Simulations Plus Q3 Revenue Climbs 7%, Net Income Swings to $3.6M; Altaris Merger at $18.50/Share Disclosed
SLP sits 67% above its 52-week low of $11.09.
Summary
Simulations Plus posted Q3 FY2026 revenue of $21.9M (+7% YoY) and net income of $3.6M, a sharp improvement from the $67.3M loss a year ago. The 10-Q also includes details of the pending $375M all-cash acquisition by Altaris at $18.50 per share.
Key Events · Earnings and Guidance · SLP
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Q3 Revenue +7%, Net Income $3.6M
Revenue reached $21.9 million, driven by a 20% jump in services revenue to $9.3 million. Net income swung to $3.6 million from a $67.3 million loss last year, when a $77.2 million impairment charge crushed results.
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Gross Margin Expands to 69%
Gross margin improved from 64% to 69%, helped by a 40% drop in software cost of revenue due to lower amortization after last year's Pro-ficiency impairment, and better utilization in services.
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R&D Investment Surges 180%
R&D expense jumped to $3.4 million as the company shifts resources toward developing an integrated, cloud-enabled AI modeling platform. Total R&D spend (including capitalized costs) was 19% of revenue.
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Merger with Altaris at $18.50/Share
The 10-Q discloses the June 15 merger agreement with Altaris for $375 million in cash, or $18.50 per share. The deal is expected to close in Q4 2026, subject to shareholder and regulatory approvals.
Analysis · SLP · Technology
A sharp recovery took hold in the quarter as revenue rose 7% to $21.9 million and net income reached $3.6 million—a dramatic reversal from the prior year's $67.3 million loss, which had been weighed down by a massive impairment. Gross margins expanded to 69%, benefiting from lower amortization costs and a richer mix of higher-margin services revenue. In a bet on future growth, R&D spending nearly tripled to fund a cloud-based AI modeling platform. The filing also formally incorporates the June 15 merger agreement with Altaris at $18.50 per share, a deal that would take the company private. While the merger caps upside near the offer price, the standalone results show a business regaining its footing after a bruising 2025.
At the time of this filing, SLP was trading at $18.47 on NASDAQ in the Technology sector, with a market capitalization of approximately $370.6M. The 52-week trading range was $11.09 to $21.01. This filing was assessed with positive market sentiment and an importance score of 7 out of 10.