Most recent blog entries

Who needs PLM?

Fri, 13 Aug 2010 20:00:00 GMT

Autodesk’s revenues in the most recent quarter rebounded more than its peers in the engineering-software business who depend on PLM.

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Forecasting Ansys’ growth

Fri, 06 Aug 2010 19:09:00 GMT

Ansys revenue growth compares favorably with its peers. But is it enough to justify its current share price?

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Dassault Systèmes revenue growth less than meets the eye

Fri, 30 Jul 2010 20:25:00 GMT

July 29, 2010 – Dassault Systèmes (Paris: DSY) reported a 24 percent rise in revenue (in euros) and a 90 percent increase in net income for the quarter ended June 30, 2010. However, this seemingly stellar performance was not the result of increased demand for Dassault Systèmes engineering-software products. Most of the rise appears due to two factors: the acquisition by Dassault Systèmes of IBM’s PLM marketing business and the eight percent drop in the value of the euro compared with the US dollar.

Figure 1 - Dassault Systèmes quarter revenues in euros look strong.
(Click image for an enlarged view.)

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PTC financials portend engineering software upturn

Fri, 30 Jul 2010 17:21:00 GMT

July 27, 2010 – Parametric Technology Corporation’s new license revenues soared 36 percent compared with the like quarter a year ago. New licenses are a harbinger of better times, because consulting and annual maintenance are almost sure to follow. During the economic downturn, large customers delayed big software projects, from which PTC derives a growing share of its business.

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A Time for Optimism?

russ.henke@cyonresearch.com — Fri, 16 Apr 2010 14:03:00 GMT

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Attending COFES 2010? Bone up on latest MCAD & EDA Financials!

russ.henke@cyonresearch.com — Tue, 16 Mar 2010 15:38:00 GMT

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IBM and Dassault Systèmes: An Amiable Separation

Wed, 28 Oct 2009 12:58:00 GMT

Late on the evening of October 26, IBM announced its intention to sell its "IBM sales and client support operations encompassing DS's Product Lifecycle Management (PLM) software … customer contracts and related assets" to Dassault Systèmes. Since 1982, IBM has sold and supported Dassault Systèmes CATIA and related software. The announced sale, which is expected to close in the first half of 2010, ends that relationship.

IBM will receive $600 million in cash for its PLM business. Approximately 700 IBM employees, including PLM general manager Al Bunshaft, will join Dassault Systèmes.

Dassault Systèmes' competitors, Siemens PLM Solutions, Parametric Technology, and Autodesk, are likely to blow the current transaction out of proportion, claiming that Dassault Systèmes has lost a major sales advantage. In reality, this deal is likely to have modest impact on both companies.

IBM will be shedding a relatively small part of its software business that doesn't fit with its main strategy. Steve Mills, IBM Software Group senior vice president, has made it clear for several years that IBM wants to be in the business of selling system software and middleware. It no longer wants to sell applications, such as mechanical design and manufacturing software. Sales of CATIA software in 2008 amounted to 30-35 percent of Dassault Systèmes' total revenue, according the Dassault Systèmes CEO Bernard Charlès, or between $600 and $700 million.

For its part, Dassault Systèmes will be able to book increased revenues from the acquisition even if software sales to IBM customers don't rise at all. IBM's gross margin on CATIA, Enovia, and related software is about 50 percent, or about $300 million. Assuming Dassault Systèmes can keep prices up, that additional $300 million will, over the next 18 months, flow to its top line.

Charlès says customers also will benefit from IBM's divesting of the PLM software organization. For historical reasons, customers currently can buy some but not all of Dassault Systèmes' PLM software from IBM. Products that aren't in IBM's price book must be bought from Dassault Systèmes directly. This administrative quirk means that many large customers must negotiate two contracts in order to buy the full line of Dassault Systèmes' PLM software.

There is little doubt that Dassault Systèmes would not have been as successful as it is if IBM had not sold its software on mainframes and RS-6000 workstations beginning in the 1980s. But with IBM losing enthusiasm for application software, it may not have many more new large accounts to deliver. Dassault Systèmes already decided to choose another company, CAXA, instead of IBM to represent its products in China.

By taking control of its own sales efforts, Dassault Systèmes will be better able to work with other large corporations in information technology such as Hewlett-Packard, Oracle (soon to be the owner of Sun Microsystems), Tata Consultancy, and Dell Computer. Dassault Systèmes will continue to be one of IBM's Global Alliance marketing partners, a status also enjoyed by Parametric Technology and Siemens PLM Software. The French software giant now competes on an equal basis with the other major suppliers of higher priced CAD/CAM, CAE, and PDM software.

The challenge for Dassault Systèmes will be winning large new accounts and mid-sized accounts that promise to grow into large accounts. Historically, the company has done well in Europe, where 46 percent of its sales are generated. But Dassault Systèmes is a laggard in the Western Hemisphere from which it derives 31 percent of its sales. In contrast PTC and Autodesk pull in 38 percent of their revenues from the Americas. A risk to investors (among many) to Dassault Systèmes investors is that former IBM employees, stripped of Big Blue's imprimatur, may not be able to close deals with corporate IT departments as well as they once did.

Dassault Systemes to Acquire IBM's PLM Business Unit

brad.holtz@cyonresearch.com — Tue, 27 Oct 2009 05:00:00 GMT

A look at the next stage of the IBM-Dassault Systemes "marriage"

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MSC.Software…New Era Begins…

russ.henke@cyonresearch.com — Thu, 15 Oct 2009 00:01:00 GMT

In this space on September 30, 2009, the then-latest news on MSC,Software appeared, in a blog article entitled, “MSC.Software…in the news again…”.

As of today, October 14, the company posted a Press Release on its website announcing that Symphony Technology Group (STG) had successfully completed its acquisition of MSC.Software Corporation.

Under the terms of the deal, Maximus Holdings Inc., an investment vehicle of STG and co-investor Elliott Management Corporation has purchased all outstanding shares of MSC stock for a price of $8.40 per share in cash, a total purchase price of approximately $390 million.

Moreover, industry veteran Dominic Gallello joins MSC as CEO. Gallello comes to MSC from Graphisoft, a Budapest-based architectural design software developer, where he was CEO. In addition, Jim Johnson joins MSC as CFO. Johnson was most recently CFO of VG Holdings, a videogame producer that was acquired by Electronic Arts in 2007.

You can access the entire Press Release by copying & pasting this URL into your browser:
http://www.mscsoftware.com/About-Us/News/Default.aspx?articleid=1131

Siemens PLM NX 7.0...

russ.henke@cyonresearch.com — Thu, 08 Oct 2009 14:14:00 GMT

Siemens PLM Software just announced the latest release of NX™ software, the company’s flagship digital product development solution. With NX 7.0, Siemens PLM Software introduced HD3D, a visual environment to help global product development teams unlock the value of PLM information.

In addition, NX 7.0 included enhancements to synchronous technology – the computer-aided design, manufacturing and engineering analysis (CAD/CAM/CAE) productivity software introduced by Siemens PLM Software last year. (See blog entry in this space dated February 11, 2009, entitled, “Solid Progress…”).

The NX 7.0 enhancements are aimed at helping accelerate a variety of product development tasks and expand the ability of NX to work with data from third party CAD applications.

The announcement of NX 7.0 was made October 7, 2009 in Paris at the Siemens PLM Connection Europe annual users conference.