Altium strength validates Autodesk deal rejection

“The adoption rate of Altium 365 has surprised the industry, and we are in the early stages of expanding our reach into the higher end enterprise level of electronics design with solutions for industry verticals such as aerospace and medical devices,” he said.

“Trends such as autonomous driving and a general desire for smart products have increased the demand for electronics and our software.”

The business has been one of the most resilient local tech stocks in 2022, down only 16 per cent for the year-to-date and up 36.8 per cent in the last six months, thanks mainly to its full-year results beating market expectations in Aug.

As part of Altium’s AGM, the company maintained its full-year guidance thanks to growing adoption of its cloud-based platform.

For the 2023 financial year, Altium has forecast revenue of $US255 million to $US265 million (representing growth of 15 per cent to 20 per cent), and underlying earnings before interest, tax, depreciation and amortization margin of 35 per cent to 37 per cent hundred.

It revealed that in the first few months of the 2023 financial year, the business was experiencing higher average revenue per user of its PCB design software, with mainstream customers using higher cost features. It’s also experiencing growing adoption of its cloud-based Altium 365 platform, and higher revenue flowing through from its search engine for electronic and industrial parts, Octopart, as component shortages ease.

On the back of the update, Altium shares had leapt 2.6 per cent to $37.48 at 11:20am.

At its current price, the company’s decision to turn its back on a verbal $40 per share bid from rival Autodesk in 2021 looks wise.

Mr Weiss said the company’s big vision was to be the dominant provider of PCB software, both for companies like Tesla and Bosch, and university students.

“Our software is modern, easy to use and implement, and provides a level of agility that is more like consumer software than traditional corporate solutions,” he said.

“Altium Designer is the default software tool of choice for all engineers from those who are studying at university to those who work at the world’s most exciting and renowned corporations… Our cloud platform Altium 365 has become an ‘out of the box’ success and has captured the attention of the electronics industry.

“We play to win, and we play for money. But we also want our success to be a force for good. I am proud to say Altium has an outstanding track record of value creation for our shareholders and for our customers, and we are passionate about our people.”

E&P managing director of technology research, Paul Mason, said the market had anticipated the reiteration of guidance.

“The share price has been pretty strong compared to other companies in our sector… In any case, in a market like this it is definitely positive for the company that they are re-iterating guidance

“We’d note that it looks like the commentary weights towards pricing over subscriber growth outcomes again.”