[Note: ANSYS provided additional information on its results last week; below is a hybrid of my original post and the updates. Many thanks to Annette Arribas, Investor Relations and Global Insurance Officer for ANSYS, for her quick response to my questions. — Ed.]

ANSYS CEO Jim Cashman characterized 2010 as a “watershed year” for simulation, as product recalls and other front-page news items made “business as usual not an option” and leading to an increase in demand for simulation products of all types to foster innovation and reduce risk.

Total revenue in Q4 was $167 million, up 11% over last year and up 19% over the third quarter. Total revenue for 2010 was $580 million, also growth of 11% over last year. Net income for the year was $153 million, leading to diluted earnings per share of $1.64, far above the $1.58 or so the company had forecast last quarter.

Comparing Q4 2010 to Q4 2009,
• Total revenue was $167 million, up 11%.
• Paid-up license revenue grew 17% to $56 million while the lease business struggled, with revenue up 3% to $49 million.
• CEO Jim Cashman said that the high-end products (multiphysics, electronics) showed double-digit growth and an increase in ASPs; at the low end, ASPs were stable when adjusted for deal size.
• Maintenance rebounded, up 14% to $57 million.
• Services revenue declined 4% to $4.7 million.
• ANSYS closed 18 7-figure deals (and no 8 figure deals), accounting for 27% of the aggregate new license revenue in Q4 or $28 million (the rest is classified as deferred revenue). This is up from 14 such deals a year ago.
• Revenue from North America was up 10% to $57 million, while revenue from Europe declined 2% to $56 million.
• The geo standout for ANSYS in Q4 was Japan, where revenue increased 36% to $27 million.
• Revenue from “Other General International Area” aka “rest of world” saw revenue increase 23% to $26 million.

For the full year 2010,
• Total revenue was up 11% to $580 million, on growth of 23% in the company’s non-Japan GIA region and growth in the paid-up license business.
• ANSYS reports that the channel is picking up new products well, and that channel revenue growth has almost kept pace with that of the direct channel; the mix stands at 73% direct/27% indirect — a slight change from the 75%/25% reported last year that is likely due to strength in Japan. Ms. Arribas pointed out that one of ANSYS’ largest channel partners is in Japan, which leads 50% or so of GIA revenue to come from the channel.
• Total lease revenue was up 1% to $185 million.
• Paid-up revenue was up 24% to $166 million.
• Maintenance was up 11% to $211 million.
• Services revenue declined 4% to $18 million.
• Revenue from North American operations grew 8% to $199 million, Europe was up 3% (led by Germany, up 8%) to $199 million.
• Asia Pacific was described as “vibrant”, with revenue from Japan up 23% to $95 million and other GIA was up 22% to $88 million. In an interesting aside, Mr. Cashman said that penetration in Japan was low, so this year’s growth was in part due to growing the brand, and in part to the recovery in the electronics industry there.

Since ANSYS is sitting on $475 million of cash and is repaying the loan taken out to buy Ansoft, analysts’ questions naturally turned to future acquisitions. Mr. Cashman said that ANSYS is always looking, but only for the long term. “We’re looking at acquisitions that foster out 10-year plus product roadmap, and add quality talent in more than ones and twos.”

ANSYS’ Q4 and 2010 results were middling from a growth perspective but handily beat profit expectations, leading happy investors to raise the share price nearly 4% in trading before the markets opened on Thursday. I happened to have a stock ticker window open while i was listening to the analysts call; the share price continued to fall even as the company delivered good financial news and outlook. The stock ultimately closed up about 1%; as Ms. Arribas said when I asked her about volatility during the analysts’ call: “After we have a good quarter the price is driven higher early in the trading day by the shorts in covering their positions, once they have done so, the volumes and the price return to a more normalized level.“ Indeed, ANSYS shares closed the week up 3%.

ANSYS also initiated guidance for 2011, forecasting Q1 revenue between $151 million and $157 million, or growth of about 13%. For 2011, the company sees total revenue in the range of $640 million to $660 million, which would be growth of 12%. This “cautious optimism” extends to hiring: ANSYS has plans to hire about 90 people this year, so get those resumes in!