The long sales cycle and potential for large license sales can lead to lumpy sales patterns, a risk reduced by the Fluent acquisition since Fluent sells a higher proportion of lease-based licenses rather than perpetual licenses. Ansys has been a leader for many years, and even if it were to fall behind technologically its customers would be unwilling to migrate to a new platform immediately. This lag could allow them to catch up or buy the necessary technology.
With the possibility of a recession rising, it is worth considering a possible demand slowdown. The company’s largest end markets are aerospace and autos. Aerospace is booming but major projects like the A-380 and Boeing Dreamliner are past the design stage, so arguably demand could slow until the next major product cycle is under way. Autos face the opposite risk – slowing demand due to the overall industry’s distress.