement acquired in December 2021.

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Artificial Intelligence

oToBrite Unveils Automotive-Grade 5MP/8MP Camera Modules to Meet Soaring Demand for High-Level ADAS/Autonomous Driving

Published

60 mins ago

September 28, 2023

CISION (PR Newswire)

otobrite-unveils-automotive-grade-5mp/8mp-camera-modules-to-meet-soaring-demand-for-high-level-adas/autonomous-driving

HSINCHU, Sept. 28, 2023 /PRNewswire/ — oToBrite, a prominent provider of Vision-AI ADAS/AD solutions, has unveiled its latest offering in response to the surging demand for high-level Advanced Driver Assistance Systems (ADAS) and Autonomous Driving (AD) applications. With the need for enhanced perception technology, particularly for heavy commercial vehicles, as the heavier the vehicle is, the longer it will take to stop, oToBrite has successfully introduced automotive-grade 5MP/8MP camera modules. These cutting-edge modules can improve the visibility and perception capabilities of ADAS/AD systems, and have been adopted among clients in North America.

oToBrite has been a leading tier-1 player for vision-AI ADAS/AD solution in the automotive industry, leveraging its full-stack capabilities spanning camera module production technology, edge-computing system design, and vision-AI model development. The company offers flexible business model and comprehensive vision-AI technology stack, enabling it to provide system solutions, camera modules, or AI IP licensing to cater to diverse customer requirements. Its automotive-grade camera modules have already garnered the trust of prominent clients and entered the supply chain of car OEMs such as Luxgen, SONY, Toyota, XPENG, etc. with over 1 million automotive-grade camera modules deployed. To learn more about oToBrite’s offerings, please visit https://www.otobrite.com/en.
The newly launched 5MP/8MP camera modules from oToBrite feature high-sensitivity CMOS sensors. oToBrite’s 5MP camera module series is equipped with Sony IMX490 Sensor and has multiple viewing angles, including 30°, 60°, 90°, and 120°. The 8MP camera module series employs Sony IMX728 sensors and also offers various viewing angles. Both 5MP and 8MP series are equipped with GMSL2 interfaces and tested with waterproof and dustproof standards of IP67/69K. They can operate within a temperature range of -40°C to +85°C, ensuring the utmost reliability and stability for customers.
oToBrite holds a distinct advantage in camera production technology, with 1K class clean room factory certified with IATF16949 and endorsed by several leading car OEMs. Additionally, the in-house developed 5/6-axis active alignment machine for high-end camera modules exhibits the capability to manufacture over 60 SKU variants of camera modules.
About oToBrite
oToBrite is a leading vison-AI ADAS/AD solutions provider. Based in Hsinchu Science Park, oToBrite has IATF 16949 certified clean room factory and several years of experience as an automotive Tier-1 supplier. Through comprehensive research and development capabilities, oToBrite provides vision-AI algorithm, ECU/domain controller and automotive-grade/special purpose camera products.
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View original content:https://www.prnewswire.co.uk/news-releases/otobrite-unveils-automotive-grade-5mp8mp-camera-modules-to-meet-soaring-demand-for-high-level-adasautonomous-driving-301939956.html

Artificial Intelligence

CFOs are the change agents driving shift to servitized business model to harness growth, cost efficiency and technology opportunities

Published

60 mins ago

September 28, 2023

CISION (PR Newswire)

Time for action is now: Customer expectations for servitization already exist (61%) and projected to increase (70%) in the next three years, in terms of value, service and reliability.
LONDON, Sept. 28, 2023 /PRNewswire/ — IFS, the global cloud enterprise software company, has shared the latest findings of its recent global research polling 2,000 senior decision-makers – VP and above – in France, Germany, Japan, Nordics, UK, USA and the UAE –across Manufacturing, Services, Telecoms, Energy & Resources, Construction & Engineering, and A&D industries. In its last overview, the company highlighted the overarching dependence on AI to create and accelerate business value from servitization.

The survey points to specific executives as drivers or enablers to successfully make the shift and align the organization behind it. The survey highlights the CFO (21%) behind the CEO (35%) as the guardian of business resilience, financial health and as the purse string holder for technology investments. CFOs recognize that the move to servitization is essential in providing predictability in revenues, expenditure and third-party costs, and are aligning themselves to becoming stewards of identifying cross-business strategies that will build competitive advantage.
At the heart of the business case for servitization, the CFO is focused on three elements: Faster and more cost-efficient time to market, visibility and predictability into revenues and CAPEX, accelerating organization alignment across people, processes and technology, to support not only the processes but also to provide the insights required to assess and optimize as they go within their business and intra-company.
CFOs exhibit the greatest urgency in implementing a servitized model out of all C-level respondents (CIOs, CHROs and CTOs), with (32%) prioritizing adoption within the next 18 months. This implies change is not only necessary but will deliver business benefits, with progress and success measured by a fully servitized P&L. CFOs are also most likely (26%) to say their role is the one driving the shift within the organization, as they understand how technology capabilities will reach deep into their organization and enable it to become more technology-driven with regards to the design and delivery of products and services: Product R&D (34%) and service R&D (32%) are two areas CFOs prioritized when looking at servitized business processes.
The priority outcome CFOs want to achieve from servitization is enhancing insight-driven decision-making capabilities (32%) – pointing to why AI is their #1 essential technology choice (49%) as it will fuel faster, more accurate and more data-led inputs into the strategic choices that impact the bottom line.
Technology as a revenue growth enhancer makes wise fiscal sense. For example, EAM is a must-have for servitization success (34%)– assets that are predictively maintained will last longer, have less downtime and result in less expenditure. FSM (40%) maximizes profitable revenue streams and enables significant cost savings across the service lifecycle through optimized workforce scheduling and planning. Similarly, the wealth of connected asset data that can be harnessed through the application of automation, ML, IoT, end-to-end connectivity – all CFO “must-implements” – explain why CFOs have emerged as such strong proponents of technology and servitization.
The CFO’s confidence about the organizational readiness is high at (42%) indicating they have the processes mapped out and are progressing well in their move to servitization, but still have either organizational impacts on people and processes (23%) or technology needs to overcome, making the CHRO the second most significant executive to drive and enable the transformation.
CHROs are more cautious about servitization readiness within the organization, being acutely aware that shifting from a product-focused to a service-focused mindset within their organizations is a barrier to implementing servitization (42%). However, CHROs are in alignment with the CFO on customer expectations for servitization, which are high now, and are set to increase. They also agree that technology is essential to success, with AI their top pick (50%).
Alex Rumble, SVP of Corporate Communications, Product Marketing, AR, & CI at IFS, commented: “The CFO’s remit has evolved hugely in the last decade away from financial reporting to understanding and influencing business-wide strategies and aiding transformation.” Rumble added, “Our research illustrates this very well and that CFOs not only understand the positive impact of aligning a business behind the customer’s expectations, but also the much broader business value of doing so.” She concluded: “Today CFOs are visionary advocates of change and digital transformation and will help build predictability in revenue and costs, ultimately the holy grail for CFOs but still technology dependent.”
Together, CFOs and CHROs can partner to be a powerful force to not only accelerate servitization, but also ensure that the whole organization is primed for success. CHROs must act as a secondary catalyst to mobilize cultural change, acting as a bridge between the business and ensuring the communication and implementation of the overall strategy is not siloed to the C-level.
About IFS
IFS develops and delivers cloud enterprise software for companies around the world who manufacture and distribute goods, build, and maintain assets, and manage service-focused operations. Within our single platform, our industry specific products are innately connected to a single data model and use embedded digital innovation so that our customers can be their best when it really matters to their customers – at the Moment of Service™. The industry expertise of our people and of our growing ecosystem, together with a commitment to deliver value at every single step, has made IFS a recognized leader and the most recommended supplier in our sector. Our team of over 5,500 employees every day live our values of agility, trustworthiness, and collaboration in how we support our thousands of customers. Learn more about how our enterprise software solutions can help your business today at ifs.com.
CONTACT: IFS Press Contacts: EUROPE / MEA / APJ: Adam Gillbe IFS, Director of Corporate & Executive Communications Email: [email protected] Phone: +44 7775 114 856
NORTH AMERICA / LATAM: Mairi Morgan IFS, Director of Corporate & Executive Communications Email: [email protected] Phone: +1 520 396 2155
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CFOs are the change agents driving shift to servitized business model to harness growth, cost efficiency and technology opportunities

View original content:https://www.prnewswire.co.uk/news-releases/cfos-are-the-change-agents-driving-shift-to-servitized-business-model-to-harness-growth-cost-efficiency-and-technology-opportunities-301941481.html

Artificial Intelligence

Breaking language barriers: thebigword’s AI workflows enhance translation delivery on time to 99% while significantly reducing turnaround times

Published

60 mins ago

September 28, 2023

CISION (PR Newswire)

LEEDS, England, Sept. 27, 2023 /PRNewswire/ — thebigword, a leading provider of language solutions, is proud to announce an improvement in its on-time delivery performance and significant reduction of turnaround times. This has been made possible through a strategic fusion of human expertise and state-of-the-art AI and Machine Translation technologies.

This exciting achievement reaffirms the company’s commitment to delivering accurate and timely translations to clients worldwide, setting new industry standards.
With the ever-growing demand for rapid and high-quality translations, thebigword has taken numerous steps, including the ability to create and implement self-driving AI workflows, to ensure their clients are receiving the highest quality of translation and customer service.
Through the enhanced integration of AI and Machine Translation solutions into its translation workflows, thebigword has achieved remarkable outcomes, such as the significant reduction in turnaround times and this notable increase in on-time deliveries. With 99% of translation projects across various languages and industries delivered on time to clients, with shorter turnaround times.
thebigword’s collaborative approach leverages the strengths of their human translators with the power of AI technologies to allow for faster translation turnaround times, while maintaining the highest levels of accuracy. Their technology platform also enables quick resource allocation, ensuring that translation projects are assigned, executed and delivered quickly to reduce delivery times.
Joshua Gould, Chief Executive Officer of thebigword Group said: “thebigword is delivering a very human service with the utilisation of next-generation AI. These innovations represent an ongoing effort to enhance the overall client experience through our ability to deliver accurate, high-speed translations at an affordable price for any budget.”
Mark Daley, Global Managing Director of thebigword Translation said: “thebigword understands how crucial timely delivery of accurate translations are for the global success of our clients, and some of the latest technological integrations we have enabled have allowed us to achieve an impressive 99% as well as faster turnaround times.”
As thebigword celebrates this achievement, it looks forward to building on its success with other translation milestones and continuing to provide high-quality translation services – further enabling its mission of eradicating the final barrier of global communication.
About thebigword:
As one of the largest language service providers globally, thebigword utilises the greatest minds and boundary-shattering technology to deliver phenomenal quality at scale to both our clients and linguist network.
thebigword provides the best translation, interpretation, localisation and language technology solutions for businesses, the public sector and individuals – handling up to 50,000 worldwide assignments every day.
For more information about thebigword’s innovative AI and Machine Translation solutions, please visit www.thebigword.com.
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For media enquiries, please contact:Lauren HockneyGlobal Head of [email protected]

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