Form 10-Q - Quarterly report [Sections 13 or 15(d)]

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2024

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: 001-41400

ASPEN TECHNOLOGY, INC.

(Exact name of registrant as specified in its charter)


Delaware						87-3100817
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)


20 Crosby Drive
Bedford
Massachusetts						01730
(Address of principal executive offices)						(Zip Code)

(Registrant’s telephone number, including area code): (781) 221-6400

____________________________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class

Trading Symbol

Name of Each Exchange on Which Registered

Common stock, $0.0001 par value per share

AZPN

Nasdaq Global Select Market

____________________________________________

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days: Yes ý No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ý No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act): Yes ☐ No ý

There were 63,249,719 shares of common stock outstanding as of October 30, 2024.

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TABLE OF CONTENTS


		Page
	PART I - FINANCIAL INFORMATION

Item 1.	Financial Statements (unaudited).	4
	Condensed Consolidated Statements of Operations for the Three Months Ended September 30, 2024 and 2023.	4
	Condensed Consolidated Statements of Comprehensive Loss for the Three Months Ended September 30, 2024 and 2023.	5
	Condensed Consolidated Balance Sheets as of September 30, 2024 and June 30, 2024.	6
	Condensed Consolidated Statements of Stockholders’ Equity for the Three Months Ended September 30, 2024 and 2023.	7
	Condensed Consolidated Statements of Cash Flow for the Three Months Ended September 30, 2024 and 2023.	8
	Notes to Condensed Consolidated Financial Statements.	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	19
Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	26
Item 4.	Controls and Procedures.	27

	PART II - OTHER INFORMATION

Item 1.	Legal Proceedings.	28
Item 1A.	Risk Factors.	28
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	28
Item 3.	Defaults upon Senior Securities.	29
Item 4.	Mine Safety Disclosures.	29
Item 5.	Other Information.	29
Item 6.	Exhibits.	30
	SIGNATURES

Aspen Technology, Inc. (“AspenTech”) has many registered trademarks including aspenONE and Aspen Plus. All other trade names, trademarks and service marks appearing in this Form 10-Q not owned by AspenTech are the property of their respective owners.

Our fiscal year ends on June 30th, and references to a specific fiscal year are to the twelve months ended June 30th of such year (for example, “fiscal 2025” refers to the year ending June 30, 2025).

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PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

Condensed Consolidated Financial Statements (Unaudited)

ASPEN TECHNOLOGY, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS


	Three Months Ended September 30,
	2024		2023

	(Dollars and Shares in Thousands, Except per Share Data; Unaudited)
Revenue:
License and solutions	$	101,659	$	148,648
Maintenance	90,686		84,968
Services and other	23,532		15,692
Total revenue	215,877		249,308
Cost of revenue:
License and solutions	63,654		71,578
Maintenance	10,688		10,200
Services and other	21,105		16,282
Total cost of revenue	95,447		98,060
Gross profit	120,430		151,248
Operating expenses:
Selling and marketing	125,661		122,378
Research and development	50,000		53,676
General and administrative	33,008		35,405
Restructuring costs	7,726		—
Total operating expenses	216,395		211,459
Loss from operations	(95,965)		(60,211)
Other income (expense), net	2,041		(5,830)
Interest income, net	17,176		14,049
Loss before benefit for income taxes	(76,748)		(51,992)
Benefit for income taxes	(16,284)		(17,467)
Net loss	$	(60,464)	$	(34,525)
Net loss per common share:
Basic	$	(0.96)	$	(0.54)
Diluted	$	(0.96)	$	(0.54)
Weighted average shares outstanding:
Basic	63,244		64,319
Diluted	63,244		64,319

See accompanying notes to these unaudited condensed consolidated financial statements.

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ASPEN TECHNOLOGY, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS


	Three Months Ended September 30,
	2024		2023

	(Dollars in Thousands; Unaudited)
Net loss	$	(60,464)	$	(34,525)
Other comprehensive income (loss):
Foreign currency translation adjustments	5,202		(11,201)
Total other comprehensive income (loss)	5,202		(11,201)
Comprehensive loss	$	(55,262)	$	(45,726)

See accompanying notes to these unaudited condensed consolidated financial statements.

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ASPEN TECHNOLOGY, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS


	September 30, 2024		June 30, 2024

	(Dollars in Thousands, Except Share Data; Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	221,093	$	236,970
Accounts receivable, net	102,867		115,533
Current contract assets, net	426,387		409,177
Prepaid expenses and other current assets	33,670		27,441
Receivables from related parties	45,300		78,483
Prepaid income taxes	2,909		8,462
Total current assets	832,226		876,066
Property, equipment and leasehold improvements, net	18,093		17,389
Goodwill	8,330,124		8,328,201
Intangible assets, net	4,063,852		4,184,750
Non-current contract assets, net	518,562		515,106
Contract costs	26,265		24,903
Operating lease right-of-use assets	95,001		96,034
Deferred income tax assets	7,627		6,989
Other non-current assets	25,189		22,269
Total assets	$	13,916,939	$	14,071,707

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	12,050	$	8,099
Accrued expenses and other current liabilities	78,926		100,167
Due to related parties	24,979		47,449
Current operating lease liabilities	12,172		13,125
Income taxes payable	21,656		44,249
Current contract liabilities	117,768		124,312
Total current liabilities	267,551		337,401
Non-current contract liabilities	33,569		27,512
Deferred income tax liabilities	758,389		790,687
Non-current operating lease liabilities	85,676		84,875
Other non-current liabilities	18,795		18,377
Stockholders’ equity:
Common stock, $0.0001 par value Authorized—600,000,000 shares Issued— 65,453,489 and 65,367,159 shares Outstanding— 63,245,006 and 63,251,495 shares	7		7
Additional paid-in capital	13,293,704		13,277,851
Accumulated deficit	(111,626)		(51,162)
Accumulated other comprehensive loss	(2,059)		(7,261)
Treasury stock, at cost — 2,208,483 and 2,115,664 shares of common stock	(427,067)		(406,580)
Total stockholders’ equity	12,752,959		12,812,855
Total liabilities and stockholders’ equity	$	13,916,939	$	14,071,707

See accompanying notes to these unaudited condensed consolidated financial statements.

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ASPEN TECHNOLOGY, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY


	Accumulated Other Comprehensive Loss		Common Stock			Additional Paid-in Capital		Accumulated Deficit		Treasury Stock			Total Stockholders’ Equity
			Number of Shares	Par Value						Number of Shares	Cost

	(Dollars in Thousands, Except Share Data; Unaudited)

Balance June 30, 2024	$	(7,261)	65,367,159	$	7	$	13,277,851	$	(51,162)	2,115,664	$	(406,580)	$	12,812,855
Net loss	—		—	—		—		(60,464)		—	—		(60,464)
Other comprehensive income	5,202		—	—		—		—		—	—		5,202
Issuance of shares of common stock	—		48,326	—		6,662		—		—	—		6,662
Issuance of restricted stock units and net share settlement related to withholding taxes	—		38,004	—		(5,623)		—		—	—		(5,623)
Repurchase of common stock	—		—	—				—		92,819	(20,487)		(20,487)
Stock-based compensation	—		—	—		14,814		—		—	—		14,814
Balance September 30, 2024	$	(2,059)	65,453,489	$	7	$	13,293,704	$	(111,626)	2,208,483	$	(427,067)	$	12,752,959


	Accumulated Other Comprehensive Income (Loss)		Common Stock			Additional Paid-in Capital		Accumulated Deficit		Treasury Stock			Total Stockholders’ Equity
			Number of Shares	Par Value						Number of Shares	Cost

	(Dollars in Thousands, Except Share Data; Unaudited)

Balance June 30, 2023	$	2,436	64,952,868	$	6	$	13,194,028	$	(41,391)	487,626	$	(84,150)	$	13,070,929
Net loss	—		—	—		—		(34,525)		—	—		(34,525)
Other comprehensive loss	(11,201)		—	—		—		—		—	—		(11,201)
Issuance of shares of common stock	—		29,644	—		3,826		—		—	—		3,826
Issuance of restricted stock units and net share settlement related to withholding taxes	—		47,896	—		(4,585)		—		—	—		(4,585)
Repurchase of common stock	—		—	—		20,210		—		686,843	(134,434)		(114,224)
Stock-based compensation	—		—	—		16,699		—		—	—		16,699
Balance September 30, 2023	$	(8,765)	65,030,408	$	6	$	13,230,178	$	(75,916)	1,174,469	$	(218,584)	$	12,926,919

See accompanying notes to these unaudited condensed consolidated financial statements.

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ASPEN TECHNOLOGY, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS


	Three Months Ended September 30,
		2024		2023

		(Dollars in Thousands; Unaudited)
Cash flows from operating activities:
Net loss		$	(60,464)	$	(34,525)
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Depreciation and amortization		122,856		123,219
Reduction in the carrying amount of right-of-use assets		3,961		3,562
Net foreign currency (gains) losses		(2,120)		5,894
Stock-based compensation		14,814		16,699
Deferred income taxes		(32,448)		(51,080)
Provision for uncollectible receivables		491		1,788
Other non-cash operating activities		(258)		19
Changes in assets and liabilities:
Accounts receivable		12,887		29,417
Contract assets		(18,851)		(24,062)
Contract costs		1,285		(1,163)
Lease liabilities		(3,041)		(3,770)
Prepaid expenses, prepaid income taxes, and other assets		(5,956)		(22,487)
Accounts payable, accrued expenses, income taxes payable and other liabilities		(37,052)		10,200
Contract liabilities		(501)		(36,730)
Net cash (used in) provided by operating activities		(4,397)		16,981
Cash flows from investing activities:
Purchases of property, equipment and leasehold improvements		(2,022)		(937)
Payments for business acquisitions, net of cash acquired		—		(8,273)
Payments for equity method investments		(30)		(98)
Payments for asset acquisitions		—		(12,500)
Net cash used in investing activities		(2,052)		(21,808)
Cash flows from financing activities:
Issuance of shares of common stock, net of taxes		6,262		3,285
Repurchases of common stock		(20,487)		(114,224)
Payment of tax withholding obligations related to restricted stock		(4,635)		(1,938)
Net transfers from Parent Company		8,836		3,890
Payments of debt issuance costs		(107)		—
Net cash used in financing activities		(10,131)		(108,987)
Effect of exchange rate changes on cash, cash equivalents and restricted cash		3,264		(6,855)
Decrease in cash, cash equivalents and restricted cash		(13,316)		(120,669)
Cash, cash equivalents and restricted cash, beginning of period		248,468		241,209
Cash, cash equivalents and restricted cash, end of period		$	235,152	$	120,540

Reconciliation of cash, cash equivalents and restricted cash:
Cash and cash equivalents		$	221,093	$	120,540
Restricted cash in other non-current assets		14,059		—
Total cash, cash equivalents and restricted cash		$	235,152	$	120,540

Supplemental disclosure of cash flow information:
Income taxes paid, net		$	32,945	$	31,842
Interest paid		$	702	$	663
Supplemental disclosure of non-cash activities:
Change in purchases of property, equipment and leasehold improvements included in accounts payable and accrued expenses		$	150	$	249
Lease liabilities arising from obtaining right-of-use assets		$	2,098	$	397

See accompanying notes to these unaudited condensed consolidated financial statements.

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ASPEN TECHNOLOGY, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. Organization and Basis of Presentation

AspenTech, together with its subsidiaries (the “Company”), is a leading industrial software company that develops solutions to address complex industrial environments where it is critical to optimize the asset design, operations and maintenance lifecycle. Through the Company’s unique combination of product capabilities, deep domain expertise and award-winning innovation, customers across diverse end markets in asset-intensive industries can improve their operational excellence while achieving sustainability goals.

The Company had revenue from customers in 113 countries during the first quarter of fiscal 2025.

Basis of Presentation

The Company has prepared the accompanying unaudited condensed consolidated financial statements as of September 30, 2024, and for the first quarter of fiscal 2025 and 2024 pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”) and in accordance with generally accepted accounting principles in the United States (“GAAP”). All intercompany balances and transactions have been eliminated in consolidation.

These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated and combined financial statements and the notes thereto included in our Annual Report on Form 10-K for the fiscal year ended June 30, 2024.

The preparation of financial statements and related disclosures in conformity with GAAP requires us to make judgments, assumptions, and estimates that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. The actual results that the Company experiences may differ materially from these estimates.

Russia

In June 2024, the United States government announced new expanded restrictions that prohibit the sale, service, maintenance, and support (such as bug fixes and updates) of enterprise management software and design and manufacturing software in the Russian market. As a result, the Company announced that it had suspended all commercial activities in Russia in the fourth quarter of fiscal 2024. This includes the discontinuation of the following activities: all commercial discussions with customers, initiating or processing renewals, providing proposals to customers or selling products or services. In addition, the Company has written-off certain assets that are related to its operations in Russia, and will be closing certain facilities, and terminating or relocating substantially all employees based in Russia during fiscal 2025.

Beginning with the consolidated balance sheet as of June 30, 2024, the Company classifies cash balances that are both held in Russia and in excess of what it estimates will be required to wind down its operations in Russia as restricted cash due to current restrictions impacting the Company’s ability to transfer funds from bank accounts located in Russia to other countries. As of September 30, 2024 and June 30, 2024, the restricted cash held in Russia was $14.0 million and $11.5 million, respectively, which is included within other non-current assets on the condensed consolidated balance sheets.

2. Significant Accounting Policies

Our significant accounting policies are described in Note 2, “Significant Accounting Policies,” to the consolidated and combined financial statements included in our Annual Report on Form 10-K for the fiscal year ended June 30, 2024. There were no material changes to our significant accounting policies during the three months ended September 30, 2024.

(a) Recently Issued Accounting Standards Not Yet Adopted

In October 2023, the FASB issued Accounting Standards Updated (“ASU”) 2023-06, Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative (“ASU 2023-06”). ASU 2023-06 was issued to modify the disclosure or presentation requirements of a variety of topics in the codification. The effective date for each amendment will be the date on which the SEC removal of the related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited. The Company does not expect the adoption of ASU 2023-06 to have a material impact on its financial position or results of operations.

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In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”). ASU 2023-07 expands segment disclosures by requiring disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items, and interim disclosures of a reportable segment’s profit or loss and assets. The disclosures required under ASU 2023-07 are also required for public entities with a single reportable segment. The ASU is effective for the Company’s first fiscal year beginning after December 15, 2023 and for interim periods within the Company’s first fiscal year beginning after December 15, 2024, with early adoption permitted. The Company does not expect the adoption of ASU 2023-07 to have a material impact on its financial position or results of operations.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. ASU 2023-09 is effective for the Company’s first fiscal year beginning after December 15, 2024. The guidance will be applied on a prospective basis with the option to apply the standard retrospectively. Early adoption is permitted. The Company does not expect the adoption of ASU 2023-09 to have a material impact on its financial position or results of operations.

3. Revenue from Contracts with Customers

Contract Assets and Contract Liabilities

The Company’s contract assets and contract liabilities were as follows as of September 30, 2024 and June 30, 2024:


	September 30, 2024		June 30, 2024

	(Dollars in Thousands)
Contract assets	$	944,949	$	924,283
Contract liabilities	(151,337)		(151,824)
Net contract assets	$	793,612	$	772,459

The majority of the Company’s contract balances are related to arrangements where revenue is recognized at a point in time and payments are made according to a contractual billing schedule. The change in the net contract asset balance during the three months ended September 30, 2024 was primarily due to greater revenue recognition as compared to billings. Revenue recognized during the first quarter of fiscal 2024 included $38.0 million that was included in the beginning contract liability balance.

Transaction Price Allocated to Remaining Performance Obligations

The following table includes the aggregate amount of the transaction price allocated as of September 30, 2024 to the performance obligations that are unsatisfied (or partially unsatisfied) at the end of the reporting period:


	Year Ended June 30,
	2025		2026		2027		2028		2029		Thereafter		Total

	(Dollars in Thousands)
License and solutions	$	158,801	$	57,595	$	19,618	$	10,301	$	5,063	$	182	$	251,560
Maintenance	246,297		234,058		172,742		114,627		67,181		34,640		869,545
Services and other	84,300		52,695		18,142		7,809		571		77		163,594
Total	$	489,398	$	344,348	$	210,502	$	132,737	$	72,815	$	34,899	$	1,284,699

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Disaggregated Revenue Information

The table below reflects disaggregated revenues by business for the three months ended September 30, 2024 and 2023:


	Three Months Ended September 30,
	2024		2023

	(Dollars in Thousands)
Heritage AspenTech	$	150,043	$	175,743
Subsurface Science & Engineering (“SSE”)	20,310		24,081
Digital Grid Management (“DGM”)	45,524		49,484
Total	$	215,877	$	249,308

The Company did not have any customers that accounted for 10 percent or more of the Company’s revenues for the three months ended September 30, 2024 and 2023, respectively.

4. Intangible Assets

Intangible assets consist of the following as of September 30, 2024 and June 30, 2024:


	Developed Technology		Trademarks		Customer Relationships and Backlog		Capitalized Software and Other		Total

September 30, 2024	(Dollars in Thousands)
Gross carrying amount	$	1,903,599	$	464,400	$	3,082,541	$	24,026	$	5,474,566
Less: Accumulated amortization	(585,236)		(18,900)		(796,521)		(10,057)		(1,410,714)
Net carrying amount	$	1,318,363	$	445,500	$	2,286,020	$	13,969	$	4,063,852

	Developed Technology		Trademarks		Customer Relationships and Backlog		Capitalized Software and Other		Total

June 30, 2024	(Dollars in Thousands)
Gross carrying amount	$	1,903,599	$	464,400	$	3,082,541	$	24,026	$	5,474,566
Less: Accumulated amortization	(537,492)		(17,931)		(724,270)		(10,123)		(1,289,816)
Net carrying amount	$	1,366,107	$	446,469	$	2,358,271	$	13,903	$	4,184,750

Of the total intangible assets net carrying amount of $4.1 billion as of September 30, 2024, $430.0 million relates to the registered trademarks associated with the Transaction (as defined in Note 15, “Related-Party Transactions”) that are not subject to amortization. Total intangible asset amortization expense was $121.8 million and $121.7 million during the three months ended September 30, 2024 and 2023, respectively.

5. Goodwill

The changes in the carrying amount of goodwill during the three months ended September 30, 2024 were as follows:


	Carrying Value
	(Dollars in Thousands)
Balance, June 30, 2024	$	8,328,201
Foreign currency translation	1,923
Balance, September 30, 2024	$	8,330,124

6. Restructuring Costs

The Company records liabilities for costs associated with exit or disposal activities in the period in which the liability is incurred. Employee severance costs are accrued when the restructuring actions have been determined and communicated to the employee. Costs for one-time termination benefits in which the employee is required to render service until termination in order to receive the benefits are recognized ratably over the future service period.

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In August 2024, the Company announced a reorganization of its corporate structure, resulting in the elimination of certain roles as it continues to seek additional opportunities to streamline expenses and increase efficiencies. Additionally, due to the expansion of sanctions by the United States government on commercial activity in Russia, the Company will be closing certain facilities, and terminating or relocating substantially all employees based in Russia during fiscal 2025. As a result of these actions, the Company has incurred and will continue to incur restructuring costs during fiscal 2025 consisting primarily of severance expenditures, one-time benefits and other contract termination costs.

Restructuring costs were $7.7 million for the three months ended September 30, 2024, and there were no restructuring costs for the three months ended September 30, 2023. As of September 30, 2024, the liability associated with unpaid restructuring costs was $1.1 million, which is included within accrued expenses and other current liabilities on the condensed consolidated balance sheets.

7. Leases

Operating lease costs are recognized on a straight-line basis over the term of the lease. The components of total lease expense for the three months ended September 30, 2024 and 2023 were as follows:


	Three Months Ended September 30,
	2024		2023

	(Dollars in Thousands)
Operating lease expense	$	4,977	$	4,466
Variable lease expense	$	404	$	223
Short term lease expense	$	136	$	157

The following table summarizes the balances of the Company’s operating lease right-of-use assets and operating lease liabilities as of September 30, 2024 and June 30, 2024:


	September 30, 2024		June 30, 2024

	(Dollars in Thousands)
Operating lease right-of-use assets	$	95,001	$	96,034
Current operating lease liabilities	$	12,172	$	13,125
Non-current operating lease liabilities	$	85,676	$	84,875

The weighted-average remaining lease term for operating leases was eleven years and eleven years, and the weighted-average discount rate was 4.2% and 4.0% as of September 30, 2024 and June 30, 2024, respectively.

The following table represents the future maturities of the Company’s operating lease liabilities as of September 30, 2024:


Year Ending June 30,	(Dollars in Thousands)
2025	$	10,219
2026	11,019
2027	14,416
2028	14,015
2029	13,125
Thereafter	91,950
Total lease payments	154,744
Less: imputed interest	(32,073)
Less: leasehold improvement incentives to be utilized	(24,823)
Total lease maturities	$	97,848

8. Fair Value

The Company determines fair value by utilizing a fair value hierarchy that ranks the quality and reliability of the information used in its determination. Fair values determined using “Level 1 inputs” utilize unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. Fair values determined using “Level 2 inputs” utilize data points that are observable, such as quoted prices, interest rates and yield curves for similar assets and liabilities.

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Cash equivalents are reported at fair value utilizing quoted market prices in identical markets, or “Level 1 Inputs.” The Company’s cash equivalents consist of short-term money market instruments.

Equity method investments are reported at fair value calculated in accordance with the market approach, utilizing market consensus pricing models with quoted prices that are directly or indirectly observable, or “Level 2 Inputs.”

The following table summarizes financial assets and liabilities measured and recorded at fair value on a recurring basis in the accompanying condensed consolidated balance sheets as of September 30, 2024 and June 30, 2024, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value:


	Fair Value Measurements at Reporting Date Using,
	Quoted Prices in Active Markets for Identical Assets (Level 1 Inputs)		Significant Other Observable Inputs (Level 2 Inputs)

	(Dollars in Thousands)
September 30, 2024
Money market funds (cash equivalents)	$	106,187	$	—
Equity method investments	$	—	$	2,467


June 30, 2024
Money market funds (cash equivalents)	$	129,710	$	—
Equity method investments	$	—	$	2,437

Financial instruments not measured or recorded at fair value in the accompanying condensed consolidated financial statements consist of accounts receivable, accounts payable and accrued liabilities. The estimated fair value of these financial instruments approximates its carrying value. The estimated fair value of the borrowings under the Second Amended and Restated Credit Agreement (described below in Note 10, “Debt”) approximates its carrying value due to the floating interest rate.

9. Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities in the accompanying condensed consolidated balance sheets consist of the following:


	September 30, 2024		June 30, 2024

	(Dollars in Thousands)
Compensation-related	$	50,610	$	61,976
Professional fees	5,661		4,987
Accrued taxes	5,146		10,991
Acquisition related	1,475		1,804
Restructuring	1,078		—
Other	14,956		20,409
Total accrued expenses and other current liabilities	$	78,926	$	100,167

10. Debt

Second Amended and Restated Credit Agreement

On June 27, 2024, the Company entered into a new Second Amended and Restated Credit Agreement (the “Second Amended and Restated Credit Agreement”) with JPMorgan Chase Bank, National Association with an expiration date of June 27, 2029 that provides for aggregate borrowing commitments of $200.0 million.

As of September 30, 2024, the Company was in compliance with the covenants associated with the Second Amended and Restated Credit Agreement, and, after considering eligible outstanding letters of credit allowable in the aggregate amount of $5.5 million, the Company had $194.5 million available for borrowing.

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For a more detailed description of the Second Amended and Restated Credit Agreement, see Note 12, “Debt” to the consolidated and combined financial statements included in our Annual Report on Form 10-K for the fiscal year ended June 30, 2024.

11. Stock-Based Compensation

The stock-based compensation expense under all equity plans and its classification in the condensed consolidated statements of operations for the three months ended September 30, 2024 and 2023 are as follows:


	Three Months Ended September 30,
	2024		2023

	(Dollars in Thousands)
Cost of license and solutions	$	551	$	680
Cost of maintenance	887		488
Cost of services and other	1,045		498
Selling and marketing	2,930		2,942
Research and development	3,000		4,553
General and administrative	6,401		7,538
Total stock-based compensation	$	14,814	$	16,699

Stock Options

The table below summarizes activities related to stock options for the three months ended September 30, 2024:


	Number of Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value(1)
				(in years)	(in thousands)
Outstanding as of June 30, 2024	760,088	$	160.82	5.61	$	43,132
Exercised	(50,006)	$	140.67
Cancelled / Forfeited	(28,323)	$	175.33
Outstanding as of September 30, 2024	681,759	$	159.47	5.62	$	65,611
Exercisable as of September 30, 2024	562,878	$	133.36	5.18	$	59,369
Vested and expected to vest as of September 30, 2024	675,824	$	142.10	5.61	$	65,386

__________

(1) The aggregate intrinsic value in this table represents any excess of the closing market price of the Company’s common stock as of September 30, 2024 ($238.82) over the exercise price of the underlying options.

Restricted Stock Units and Performance Stock Units

Restricted stock units and performance stock units are not included in issued and outstanding common stock until the units are vested and the underlying shares are settled. The table below summarizes activities related to restricted stock units and performance stock units for the three months ended September 30, 2024:


	Number of Shares Underlying Performance Stock Units		Weighted Average Grant-Date Fair Value PSUs		Number of Shares Underlying Restricted Stock Units		Weighted Average Grant-Date Fair Value RSUs

	(Dollars in Thousands, except per share data)
Outstanding as of June 30, 2024	82,656		$	194.03	288,887		$	193.98
Granted	87,945		$	234.14	159,878		$	231.06
Settled	—		—		(62,272)		$	196.29
Forfeited	(13,289)		$	194.10	(28,652)		$	198.05
Outstanding as of September 30, 2024	157,312		$	216.45	357,841		$	210.23
Weighted average remaining recognition period of outstanding units (in years)	2.58				2.16
Unrecognized stock-based compensation expense of outstanding units	$	22,753			$	62,714
Aggregate intrinsic value of outstanding units	$	29,282			$	83,133

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In fiscal 2024 and 2025, the Company granted performance stock units with both a performance and service condition. The performance condition relates to the attainment of predefined goals based on annual contract value and free cash flow. On a quarterly basis, management evaluates the probability that the threshold performance goals will be achieved, if at all, and the anticipated level of attainment to determine the amount of compensation expense to record in the condensed consolidated financial statements.

12. Net Loss Per Share

The calculations of basic and diluted net loss per share and basic and diluted weighted average shares outstanding for the three months ended September 30, 2024 and 2023 are as follows:


	Three Months Ended September 30,
	2024		2023

	(Dollars and Shares in Thousands, Except per Share Data)
Net loss	$	(60,464)	$	(34,525)

Basic weighted average shares outstanding	63,244		64,319



Dilutive weighted average shares outstanding	63,244		64,319

Net loss per share
Basic	$	(0.96)	$	(0.54)
Dilutive	$	(0.96)	$	(0.54)

For the three months ended September 30, 2024, and 2023, certain employee equity awards were anti-dilutive due to the Company’s net loss. The following employee equity awards were excluded from the calculation of diluted weighted average shares outstanding because their effect would be anti-dilutive as of September 30, 2024 and 2023:


	Three Months Ended September 30,
	2024	2023

	(Shares in Thousands)
Employee equity awards	1,032	1,449

13. Stock Repurchases

On August 6, 2024, the Company announced that its Board of Directors approved a share repurchase authorization (the “Fiscal 2025 Share Repurchase Authorization”) pursuant to which an aggregate amount of $100.0 million of its common stock may be repurchased, by means of open market transactions, block transactions, privately negotiated purchase transactions or any other purchase techniques, including 10b5-1 trading plans. The timing and amount of any shares repurchased under the Fiscal 2025 Share Repurchase Authorization are based on market conditions and other factors. All shares of the Company’s common stock repurchased have been recorded as treasury stock under the cost method. The Company reflects share repurchases in its condensed consolidated financial statements once the transaction is settled.

As of September 30, 2024, a total of 92,819 shares have been repurchased under the Fiscal 2025 Share Repurchase Authorization for $20.5 million, with the total remaining value available for repurchase being $79.5 million.

14. Benefit for Income Taxes

The Company computes its tax benefit for interim periods by applying the estimated annual effective tax rate (“AETR”) to year-to-date income from operations and adjusting for discrete items arising in that quarter. However, if the Company is unable to make a reliable estimate of its AETR, then the actual effective tax rate for the year-to-date period may be the best estimate. For both the three months ended September 30, 2024 and September 30, 2023 the Company recorded the actual effective tax rate as it was determined that the AETR approach was not the most appropriate estimate.

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Benefit for income taxes was $16.3 million and $17.5 million for the three months ended September 30, 2024 and 2023, respectively, resulting in effective tax rates of 21.2% and 33.6%, respectively. Income tax benefit decreased primarily due to the lower Foreign-Derived Intangible Income (“FDII”) deduction taken this year compared to last year resulting from lower taxable income in the first quarter of fiscal 2025 compared to the first quarter of fiscal 2024. The first quarter of fiscal 2024 included a significant temporary item that increased taxable income relating to a change in the methodology for recording revenue for tax purposes on multi-year software licenses. There was no such temporary item in the first quarter of fiscal 2025.

15. Related-Party Transactions

On October 10, 2021, Emerson Electric Co. (“Emerson”) entered into a definitive agreement (the “Transaction Agreement”) with AspenTech Corporation (f/k/a Aspen Technology, Inc.) (“Heritage AspenTech”) to contribute the Emerson industrial software business (the “Industrial Software Business”), along with $6.014 billion in cash, to create AspenTech (the “Transaction”). The Industrial Software Business included the DGM business and the SSE business. The Transaction closed on May 16, 2022 (“Closing Date”). Emerson owned approximately 56% of AspenTech on a fully diluted basis as of September 30, 2024.

The Company utilizes some aspects of Emerson’s centralized treasury function to manage the working capital and financing needs of its business operations. This function oversees a cash pooling arrangement which sweeps certain Company cash accounts into pooled Emerson cash accounts on a daily basis which are reflected as receivables from related parties in the condensed consolidated balance sheets. Conversely, any cash funded to the Company from these pooled Emerson cash accounts are reflected as due to related parties in the condensed consolidated balance sheets. The aggregate net activity between the Company and Emerson associated with the cash pooling arrangement is reflected within cash flows from financing activities as net transfers from parent within the condensed consolidated statements of cash flows.

Before the closing of the Transaction, the Industrial Software Business was charged for costs directly attributable to the DGM and SSE businesses and was allocated a portion of Emerson’s costs, including general corporate costs, information technology costs, insurance and other benefit costs, and shared service and other costs. All of these costs are reflected in the Company’s condensed consolidated financial statements. Management believes the methodologies and assumptions used to allocate these costs are reasonable.

At the closing of the Transaction, Emerson and the Company entered into a transition service agreement (the “Transition Service Agreement”) for the provision of certain transitionary services from Emerson to the Company. Pursuant to the Transition Service Agreement, Emerson provides the Company with certain services, including information technology, human resources and other specified services, as well as access to certain of Emerson’s existing facilities. Transition Service Agreement related activities have been recorded as cost of goods sold or operating expenses from related parties and resulting balances have been presented as receivable from or due to related parties in the condensed consolidated financial statements. The Transition Services Agreement expires on December 31, 2024.

In connection with the closing of the Transaction, the Company entered into a registration rights agreement (the “Registration Rights Agreement”) and a tax matters agreement (the “Tax Matters Agreement”) with Emerson. The Registration Rights Agreement grants Emerson certain market registration rights, including demand registration rights and piggyback registration rights, with respect to its registrable securities. The Company has agreed to pay out-of-pocket fees and expenses in connection with such registration, subject to certain exceptions. The Tax Matters Agreement governs the rights and obligations that the Company and Emerson have with respect to taxes of the Company and certain Emerson subsidiaries. In addition, under the terms of the Tax Matters Agreement, the Company agreed to indemnify Emerson and its affiliates against any and all tax-related liabilities incurred by them relating to the Transaction and certain related business reorganizations to the extent such tax-related liabilities are caused by any action taken by the Company.

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Receivables from related parties and due to related parties reported in the condensed consolidated balance sheets as of September 30, 2024 and June 30, 2024 include the following:


	September 30, 2024		June 30, 2024

	(Dollars in Thousands)
Interest bearing receivables from related parties	$	45,119	$	78,278
Trade receivables from related parties	181		205
Receivables from related parties	$	45,300	$	78,483

Interest bearing payables to related parties	$	24,661	$	47,315
Trade payables to related parties	318		134
Due to related parties	$	24,979	$	47,449

Allocations and charges from Emerson are as follows:


	Three Months Ended September 30,
	2024		2023

	(Dollars in Thousands)

Information technology	$	194	$	975

Shared services and other	$	162	$	374

Corporate costs, human resources, and insurance and other benefits are recorded in general and administrative expenses and information technology, facility charges, and shared services and other are allocated to cost of goods sold and operating expenses based on systemic methods.

Before the closing of the Transaction, the DGM and SSE businesses engaged in various transactions to sell software and purchase goods in the ordinary course of business with affiliates of Emerson. At the closing, the Company and Emerson entered into a commercial agreement to allow Emerson to distribute software and services from the Company (the “Commercial Agreement”). Pursuant to the Commercial Agreement as amended from time to time in accordance with the Stockholders Agreement (as defined below), AspenTech grants Emerson the right to distribute, on a non-exclusive basis, certain (i) existing Heritage AspenTech products, (ii) existing Emerson products transferred to AspenTech pursuant to the Transaction Agreement and (iii) future AspenTech products as mutually agreed upon, in each case, to end-users through Emerson acting as an agent, reseller or original equipment manufacturer. Commercial Agreement-related activities have been recorded as revenues and expenses from related parties and resulting trade balances have been presented as trade receivables from related parties in the condensed consolidated financial statements. Revenue and purchases from Emerson affiliates for the three months ended September 30, 2024 and 2023 are as follows:


	Three Months Ended September 30,
	2024		2023

	(Dollars in Thousands)
Revenue from Emerson affiliates	$	987	$	313

Purchases from Emerson affiliates	$	75	$	68

Emerson Share Maintenance Rights

Immediately following the closing of the Transaction, Emerson beneficially owned 55% of the fully diluted shares of AspenTech common stock. At the Closing Date, the Company and Emerson entered into a stockholders agreement (the “Stockholders Agreement”), which sets forth, among other matters, the right of Emerson to nominate directors to AspenTech’s board of directors, the right of Emerson to nominate the chair of AspenTech’s board of directors, the composition of the committees of AspenTech’s board of directors, certain consent rights of Emerson to certain material actions taken by the Company and consent rights with respect to modifications or changes to the Company’s business strategy. Under the Stockholders Agreement, Emerson also has the right to acquire additional equity securities of AspenTech pursuant to pre-agreed procedures and rights in order to maintain its ownership interest. No additional shares of common stock, or any other equity securities of AspenTech, were issued by the Company to Emerson subsequent to the closing of the Transaction through September 30, 2024.

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Plantweb Optics Analytics

On July 28, 2023, the Company entered into the Plantweb Optics Analytics Assignment and License Agreement with Emerson for the purchase of Emerson’s Plantweb Optics Analytics software and the perpetual and royalty-free licensing of other Emerson intellectual property for $12.5 million in the aggregate.

The Company is currently integrating the purchased software and licensed intellectual property with its existing asset performance management product suite and accordingly has capitalized the full purchase price in accordance with ASC 985-20, “Costs of Software to be Sold, Leased, or Marketed.”

16. Segment and Geographic Information

The Company operates in one operating and reportable segment. The Company’s chief operating decision maker is its President and Chief Executive Officer, who makes operating decisions, assesses performance and allocates resources on a consolidated basis.

Geographic Information

Summarized below is information about the Company’s geographic operations:


	Revenue by Destination
	Three Months Ended September 30,
	2024		2023

	(Dollars in Thousands)
Americas	$	111,866	$	133,016
Asia, Middle East and Africa	52,269		57,685
Europe	51,742		58,607
Total	$	215,877	$	249,308

Americas included revenue in the United States of $83.4 million and $96.0 million for the three months ended September 30, 2024 and 2023, respectively.


	Property, Equipment, and
	Leasehold Improvements, Net
	September 30, 2024		June 30, 2024

	(Dollars in Thousands)
Americas	$	13,906	$	13,643
Asia, Middle East and Africa	2,452		2,011
Europe	1,735		1,735
Total	$	18,093	$	17,389

Property, equipment, and leasehold improvements, net located in the United States were $11.5 million and $11.2 million as of September 30, 2024 and June 30, 2024, respectively.

17. Subsequent Events

On October 25, 2024, the Company entered into a definitive agreement to acquire Open Grid Systems Limited (“OGS”). OGS is a global provider of network model management technology and a pioneer in developing model-driven applications supporting open access to data through industry standards. The Company has agreed to pay $45.0 million, plus the value of any cash acquired and any necessary net working capital adjustments. The Company currently intends to finance the transaction through cash on hand. The acquisition is expected to close in the second fiscal quarter of 2025, subject to receipt of regulatory approvals.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Cautionary Note Regarding Forward-Looking Statements

Statements in this Quarterly Report on Form 10-Q (this “Quarterly Report”) that are not strictly historical may be “forward-looking” statements for purposes of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, which involve risks and uncertainties, and AspenTech undertakes no obligation to update any such statements to reflect later developments. In some cases, you can identify forward-looking statements by the following words: “may,” “will,” “could,” “would,” “should,” “expect,” “intend,” “plan,” “strategy,” “anticipate,” “believe,” “estimate,” “predict,” “project,” “potential,” “continue,” “ongoing,” “opportunity” or the negative of these terms or other comparable terminology, although not all forward-looking statements contain these words. These statements are only predictions and are based on current expectations of management. The outcome of the events described in these forward-looking statements is subject to known and unknown risks, uncertainties and other factors that may cause our, our customers’ or our industry’s actual results, levels of activity, performance or achievements expressed or implied by these forward-looking statements, to differ including those set forth below under “Item 1A. Risk Factors” of Part II of this Quarterly Report and those described in our most recent Annual Report on Form 10-K and subsequent reports filed with the SEC. You should read this Quarterly Report completely and with the understanding that our actual future results may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements.

Any forward-looking statements speak only as of the date of this Quarterly Report. We undertake no obligation to update any forward-looking statements, whether as a result of new information or developments, future events or otherwise, except as required by law. You should read the following discussion in conjunction with our condensed consolidated financial statements and related notes thereto contained in this Quarterly Report. You should also read “Item 1A. Risk Factors” of Part II of this Quarterly Report for a discussion of important factors that could cause our actual results to differ materially from our expectations.

Our fiscal year ends on June 30, and references in this Quarterly Report to a specific fiscal year are to the twelve months ended June 30 of such year (for example, “fiscal 2025” refers to the year ending June 30, 2025).

Business Overview

We are a global leader in industrial software focused on helping customers in asset-intensive industries address the dual challenge of meeting the increasing demand for resources from a rapidly growing population while also operating in a more sustainable manner. Our solutions address complex environments where it is critical to optimize across the full asset lifecycle - asset design, operation, and maintenance - enabling customers to run their assets safer, greener, longer and faster. Thousands of companies, ranging from multi-national corporations to start-ups, rely on our software to help them run their assets more profitably, resiliently, and sustainably to meet their operational excellence and sustainability goals.

We help customers solve some of their critical challenges via our purpose-built software that combines engineering first principles, deep industry domain knowledge, and advanced technologies, such as Industrial Artificial Intelligence (“Industrial AI”), which is the combination of data insights from artificial intelligence and domain expertise grounded in engineering fundamentals, asset knowledge and industry experience. We drive significant value creation through our decades of experience in modeling, simulation, and optimization technologies. The operational challenges we help our customers solve include maintaining maximum efficiency in process operations, managing electrical grids amid the growth in renewable energy sources, helping ensure supply chain resiliency, reducing carbon emissions, and more.

Today, our software also enables companies to develop and scale new processes to support the energy transition and a net zero future, such as green hydrogen, biofuels, carbon capture, utilization and storage, circularity of plastics, and batteries.

By combining the software capabilities, deep domain expertise and leadership of Heritage AspenTech with the DGM and SSE businesses, we expanded our served markets, augmented our expertise and sales channels, and broadened our portfolio to include five product suites: Performance Engineering (“ENG”), Manufacturing and Supply Chain (“MSC”), Asset Performance Management (“APM”), DGM, and SSE. These suites are supported by inmation Software GmbH, our data platform with advanced capabilities in data contextualization, structuring and cleansing, that enables our customers to better manage their industrial data at scale.

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Recent Events

On August 6, 2024, we announced that our Board of Directors approved the Fiscal 2025 Share Repurchase Authorization, pursuant to which we may repurchase up to an aggregate amount of $100.0 million of our outstanding shares of common stock. During the first quarter of fiscal 2025, we repurchased 92,819 shares for $20.5 million under the Fiscal 2025 Share Repurchase Authorization and the total remaining value under the Fiscal 2025 Share Repurchase Authorization as of September 30, 2024 was $79.5 million.

On October 25, 2024, the Company entered into a definitive agreement to acquire OGS, which is a global provider of network model management technology and a pioneer in developing model-driven applications supporting open access to data through industry standards. The Company has agreed to pay $45 million, plus the value of any cash acquired and any necessary net working capital adjustments. The Company currently intends to finance the transaction through cash on hand. The acquisition is expected to close in the second fiscal quarter of 2025, subject to receipt of regulatory approvals.

Key Business Metrics

Background

We utilize key business metrics to track and assess the performance of our business. We have identified the following set of appropriate business metrics in the context of our evolving business:

•Annual contract value (“ACV”)

•Total contract value (“TCV”)

•Bookings

We also use the following non-GAAP business metrics in addition to GAAP measures to track our business performance:

•Free cash flow

•Non-GAAP operating income

We make these measures available to investors and none of these metrics should be considered as an alternative to any measure of financial performance calculated in accordance with GAAP.

Annual Contract Value

ACV is an estimate of the annual value of our portfolio of term license and software maintenance and support (“SMS”) contracts, the annual value of SMS agreements purchased with perpetual licenses, and the annual value of standalone SMS agreements purchased with certain legacy term license agreements, which have become an immaterial part of our business.

Comparing ACV for different dates can provide insight into the growth and retention rates of our recurring software business because ACV represents the estimated annual billings associated with our recurring license and SMS agreements at any point in time. Management uses the ACV business metric to evaluate the growth and performance of our business as well as for planning and forecasting purposes. We believe that ACV is a useful business metric to investors as it provides insight into the growth component of our software business.

ACV generally increases as a result of new term license and SMS agreements with new or existing customers, renewals or modifications of existing term license agreements that result in higher license fees due to contractually-agreed price escalation or an increase in the number of tokens (units of software usage) or products licensed, or an increase in the value of licenses delivered.

ACV is adversely affected by term license and SMS agreements that are renewed at a lower entitlement level or not renewed, a decrease in the value of licenses delivered, and, to a lesser extent, by customer agreements that become inactive during the agreement’s term because, in our determination, amounts due (or which will become due) under the agreement are not collectible. As ACV is an estimate of annual billings, it will generally not include contracts with a term of less than one year. Because ACV represents all other active term software and SMS agreements, it may include amounts under agreements with customers that are delinquent in paying invoices, that are in bankruptcy proceedings, and agreements that are subject to termination by the customer or where payment is otherwise in doubt.

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As of September 30, 2024, customer agreements representing approximately 85.3% of our ACV (by value) were denominated in U.S. dollars. For agreements denominated in other currencies, we use a fixed historical exchange rate to calculate ACV in U.S. dollars rather than using current exchange rates, so that our calculation of growth in ACV is not affected by fluctuations in foreign currencies.

For term license agreements that contain professional services or other products and services, we have included the portion of those agreements that are reflective of the relative fair value of the term license, rather than the portion of the actual invoice attributed to the term license, as outlined in the agreement within ACV. We believe that this methodology more accurately allocates any discounts or premiums to the different elements of the agreement.

Beginning in the fourth quarter of fiscal 2024, we suspended all commercial activities in Russia following the announcement of expanded commercial sanctions in the country. Beginning in the first quarter of fiscal 2025, we no longer include Russia within ACV for all periods presented. ACV grew by approximately 9.4%, from $860.5 million as of September 30, 2023 to $941.4 million as of September 30, 2024, and by approximately 0.9% from $932.9 million as of June 30, 2024 to $941.4 million as of September 30, 2024.

Total Contract Value

TCV is the aggregate value of all payments received or to be received under all active term license and SMS agreements, including maintenance and escalation. Our TCV was $4.0 billion as of September 30, 2024, and $3.7 billion as of September 30, 2023. Excluding TCV associated with the Company’s Russia business, TCV was $3.6 billion as of September 30, 2023.

Bookings

Bookings is the total value of customer term license and perpetual license SMS contracts signed and delivered in the current period, less the value of such contracts signed in the current period where the initial licenses and SMS agreements are not yet deemed delivered, plus the customer term license and perpetual license SMS contracts signed in a previous period for which the initial licenses are deemed delivered in the current period.

Bookings were $151.4 million during the three months ended September 30, 2024, compared to $211.8 million during the three months ended September 30, 2023. The change in bookings is primarily driven by the timing of contract renewals and a higher concentration of attrition.

Non-GAAP Business Metrics

Free cash flow (non-GAAP) excludes certain non-cash and non-recurring expenses, and is used as a supplement to net cash (used in) provided by operating activities presented on a GAAP basis. We believe that free cash flow (non-GAAP) is a useful financial measure because it permits investors to view our performance using tools that our management uses to gauge progress in achieving goals and as an indication of cash flow that may be available to fund future investments and other capital uses, such as to repay borrowings under our credit facilities or to fund acquisitions or share repurchase authorizations.

The following table provides a reconciliation of net cash (used in) provided by operating activities (GAAP) to free cash flow (non-GAAP) for the indicated periods:


	Three Months Ended September 30,
	2024		2023

	(Dollars in Thousands)
Net cash (used in) provided by operating activities (GAAP)	$	(4,397)	$	16,981
Purchase of property, equipment, and leasehold improvements	(2,022)		(937)
Free cash flow (non-GAAP)	$	(6,419)	$	16,044

Non-GAAP income from operations excludes certain non-cash and non-recurring expenses, and is used as a supplement to loss from operations presented on a GAAP basis. We believe that non-GAAP income from operations is a useful financial measure because removing certain non-cash and other items provides additional insight into recurring profitability.

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The following table provides a reconciliation of GAAP loss from operations to non-GAAP income from operations for the indicated periods:


	Three Months Ended September 30,
	2024		2023

	(Dollars in Thousands)
GAAP loss from operations	$	(95,965)	$	(60,211)
Plus:
Stock-based compensation	14,814		16,699
Amortization of intangible assets	121,589		121,587
Acquisition and integration planning related fees	405		(255)
Restructuring costs	7,726		—
Non-GAAP income from operations	$	48,569	$	77,820

Critical Accounting Estimates and Judgments

As of September 30, 2024, the Company’s critical accounting estimates and judgments had not changed significantly from June 30, 2024. Note 2, “Significant Accounting Policies,” to the consolidated and combined financial statements in our Annual Report on Form 10-K for the fiscal year ended June 30, 2024 describes the significant accounting policies and methods used in the preparation of the condensed consolidated financial statements appearing in this Quarterly Report. The accounting policies that reflect our critical estimates, judgments and assumptions in the preparation of our condensed consolidated financial statements included in this Quarterly Report are described in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Item 7 of our Annual Report on Form 10-K for the fiscal year ended June 30, 2024.

Results of Operations

Comparison of the Three Months Ended September 30, 2024 and 2023

The following table sets forth the results of operations, the period-over-period percentage change, and the results of operations as a percentage of total revenue for certain financial data for the three months ended September 30, 2024 and 2023:


	Three Months Ended September 30,				Increase / (Decrease) Change				(% of Revenue)
	2024		2023		$		%		2024		2023

	(Dollars in Thousands)
Revenue:
License and solutions	$	101,659	$	148,648	$	(46,989)	(31.6)	%	47.1	%	59.6	%
Maintenance	90,686		84,968		5,718		6.7		42.0		34.1
Services and other	23,532		15,692		7,840		50.0		10.9		6.3
Total revenue	215,877		249,308		(33,431)		(13.4)		100.0		100.0
Cost of revenue:
License and solutions	63,654		71,578		(7,924)		(11.1)		29.5		28.7
Maintenance	10,688		10,200		488		4.8		5.0		4.1
Services and other	21,105		16,282		4,823		29.6		9.8		6.5
Total cost of revenue	95,447		98,060		(2,613)		(2.7)		44.2		39.3
Gross profit	120,430		151,248		(30,818)		(20.4)		55.8		60.7
Operating expenses:
Selling and marketing	125,661		122,378		3,283		2.7		58.2		49.1
Research and development	50,000		53,676		(3,676)		(6.8)		23.2		21.5
General and administrative	33,008		35,405		(2,397)		(6.8)		15.3		14.2
Restructuring costs	7,726		—		7,726		100.0		3.6		—
Total operating expenses	216,395		211,459		4,936		2.3		100.2		84.8
Loss from operations	(95,965)		(60,211)		(35,754)		59.4		(44.5)		(24.2)
Other expense, net	2,041		(5,830)		7,871		(135.0)		0.9		(2.3)
Interest income, net	17,176		14,049		3,127		22.3		8.0		5.6
Loss before benefit for income taxes	(76,748)		(51,992)		(24,756)		47.6		(35.6)		(20.9)
Benefit for income taxes	(16,284)		(17,467)		1,183		(6.8)		(7.6)		(7.0)
Net loss	$	(60,464)	$	(34,525)	$	(25,939)	75.1	%	(28.0)	%	(13.8)	%

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Revenue

Total revenue decreased by $33.4 million, or 13.4%, during the three months ended September 30, 2024, as compared to the same period in the prior fiscal year, due to a decrease of $47.0 million in license and solutions revenue, partially offset by an increase of $5.7 million in maintenance revenue, and an increase of $7.8 million in services and other revenue.

License and Solutions Revenue

License and solutions revenue decreased by $47.0 million, or 31.6%, during the three months ended September 30, 2024, as compared to the same period in the prior fiscal year, primarily due to the timing of renewals and new contracts signed in the same period in the prior fiscal year.

Maintenance Revenue

Maintenance revenue increased by $5.7 million, or 6.7%, during the three months ended September 30, 2024, as compared to the same period in the prior fiscal year, primarily due to growth of our base of customer arrangements through both natural renewals of, and amendments to, existing customer arrangements.

Services and Other Revenue

Services and other revenue increased by $7.8 million, or 50.0%, during the three months ended September 30, 2024, as compared to the same period in the prior fiscal year, primarily due to increased activities from certain customer contracts where the related professional services revenue is recognized as a distinct performance obligation, and the timing and volume of professional services engagements

Cost of Revenue

Total cost of revenue decreased by $2.6 million, or 2.7%, during the three months ended September 30, 2024, as compared to the same period in the prior fiscal year.

Cost of License and Solutions Revenue

Cost of license and solutions revenue decreased by $7.9 million, or 11.1%, during the three months ended September 30, 2024, as compared to the same period in the prior fiscal year, primarily due to the business transformation activities in which we began recognizing distinct performance obligations for certain customer contracts effective beginning in the third quarter of fiscal 2023, whereby costs associated with these customer contracts are recognized in cost of services and other revenue. Gross profit margin on license and solutions revenue during the three months ended September 30, 2024 decreased to 37.4%, from 51.8% for the three months ended September 30, 2023, primarily due to lower license and solutions revenue in the current period.

Cost of Maintenance Revenue

Cost of maintenance revenue increased by $0.5 million, or 4.8%, during the three months ended September 30, 2024, as compared to the same period in the prior fiscal year. Gross profit margin on maintenance revenue during the three months ended September 30, 2024 increased to 88.2%, from 88.0% for the three months ended September 30, 2023, primarily due to higher maintenance revenue.

Cost of Services and Other Revenue

Cost of services and other revenue increased by $4.8 million, or 29.6%, for the three months ended September 30, 2024, as compared to the same period in the prior fiscal year, primarily due to the increased activities from customer contracts where the related professional services revenue is recognized as a distinct performance obligation and the corresponding cost is recognized in cost of services and other revenue. Gross profit margin on services and other revenue during the three months ended September 30, 2024 increased to 10.3%, from (3.8)% for the three months ended September 30, 2023, primarily due to higher services and other revenue resulting from better leveraging our costs with increased projects.

Gross Profit

Overall gross profit decreased by $30.8 million, or 20.4%, for the three months ended September 30, 2024, as compared to the same period in the prior fiscal year, primarily due to lower licensing and solutions revenue. Gross profit margin during the three months ended September 30, 2024 decreased to 55.8%, from 60.7% for the three months ended September 30, 2023. The decrease was primarily driven by a decrease in license and solutions revenue compared to the same period in the prior fiscal year, which has a relatively fixed cost base.

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Operating Expenses

Selling and Marketing Expense

Selling and marketing expense increased by $3.3 million, or 2.7%, during the three months ended September 30, 2024, as compared to the same period in the prior fiscal year, primarily due to the expansion of our sales capacity in new and existing markets.

Research and Development Expense

Research and development expense decreased by $3.7 million, or 6.8%, during the three months ended September 30, 2024, as compared to the same period in the prior fiscal year, primarily due to lower compensation costs of $3.5 million, related to a reduction of salary and stock-based compensation expenses resulting from the reorganization of our corporate structure that was announced in August 2024. See Note 6 “Restructuring Costs” to our condensed consolidated financial statements included in this Quarterly Report for further information.

General and Administrative Expense

General and administrative expense decreased by $2.4 million, or 6.8%, during the three months ended September 30, 2024, as compared to the same period in the prior fiscal year, primarily due to lower compensation costs of $2.5 million related to lower salary, benefits, bonus, and stock-based compensation expenses resulting from the reorganization of our corporate structure that was announced in August 2024. See Note 6 “Restructuring Costs” to our condensed consolidated financial statements included in this Quarterly Report for further information.

Restructuring Costs

Restructuring costs increased by $7.7 million, or 100.0%, during the three months ended September 30, 2024, as compared to the same period in the prior fiscal year. This is a result of the reorganization of our corporate structure that was announced in August 2024, which resulted in the elimination of certain roles and our winding down of operations in Russia.

Non-Operating (Expense) Income

Other Income (Expense), Net

Other income (expense), net increased by $7.9 million, or 135.0%, during the three months ended September 30, 2024, as compared to the same period in the prior fiscal year, primarily due to $7.3 million in unrealized and realized foreign currency exchange gains.

Interest Income, Net

Interest income, net increased by $3.1 million, or 22.3%, during the three months ended September 30, 2024, as compared to the same period in the prior fiscal year, primarily due to an increase in interest income earned on long-term revenue contracts of $2.3 million.

Benefit for Income Taxes

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Liquidity and Capital Resources

Resources

As of September 30, 2024 and June 30, 2024, our principal sources of liquidity consisted of $221.1 million and $237.0 million, in cash and cash equivalents, respectively.

We believe our existing cash on hand and cash flows generated by operations are sufficient for at least the next 12 months to meet our operating requirements, including those related to salaries and wages, working capital, capital expenditures, and other liquidity requirements associated with operations. We may need to raise additional funds if we decide to make one or more acquisitions of businesses, technologies or products. If additional funding for such purposes is required beyond existing resources and our Second Amended and Restated Credit Agreement described below, we may not be able to affect a receivable, equity or debt financing on terms acceptable to us or at all.

Second Amended and Restated Credit Agreement

On June 27, 2024, the Company entered into a Second Amended and Restated Credit Agreement (the “Second Amended and Restated Credit Agreement”) with JPMorgan Chase Bank, National Association. The Second Amended and Restated Credit Agreement has an expiration date of June 27, 2029, and provides for aggregate borrowing commitments of $200.0 million.

Cash Flows

Operating Cash Flows

Net cash provided by operating activities decreased by $21.4 million during the three-month period ended September 30, 2024, as compared to the same period in prior fiscal year, primarily driven by one-time charges related to the Company’s workforce reduction and Russia exit, as well as the timing of collections in the first quarter of fiscal 2025.

Investing Cash Flows

Net cash used in investing activities decreased by $19.8 million during the three-month period ended September 30, 2024, as compared to the same period in prior fiscal year, primarily driven by a decrease of $12.5 million in cash used for asset acquisitions and a decrease of $8.3 million in cash used for business acquisitions.

Financing Cash Flows

Net cash used in financing activities decreased by $98.9 million during the three-month period ended September 30, 2024, as compared to the same period in prior fiscal year, primarily driven by a decrease of $93.7 million in cash used for common stock repurchases.

Free Cash Flows

Free cash flow (non-GAAP) decreased by $22.5 million during the three-month period ended September 30, 2024, as compared to the same period in the prior fiscal year, primarily driven by the decrease in net cash provided by operating activities.

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The following table provides a reconciliation of net cash provided by operating activities (GAAP) to free cash flow (non-GAAP) for the indicated periods:


	Three Months Ended September 30,
	2024		2023

	(Dollars in Thousands)
Net cash (used in) provided by operating activities (GAAP)	$	(4,397)	$	16,981
Purchase of property, equipment, and leasehold improvements	(2,022)		(937)
Free cash flow (non-GAAP)	$	(6,419)	$	16,044

Contractual Obligations

Letters of Credit

Standby letters of credit in the aggregate amounts of $24.5 million and $32.9 million secured our performance on professional services contracts, certain facility leases and potential liabilities as of September 30, 2024 and June 30, 2024, respectively. The letters of credit expire at various dates through fiscal 2029.

Effects of Inflation

We do not believe that inflation has had a material impact on our business or operating results during the periods presented. However, inflation may in the future have an impact on our ability to execute on our acquisition strategy. Inflationary costs could adversely affect our business, financial condition and results of operations. In addition, increased inflation has had, and may continue to have, an effect on interest rates. Increased interest rates may adversely affect our borrowing rate and our ability to obtain, or the terms under which we can obtain, any potential additional funding.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Foreign Currency Risk

During the three months ended September 30, 2024 and 2023, 9.9% and 7.1% of our total revenue was denominated in a currency other than the U.S. dollar, respectively. In addition, certain of our operating costs incurred outside the United States are denominated in currencies other than the U.S. dollar. We conduct business on a worldwide basis and as a result, a portion of our revenue, earnings, net assets, and net investments in foreign affiliates is exposed to changes in foreign currency exchange rates. We measure our net exposure for cash balance positions and for cash inflows and outflows in order to evaluate the need to mitigate our foreign exchange risk. We may enter into foreign currency forward contracts to minimize the impact related to unfavorable exchange rate movements related to our cash positions and cash flows, although we have not done so during the three months ended September 30, 2024 and 2023. Currently, our largest exposures to foreign exchange rates exist primarily with the Euro, Pound Sterling, Japanese Yen, Indonesian Rupiah, Kuwaiti Dinar, Brazilian Reais, Norwegian Krone, Australian Dollar, and Canadian Dollar.

We recorded net foreign currency exchange gains of $2.1 million and losses of $5.9 million, respectively, during the three months ended September 30, 2024 and 2023, related to the settlement and remeasurement of transactions denominated in currencies other than the functional currency of our operating units. Our analysis of operating results transacted in various foreign currencies indicated that a hypothetical 10% change in foreign currency exchange rates could have increased or decreased our results of operations by approximately $2.9 million and $4.7 million for the three months ended September 30, 2024 and 2023, respectively.

Interest Rate Risk

We place our investments in money market instruments. Our analysis of our investment portfolio and interest rates as of September 30, 2024 indicated that a hypothetical 100 basis point increase or decrease in interest rates would not have a material impact on the fair value of our investment portfolio determined in accordance with an income-based approach utilizing portfolio future cash flows discounted at the appropriate rates.

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Investment Risk

We own an interest in a limited partnership investment fund. The primary objective of this partnership is investing in equity and equity-related securities (including convertible debt) of venture growth-stage businesses. We account for the investment in accordance with Topic 323, Investments - Equity Method and Joint Ventures. Our total commitment under this partnership is $11.8 million Canadian dollars, or $8.7 million U.S. dollars. Under the conditions of the equity method investment, unfavorable future changes in market conditions could lead to a potential loss up to the full value of our $11.8 million Canadian dollars, or $8.7 million U.S. dollars commitment. As of September 30, 2024, the fair value of this investment was $3.3 million Canadian dollars, or $2.5 million U.S. dollars, representing our payment towards the total commitment, and is recorded in non-current assets in our condensed consolidated balance sheets.

Item 4. Controls and Procedures.

a) Disclosure Controls and Procedures

Our management, with the participation of our chief executive officer and chief financial officer, evaluated the effectiveness of our disclosure controls and procedures as of September 30, 2024. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Securities Exchange Act”) means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Securities Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Securities Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives, and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures as of September 30, 2024, our chief executive officer and chief financial officer concluded that, as of such date, our disclosure controls and procedures were effective.

b) Changes in Internal Controls Over Financial Reporting

There was no change in our internal control over financial reporting that occurred during the three months ended September 30, 2024, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. We will continue to review and document our disclosure controls and procedures, including our internal control over financial reporting, and may from time to time make changes aimed at enhancing their effectiveness and to ensure that our systems evolve with our business.

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PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

None.

Item 1A. Risk Factors.

The risks described in “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended June 30, 2024, could materially and adversely affect our business, financial condition and results of operations. These risk factors do not identify all risks that we face—our operations could also be affected by factors that are not presently known to us or that we currently consider to be immaterial to our operations. The Risk Factors section in our Annual Report on Form 10-K for the fiscal year ended June 30, 2024 remains current in all material respects, with the exception of the risk factor described below.

An escalation of the conflict in the Middle East may have a material adverse impact on our business and operations in the region.

We have operations and customers in the Middle East. Since the initial commencement of the Israeli-Hamas conflict, there have been continued hostilities along Israel’s northern border with Lebanon (with the Hezbollah terror organization) and on other fronts from various extremist groups in the region, such as the Houthis in Yemen and various rebel militia groups in Syria and Iraq. Israel has carried out a number of targeted strikes on sites belonging to these terror organizations. In October 2024, Israel began limited ground operations against Hezbollah in Lebanon. In addition, Iran recently launched direct attacks on Israel and has threatened to continue to attack Israel. Iran is also believed to have a strong influence among extremist groups in the region, such as Hamas in Gaza, Hezbollah in Lebanon, the Houthis in Yemen and various rebel militia groups in Syria and Iraq. A further escalation of the conflict or an extension of the conflict for a longer period of time could result in additional armed conflict in other regions in the Middle East and elsewhere, terrorist activities, and political or macroeconomic instability in the Middle East region. This, in turn, could cause our customers in the region to reduce their capital expenditures, resulting in a reduction of our sales to such customers. A decline in our sales to our customers in the affected region and any further impact of such conflict or instability on our operations could materially adversely affect our business and operations in the region, and our financial condition and results of operations generally.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Purchases of Equity Securities by the Issuer

On August 6, 2024, we announced that our board of directors approved the Fiscal 2025 Share Repurchase Authorization, pursuant to which an aggregate amount of $100.0 million of our common stock may be repurchased.

As of September 30, 2024, a total of 92,819 shares have been repurchased under the Fiscal 2025 Share Repurchase Authorization for $20.5 million, with the total remaining value being $79.5 million. For more details on the Fiscal 2025 Share Repurchase Authorization, refer to Note 13, “Stock Repurchases” to our condensed consolidated financial statements included in this Quarterly Report.

The following is a summary of stock repurchases for each month during the first quarter of fiscal 2025:


Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Approximate Dollar Value that May Yet Be Purchased Under the Plans or Programs (1)

	(Dollars in Thousands, Except Shares and per Share Data)
July 1, 2024 to July 31, 2024	—	—		—	—
August 1, 2024 to August 31, 2024	48,451	$	214.98	48,451	$	89,584
September 1, 2024 to September 30, 2024	44,368	$	227.00	44,368	$	79,512
Total	92,819	$	220.73	92,819

__________

(1) On August 6, 2024, the Company announced that its Board of Directors approved the Fiscal 2025 Share Repurchase Authorization, pursuant to which an aggregate amount of $100.0 million of its common stock may be repurchased.

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Item 3. Defaults upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

None.

Item 5. Other Information.

During the three months ended September 30, 2024, none of our directors or officers adopted, made certain modifications to, or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K

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Item 6. Exhibits.

Exhibit Number

Description

10.1^

Aspen Technology, Inc. Executive Retention Plan

10.2^

Aspen Technology, Inc. Board of Directors Compensation Plan

31.1

Certification of Principal Executive Officer pursuant to Exchange Act Rules 13a-14 and 15d-14, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2

Certification of Principal Financial Officer pursuant to Exchange Act Rules 13a-14 and 15d-14, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1

Certification of President and Chief Executive Officer and Senior Vice President and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS

Inline Instance Document

101.SCH

Inline XBRL Taxonomy Extension Schema Document

101.CAL

Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF

Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB

Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE

Inline XBRL Taxonomy Extension Presentation Linkbase Document

104

Cover Page Interactive Data File (embedded within the Inline XBRL document)

Management contract or compensatory plan or arrangement

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	Aspen Technology, Inc.

Date: November 4, 2024	By:	/s/ ANTONIO J. PIETRI
		Antonio J. Pietri
		President and Chief Executive Officer
		(Principal Executive Officer)


Date: November 4, 2024	By:	/s/ DAVID BAKER
		David Baker
		Senior Vice President, Chief Financial Officer
		(Principal Financial Officer)

Aspen Technology, Inc. Executive Retention Plan

2 Aspen Technology, Inc. Executive Retention Plan EFFECTIVE DATE; PURPOSE This Aspen Technology, Inc. Executive Retention Plan (the “Plan”) is effective as of May 2, 2024 (the “Effective Date”). Capitalized terms used but not otherwise defined have the meanings given to them in the “Definitions” section of this Plan. ELIGIBILITY The Board may designate employees of the Company or a subsidiary as participants in the Plan (the “Participants”) and the Board may amend the list of Participants from time to time, unless otherwise agreed in writing with a Participant. The Board may delegate the authority to administer the Plan and to select Participants to the Human Capital Committee. No employee who has been selected as a Participant may be removed as a Participant during the twelve-month period immediately following a Change in Control or a Control Event. The Participants are set forth on Exhibit A hereto, which Exhibit shall be updated from time to time to reflect designations by the Board or the Human Capital Committee. QUALIFYING TERMINATION Participants will become entitled to payments and benefits hereunder upon a “Qualifying Termination,” which means the termination of the Participant’s employment by the Company without Cause or by the Participant for Good Reason. SEVERANCE BENEFITS A Participant who experiences a Qualifying Termination will be entitled to payments and benefits under only one of paragraphs (a), (b) and (c) below, subject to the other terms of this Plan. (a) Qualifying Termination. If a Participant has a Qualifying Termination not described in paragraph (b) or (c) then, subject to the execution and non-revocation of the Release Agreement, the Company will pay the Participant the following: (i) The Accrued Amounts. (ii) Cash severance, payable during the 12-month period following the Participant’s termination date in substantially equal installments on the Company’s normal payroll schedule, equal to the sum of (A) 12 months of the Participant’s base salary and (b) the Participant’s target annual cash bonus, pro-rated for the portion of the fiscal year which has elapsed as of the date of the Qualifying Termination and less any portion of actual cash bonus earned with respect to the year of termination that has previously been paid to the Participant (in either case without giving effect to any reductions constituting Good Reason) (the “Salary Severance”);

3 (iii) An additional cash payment, payable in a lump sum, within 10 business days following the effectiveness of the Release Agreement, in an amount equal to 12 times the monthly employer portion of the premium for the same level of coverage, including dependents, provided to the Participant under the Company’s group health benefit plans immediately before the termination date (the “Benefits Severance”); and (iv) If and to the extent determined to be appropriate by the Board, Company-paid outplacement services (the “Outplacement Services”). (b) Qualifying Termination following a Change in Control. If a Participant has a Qualifying Termination during the 12 month period immediately following the consummation of a Change in Control, then: (i) The Company will pay the Participant the Accrued Amounts, Salary Severance, Benefits Severance and Outplacement Services, except that the Salary Severance will be payable in a lump sum, within 10 business days following the effectiveness of the Release Agreement (to the extent permissible without violating Section 409A of the Code); and (ii) Also subject to the execution and non-revocation of the Release Agreement, each then unvested equity or equity-based award held by the Participant will, upon the effectiveness of the Release Agreement, become fully vested (and, if applicable, such awards will be fully exercisable), with any awards that are subject to the attainment of performance criteria vesting at the target level of performance (or, if determinable and greater, the actual level of performance). Any outstanding stock option held by the Participant on her or her termination date will continue to be exercisable until the earlier of 90 days following the Participant’s termination date or the original expiration date of the stock option. (c) Qualifying Termination Following a Control Event. If a Participant has a Qualifying Termination within the one year period commencing upon the occurrence of a Control Event (a “Covered Termination”) and subsection (b) does not apply to the Participant’s termination, then: (i) The Company will pay the Participant the Accrued Amounts, Salary Severance, Benefits Severance and Outplacement Services, except that the Salary Severance and the Benefits Severance will each be payable in a lump sum, within 10 business days following the effectiveness of the Release Agreement (to the extent permissible without violating Section 409A of the Code); and

4 (ii) Each Specified Equity Award held by the Participant will (subject to the execution and non-revocation of the Release Agreement) become vested and, if applicable, exercisable, as follows: (1) Each Specified Award which is subject to only time- based vesting conditions will vest in with respect to the portion of the award which would have become vested in the one year period immediately following the Covered Termination had the Participant remained employed, with the vesting to occur immediately prior to the Covered Termination and, in the case of Specified Awards which are stock options, the options will remain exercisable for 90 days following the Covered Termination (but not beyond the maximum term of the applicable stock option); and (2) Each Specified Award which is subject to performance-based vesting conditions will, upon the Covered Termination, (A) be converted into a time vesting award, vesting in equal annual tranches at the target level of performance and (B) be immediately vested as to the portion of the award which would have vested on the time vesting schedule described in clause (A), commencing on the date of grant and ending on the one-year anniversary of the Covered Termination. Except as may be required by Section 409A of the Code, shares (or cash or other property into which the awards are equitably adjusted) subject to awards which become vested pursuant to subsection (b) subsection (c) (other than stock options or stock appreciation rights which remain outstanding) will be delivered on or as soon as practicable following vesting. The Participant will not have to mitigate the amount of any payment or benefits payable under this Plan by seeking other employment or otherwise. Further, the amount of any payment or benefits payable under this Plan will not be reduced by any compensation earned by the Participant from employment by another employer, by retirement benefits, by offset against any amount claimed to be owed by the Participant to the Company or otherwise. DEFINITIONS “Accrued Amounts” means (i) any unpaid base salary accrued by the Participant through the Participant’s termination date; (ii) any unpaid annual incentive bonus earned by the Participant for a prior fiscal year; and (iii) any vested employee benefits that the Participant is entitled to receive as of the termination date under any employee benefit plan of the Company or one of its subsidiaries (in accordance with the terms of the plan). “Board” means the Board of Directors of the Company. “Cause” means (a) the Participant’s repeated failure to perform the Participant’s assigned duties; (b) the Participant’s engagement in illegal conduct or gross misconduct which is materially harmful to the Company’s business or reputation; (c) the Participant materially fails to comply with any written policy applicable to the Participant, including, but not limited to, the Company’s Code of Business Ethics and Conduct or Insider Trading Policy; or (d) the Participant’s commission of a felony under the laws of the United States or any State of the United States. Notwithstanding the foregoing, if the

5 Participant has an effective employment agreement with the Company or a subsidiary which contains a Cause definition, that definition will govern for purposes of the Plan. “Change in Control” has the meaning set forth in the Aspen Technology, Inc. 2022 Omnibus Incentive Plan, as in effect on the Effective Date; provided that, if at any time following the Effective Date, EMR Worldwide, Inc. ceases to be the beneficial owner (within the meaning of Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended) of 50% or more of either (x) the then-outstanding shares of common stock of the Company or (y) the combined voting power of the then-outstanding securities of the Company entitled to vote generally in the election of directors, then at the time the beneficial ownership falls below either that 50% level, then after that date the following clauses will be deemed to have been deleted from such definition for purposes of this Plan: (1) clause (D) of Section 15.3.2(i), the proviso to Section 15.3.2(ii) and (3) clause (B) of Section 15.3.2(iii). “Code” means the Internal Revenue Code of 1986, as amended. Any reference to a section of the Code includes a reference to any related regulations. A “Control Event” will occur upon the first date following the Effective Date when EMR Worldwide, Inc. and its affiliates hold 90% or more of either (x) the then-outstanding shares of common stock of the Company or (y) the combined voting power of the then-outstanding securities of the Company entitled to vote generally in the election of directors. “Good Reason” means the occurrence of any of the following without the prior written consent of the Participant: (a) a reduction in the Participant’s annual base salary or annual cash bonus opportunity as in effect on the Effective Date or, if later, the date upon which the Participant is selected as a Participant (and as Participant’s base salary may be increased from time to time), other than pursuant to an across-the-board reduction in base salary for all similarly-situated executives of the Company and its affiliates; (b) a change by the Company to the Participant’s primary work location to a new location that is more than 50 miles away from Participant’s primary work location immediately prior to the change; or (c) a material reduction in the Participant’s authority, duties or responsibilities as of immediately before the Effective Date or, if later, the date upon which the Participant is selected as a Participant (and as Participant’s authority, duties or responsibilities may be increased from time to time); provided however, that following a Control Event, “Good Reason” does not exist if the Participant is employed by the Company with substantially the same authority, duty and responsibilities with respect to the Company’s business that participant had immediately prior to the Effective Date (or, if later, the date upon which the Participant is selected as a Participant (and as Participant’s authority, duties or responsibilities may be increased from time to time)) and shall not be deemed to exist solely because the Participant’s title or reporting relationship is revised to reflect the Participant’s placement, solely by virtue of a Control Event, within the overall corporate hierarchy of the post-transaction entity.

6 Notwithstanding the foregoing, if the Participant has an effective employment agreement with the Company or a subsidiary which contains a Good Reason definition, that definition will govern for purposes of the Plan. In order for a resignation by a Participant to constitute a termination for Good Reason hereunder, the Participant must give notice to the Company of the event or circumstance constituting Good Reason within 30 days of the occurrence of that event or circumstance and the Company must have failed to cure the event or circumstance within the 30-day period following receipt of notice (and the Participant must have resigned within the 30-day period immediately following the expiration of the cure period). “Release Agreement” means a General Release of Claims in a form acceptable to the Company, in its sole discretion. “Specified Equity Awards” means unvested equity or equity-based compensation awards from the Company, whenever granted, unless both (1) the award is granted following the Effective Date and (2) the award agreement for the subsequent award specifically exempts the award from the application of subsection (c) of the Severance Benefits section of this Plan. SECTION 280G If it is determined that any payment or benefit provided to the Participant or for the Participant’s benefit (whether or not paid under this Plan) (the “Total Payments”) would be subject to the excise tax imposed by Section 4999 of the Code, (the “Excise Tax”), then the Total Payments payable under this Plan will be reduced to the highest amount which would not be subject to the Excise Tax, but only if the reduction would result in the Participant keeping a larger amount, on an after-tax basis (accounting for federal, state and local income taxes and the imposition of the Excise Tax), than if the Participant received all of the Total Payments. Any reduction will be effected in a manner which is intended to comply with any applicable requirements under Section 409A of the Code. NOTICES All notices, instructions and other communications related to the Plan will be in writing. Any notice, instruction or communication will be sent either (i) by registered or certified mail, return receipt requested, postage prepaid, or (ii) prepaid via a reputable nationwide overnight courier service, in each case addressed to the Company, at Aspen Technology, Inc.; ATTN: Secretary (or, if the Participant is the Secretary, to the attention of the President); 20 Crosby Drive, Bedford MA 01730, and to the Participant at the address the Company has on file for the Participant. Any notice, instruction or communication will be deemed to have been delivered five business days after it is sent by registered or certified mail, return receipt requested, postage prepaid, or one business day after it is sent via a reputable nationwide overnight courier service. CLAIMS; DISPUTES All claims by a Participant for benefits under the Plan will be directed to the Board and will be in writing. Any rejection by the Board of a claim will be delivered to the Participant in writing and will set forth the specific reasons for the rejection and the specific provisions of this Plan relied on.

7 EXPENSES Before a Change in Control has occurred, all legal, accounting and other fees and expenses which a party may reasonably incur as a result of any claim or contest (regardless of the outcome thereof) by the Company, the Participant or others regarding the validity or enforceability of, or liability under, any provision of this Plan or any guarantee of performance thereof (including as a result of any contest by the Participant regarding the amount of any payment or benefits pursuant to this Plant), will be the responsibility of the non-prevailing party. After a Change in Control has occurred, the Company will pay as incurred all legal, accounting and other fees and expenses which the Participant may reasonably incur as a result of any claim or contest (regardless of the outcome thereof) by the Company, the Participant or others regarding the validity or enforceability of, or liability under, any provision of this Plan. ADMINISTRATION The Board has the authority to administer and interpret the Plan. The Board has all powers necessary to carry out its responsibilities under the Plan, including to (i) administer the Plan according to its terms and to interpret Plan policies and procedures; (ii) resolve and clarify inconsistencies, ambiguities and omissions in the Plan and between the Plan and other related documents; (iii) take all actions and make all decisions about eligibility to participate in the Plan and entitlement to receive benefits under the Plan, and benefit amounts; (iv) make, amend, interpret, and enforce all rules and regulations for the administration of the Plan; (v) process and approve or deny all claims for benefits; and (vi) resolve questions that arise in connection with the Plan. The Board may delegate any of its duties related to the Plan to any person or group that it designates. Any delegation will be in writing. If the Board has delegated duties under the Plan, any reference to the Board in this Plan document will instead reference the delegate. AMENDMENT; TERMINATION The Plan may be amended or terminated by the Board at any time; provided, however, that the Plan may not be amended or terminated during the 12 months immediately after a Change in Control or Control Event. TAX MATTERS Withholding. The Company will have the right to withhold from any amount payable under the Plan any Federal, state and local taxes in order for the Company to satisfy any withholding tax obligation it may have under any applicable law or regulation. Section 409A. The intent of the parties is that payments and benefits under this Plan be exempt from, or comply with, Section 409A of the Code, and accordingly, to the maximum extent permitted, this Plan will be interpreted and administered to be in accordance with Section 409A. Notwithstanding anything contained in this Plan to the contrary, the Participant will not be considered to have terminated employment with the Company for purposes of any payments under this Plan which are subject to Section 409A of the Code until the Participant would be considered to have has a “separation from service” from the Company within the meaning of Section 409A of the Code. Each amount to be paid or benefit to be provided under this Plan will be construed as a separate payment for purposes of Section 409A of the Code, and any payments described in this Plan that are due within the “short term deferral period” as defined in Section 409A of the Code will not be treated as deferred compensation unless applicable law requires otherwise. Without limiting the

8 foregoing and notwithstanding anything contained in this Plan to the contrary, if needed in order to avoid accelerated taxation and/or tax penalties under Section 409A of the Code, amounts that would otherwise be payable and benefits that would otherwise be provided pursuant to this Plan during the 6- month period immediately after a Participant’s separation from service will instead be paid on the first business day after the date that is 6 months after the Participant’s separation from service (or, if earlier, death). If needed to avoid accelerated taxation and/or tax penalties under Section 409A of the Code, amounts reimbursable to the Participant under this Plan will be paid to the Participant on or before the last day of the year after the year in which the expense was incurred and the amount of expenses eligible for reimbursement (and in-kind benefits provided) during any one year may not effect amounts reimbursable or provided in any subsequent year. The Company makes no representation that any or all of the payments described in this Plan will be exempt from or comply with Section 409A of the Code and makes no undertaking to preclude Section 409A of the Code from applying to any payment. The Participant will be solely responsible for the payment of any taxes and penalties incurred under Section 409A. GENERAL PROVISIONS At-Will Employment. The Plan does not alter the status of each Participant as an at-will employee of the Company. Nothing in the Plan gives any Participant the right to remain employed by the Company or limits the Company’s right to terminate the employment of any Participant at any time, with or without Cause. Severability. The invalidity or unenforceability of any provision of the Plan will not affect the validity or enforceability of any other provision of the Plan. If any provision of the Plan is held by a court of competent jurisdiction to be unenforceable, the provision will be deemed modified as needed to make the provision legal, valid and enforceable, and the other remaining provisions of the Plan will not be affected. Successors. The Plan will be binding upon any successor to the Company, its assets, its businesses or its interest (whether as a result of a Change in Control or otherwise), as if no succession had taken place. If any successor would not automatically be bound by the Plan, the Company will require the successor to expressly assume the Plan in writing and honor the obligations of the Company under the Plan under the Plan, as if no succession had taken place. All payments and benefits that become due to a Participant under the Plan will inure to the benefit of his or her heirs, assigns, designees or legal representatives. Compensation Recovery Policy.. Payments and benefits hereunder shall be subject to the Company’s Compensation Recovery Policy or or incentive compensation recoupment policy as in effect from time to time. Transfer and Assignment. Neither a Participant nor any other person will have any right to sell, assign or otherwise transfer any amounts payable under the Plan before the date that the amounts are paid, except that, if a Participant dies, those amounts will be paid to the Participant’s beneficiaries.

9 Governing Law. If not pre-empted by federal law, the Plan will be governed by the internal laws of The Commonwealth of Massachusetts, without regard to conflicts of law principles.

EXHIBIT B Terms and Conditions of Participation by Antonio J. Pietri in the Aspen Technology, Inc. Executive Retention Plan (the “Plan”) Antonio J. Pietri (the “Executive”) was designated by the Board as a Participant, effective September 19, 2024. The Executive shall be subject to all of the terms and conditions of the Plan, other than the specific changes set forth below. The changes to the terms of the Plan, which apply solely to the Executive, are as follows:  In clause (a)(ii) under the SEVERANCE BENEFITS section, the reference to “the 12- month period following the Participant’s termination date” shall be modified to refer to “the 18-month period following the Participant’s termination date”  In clause (a)(ii) under the SEVERANCE BENEFITS section, the reference to “12 months of the Participant’s base salary” shall be modified to refer to “18 months of the Participant’s base salary”  In clause (a)(iii) under the SEVERANCE BENEFITS section, the reference to “in an amount equal to 12 times the monthly employer portion of the premium” shall be modified to refer to “in an amount equal to 18 times the monthly employer portion of the premium”  In clause (c)(ii)(1) under the SEVERANCE BENEFITS section, the reference to “the one year period immediately following the Covered Termination” shall be modified to refer to “the eighteen month period immediately following the Covered Termination”  In clause (c)(ii)(2) under the SEVERANCE BENEFITS section, the reference to “the one-year anniversary of the Covered Termination” shall be modified to refer to “the eighteen month anniversary of the Covered Termination” All other provisions of the Plan shall apply to the Executive without alteration. The adoption of this Exhibit B by the Board shall constitute an amendment of the Plan in accordance with the applicable provisions thereof. Capitalized terms which are not defined herein shall have the meaning set forth in the Plan.

1 Aspen Technology, Inc. Board of Directors Compensation Policy Adopted October 14, 2024 Eligibility for Director Compensation  Except as set for the below, members of the Board of Directors (the “Board”) of Aspen Technology, Inc. (the “Company”) receive the compensation described below for their service on the Board.  Board members who also serve as members of management of the Company or Emerson Electric Co. are not eligible for compensation for their service on the Board. Director Compensation  The Company pays an annual cash retainer of $80,000 to each director. Payments are made in advance in equal quarterly installments. If a director joins the Board after the beginning of a quarter, the director will receive a pro-rated portion of the annual cash retainer.  In addition to the annual cash retainer, Board and committee chairs receive additional annual cash retainers as follows: o Board Chair - $100,000 o Audit Committee Chair - $15,000 o Human Capital Committee Chair - $15,000 o Nominating and Corporate Governance Committee Chair - $7,500 o M&A Committee Chair - $15,000 o Related Party Transaction Committees Chair – $7,500  Each director also will receive an annual grant of restricted stock units (“RSUs”) with a grant date value of $240,000 (the “Annual RSU Award”). The Annual RSU Award will be issued on the first trading day of the fiscal year and vest on the last trading day of the fiscal year, subject to continual service by the director during that period. o A director who joins the Company during a fiscal year will receive a grant pro-rated from the initial date of appointment through the end of the fiscal year. o Directors are responsible for all tax payments resulting from the vesting of an Annual RSU Award. New Director Grant  Each new director will receive a one-time, initial grant of RSUs with a grant date value of $200,000 on the fifth trading day after the director commences their service on the Board (the “Initial RSU Award”).

2 o One-third of the Initial RSU Award will vest on the first anniversary of the grant date and in eight equal quarterly installments thereafter on the last trading day of the quarter beginning on the last trading day of the quarter of the first anniversary. o Directors are responsible for all tax payments resulting from the vesting of the Initial Award. Cessation of Board membership (other than following a Control Event)  Upon cessation of Board membership, the Company will accelerate the vesting of the Annual RSU Award or the Initial RSU Award through the last date of service as a member of the Board.  The Company does not “claw back” cash retainers paid at the beginning of the quarter in which the director resigns or departs the Board. Death or Disability of a Director  The Annual RSU Award and Initial RSU Award will accelerate and vest through the date of the death or disability of the director.  The Company does not “claw back” cash retainers paid at the beginning of the quarter in which the director dies or becomes disabled. Cessation of Board membership following a Control Event Upon cessation of Board membership (other than as a result of a resignation by the director) within the one year period following the occurrence of a Control Event (a "Covered Termination"), the Company will accelerate the vesting of the Annual RSU Award or the Initial RSU Award with respect to the portion of those awards which would have become vested in the one year period immediately following the Covered Termination had the director remained a Board member. A "Control Event" will occur when EMR Worldwide, Inc. and its affiliates hold 90% or more of either (x) the then-outstanding shares of common stock of the Company or (y) the combined voting power of the then-outstanding securities of the Company entitled to vote generally in the election of directors. Note: if equity grants cannot be made due to legal and/or regulatory restrictions, the grants will be delayed until a date as soon as practicable following the removal or lapse of such restrictions.

EXHIBIT 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Antonio J. Pietri, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Aspen Technology, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: November 4, 2024			/s/ ANTONIO. J. PIETRI
			Antonio J. Pietri
			President and Chief Executive Officer
			(Principal Executive Officer)

EXHIBIT 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, David Baker, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Aspen Technology, Inc.;

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: November 4, 2024			/s/ DAVID BAKER
			David Baker
			Senior Vice President, Chief Financial Officer
			(Principal Financial Officer)

EXHIBIT 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Aspen Technology, Inc. (the “Company”) for the quarter ended September 30, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned hereby certifies in his capacity as an officer of the Company, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to his knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


Date: November 4, 2024			/s/ ANTONIO J. PIETRI
			Antonio J. Pietri
			President and Chief Executive Officer
			(Principal Executive Officer)


Date: November 4, 2024			/s/ DAVID BAKER
			David Baker
			Senior Vice President, Chief Financial Officer
			(Principal Financial Officer)

A signed original of this written statement required by Section 906 has been provided to Aspen Technology, Inc. and will be retained by Aspen Technology, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

Cover Page - shares	3 Months Ended
Cover Page - shares	Sep. 30, 2024	Oct. 30, 2024
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Entity File Number	001-41400
Entity Registrant Name	ASPEN TECHNOLOGY, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	87-3100817
Entity Address, Address Line One	20 Crosby Drive
Entity Address, City or Town	Bedford
Entity Address, State or Province	MA
Entity Address, Postal Zip Code	01730
City Area Code	781
Local Phone Number	221-6400
Title of 12(b) Security	Common stock, $0.0001 par value per share
Trading Symbol	AZPN
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Central Index Key	0001897982
Amendment Flag	false
Current Fiscal Year End Date	--06-30
Document Fiscal Year Focus	2025
Document Fiscal Period Focus	Q1
Document Period End Date	Sep. 30, 2024
Entity Common Stock, Shares Outstanding		63,249,719

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Revenue:
Total revenue	$ 215,877	$ 249,308
Cost of revenue:
Total cost of revenue	95,447	98,060
Gross profit	120,430	151,248
Operating expenses:
Selling and marketing	125,661	122,378
Research and development	50,000	53,676
General and administrative	33,008	35,405
Restructuring Costs	7,726	0
Total operating expenses	216,395	211,459
Loss from operations	(95,965)	(60,211)
Other income (expense), net	2,041	(5,830)
Interest income, net	17,176	14,049
Loss before benefit for income taxes	(76,748)	(51,992)
Benefit for income taxes	(16,284)	(17,467)
Net loss	$ (60,464)	$ (34,525)
Earnings Per Share [Abstract]
Basic	$ (0.96)	$ (0.54)
Diluted	$ (0.96)	$ (0.54)
Weighted average shares outstanding:
Basic	63,244	64,319
Diluted	63,244	64,319
License and solutions
Revenue:
Total revenue	$ 101,659	$ 148,648
Cost of revenue:
Total cost of revenue	63,654	71,578
Maintenance
Revenue:
Total revenue	90,686	84,968
Cost of revenue:
Total cost of revenue	10,688	10,200
Services and other
Revenue:
Total revenue	23,532	15,692
Cost of revenue:
Total cost of revenue	$ 21,105	$ 16,282

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Net loss	$ (60,464)	$ (34,525)
Other comprehensive income (loss):
Foreign currency translation adjustments	5,202	(11,201)
Total other comprehensive income (loss)	5,202	(11,201)
Comprehensive loss	$ (55,262)	$ (45,726)

CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Sep. 30, 2024	Jun. 30, 2024
Current assets:
Cash and cash equivalents	$ 221,093	$ 236,970
Accounts receivable, net	102,867	115,533
Current contract assets, net	426,387	409,177
Prepaid expenses and other current assets	33,670	27,441
Receivables from related parties	45,300	78,483
Prepaid income taxes	2,909	8,462
Total current assets	832,226	876,066
Property, equipment and leasehold improvements, net	18,093	17,389
Goodwill	8,330,124	8,328,201
Finite-Lived Intangible Assets, Net	4,063,852	4,184,750
Non-current contract assets, net	518,562	515,106
Contract costs	26,265	24,903
Operating lease right-of-use assets	95,001	96,034
Deferred income tax assets	7,627	6,989
Other non-current assets	25,189	22,269
Total assets	13,916,939	14,071,707
Current liabilities:
Accounts payable	12,050	8,099
Accrued expenses and other current liabilities	78,926	100,167
Due to related parties	24,979	47,449
Current operating lease liabilities	12,172	13,125
Income taxes payable	21,656	44,249
Current contract liabilities	117,768	124,312
Total current liabilities	267,551	337,401
Non-current contract liabilities	33,569	27,512
Deferred income tax liabilities	758,389	790,687
Non-current operating lease liabilities	85,676	84,875
Other non-current liabilities	18,795	18,377
Stockholders' equity:
Common Stock, Value, Issued	7	7
Additional paid-in capital	13,293,704	13,277,851
Accumulated deficit	(111,626)	(51,162)
Accumulated other comprehensive loss	$ (2,059)	$ (7,261)
Treasury Stock, Common, Shares	2,208,483	2,115,664
Treasury Stock, Value	$ (427,067)	$ (406,580)
Total stockholders’ equity	12,752,959	12,812,855
Total liabilities and stockholders’ equity	$ 13,916,939	$ 14,071,707
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, authorized	600,000,000	600,000,000
Common stock, issued	65,453,489	65,367,159
Common stock, outstanding	63,245,006	63,251,495

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) Statement - USD ($) $ in Thousands	Total	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Treasury Stock, Common
Common stock, issued		64,952,868				487,626
Additional paid-in capital			$ 13,194,028
Accumulated deficit				$ (41,391)
Accumulated other comprehensive loss					$ 2,436
Total stockholders’ equity	$ 13,070,929	$ 6				$ (84,150)
Net loss	(34,525)			(34,525)
Total other comprehensive income (loss)	(11,201)				(11,201)
Issuance of shares of common stock (in shares)		29,644
Issuance of shares of common stock, amount	3,826		3,826
Issuance of restricted stock units and net share settlement related to withholding taxes (in shares)		47,896
Issuance of restricted stock units and net share settlement related to withholding taxes, amount	(4,585)		(4,585)
Repurchase of common stock, amount	(114,224)		(20,210)			$ 134,434
Stock-based compensation	16,699		16,699
Treasury Stock, Shares, Acquired						686,843
Common stock, issued		65,030,408				1,174,469
Additional paid-in capital			13,230,178
Accumulated deficit				(75,916)
Accumulated other comprehensive loss					(8,765)
Total stockholders’ equity	$ 12,926,919	$ 6				$ (218,584)
Common stock, issued	65,367,159	65,367,159				2,115,664
Additional paid-in capital	$ 13,277,851		13,277,851
Accumulated deficit	(51,162)			(51,162)
Accumulated other comprehensive loss	(7,261)				(7,261)
Total stockholders’ equity	12,812,855	$ 7				$ (406,580)
Net loss	(60,464)			(60,464)
Total other comprehensive income (loss)	5,202				5,202
Issuance of shares of common stock (in shares)		48,326
Issuance of shares of common stock, amount	6,662		6,662
Issuance of restricted stock units and net share settlement related to withholding taxes (in shares)		38,004
Issuance of restricted stock units and net share settlement related to withholding taxes, amount	(5,623)		(5,623)
Repurchase of common stock, amount	(20,487)					$ 20,487
Stock-based compensation	$ 14,814		14,814
Treasury Stock, Shares, Acquired						92,819
Common stock, issued	65,453,489	65,453,489				2,208,483
Additional paid-in capital	$ 13,293,704		$ 13,293,704
Accumulated deficit	(111,626)			$ (111,626)
Accumulated other comprehensive loss	(2,059)				$ (2,059)
Total stockholders’ equity	$ 12,752,959	$ 7				$ (427,067)

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Cash flows from operating activities:
Net loss	$ (60,464)	$ (34,525)
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Depreciation and amortization	122,856	123,219
Reduction in the carrying amount of right-of-use assets	3,961	3,562
Net foreign currency (gains) losses	(2,120)	5,894
Stock-based compensation	14,814	16,699
Deferred income taxes	(32,448)	(51,080)
Provision for uncollectible receivables	491	1,788
Other non-cash operating activities	(258)	19
Changes in assets and liabilities:
Accounts receivable	12,887	29,417
Contract assets	(18,851)	(24,062)
Contract costs	1,285	(1,163)
Lease liabilities	(3,041)	(3,770)
Prepaid expenses, prepaid income taxes, and other assets	(5,956)	(22,487)
Accounts payable, accrued expenses, income taxes payable and other liabilities	(37,052)	10,200
Contract liabilities	(501)	(36,730)
Net cash (used in) provided by operating activities	(4,397)	16,981
Cash flows from investing activities:
Purchases of property, equipment and leasehold improvements	(2,022)	(937)
Payments for business acquisitions, net of cash acquired	0	(8,273)
Payments to Acquire Equity Method Investments	30	98
Payments for Software	0	(12,500)
Net cash used in investing activities	(2,052)	(21,808)
Cash flows from financing activities:
Issuance of shares of common stock, net of taxes	6,262	3,285
Payments for Repurchase of Common Stock	(20,487)	(114,224)
Payment of tax withholding obligations related to restricted stock	(4,635)	(1,938)
Net transfers from Parent Company	(8,836)	(3,890)
Payments of Debt Issuance Costs	(107)	0
Net cash used in financing activities	(10,131)	(108,987)
Effect of exchange rate changes on cash, cash equivalents and restricted cash	3,264	(6,855)
Decrease in cash, cash equivalents and restricted cash	(13,316)	(120,669)
Cash, cash equivalents and restricted cash, beginning of period	236,970
Cash, cash equivalents and restricted cash, end of period	221,093	120,540
Restricted Cash	14,059	0
Supplemental disclosure of non-cash activities:
Change in purchases of property, equipment and leasehold improvements included in accounts payable and accrued expenses	150	249
Lease liabilities arising from obtaining right-of-use assets	2,098	397
Supplemental disclosure of cash flow information:
Income taxes paid, net	32,945	31,842
Interest paid	702	663
Reconciliation to amounts within the unaudited consolidated balance sheets: [Abstract]
Cash, cash equivalents, and restricted cash, end of period	$ 235,152	$ 120,540	$ 248,468	$ 241,209

Interim Unaudited Consolidated Financial Statements	3 Months Ended
Interim Unaudited Consolidated Financial Statements	Sep. 30, 2024
Contractors [Abstract]
Nature of Operations	Organization and Basis of Presentation AspenTech, together with its subsidiaries (the “Company”), is a leading industrial software company that develops solutions to address complex industrial environments where it is critical to optimize the asset design, operations and maintenance lifecycle. Through the Company’s unique combination of product capabilities, deep domain expertise and award-winning innovation, customers across diverse end markets in asset-intensive industries can improve their operational excellence while achieving sustainability goals. The Company had revenue from customers in 113 countries during the first quarter of fiscal 2025. Basis of Presentation The Company has prepared the accompanying unaudited condensed consolidated financial statements as of September 30, 2024, and for the first quarter of fiscal 2025 and 2024 pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”) and in accordance with generally accepted accounting principles in the United States (“GAAP”). All intercompany balances and transactions have been eliminated in consolidation. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated and combined financial statements and the notes thereto included in our Annual Report on Form 10-K for the fiscal year ended June 30, 2024. The preparation of financial statements and related disclosures in conformity with GAAP requires us to make judgments, assumptions, and estimates that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. The actual results that the Company experiences may differ materially from these estimates. Russia In June 2024, the United States government announced new expanded restrictions that prohibit the sale, service, maintenance, and support (such as bug fixes and updates) of enterprise management software and design and manufacturing software in the Russian market. As a result, the Company announced that it had suspended all commercial activities in Russia in the fourth quarter of fiscal 2024. This includes the discontinuation of the following activities: all commercial discussions with customers, initiating or processing renewals, providing proposals to customers or selling products or services. In addition, the Company has written-off certain assets that are related to its operations in Russia, and will be closing certain facilities, and terminating or relocating substantially all employees based in Russia during fiscal 2025. Beginning with the consolidated balance sheet as of June 30, 2024, the Company classifies cash balances that are both held in Russia and in excess of what it estimates will be required to wind down its operations in Russia as restricted cash due to current restrictions impacting the Company’s ability to transfer funds from bank accounts located in Russia to other countries. As of September 30, 2024 and June 30, 2024, the restricted cash held in Russia was $14.0 million and $11.5 million, respectively, which is included within other non-current assets on the condensed consolidated balance sheets.

Significant Accounting Policies	3 Months Ended
Significant Accounting Policies	Sep. 30, 2024
Accounting Policies [Abstract]
Significant Accounting Policies	Significant Accounting Policies Our significant accounting policies are described in Note 2, “Significant Accounting Policies,” to the consolidated and combined financial statements included in our Annual Report on Form 10-K for the fiscal year ended June 30, 2024. There were no material changes to our significant accounting policies during the three months ended September 30, 2024. (a) Recently Issued Accounting Standards Not Yet Adopted In October 2023, the FASB issued Accounting Standards Updated (“ASU”) 2023-06, Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative (“ASU 2023-06”). ASU 2023-06 was issued to modify the disclosure or presentation requirements of a variety of topics in the codification. The effective date for each amendment will be the date on which the SEC removal of the related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited. The Company does not expect the adoption of ASU 2023-06 to have a material impact on its financial position or results of operations. In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”). ASU 2023-07 expands segment disclosures by requiring disclosure of significant segment expenses that are regularly provided to the chief operating decision maker and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items, and interim disclosures of a reportable segment’s profit or loss and assets. The disclosures required under ASU 2023-07 are also required for public entities with a single reportable segment. The ASU is effective for the Company’s first fiscal year beginning after December 15, 2023 and for interim periods within the Company’s first fiscal year beginning after December 15, 2024, with early adoption permitted. The Company does not expect the adoption of ASU 2023-07 to have a material impact on its financial position or results of operations. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. ASU 2023-09 is effective for the Company’s first fiscal year beginning after December 15, 2024. The guidance will be applied on a prospective basis with the option to apply the standard retrospectively. Early adoption is permitted. The Company does not expect the adoption of ASU 2023-09 to have a material impact on its financial position or results of operations.

Revenue from Contracts with Customers (Notes)

3 Months Ended

Sep. 30, 2024

Revenue from Contract with Customer [Abstract]

Revenue from Contract with Customer [Text Block]

Revenue from Contracts with Customers

Contract Assets and Contract Liabilities

The Company’s contract assets and contract liabilities were as follows as of September 30, 2024 and June 30, 2024:


	September 30, 2024		June 30, 2024

	(Dollars in Thousands)
Contract assets	$	944,949	$	924,283
Contract liabilities	(151,337)		(151,824)
Net contract assets	$	793,612	$	772,459

Transaction Price Allocated to Remaining Performance Obligations


	Year Ended June 30,
	2025		2026		2027		2028		2029		Thereafter		Total

	(Dollars in Thousands)
License and solutions	$	158,801	$	57,595	$	19,618	$	10,301	$	5,063	$	182	$	251,560
Maintenance	246,297		234,058		172,742		114,627		67,181		34,640		869,545
Services and other	84,300		52,695		18,142		7,809		571		77		163,594
Total	$	489,398	$	344,348	$	210,502	$	132,737	$	72,815	$	34,899	$	1,284,699

Disaggregated Revenue Information

The table below reflects disaggregated revenues by business for the three months ended September 30, 2024 and 2023:


	Three Months Ended September 30,
	2024		2023

	(Dollars in Thousands)
Heritage AspenTech	$	150,043	$	175,743
Subsurface Science & Engineering (“SSE”)	20,310		24,081
Digital Grid Management (“DGM”)	45,524		49,484
Total	$	215,877	$	249,308

The Company did not have any customers that accounted for 10 percent or more of the Company’s revenues for the three months ended September 30, 2024 and 2023, respectively.

Intangible Assets

3 Months Ended

Sep. 30, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets

Intangible assets consist of the following as of September 30, 2024 and June 30, 2024:


	Developed Technology		Trademarks		Customer Relationships and Backlog		Capitalized Software and Other		Total

September 30, 2024	(Dollars in Thousands)
Gross carrying amount	$	1,903,599	$	464,400	$	3,082,541	$	24,026	$	5,474,566
Less: Accumulated amortization	(585,236)		(18,900)		(796,521)		(10,057)		(1,410,714)
Net carrying amount	$	1,318,363	$	445,500	$	2,286,020	$	13,969	$	4,063,852

	Developed Technology		Trademarks		Customer Relationships and Backlog		Capitalized Software and Other		Total

June 30, 2024	(Dollars in Thousands)
Gross carrying amount	$	1,903,599	$	464,400	$	3,082,541	$	24,026	$	5,474,566
Less: Accumulated amortization	(537,492)		(17,931)		(724,270)		(10,123)		(1,289,816)
Net carrying amount	$	1,366,107	$	446,469	$	2,358,271	$	13,903	$	4,184,750

Goodwill

3 Months Ended

Sep. 30, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill

The changes in the carrying amount of goodwill during the three months ended September 30, 2024 were as follows:


	Carrying Value
	(Dollars in Thousands)
Balance, June 30, 2024	$	8,328,201
Foreign currency translation	1,923
Balance, September 30, 2024	$	8,330,124

Fair Value

3 Months Ended

Sep. 30, 2024

Fair Value Disclosures [Abstract]

Fair Value


	Fair Value Measurements at Reporting Date Using,
	Quoted Prices in Active Markets for Identical Assets (Level 1 Inputs)		Significant Other Observable Inputs (Level 2 Inputs)

	(Dollars in Thousands)
September 30, 2024
Money market funds (cash equivalents)	$	106,187	$	—
Equity method investments	$	—	$	2,467


June 30, 2024
Money market funds (cash equivalents)	$	129,710	$	—
Equity method investments	$	—	$	2,437

Credit Agreement	3 Months Ended
Credit Agreement	Sep. 30, 2024
Debt Disclosure [Abstract]
Credit Agreement	Debt Second Amended and Restated Credit Agreement On June 27, 2024, the Company entered into a new Second Amended and Restated Credit Agreement (the “Second Amended and Restated Credit Agreement”) with JPMorgan Chase Bank, National Association with an expiration date of June 27, 2029 that provides for aggregate borrowing commitments of $200.0 million. As of September 30, 2024, the Company was in compliance with the covenants associated with the Second Amended and Restated Credit Agreement, and, after considering eligible outstanding letters of credit allowable in the aggregate amount of $5.5 million, the Company had $194.5 million available for borrowing. For a more detailed description of the Second Amended and Restated Credit Agreement, see Note 12, “Debt” to the consolidated and combined financial statements included in our Annual Report on Form 10-K for the fiscal year ended June 30, 2024.

Stock-Based Compensation

3 Months Ended

Sep. 30, 2024

Share-Based Payment Arrangement [Abstract]

Stock-Based Compensation


	Three Months Ended September 30,
	2024		2023

	(Dollars in Thousands)
Cost of license and solutions	$	551	$	680
Cost of maintenance	887		488
Cost of services and other	1,045		498
Selling and marketing	2,930		2,942
Research and development	3,000		4,553
General and administrative	6,401		7,538
Total stock-based compensation	$	14,814	$	16,699

Stock Options

The table below summarizes activities related to stock options for the three months ended September 30, 2024:


	Number of Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value(1)
				(in years)	(in thousands)
Outstanding as of June 30, 2024	760,088	$	160.82	5.61	$	43,132
Exercised	(50,006)	$	140.67
Cancelled / Forfeited	(28,323)	$	175.33
Outstanding as of September 30, 2024	681,759	$	159.47	5.62	$	65,611
Exercisable as of September 30, 2024	562,878	$	133.36	5.18	$	59,369
Vested and expected to vest as of September 30, 2024	675,824	$	142.10	5.61	$	65,386

__________

Restricted Stock Units and Performance Stock Units


	Number of Shares Underlying Performance Stock Units		Weighted Average Grant-Date Fair Value PSUs		Number of Shares Underlying Restricted Stock Units		Weighted Average Grant-Date Fair Value RSUs

	(Dollars in Thousands, except per share data)
Outstanding as of June 30, 2024	82,656		$	194.03	288,887		$	193.98
Granted	87,945		$	234.14	159,878		$	231.06
Settled	—		—		(62,272)		$	196.29
Forfeited	(13,289)		$	194.10	(28,652)		$	198.05
Outstanding as of September 30, 2024	157,312		$	216.45	357,841		$	210.23
Weighted average remaining recognition period of outstanding units (in years)	2.58				2.16
Unrecognized stock-based compensation expense of outstanding units	$	22,753			$	62,714
Aggregate intrinsic value of outstanding units	$	29,282			$	83,133

Net Income Per Share

3 Months Ended

Sep. 30, 2024

Earnings Per Share [Abstract]

Net Income Per Share

Net Loss Per Share

The calculations of basic and diluted net loss per share and basic and diluted weighted average shares outstanding for the three months ended September 30, 2024 and 2023 are as follows:


	Three Months Ended September 30,
	2024		2023

	(Dollars and Shares in Thousands, Except per Share Data)
Net loss	$	(60,464)	$	(34,525)

Basic weighted average shares outstanding	63,244		64,319



Dilutive weighted average shares outstanding	63,244		64,319

Net loss per share
Basic	$	(0.96)	$	(0.54)
Dilutive	$	(0.96)	$	(0.54)


	Three Months Ended September 30,
	2024	2023

	(Shares in Thousands)
Employee equity awards	1,032	1,449

Stock Repurchases	3 Months Ended
Stock Repurchases	Sep. 30, 2024
Equity [Abstract]
Treasury Stock	Stock Repurchases On August 6, 2024, the Company announced that its Board of Directors approved a share repurchase authorization (the “Fiscal 2025 Share Repurchase Authorization”) pursuant to which an aggregate amount of $100.0 million of its common stock may be repurchased, by means of open market transactions, block transactions, privately negotiated purchase transactions or any other purchase techniques, including 10b5-1 trading plans. The timing and amount of any shares repurchased under the Fiscal 2025 Share Repurchase Authorization are based on market conditions and other factors. All shares of the Company’s common stock repurchased have been recorded as treasury stock under the cost method. The Company reflects share repurchases in its condensed consolidated financial statements once the transaction is settled. As of September 30, 2024, a total of 92,819 shares have been repurchased under the Fiscal 2025 Share Repurchase Authorization for $20.5 million, with the total remaining value available for repurchase being $79.5 million.

Income Taxes	3 Months Ended
Income Taxes	Sep. 30, 2024
Income Tax Disclosure [Abstract]
Income Taxes	Benefit for Income Taxes The Company computes its tax benefit for interim periods by applying the estimated annual effective tax rate (“AETR”) to year-to-date income from operations and adjusting for discrete items arising in that quarter. However, if the Company is unable to make a reliable estimate of its AETR, then the actual effective tax rate for the year-to-date period may be the best estimate. For both the three months ended September 30, 2024 and September 30, 2023 the Company recorded the actual effective tax rate as it was determined that the AETR approach was not the most appropriate estimate. Benefit for income taxes was $16.3 million and $17.5 million for the three months ended September 30, 2024 and 2023, respectively, resulting in effective tax rates of 21.2% and 33.6%, respectively. Income tax benefit decreased primarily due to the lower Foreign-Derived Intangible Income (“FDII”) deduction taken this year compared to last year resulting from lower taxable income in the first quarter of fiscal 2025 compared to the first quarter of fiscal 2024. The first quarter of fiscal 2024 included a significant temporary item that increased taxable income relating to a change in the methodology for recording revenue for tax purposes on multi-year software licenses. There was no such temporary item in the first quarter of fiscal 2025.

Comprehensive Text Block List

3 Months Ended

Sep. 30, 2024

Text Block [Abstract]

Related Party Transactions Disclosure

Related-Party Transactions

Receivables from related parties and due to related parties reported in the condensed consolidated balance sheets as of September 30, 2024 and June 30, 2024 include the following:


	September 30, 2024		June 30, 2024

	(Dollars in Thousands)
Interest bearing receivables from related parties	$	45,119	$	78,278
Trade receivables from related parties	181		205
Receivables from related parties	$	45,300	$	78,483

Interest bearing payables to related parties	$	24,661	$	47,315
Trade payables to related parties	318		134
Due to related parties	$	24,979	$	47,449

Allocations and charges from Emerson are as follows:


	Three Months Ended September 30,
	2024		2023

	(Dollars in Thousands)

Information technology	$	194	$	975

Shared services and other	$	162	$	374


	Three Months Ended September 30,
	2024		2023

	(Dollars in Thousands)
Revenue from Emerson affiliates	$	987	$	313

Purchases from Emerson affiliates	$	75	$	68

Emerson Share Maintenance Rights

Plantweb Optics Analytics

Segment Information

3 Months Ended

Sep. 30, 2024

Segment Reporting [Abstract]

Segment Information

Segment and Geographic Information

Geographic Information

Summarized below is information about the Company’s geographic operations:


	Revenue by Destination
	Three Months Ended September 30,
	2024		2023

	(Dollars in Thousands)
Americas	$	111,866	$	133,016
Asia, Middle East and Africa	52,269		57,685
Europe	51,742		58,607
Total	$	215,877	$	249,308

Americas included revenue in the United States of $83.4 million and $96.0 million for the three months ended September 30, 2024 and 2023, respectively.


	Property, Equipment, and
	Leasehold Improvements, Net
	September 30, 2024		June 30, 2024

	(Dollars in Thousands)
Americas	$	13,906	$	13,643
Asia, Middle East and Africa	2,452		2,011
Europe	1,735		1,735
Total	$	18,093	$	17,389

Property, equipment, and leasehold improvements, net located in the United States were $11.5 million and $11.2 million as of September 30, 2024 and June 30, 2024, respectively.

Leases

3 Months Ended

Sep. 30, 2024

Leases [Abstract]

Leases

Operating lease costs are recognized on a straight-line basis over the term of the lease. The components of total lease expense for the three months ended September 30, 2024 and 2023 were as follows:


	Three Months Ended September 30,
	2024		2023

	(Dollars in Thousands)
Operating lease expense	$	4,977	$	4,466
Variable lease expense	$	404	$	223
Short term lease expense	$	136	$	157

The following table summarizes the balances of the Company’s operating lease right-of-use assets and operating lease liabilities as of September 30, 2024 and June 30, 2024:


	September 30, 2024		June 30, 2024

	(Dollars in Thousands)
Operating lease right-of-use assets	$	95,001	$	96,034
Current operating lease liabilities	$	12,172	$	13,125
Non-current operating lease liabilities	$	85,676	$	84,875

The following table represents the future maturities of the Company’s operating lease liabilities as of September 30, 2024:


Year Ending June 30,	(Dollars in Thousands)
2025	$	10,219
2026	11,019
2027	14,416
2028	14,015
2029	13,125
Thereafter	91,950
Total lease payments	154,744
Less: imputed interest	(32,073)
Less: leasehold improvement incentives to be utilized	(24,823)
Total lease maturities	$	97,848

Regulated Operations

3 Months Ended

Sep. 30, 2024

Regulated Operations [Abstract]

Supplemental Balance Sheet Disclosures [Text Block]

Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities in the accompanying condensed consolidated balance sheets consist of the following:


	September 30, 2024		June 30, 2024

	(Dollars in Thousands)
Compensation-related	$	50,610	$	61,976
Professional fees	5,661		4,987
Accrued taxes	5,146		10,991
Acquisition related	1,475		1,804
Restructuring	1,078		—
Other	14,956		20,409
Total accrued expenses and other current liabilities	$	78,926	$	100,167

Restructuring and Related Activities	3 Months Ended
Restructuring and Related Activities	Sep. 30, 2024
Restructuring and Related Activities [Abstract]
Restructuring and Related Activities Disclosure	Restructuring Costs The Company records liabilities for costs associated with exit or disposal activities in the period in which the liability is incurred. Employee severance costs are accrued when the restructuring actions have been determined and communicated to the employee. Costs for one-time termination benefits in which the employee is required to render service until termination in order to receive the benefits are recognized ratably over the future service period. In August 2024, the Company announced a reorganization of its corporate structure, resulting in the elimination of certain roles as it continues to seek additional opportunities to streamline expenses and increase efficiencies. Additionally, due to the expansion of sanctions by the United States government on commercial activity in Russia, the Company will be closing certain facilities, and terminating or relocating substantially all employees based in Russia during fiscal 2025. As a result of these actions, the Company has incurred and will continue to incur restructuring costs during fiscal 2025 consisting primarily of severance expenditures, one-time benefits and other contract termination costs. Restructuring costs were $7.7 million for the three months ended September 30, 2024, and there were no restructuring costs for the three months ended September 30, 2023. As of September 30, 2024, the liability associated with unpaid restructuring costs was $1.1 million, which is included within accrued expenses and other current liabilities on the condensed consolidated balance sheets.

Subsequent Events	3 Months Ended
Subsequent Events	Sep. 30, 2024
Subsequent Events [Abstract]
Subsequent Events	Subsequent Events On October 25, 2024, the Company entered into a definitive agreement to acquire Open Grid Systems Limited (“OGS”). OGS is a global provider of network model management technology and a pioneer in developing model-driven applications supporting open access to data through industry standards. The Company has agreed to pay $45.0 million, plus the value of any cash acquired and any necessary net working capital adjustments. The Company currently intends to finance the transaction through cash on hand. The acquisition is expected to close in the second fiscal quarter of 2025, subject to receipt of regulatory approvals.

Intangible Assets (Policies)

3 Months Ended

Sep. 30, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets

Intangible assets consist of the following as of September 30, 2024 and June 30, 2024:


	Developed Technology		Trademarks		Customer Relationships and Backlog		Capitalized Software and Other		Total

September 30, 2024	(Dollars in Thousands)
Gross carrying amount	$	1,903,599	$	464,400	$	3,082,541	$	24,026	$	5,474,566
Less: Accumulated amortization	(585,236)		(18,900)		(796,521)		(10,057)		(1,410,714)
Net carrying amount	$	1,318,363	$	445,500	$	2,286,020	$	13,969	$	4,063,852

	Developed Technology		Trademarks		Customer Relationships and Backlog		Capitalized Software and Other		Total

June 30, 2024	(Dollars in Thousands)
Gross carrying amount	$	1,903,599	$	464,400	$	3,082,541	$	24,026	$	5,474,566
Less: Accumulated amortization	(537,492)		(17,931)		(724,270)		(10,123)		(1,289,816)
Net carrying amount	$	1,366,107	$	446,469	$	2,358,271	$	13,903	$	4,184,750

Goodwill (Policies)

3 Months Ended

Sep. 30, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill

The changes in the carrying amount of goodwill during the three months ended September 30, 2024 were as follows:


	Carrying Value
	(Dollars in Thousands)
Balance, June 30, 2024	$	8,328,201
Foreign currency translation	1,923
Balance, September 30, 2024	$	8,330,124

Revenue from Contracts with Customers (Tables)

3 Months Ended

Sep. 30, 2024

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue [Table Text Block]

The table below reflects disaggregated revenues by business for the three months ended September 30, 2024 and 2023:


	Three Months Ended September 30,
	2024		2023

	(Dollars in Thousands)
Heritage AspenTech	$	150,043	$	175,743
Subsurface Science & Engineering (“SSE”)	20,310		24,081
Digital Grid Management (“DGM”)	45,524		49,484
Total	$	215,877	$	249,308

Contract with Customer, Contract Asset, Contract Liability, and Receivable [Table Text Block]

The Company’s contract assets and contract liabilities were as follows as of September 30, 2024 and June 30, 2024:


	September 30, 2024		June 30, 2024

	(Dollars in Thousands)
Contract assets	$	944,949	$	924,283
Contract liabilities	(151,337)		(151,824)
Net contract assets	$	793,612	$	772,459

Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Table Text Block]


	Year Ended June 30,
	2025		2026		2027		2028		2029		Thereafter		Total

	(Dollars in Thousands)
License and solutions	$	158,801	$	57,595	$	19,618	$	10,301	$	5,063	$	182	$	251,560
Maintenance	246,297		234,058		172,742		114,627		67,181		34,640		869,545
Services and other	84,300		52,695		18,142		7,809		571		77		163,594
Total	$	489,398	$	344,348	$	210,502	$	132,737	$	72,815	$	34,899	$	1,284,699

Intangible Assets (Tables)

3 Months Ended

Sep. 30, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible assets

Intangible assets consist of the following as of September 30, 2024 and June 30, 2024:


	Developed Technology		Trademarks		Customer Relationships and Backlog		Capitalized Software and Other		Total

September 30, 2024	(Dollars in Thousands)
Gross carrying amount	$	1,903,599	$	464,400	$	3,082,541	$	24,026	$	5,474,566
Less: Accumulated amortization	(585,236)		(18,900)		(796,521)		(10,057)		(1,410,714)
Net carrying amount	$	1,318,363	$	445,500	$	2,286,020	$	13,969	$	4,063,852

	Developed Technology		Trademarks		Customer Relationships and Backlog		Capitalized Software and Other		Total

June 30, 2024	(Dollars in Thousands)
Gross carrying amount	$	1,903,599	$	464,400	$	3,082,541	$	24,026	$	5,474,566
Less: Accumulated amortization	(537,492)		(17,931)		(724,270)		(10,123)		(1,289,816)
Net carrying amount	$	1,366,107	$	446,469	$	2,358,271	$	13,903	$	4,184,750

Goodwill (Tables)

3 Months Ended

Sep. 30, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Changes in carrying amount of goodwill by reporting unit

The changes in the carrying amount of goodwill during the three months ended September 30, 2024 were as follows:


	Carrying Value
	(Dollars in Thousands)
Balance, June 30, 2024	$	8,328,201
Foreign currency translation	1,923
Balance, September 30, 2024	$	8,330,124

Fair Value Fair Value (Tables)

3 Months Ended

Sep. 30, 2024

Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]

Fair Value Option, Disclosures [Table Text Block]


	Fair Value Measurements at Reporting Date Using,
	Quoted Prices in Active Markets for Identical Assets (Level 1 Inputs)		Significant Other Observable Inputs (Level 2 Inputs)

	(Dollars in Thousands)
September 30, 2024
Money market funds (cash equivalents)	$	106,187	$	—
Equity method investments	$	—	$	2,467


June 30, 2024
Money market funds (cash equivalents)	$	129,710	$	—
Equity method investments	$	—	$	2,437

Stock-Based Compensation (Tables)

3 Months Ended

Sep. 30, 2024

Share-Based Payment Arrangement [Abstract]

Schedule of stock-based compensation expense


	Three Months Ended September 30,
	2024		2023

	(Dollars in Thousands)
Cost of license and solutions	$	551	$	680
Cost of maintenance	887		488
Cost of services and other	1,045		498
Selling and marketing	2,930		2,942
Research and development	3,000		4,553
General and administrative	6,401		7,538
Total stock-based compensation	$	14,814	$	16,699

Schedule of activities related to stock options

The table below summarizes activities related to stock options for the three months ended September 30, 2024:


	Number of Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value(1)
				(in years)	(in thousands)
Outstanding as of June 30, 2024	760,088	$	160.82	5.61	$	43,132
Exercised	(50,006)	$	140.67
Cancelled / Forfeited	(28,323)	$	175.33
Outstanding as of September 30, 2024	681,759	$	159.47	5.62	$	65,611
Exercisable as of September 30, 2024	562,878	$	133.36	5.18	$	59,369
Vested and expected to vest as of September 30, 2024	675,824	$	142.10	5.61	$	65,386

__________

Schedule of activities related to restricted stock units and performance stock units

The table below summarizes activities related to restricted stock units and performance stock units for the three months ended September 30, 2024:


	Number of Shares Underlying Performance Stock Units		Weighted Average Grant-Date Fair Value PSUs		Number of Shares Underlying Restricted Stock Units		Weighted Average Grant-Date Fair Value RSUs

	(Dollars in Thousands, except per share data)
Outstanding as of June 30, 2024	82,656		$	194.03	288,887		$	193.98
Granted	87,945		$	234.14	159,878		$	231.06
Settled	—		—		(62,272)		$	196.29
Forfeited	(13,289)		$	194.10	(28,652)		$	198.05
Outstanding as of September 30, 2024	157,312		$	216.45	357,841		$	210.23
Weighted average remaining recognition period of outstanding units (in years)	2.58				2.16
Unrecognized stock-based compensation expense of outstanding units	$	22,753			$	62,714
Aggregate intrinsic value of outstanding units	$	29,282			$	83,133

Net Income Per Share (Tables)

3 Months Ended

Sep. 30, 2024

Earnings Per Share [Abstract]

Schedule of calculations of basic and diluted net income per share and basic and dilutive weighted average shares outstanding

The calculations of basic and diluted net loss per share and basic and diluted weighted average shares outstanding for the three months ended September 30, 2024 and 2023 are as follows:


	Three Months Ended September 30,
	2024		2023

	(Dollars and Shares in Thousands, Except per Share Data)
Net loss	$	(60,464)	$	(34,525)

Basic weighted average shares outstanding	63,244		64,319



Dilutive weighted average shares outstanding	63,244		64,319

Net loss per share
Basic	$	(0.96)	$	(0.54)
Dilutive	$	(0.96)	$	(0.54)

Schedule of employee equity awards excluded from the calculation of dilutive weighted average shares outstanding

The following employee equity awards were excluded from the calculation of diluted weighted average shares outstanding because their effect would be anti-dilutive as of September 30, 2024 and 2023:


	Three Months Ended September 30,
	2024	2023

	(Shares in Thousands)
Employee equity awards	1,032	1,449

Comprehensive Text Block List (Tables)

3 Months Ended

Sep. 30, 2024

Text Block [Abstract]

Restructuring and Related Costs

Allocations and charges from Emerson are as follows:


	Three Months Ended September 30,
	2024		2023

	(Dollars in Thousands)

Information technology	$	194	$	975

Shared services and other	$	162	$	374

Investments in and Advances to Affiliates


	Three Months Ended September 30,
	2024		2023

	(Dollars in Thousands)
Revenue from Emerson affiliates	$	987	$	313

Purchases from Emerson affiliates	$	75	$	68

Schedule of Accounts Payable and Accrued Liabilities

Receivables from related parties and due to related parties reported in the condensed consolidated balance sheets as of September 30, 2024 and June 30, 2024 include the following:


	September 30, 2024		June 30, 2024

	(Dollars in Thousands)
Interest bearing receivables from related parties	$	45,119	$	78,278
Trade receivables from related parties	181		205
Receivables from related parties	$	45,300	$	78,483

Interest bearing payables to related parties	$	24,661	$	47,315
Trade payables to related parties	318		134
Due to related parties	$	24,979	$	47,449

Segment Information (Tables)

3 Months Ended

Sep. 30, 2024

Segment Reporting [Abstract]

Revenue from External Customers by Geographic Areas

Summarized below is information about the Company’s geographic operations:


	Revenue by Destination
	Three Months Ended September 30,
	2024		2023

	(Dollars in Thousands)
Americas	$	111,866	$	133,016
Asia, Middle East and Africa	52,269		57,685
Europe	51,742		58,607
Total	$	215,877	$	249,308

Property, Plant and Equipment [Table Text Block]


	Property, Equipment, and
	Leasehold Improvements, Net
	September 30, 2024		June 30, 2024

	(Dollars in Thousands)
Americas	$	13,906	$	13,643
Asia, Middle East and Africa	2,452		2,011
Europe	1,735		1,735
Total	$	18,093	$	17,389

Leases (Tables)

3 Months Ended

Sep. 30, 2024

Leases [Abstract]

Schedule of Lease Cost

Operating lease costs are recognized on a straight-line basis over the term of the lease. The components of total lease expense for the three months ended September 30, 2024 and 2023 were as follows:


	Three Months Ended September 30,
	2024		2023

	(Dollars in Thousands)
Operating lease expense	$	4,977	$	4,466
Variable lease expense	$	404	$	223
Short term lease expense	$	136	$	157

The following table summarizes the balances of the Company’s operating lease right-of-use assets and operating lease liabilities as of September 30, 2024 and June 30, 2024:


	September 30, 2024		June 30, 2024

	(Dollars in Thousands)
Operating lease right-of-use assets	$	95,001	$	96,034
Current operating lease liabilities	$	12,172	$	13,125
Non-current operating lease liabilities	$	85,676	$	84,875

Lessee, Operating Lease, Liability, Maturity

The following table represents the future maturities of the Company’s operating lease liabilities as of September 30, 2024:


Year Ending June 30,	(Dollars in Thousands)
2025	$	10,219
2026	11,019
2027	14,416
2028	14,015
2029	13,125
Thereafter	91,950
Total lease payments	154,744
Less: imputed interest	(32,073)
Less: leasehold improvement incentives to be utilized	(24,823)
Total lease maturities	$	97,848

Organization and Basis of Presentation (Details) $ in Millions	3 Months Ended
	Sep. 30, 2024 USD ($) countries	Jun. 30, 2024 USD ($)
Contractors [Abstract]
us-gaap_NumberOfCountriesInWhichEntityOperates \| countries	113
Restricted Cash Held in Russia \| $	$ 14.0	$ 11.5

Revenue from Contracts with Customers (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Revenue from Contract with Customer [Abstract]
Revenue recognized that was previously deferred	$ 38,000
Revenue from Contract with Customer, Excluding Assessed Tax	$ 215,877	$ 249,308
Segment Reporting, Disclosure of Major Customers	not	not
Revenue recognized that was previously deferred	$ 38,000
OSI Inc.
Revenue from Contract with Customer, Excluding Assessed Tax	45,524	$ 49,484
SSE
Revenue from Contract with Customer, Excluding Assessed Tax	20,310	24,081
Heritage AspenTech
Revenue from Contract with Customer, Excluding Assessed Tax	$ 150,043	$ 175,743

Revenue from Contracts with Customers Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Total revenue	$ 215,877	$ 249,308
License and solutions
Total revenue	101,659	148,648
Maintenance
Total revenue	90,686	84,968
Services and other
Total revenue	$ 23,532	$ 15,692

Revenue from Contracts with Customers Contract Balances (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2024	Jun. 30, 2024
Revenue recognized that was previously deferred	$ 38,000
Deferred revenue	(151,337)	$ (151,824)
Contract assets	944,949	924,283
Net Contract Assets (Liabilities)	$ 793,612	$ 772,459

Revenue from Contracts with Customers Transaction Price Allocated to Remaining Performance Obligations (Details) $ in Thousands	Sep. 30, 2024 USD ($)
Transaction Price Allocated to Remaining Performance Obligations, Amount	$ 1,284,699
FY24
Transaction Price Allocated to Remaining Performance Obligations, Amount	489,398
FY25
Transaction Price Allocated to Remaining Performance Obligations, Amount	344,348
FY26
Transaction Price Allocated to Remaining Performance Obligations, Amount	210,502
FY27
Transaction Price Allocated to Remaining Performance Obligations, Amount	132,737
FY28
Transaction Price Allocated to Remaining Performance Obligations, Amount	72,815
FY29
Transaction Price Allocated to Remaining Performance Obligations, Amount	34,899
License and solutions
Transaction Price Allocated to Remaining Performance Obligations, Amount	251,560
License and solutions \| FY24
Transaction Price Allocated to Remaining Performance Obligations, Amount	158,801
License and solutions \| FY25
Transaction Price Allocated to Remaining Performance Obligations, Amount	57,595
License and solutions \| FY26
Transaction Price Allocated to Remaining Performance Obligations, Amount	19,618
License and solutions \| FY27
Transaction Price Allocated to Remaining Performance Obligations, Amount	10,301
License and solutions \| FY28
Transaction Price Allocated to Remaining Performance Obligations, Amount	5,063
License and solutions \| FY29
Transaction Price Allocated to Remaining Performance Obligations, Amount	182
Maintenance
Transaction Price Allocated to Remaining Performance Obligations, Amount	869,545
Maintenance \| FY24
Transaction Price Allocated to Remaining Performance Obligations, Amount	246,297
Maintenance \| FY25
Transaction Price Allocated to Remaining Performance Obligations, Amount	234,058
Maintenance \| FY26
Transaction Price Allocated to Remaining Performance Obligations, Amount	172,742
Maintenance \| FY27
Transaction Price Allocated to Remaining Performance Obligations, Amount	114,627
Maintenance \| FY28
Transaction Price Allocated to Remaining Performance Obligations, Amount	67,181
Maintenance \| FY29
Transaction Price Allocated to Remaining Performance Obligations, Amount	34,640
Services and other
Transaction Price Allocated to Remaining Performance Obligations, Amount	163,594
Services and other \| FY24
Transaction Price Allocated to Remaining Performance Obligations, Amount	84,300
Services and other \| FY25
Transaction Price Allocated to Remaining Performance Obligations, Amount	52,695
Services and other \| FY26
Transaction Price Allocated to Remaining Performance Obligations, Amount	18,142
Services and other \| FY27
Transaction Price Allocated to Remaining Performance Obligations, Amount	7,809
Services and other \| FY28
Transaction Price Allocated to Remaining Performance Obligations, Amount	571
Services and other \| FY29
Transaction Price Allocated to Remaining Performance Obligations, Amount	$ 77

Intangible Assets - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Jun. 30, 2024
Finite-Lived Intangible Assets [Line Items]
Developed Technology	$ 5,474,566		$ 5,474,566
Trademarks	(1,410,714)		(1,289,816)
Intangible assets, net	4,063,852		4,184,750
Intangible asset amortization expense	121,800	$ 121,700
Heritage AspenTech
Finite-Lived Intangible Assets [Line Items]
Amortization of Intangible Assets	430,000
Gross carrying amount
Finite-Lived Intangible Assets [Line Items]
Developed Technology	1,903,599		1,903,599
Trademarks	(585,236)		(537,492)
Intangible assets, net	1,318,363		1,366,107
Less: Accumulated amortization
Finite-Lived Intangible Assets [Line Items]
Developed Technology	3,082,541		3,082,541
Trademarks	(796,521)		(724,270)
Intangible assets, net	2,286,020		2,358,271
Trademarks
Finite-Lived Intangible Assets [Line Items]
Developed Technology	464,400		464,400
Trademarks	(18,900)		(17,931)
Intangible assets, net	445,500		446,469
Purchased software
Finite-Lived Intangible Assets [Line Items]
Developed Technology	24,026		24,026
Trademarks	(10,057)		(10,123)
Intangible assets, net	$ 13,969		$ 13,903

Intangible Assets - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Jun. 30, 2024
Goodwill and Intangible Assets Disclosure [Abstract]
Intangible asset amortization expense	$ 121,800	$ 121,700
Intangible assets, net	$ 4,063,852		$ 4,184,750

Goodwill - Goodwill, Net (Details) $ in Thousands	3 Months Ended
Goodwill - Goodwill, Net (Details) $ in Thousands	Sep. 30, 2024 USD ($)
Goodwill:
Balance, June 30, 2024	$ 8,328,201
Foreign currency translation	1,923
Balance, September 30, 2024	$ 8,330,124

Fair Value (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Jun. 30, 2024
Level 1 Inputs
Fair Value
Money market funds (cash equivalents)	$ 106,187	$ 129,710
Level 2 Inputs
Fair Value
Equity method investments	$ 2,467	$ 2,437

Credit Agreement (Details) - USD ($) $ in Millions	Sep. 30, 2024	Jun. 27, 2024
Credit Agreement
Letters of Credit Outstanding, Amount	$ 5.5
Revolving Credit Facility [Member]
Credit Agreement
Principal amount	$ 194.5
Second Amended and Restated Credit Agreement
Credit Agreement
Principal amount		$ 200.0

Credit Agreement Schedule of Long-Term Debt (Details) $ in Millions	Sep. 30, 2024 USD ($)
Debt Instrument [Line Items]
Letters of Credit Outstanding, Amount	$ 5.5
Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Debt Instrument, Face Amount	$ 194.5

Stock-Based Compensation - Additional Disclosures (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Stock-based compensation, additional disclosures
Issuance of shares of common stock, net of taxes	$ 6,262	$ 3,285
Employee stock purchase plan, stock-based compensation	$ 14,814	$ 16,699
Restricted Stock Units
Stock-based compensation, additional disclosures
Weighted average grant-date fair value of RSUs granted	$ 231.06
Performance awards, shares granted	159,878
Performance Shares [Member]
Stock-based compensation, additional disclosures
Weighted average grant-date fair value of RSUs granted	$ 234.14
Performance awards, shares granted	87,945

Stock-Based Compensation - Stock-Based Compensation Accounting (Details)

3 Months Ended

Sep. 30, 2024

Stock-Based Compensation Accounting

Schedule of activities related to restricted stock units and performance stock units

The table below summarizes activities related to restricted stock units and performance stock units for the three months ended September 30, 2024:


	Number of Shares Underlying Performance Stock Units		Weighted Average Grant-Date Fair Value PSUs		Number of Shares Underlying Restricted Stock Units		Weighted Average Grant-Date Fair Value RSUs

	(Dollars in Thousands, except per share data)
Outstanding as of June 30, 2024	82,656		$	194.03	288,887		$	193.98
Granted	87,945		$	234.14	159,878		$	231.06
Settled	—		—		(62,272)		$	196.29
Forfeited	(13,289)		$	194.10	(28,652)		$	198.05
Outstanding as of September 30, 2024	157,312		$	216.45	357,841		$	210.23
Weighted average remaining recognition period of outstanding units (in years)	2.58				2.16
Unrecognized stock-based compensation expense of outstanding units	$	22,753			$	62,714
Aggregate intrinsic value of outstanding units	$	29,282			$	83,133

Stock-Based Compensation - Stock-Based Compensation Expense and its Classification in the Consolidated Statements of Operations (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Recorded as expenses:
Total stock-based compensation	$ 14,814	$ 16,699
License and solutions
Recorded as expenses:
Total stock-based compensation	551	680
Cost of maintenance
Recorded as expenses:
Total stock-based compensation	887	488
Cost of services and other
Recorded as expenses:
Total stock-based compensation	1,045	498
Selling and marketing
Recorded as expenses:
Total stock-based compensation	2,930	2,942
Research and development
Recorded as expenses:
Total stock-based compensation	3,000	4,553
General and administrative
Recorded as expenses:
Total stock-based compensation	$ 6,401	$ 7,538

Stock-Based Compensation - Stock Option Activity (Details) - USD ($)

3 Months Ended

Sep. 30, 2024

Sep. 30, 2023

Jun. 30, 2024

Aggregate Intrinsic Value

Issuance of shares of common stock, net of taxes

$ 6,262,000

$ 3,285,000

Share Price

$ 238.82

Stock-Based Compensation


	Three Months Ended September 30,
	2024		2023

	(Dollars in Thousands)
Cost of license and solutions	$	551	$	680
Cost of maintenance	887		488
Cost of services and other	1,045		498
Selling and marketing	2,930		2,942
Research and development	3,000		4,553
General and administrative	6,401		7,538
Total stock-based compensation	$	14,814	$	16,699

Stock Options

The table below summarizes activities related to stock options for the three months ended September 30, 2024:


	Number of Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value(1)
				(in years)	(in thousands)
Outstanding as of June 30, 2024	760,088	$	160.82	5.61	$	43,132
Exercised	(50,006)	$	140.67
Cancelled / Forfeited	(28,323)	$	175.33
Outstanding as of September 30, 2024	681,759	$	159.47	5.62	$	65,611
Exercisable as of September 30, 2024	562,878	$	133.36	5.18	$	59,369
Vested and expected to vest as of September 30, 2024	675,824	$	142.10	5.61	$	65,386

__________

Restricted Stock Units and Performance Stock Units


	Number of Shares Underlying Performance Stock Units		Weighted Average Grant-Date Fair Value PSUs		Number of Shares Underlying Restricted Stock Units		Weighted Average Grant-Date Fair Value RSUs

	(Dollars in Thousands, except per share data)
Outstanding as of June 30, 2024	82,656		$	194.03	288,887		$	193.98
Granted	87,945		$	234.14	159,878		$	231.06
Settled	—		—		(62,272)		$	196.29
Forfeited	(13,289)		$	194.10	(28,652)		$	198.05
Outstanding as of September 30, 2024	157,312		$	216.45	357,841		$	210.23
Weighted average remaining recognition period of outstanding units (in years)	2.58				2.16
Unrecognized stock-based compensation expense of outstanding units	$	22,753			$	62,714
Aggregate intrinsic value of outstanding units	$	29,282			$	83,133

Stock Options

Stock options activity

Outstanding, beginning of period (in shares)

760,088

Exercised (in shares)

(50,006)

Outstanding, end of period (in shares)

681,759

Weighted Average Exercise Price

Outstanding, beginning of period (in dollars per share)

$ 160.82

Exercised (in dollars per share)

140.67

Outstanding, end of period (in dollars per share)

$ 159.47

Aggregate Intrinsic Value

Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Forfeitures and Expirations in Period

(28,323)

Cancelled / Forfeited (in dollars per share)

$ 175.33

Outstanding, end of period

$ 65,611

$ 43,132

Vested and exercisable, end of period (in shares)

562,878

Vested and exercisable, end of period (in dollars per share)

$ 133.36

Vested and exercisable, end of period

5 years 2 months 4 days

Vested and exercisable, end of period

$ 59,369

Vested and expected to vest, end of period (in shares)

675,824

Vested and expected to vest, end of period (in dollars per share)

$ 142.10

Vested and expected to vest, end of period

5 years 7 months 9 days

Vested and expected to vest, end of period

$ 65,386

Share-Based Compensation Arrangement by Share-Based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term

5 years 7 months 13 days

5 years 7 months 9 days

Stock-Based Compensation - RSU Activity (Details) - USD ($)	3 Months Ended
	Sep. 30, 2024	Jun. 30, 2024
Restricted Stock Units
Restricted stock units activity
Granted (in shares)	159,878
Weighted Average Grant Date Fair Value
Granted (in dollars per share)	$ 231.06
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number	357,841	288,887
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Outstanding, Weighted Average Remaining Contractual Terms	2 years 1 month 28 days
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Vested in Period	(62,272)
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Forfeited in Period	(28,652)
Total unrecognized compensation cost	$ 62,714
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Aggregate Intrinsic Value, Outstanding	$ 83,133
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value	$ 210.23	$ 193.98
Settled (RSUs) (in dollars per share)	196.29
Cancelled / Forfeited (in dollars per share)	$ 198.05
Performance Shares [Member]
Restricted stock units activity
Granted (in shares)	87,945
Weighted Average Grant Date Fair Value
Granted (in dollars per share)	$ 234.14
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number	157,312	82,656
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Outstanding, Weighted Average Remaining Contractual Terms	2 years 6 months 29 days
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Vested in Period	0
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Forfeited in Period	(13,289)
Total unrecognized compensation cost	$ 22,753
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Aggregate Intrinsic Value, Outstanding	$ 29,282
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value	$ 216.45	$ 194.03
Settled (RSUs) (in dollars per share)	0
Cancelled / Forfeited (in dollars per share)	$ 194.10

Net Income Per Share - Calculations of Basic and Diluted Net Income per Share and Basic and Dilutive Weighted Average Shares Outstanding (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Net loss	$ (60,464)	$ (34,525)
Weighted Average Number of Shares Outstanding, Basic	63,244	64,319
Basic	$ (0.96)	$ (0.54)
Earnings Per Share, Diluted	$ (0.96)	$ (0.54)
Dilutive impact from:
Dilutive weighted average shares outstanding (in shares)	63,244	64,319

Net Income Per Share - Stock Options Excluded from the Computation of Dilutive Weighted Average Shares Outstanding (Details) - shares	3 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Employee equity awards were excluded from the calculation of dilutive weighted average shares outstanding because their effect would be anti-dilutive
Employee equity awards (in shares)	1,032,000	1,449,000

Net Income Per Share - Employee Equity Awards Excluded from the Calculation of Dilutive Weighted Average Shares Outstanding (Details) - shares	3 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Employee equity awards were excluded from the calculation of dilutive weighted average shares outstanding because their effect would be anti-dilutive
Employee equity awards (in shares)	1,032,000	1,449,000

Stock Repurchases - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Aug. 06, 2024
Stock Transactions, Parenthetical Disclosure [Abstract]
Treasury Stock, Value, Acquired, Cost Method	$ 20,487	$ 114,224
Treasury Stock, Common
Stock Transactions, Parenthetical Disclosure [Abstract]
Treasury Stock, Shares, Acquired	92,819	686,843
Treasury Stock, Value, Acquired, Cost Method	$ (20,487)	$ (134,434)
Additional Paid-in Capital [Member]
Stock Transactions, Parenthetical Disclosure [Abstract]
Treasury Stock, Value, Acquired, Cost Method		$ 20,210
Aug 1 Share Repurchase Authorization Program
Stock Transactions, Parenthetical Disclosure [Abstract]
Treasury Stock, Shares, Acquired	92,819
Treasury Stock, Value, Acquired, Cost Method	$ 20,500
Approved stock repurchase program, authorized amount (up to)			$ 100,000
Remaining capacity under the stock repurchase program	$ 79,500

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended
Income Taxes (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Sep. 30, 2023
Income Tax Disclosure [Abstract]
Benefit for income taxes	$ (16,284)	$ (17,467)
Effective income tax rate (as a percent)	21.20%	33.60%

Comprehensive Text Block List (Details) - USD ($) $ in Thousands		3 Months Ended
	Oct. 10, 2021	Sep. 30, 2024	Sep. 30, 2023	Jun. 30, 2024	Jul. 28, 2023
Payment for Plantweb Optics Analytics					$ 12,500
Receivables from related parties		$ 45,300		$ 78,483
Due to related parties		24,979		47,449
Receivables from related parties		45,300		78,483
Due to related parties		24,979		47,449
Heritage AspenTech
Consideration transferred	$ 6,014,000
Emerson Electric Co.
Text Block [Abstract]
Purchases from Emerson affiliates		75	$ 68
Revenue from Emerson affiliates		987	313
Purchases from Emerson affiliates		75	68
Revenue from Emerson affiliates		$ 987	313
Emerson Electric Co. \| Heritage AspenTech
Text Block [Abstract]
Business Acquisition, Percentage of Voting Interests Acquired		56.00%
Business Acquisition, Percentage of Voting Interests Acquired		56.00%
Information technology
Payments of Distributions to Affiliates		$ 194	975
Shared services and other
Payments of Distributions to Affiliates		162	$ 374
Related Party
Financing Receivable, after Allowance for Credit Loss		45,119		78,278
Accounts Receivable, after Allowance for Credit Loss		181		205
Accounts Payable		318		134
Notes Payable		24,661		47,315
Receivables from related parties		45,300		78,483
Due to related parties		24,979		47,449
Financing Receivable, after Allowance for Credit Loss		45,119		78,278
Accounts Receivable, after Allowance for Credit Loss		181		205
Notes Payable		24,661		47,315
Accounts Payable		318		134
Receivables from related parties		45,300		78,483
Due to related parties		$ 24,979		$ 47,449

Segment Information - Summary of Reportable Segments' Profits (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Jun. 30, 2024
Summary of reportable segments' profits
Loss from operations	$ (95,965)	$ (60,211)
Property, equipment and leasehold improvements, net	18,093		$ 17,389
Revenue from Contract with Customer, Excluding Assessed Tax	215,877	249,308
Americas
Summary of reportable segments' profits
Property, equipment and leasehold improvements, net	13,906		13,643
Revenue from Contract with Customer, Excluding Assessed Tax	111,866	133,016
Asia, Middle East and Africa
Summary of reportable segments' profits
Property, equipment and leasehold improvements, net	2,452		2,011
Revenue from Contract with Customer, Excluding Assessed Tax	52,269	57,685
Europe
Summary of reportable segments' profits
Property, equipment and leasehold improvements, net	1,735		1,735
Revenue from Contract with Customer, Excluding Assessed Tax	51,742	58,607
North America
Summary of reportable segments' profits
Property, equipment and leasehold improvements, net	11,500		$ 11,200
Revenue from Contract with Customer, Excluding Assessed Tax	$ 83,400	$ 96,000

Leases (Details) - USD ($) $ in Thousands	3 Months Ended
Leases (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Sep. 30, 2023	Jun. 30, 2024
Leases [Abstract]
Operating lease expense	$ 4,977	$ 4,466
Variable lease costs	404	223
Short-Term Lease, Cost	136	$ 157
Operating lease right-of-use assets	95,001		$ 96,034
Current operating lease liabilities	12,172		13,125
Non-current operating lease liabilities	$ 85,676		$ 84,875
Weighted average remaining lease term	11 years		11 years
Weighted average discount rate	4.20%		4.00%
2025	$ 10,219
2026	11,019
2027	14,416
2028	14,015
2029	13,125
Thereafter	91,950
Total lease payments	154,744
Less: imputed interest	(32,073)
Leasehold Improvements, Gross	(24,823)
Operating lease liabilities	$ 97,848

Regulated Operations (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Jun. 30, 2024
Regulated Operations [Abstract]
Compensation-related	$ 50,610	$ 61,976
Deferred acquisition payments	1,475	1,804
Accrued Professional Fees, Current	5,661	4,987
Accrued Income Taxes	5,146	10,991
Restructuring Reserve	1,078	0
Other Accrued Liabilities, Current	14,956	20,409
Accrued expenses and other current liabilities	$ 78,926	$ 100,167

Restructuring and Related Activities (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Jun. 30, 2024
Restructuring and Related Activities [Abstract]
Restructuring Costs	$ 7,726	$ 0
Restructuring Reserve	$ 1,078		$ 0