The Altium Limited (ASX: ALU) share price has dropped in early trade today after the software company released a mixed trading update to the market.
At the time of writing, the Altium share price is trading down 3.% at $29.85.
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What did Altium announce?
Altium advised it will meet its full-year guidance target, despite major disruptions caused by COVID-19.
For the first half of FY21 ending 31 December, Altium expects to deliver revenue of around US$89.6 million. This is a drop of 3% on the prior corresponding period.
The company revealed that its United States business recorded a 10% fall in revenue due to rising coronavirus cases. Severe COVID-19 lockdowns cross the Atlantic are also impacting revenue growth, with Altium's European segment is also experiencing a drop in sales.
The company's NEXUS solution suffered a 14% fall in growth as deals were pushed back for the second-half of the year. Altium is expecting a significant pipeline from this coming into the new period.
In China, revenue plummeted 15% as licence compliance activities become more difficult to achieve, especially in the lower-end of the market.
Negative news aside, Altium said other areas of the business have been performing well.
Board and Systems revenue improved in the second quarter to be in line with the previous 2020 half-year performance. This is after the company saw a 11% setback on first-quarter revenue compared to year-on-year.
Electronic manufacturing also strongly rebounded with its Octopart search engine attaining a 19% increase in revenue for the first half of FY21. The company said this was a leading indicator for future sales of PCB design.
In addition, term-based licences grew, up 166% over the first-half on the same period last year, resulting in a US$1 million revenue decline.
Altium will release its half-year results on 15 February, 2021. The company advised it was confident it would achieve a better second-half result, and reaffirmed its full-year guidance.
Words from the CEO
Commenting on the results, Altium CEO Aram Mirkazemi said:
Despite a challenging first half, we saw signs of recovery in Q2. This result was achieved despite extreme conditions in the US and the restructuring of our sales organisation.
I am confident that with our pivot to the cloud and our move to digital sales that the Q2 momentum will continue into the second half.
How has the Altium share price performed?
The Altium share price has been on a rollercoaster over the past 12 months. The company's shares reached a 52-week high of $42.76 in February, before falling to a low of $23.11 in March.
Most recently, its shares have dipped lower this year off the back of the weakening tech sector in the United States.
