Aspen Technology (AZPN) Q2 2025 earnings summary

Executive summary

• Revenue for Q2 FY2025 was $303.6 million, up 18% year-over-year and 5% sequentially, driven by license, maintenance, and services growth.

• Net income for the quarter was $20.3 million ($0.32 per diluted share), compared to a net loss of $21.5 million in the prior year.

• AspenTech entered into a definitive Merger Agreement with Emerson Electric Co. in January 2025 for a $265/share cash tender offer, expected to close in the first half of 2025.

• The company completed the acquisition of Open Grid Systems, Ltd. in Q2 FY2025 for $48.9 million, adding $31.8 million in goodwill.

• Share repurchase activity was suspended in Q2 FY25 after repurchasing 92,819 shares for $20.5 million under a $100 million authorization.

Financial highlights

• License and solutions revenue rose 23% year-over-year to $188.2 million; maintenance revenue grew 6% to $90.6 million; services and other revenue increased 26% to $24.7 million.

• Bookings totaled $307.5 million, up from $233.4 million in Q2 FY2024.

• Gross profit margin improved to 68.9% from 63.1% year-over-year.

• Operating expenses decreased 5.3% year-over-year, reflecting lower compensation costs from an August 2024 reorganization.

• Cash and equivalents were $181.8 million at quarter-end, down from $237.0 million at June 30, 2024, due to share repurchases and the Open Grid Systems acquisition.

Outlook and guidance

• The pending merger with Emerson is expected to close in the first half of 2025, subject to customary closing conditions.

• Management expects sufficient liquidity for at least the next 12 months, with $181.8 million in cash and $194.5 million available under a $200 million credit facility.

• ACV grew 9.2% year-over-year to $964.9 million as of December 31, 2024; bookings for the quarter were $307.5 million.