ANSYS announced Q1 results today, with GAAP revenue of $116.3 million coming in
slightly lower than the company’s earlier forecast of between $117 million and $129 million
but still up from last year’s reported $109.5 million.

Like everyone else in the engineering software space, ANSYS saw license revenue fall in
Q1, dropping 4% from a year ago to $70.5 million. The lease business was up 5% (to 36%
of total revenue) as the paid-up business declined 15%. Maintenance and services revenue
grew 28% over last year to $45.8 million — but only 2% over the December quarter, showing
the inevitable slowdown resulting from lower license revenue.

Organic (excluding Ansoft) revenue was down 2% when compared to Q1 last year — down
10% in North America, up "mid single digits" in Europe, down "mid single digits" in the rest
of world — and Ansoft didn’t perform well, contributing $21.7 million, down sharply from the
$34 million reported for the three months ended April 30, 2008. Ansoft’s paid-up license
model is less attractive right now and its industry and geographic exposure greater than
core ANSYS products’.

The high-end products were more resilient in the face of current economic challenges with
stable ASPs; at the lower end, ASPs were slightly up even as sales were harder to close.
CEO Cashman said that ANSYS didn’t discount unusually heavily in Q1, but worked with
customers to "strike a balance between value and price" — perhaps suggesting leases in
stead of paid-up licenses if money was an issue or structuring a deal so that it came in
within a buyer’s signature authority.

ANSYS calls layoffs "right-sizing" and will continue its program with headcount reductions
in "most geographies and functional expense lines".

For the second quarter, it now expects GAAP-basis revenue in the range of $118 million to
$124 million and for fiscal 2009, the company now sees GAAP-basis revenue of between
$502 million and $552 million, as compared to the earlier forecast of between $522 million
and $582 million.