TROY, Mich., Aug. 01, 2024 (GLOBE NEWSWIRE) -- Altair (NASDAQ:ALTR), a global leader in computational intelligence, today released its financial results for the second quarter and six months ended June 30, 2024.

"Altair maintained its strong trajectory during the second quarter, with software revenue and total revenue above the high end of guidance," said James R. Scapa, founder, chairman, and chief executive officer, Altair. "Our Q2 results underscore the robustness of our software product lineup, which continues to empower customers with industry-leading computational intelligence."

"We are pleased with our execution in the second quarter and first half of the year," said Matt Brown, chief financial officer, Altair. "Our quarterly revenues exceeded expectations as we continued to deliver software revenue growth, which gives us confidence in our path to meet our financial targets for the year."

Second Quarter 2024 Financial Highlights

Software revenue was $135.4 million compared to $125.3 million for the second quarter of 2023, an increase of 8.1% in reported currency and 10.6% in constant currency
Total revenue was $148.8 million compared to $141.2 million for the second quarter of 2023, an increase of 5.4% in reported currency and 7.8% in constant currency
Net loss was $(5.1) million compared to a net loss of $(22.3) million for the second quarter of 2023. Net loss per share, diluted was $(0.06) based on 83.6 million diluted weighted average common shares outstanding, compared to net loss per share, diluted of $(0.28) for the second quarter of 2023, based on 80.0 million diluted weighted average common shares outstanding. Net loss margin was -3.5% compared to net loss margin of -15.8% for the second quarter of 2023
Non-GAAP net income was $14.8 million, compared to non-GAAP net income of $13.2 million for the second quarter of 2023, an increase of 12.1%. Non-GAAP net income per share, diluted was $0.16 based on 91.0 million non-GAAP diluted common shares outstanding, compared to non-GAAP net income per share, diluted of $0.15 for the second quarter of 2023, based on 88.4 million non-GAAP diluted common shares outstanding
Adjusted EBITDA was $17.3 million compared to $17.1 million for the second quarter of 2023, an increase of 1.7%. Adjusted EBITDA margin was 11.7% compared to 12.1% for the second quarter of 2023
Cash provided by operating activities was $28.6 million, compared to $30.0 million for the second quarter of 2023
Free cash flow was $26.3 million, compared to $25.6 million for the second quarter of 2023.

Business Outlook

Based on information available as of today, Altair is issuing the following guidance for the third quarter and full year 2024:

(in millions, except %)	Third Quarter 2024							Full Year 2024
Software Revenue	$	130		to	$	133		$	590		to	$	600
Growth Rate		9.2	%			11.7	%		7.3	%			9.1	%
Growth Rate - Constant Currency		11.1	%			13.7	%		8.9	%			10.8	%
Total Revenue	$	145			$	148		$	648			$	658
Growth Rate		8.2	%			10.4	%		5.8	%			7.4	%
Growth Rate - Constant Currency		10.0	%			12.3	%		7.5	%			9.1	%
Net (Loss) Income	$	(14.0	)		$	(11.1	)	$	22.6			$	30.3
Non-GAAP Net Income	$	13.4			$	15.7		$	108.4			$	114.4
Adjusted EBITDA	$	16			$	19		$	136			$	144
Net Cash Provided by Operating Activities								$	133			$	141
Free Cash Flow								$	122			$	130

The following table provides a reconciliation of Full Year 2024 guidance to the last guidance provided in May

	(Unaudited)
	Full Year 2024
(in millions)	Midpoint of Guidance in May		Increase/ (Decrease)		Currency Fluctuations from Prior Guidance			Midpoint of Guidance in August
Software Revenue	$	595.0	$	3.0	$	(3.0	)	$	595.0
Total Revenue	$	657.0	$	—	$	(4.0	)	$	653.0
Adjusted EBITDA	$	142.0	$	—	$	(2.0	)	$	140.0

Conference Call Information

What:		Altair's Second Quarter 2024 Financial Results Conference Call
When:		Thursday, August 1, 2024
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, Billings, 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, 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 includes the diluted weighted average shares outstanding per GAAP regardless of whether the Company is in a loss position.

Billings consists of total revenue plus the change in deferred revenue, excluding deferred revenue from acquisitions.

Adjusted EBITDA represents net income adjusted for income tax expense, interest expense, interest income and other, depreciation and amortization, stock-based compensation expense, 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 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, 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 intelligence 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 https://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 third quarter and full year 2024, our statements regarding our expectations for 2024, 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

Jennifer Ristic

216-849-3109

jristic@altair.com

Investor Relations

Altair

Stephen Palmtag

669-328-9111

spalmtag@altair.com

ALTAIR ENGINEERING INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS

	June 30, 2024			December 31, 2023
(In thousands)	(Unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	507,008		$	467,459
Accounts receivable, net		126,560			190,461
Income tax receivable		17,682			16,650
Prepaid expenses and other current assets		28,582			26,053
Total current assets		679,832			700,623
Property and equipment, net		38,463			39,803
Operating lease right of use assets		31,816			30,759
Goodwill		459,070			458,125
Other intangible assets, net		77,537			83,550
Deferred tax assets		9,120			9,955
Other long-term assets		40,119			40,678
TOTAL ASSETS	$	1,335,957		$	1,363,493
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable	$	4,002		$	8,995
Accrued compensation and benefits		39,819			45,081
Current portion of operating lease liabilities		8,057			8,825
Other accrued expenses and current liabilities		41,508			48,398
Deferred revenue		123,439			131,356
Current portion of convertible senior notes, net		—			81,455
Total current liabilities		216,825			324,110
Convertible senior notes, net		226,518			225,929
Operating lease liabilities, net of current portion		24,568			22,625
Deferred revenue, non-current		28,745			32,347
Other long-term liabilities		47,995			47,151
TOTAL LIABILITIES		544,651			652,162
Commitments and contingencies
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 59,198 and 55,240 shares as of June 30, 2024, and December 31, 2023, respectively		5			5
Class B common stock, authorized 41,203 shares, issued and outstanding 25,471 and 26,814 shares as of June 30, 2024, and December 31, 2023, respectively		3			3
Additional paid-in capital		939,691			864,135
Accumulated deficit		(119,103	)		(130,503	)
Accumulated other comprehensive loss		(29,290	)		(22,309	)
TOTAL STOCKHOLDERS' EQUITY		791,306			711,331
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	1,335,957		$	1,363,493

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

	Three Months Ended June 30,						Six Months Ended June 30,
(in thousands, except per share data)	2024			2023			2024			2023
Revenue
License	$	92,699		$	87,738		$	210,406		$	200,147
Maintenance and other services		42,724			37,583			83,446			74,817
Total software		135,423			125,321			293,852			274,964
Engineering services and other		13,372			15,840			27,855			32,231
Total revenue		148,795			141,161			321,707			307,195
Cost of revenue
License		3,152			3,981			7,642			8,805
Maintenance and other services		16,199			13,639			30,365			28,065
Total software *		19,351			17,620			38,007			36,870
Engineering services and other		11,165			13,177			23,402			26,662
Total cost of revenue		30,516			30,797			61,409			63,532
Gross profit		118,279			110,364			260,298			243,663
Operating expenses:
Research and development *		55,570			55,277			107,903			108,528
Sales and marketing *		46,475			44,982			90,909			88,474
General and administrative *		19,294			18,622			37,055			36,573
Amortization of intangible assets		7,629			7,625			15,067			15,439
Other operating (income) expense, net		(786	)		127			(1,668	)		5,732
Total operating expenses		128,182			126,633			249,266			254,746
Operating (loss) income		(9,903	)		(16,269	)		11,032			(11,083	)
Interest expense		1,604			1,528			3,180			3,054
Other income, net		(5,750	)		(4,195	)		(9,707	)		(7,808	)
(Loss) income before income taxes		(5,757	)		(13,602	)		17,559			(6,329	)
Income tax (benefit) expense		(610	)		8,678			6,159			17,910
Net (loss) income	$	(5,147	)	$	(22,280	)	$	11,400		$	(24,239	)
(Loss) earnings per share, basic
(Loss) earnings per share	$	(0.06	)	$	(0.28	)	$	0.14		$	(0.30	)
Weighted average shares		83,607			79,986			83,097			80,088
(Loss) earnings per share, diluted
(Loss) earnings per share	$	(0.06	)	$	(0.28	)	$	0.13		$	(0.30	)
Weighted average shares		83,607			79,986			87,397			80,088

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

	(Unaudited)
	Three Months Ended June 30,				Six Months Ended June 30,
(in thousands)	2024		2023		2024		2023
Cost of revenue – software	$	2,097	$	2,572	$	4,099	$	5,324
Research and development		6,618		9,943		12,978		18,686
Sales and marketing		4,979		7,581		9,499		15,172
General and administrative		3,661		3,640		6,778		6,715
Total stock-based compensation expense	$	17,355	$	23,736	$	33,354	$	45,897

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

	Six Months Ended June 30,
(In thousands)	2024			2023
OPERATING ACTIVITIES:
Net income (loss)	$	11,400		$	(24,239	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization		19,557			19,488
Stock-based compensation expense		33,354			45,897
Deferred income taxes		(367	)		2,015
Loss on mark-to-market adjustment of contingent consideration		189			7,987
Other, net		1,166			1,335
Changes in assets and liabilities:
Accounts receivable, net		61,360			45,077
Prepaid expenses and other current assets		(3,647	)		(3,166	)
Other long-term assets		164			(2,516	)
Accounts payable		(4,382	)		(5,529	)
Accrued compensation and benefits		(4,071	)		(6,591	)
Other accrued expenses and current liabilities		(2,834	)		4,857
Deferred revenue		(9,882	)		4,614
Net cash provided by operating activities		102,007			89,229
INVESTING ACTIVITIES:
Payments for acquisition of businesses, net of cash acquired		(13,680	)		(721	)
Capital expenditures		(5,004	)		(6,184	)
Other investing activities, net		(398	)		(1,452	)
Net cash used in investing activities		(19,082	)		(8,357	)
FINANCING ACTIVITIES:
Settlement of convertible senior notes		(81,729	)		—
Proceeds from the exercise of common stock options		37,227			23,507
Proceeds from employee stock purchase plan contributions		4,363			3,797
Payments for repurchase and retirement of common stock		—			(6,255	)
Other financing activities		—			(48	)
Net cash (used in) provided by financing activities		(40,139	)		21,001
Effect of exchange rate changes on cash, cash equivalents and restricted cash		(3,295	)		(44	)
Net increase in cash, cash equivalents and restricted cash		39,491			101,829
Cash, cash equivalents and restricted cash at beginning of year		467,576			316,958
Cash, cash equivalents and restricted cash at end of period	$	507,067		$	418,787

Change in Presentation of Revenue and Cost of Revenue

Effective in the first quarter of 2024, the Company changed the presentation of revenue and cost of revenue in its Consolidated Statements of Operations to combine the financial statement line items ("FSLIs") labeled "Software related services", "Client engineering services" and "Other" into one FSLI labeled "Engineering services and other". The change in presentation has been applied retrospectively and does not affect the software revenue, total revenue, software cost of revenue or total cost of revenue amounts previously reported or have any effect on segment reporting.

Financial Results

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

	(Unaudited)
	Three Months Ended June 30,						Six Months Ended June 30,
(in thousands, except per share amounts)	2024			2023			2024			2023
Net (loss) income	$	(5,147	)	$	(22,280	)	$	11,400		$	(24,239	)
Stock-based compensation expense		17,355			23,736			33,354			45,897
Amortization of intangible assets		7,629			7,625			15,067			15,439
Non-cash interest expense		422			465			894			930
Impact of non-GAAP tax rate⁽¹⁾		(5,548	)		4,033			(10,843	)		2,100
Special adjustments and other⁽²⁾		104			(361	)		1,134			4,870
Non-GAAP net income	$	14,815		$	13,218		$	51,006		$	44,997

Net (loss) income per share, diluted	$	(0.06	)	$	(0.28	)	$	0.13		$	(0.30	)
Non-GAAP net income per share, diluted	$	0.16		$	0.15		$	0.56		$	0.51

GAAP diluted shares outstanding		83,607			79,986			87,397			80,088
Non-GAAP diluted shares outstanding		90,994			88,383			90,606			88,735

(1)		For the three and six months ended June 30, 2024, the Company used a non-GAAP effective tax rate of 25%. For the three and six months ended June 30, 2023, the Company used a non-GAAP effective tax rate of 26%.

(2)		The three months ended June 30, 2024, includes $0.1 million of currency losses on acquisition-related intercompany loans. The three months ended June 30, 2023, includes a $1.0 million loss from the mark-to-market adjustment of contingent consideration associated with the World Programming acquisition and $1.3 million of currency gains on acquisition-related intercompany loans. The six months ended June 30, 2024, includes $0.9 million of currency losses on acquisition-related intercompany loans, and a $0.2 million loss from the mark-to-market adjustment of contingent consideration associated with the World Programming acquisition. The six months ended June 30, 2023, includes an $8.0 million loss from the mark-to-market adjustment of contingent consideration associated with the World Programming acquisition and $3.1 million currency gains on acquisition-related intercompany loans.

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

	(Unaudited)
	Three Months Ended June 30,						Six Months Ended June 30,
(in thousands)	2024			2023			2024			2023
Net (loss) income	$	(5,147	)	$	(22,280	)	$	11,400		$	(24,239	)
Income tax (benefit) expense		(610	)		8,678			6,159			17,910
Stock-based compensation expense		17,355			23,736			33,354			45,897
Interest expense		1,604			1,528			3,180			3,054
Depreciation and amortization		9,938			9,738			19,557			19,488
Special adjustments, interest income and other⁽¹⁾		(5,792	)		(4,344	)		(10,484	)		(1,999	)
Adjusted EBITDA	$	17,348		$	17,056		$	63,166		$	60,111

(1)

The three months ended June 30, 2024, primarily includes $5.9 million of interest income. The three months ended June 30, 2023, includes $4.0 million of interest income, $1.3 million of currency gains on acquisition-related intercompany loans, and a $1.0 million loss from the mark-to-market adjustment of contingent consideration associated with the World Programming acquisition. The six months ended June 30, 2024, includes $11.6 million of interest income, $0.9 million of currency losses on acquisition-related intercompany loans, and a $0.2 million loss from the mark-to-market adjustment of contingent consideration associated with the World Programming acquisition. The six months ended June 30, 2023, includes an $8.0 million loss from the mark-to-market adjustment of contingent consideration associated with the World Programming acquisition, $6.9 million of interest income, and $3.1 million currency gains on acquisition-related intercompany loans.

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 June 30,						Six Months Ended June 30,
(in thousands)	2024			2023			2024			2023
Net cash provided by operating activities	$	28,557		$	30,030		$	102,007		$	89,229
Capital expenditures		(2,238	)		(4,457	)		(5,004	)		(6,184	)
Free cash flow	$	26,319		$	25,573		$	97,003		$	83,045

The following table provides a reconciliation of Non-GAAP gross profit to gross profit, the most comparable GAAP financial measure, and a comparison of Non-GAAP gross margin (Non-GAAP gross profit as a percentage of total revenue) to gross margin (gross profit as a percentage of total revenue), the most comparable GAAP financial measure:

	(Unaudited)
	Three Months Ended June 30,						Six Months Ended June 30,
(in thousands)	2024			2023			2024			2023
Gross profit	$	118,279		$	110,364		$	260,298		$	243,663
Stock-based compensation expense		2,097			2,572			4,099			5,324
Non-GAAP gross profit	$	120,376		$	112,936		$	264,397		$	248,987

Gross profit margin		79.5	%		78.2	%		80.9	%		79.3	%
Non-GAAP gross margin		80.9	%		80.0	%		82.2	%		81.1	%

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 June 30,						Six Months Ended June 30,
(in thousands)	2024			2023			2024			2023
Total operating expense	$	128,182		$	126,633		$	249,266		$	254,746
Stock-based compensation expense		(15,258	)		(21,164	)		(29,255	)		(40,573	)
Amortization		(7,629	)		(7,625	)		(15,067	)		(15,439	)
Loss on mark-to-market adjustment of contingent consideration		(44	)		(981	)		(189	)		(7,987	)
Non-GAAP operating expense	$	105,251		$	96,863		$	204,755		$	190,747

The following table provides a reconciliation of Billings to revenue, the most comparable GAAP financial measure:

	(Unaudited)
	Three Months Ended June 30,						Six Months Ended June 30,
(in thousands)	2024			2023			2024			2023
Revenue	$	148,795		$	141,161		$	321,707		$	307,195
Ending deferred revenue		152,184			148,547			152,184			148,547
Beginning deferred revenue		(144,939	)		(141,943	)		(163,703	)		(144,460	)
Deferred revenue acquired		(1,572	)		—			(1,572	)		—
Billings	$	154,468		$	147,765		$	308,616		$	311,282

The following table provides Software revenue, Total revenue, Billings and Adjusted EBITDA on a constant currency basis:

	(Unaudited)
	Three Months Ended June 30, 2024						Three Months Ended June 30, 2023		Increase/ (Decrease) %
(in thousands)	As reported		Currency changes		As adjusted for constant currency		As reported		As reported			As adjusted for constant currency
Software revenue	$	135.4	$	3.3	$	138.7	$	125.3		8.1	%		10.6	%
Total revenue	$	148.8	$	3.4	$	152.2	$	141.2		5.4	%		7.8	%
Billings	$	154.5	$	3.7	$	158.2	$	147.8		4.5	%		7.1	%
Adjusted EBITDA	$	17.3	$	2.2	$	19.5	$	17.1		1.7	%		14.1	%


	(Unaudited)
	Six Months Ended June 30, 2024						Six Months Ended June 30, 2023		Increase/ (Decrease) %
(in thousands)	As reported		Currency changes		As adjusted for constant currency		As reported		As reported			As adjusted for constant currency
Software revenue	$	293.9	$	4.7	$	298.6	$	275.0		6.9	%		8.6	%
Total revenue	$	321.7	$	4.9	$	326.6	$	307.2		4.7	%		6.3	%
Billings	$	308.6	$	4.5	$	313.1	$	311.3		-0.9	%		0.6	%
Adjusted EBITDA	$	63.2	$	3.4	$	66.6	$	60.1		5.1	%		10.8	%

Business Outlook

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

	(Unaudited)
	Three Months Ending September 30, 2024						Year Ending December 31, 2024
(in thousands)	Low			High			Low			High
Net (loss) income	$	(14,000	)	$	(11,100	)	$	22,600		$	30,300
Stock-based compensation expense		17,800			17,800			68,900			68,900
Amortization of intangible assets		8,400			8,400			31,500			31,500
Non-cash interest expense		300			300			1,500			1,500
Impact of non-GAAP tax rate⁽¹⁾		900			300			(17,200	)		(18,900	)
Special adjustments and other⁽²⁾		—			—			1,100			1,100
Non-GAAP net income	$	13,400		$	15,700		$	108,400		$	114,400

(1)		The Company uses a non-GAAP effective tax rate of 25%.

(2)		The year ending December 31, 2024, includes a $0.2 million loss from the mark-to-market adjustment of contingent consideration associated with the World Programming acquisition, and $0.9 million of currency losses on acquisition-related intercompany loans.

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

	(Unaudited)
	Three Months Ending September 30, 2024						Year Ending December 31, 2024
(in thousands)	Low			High			Low			High
Net (loss) income	$	(14,000	)	$	(11,100	)	$	22,600		$	30,300
Income tax expense		5,400			5,500			19,000			19,300
Stock-based compensation expense		17,800			17,800			68,900			68,900
Interest (income) expense		(3,900	)		(3,900	)		(16,200	)		(16,200	)
Depreciation and amortization		10,700			10,700			40,600			40,600
Special adjustments and other⁽¹⁾		—			—			1,100			1,100
Adjusted EBITDA	$	16,000		$	19,000		$	136,000		$	144,000

(1)

The year ending December 31, 2024, includes a $0.2 million loss from the mark-to-market adjustment of contingent consideration associated with the World Programming acquisition, and $0.9 million of currency losses on acquisition-related intercompany loans.

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, 2024
(in thousands)	Low			High
Net cash provided by operating activities	$	133,000		$	141,000
Capital expenditures		(11,000	)		(11,000	)
Free cash flow	$	122,000		$	130,000

Altair Announces Second Quarter 2024 Financial Results