ANSYS, Inc.

will be in listen-only mode. If you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on your telephone keypad. To withdraw your question, please press star, then two. Please note this event is being recorded. At this time, I would like to turn the conference over to Ms. to Ryan for opening remarks. Please go ahead.

Good morning, everyone. Our earnings release, the related prepared remarks document, and the link to our second quarter 2023 Form 10-Q have all been posted on the homepage of our Investor Relations website. They contain the key financial information and supporting data relative to our second quarter financial results and business updates, as well as our Q3 and fiscal year 2023 outlook and the key underlying quantitative and qualitative assumptions. Today's presentation contains forward-looking information. Important factors that may affect our future results are discussed in our public filings. Forward-looking statements are based upon our view of the business as of today, and ANSYS undertakes no obligations to update any such information. During this call, we will be referring to non-GAAP financial measures unless otherwise stated. A discussion of the various items that are excluded and reconciliations of GAAP to the comparable non-GAAP financial measures are included in our earnings release materials. I would now like to turn the call over to our President and CEO, Ajay Gopal, for his opening remarks. Ajay?

Good morning, and thank you for joining today's call. Building on the momentum of the first quarter of 2023, Q2 was another excellent quarter for Ansys, in which we beat our guidance across all key metrics. For the first half of 2023, we saw double-digit growth in ACV and revenue, as well as broad-based growth across industries, geographies, and customer types. I'm excited about our outstanding performance in Q2 and the first half of the year, as well as our strong pipeline. And I'm delighted to announce that we are raising full year guidance for ACV and revenue. Nicole will have the details in a few minutes. For Q2, our top three contributors by industry were high-tech and semiconductors, aerospace and defense, and automotive and ground transportation. We saw robust growth in our small and medium-sized accounts, and from a geographical perspective, our growth was as we expected. One of our largest contracts of the quarter was a four-year, eight-figure agreement with a multinational industrial company based in Japan. This longtime Ansys customer is growing the number of users of our core products while expanding its use of new products across our multi-physics portfolio. As part of this customer's digital transformation, it is using Ansys to establish a virtual product environment, which is helping to drive the company's sustainability and go-to-market strategies by accelerating its product development initiatives. On our calls, I typically highlight a specific aspect of our business. Over the past several quarters, I have discussed the critical role that Ansys solutions play in sustainability, I have highlighted how customers are using our solutions in the development of next generation semiconductors, and I have given you insights into the innovation we are driving across our multi-physics portfolio through our five technology pillars. Given our continuing strength in aerospace and defense, our second largest sector, I would like to use today's call to discuss this critical industry. In fact, Our largest contract of the quarter was a nearly $57 million multi-year agreement with a global aerospace and defense company based in the United States. This contract reflects significant growth over the previous contract to keep up with user demand. The aerospace industry has experienced a resurgence since the pandemic with commercial air travel returning to record levels this summer. From a product development perspective, Industry leaders are challenging old assumptions about their aircraft, and ANSA simulation is playing a key role in this industry transformation. For example, in the past, most airplanes were powered by traditional aircraft fuel. Today, though, commercial aircraft manufacturers can choose from those fuels, They can use a SAS or sustainable aviation fuel blend, or they can consider alternative fuels, including hydrogen. These critical choices not only have a significant economic impact for an organization, but they also play an important role in sustainability initiatives of aerospace companies. Sustainability is a key driver at aircraft engine maker Pratt & Whitney. which has a vision of enabling the air transportation sector to achieve net zero carbon emissions by 2050. Today, the company's engines are certified to run on 50% SAFs. By using simulation from ANSYS, the company plans to increase that number close to 100%. ANSYS solutions are used in a number of sustainability initiatives at Pratt & Whitney, including developing a hydrogen propulsion system and optimizing the company's geared turbofan, which is reducing fuel consumption by 16% and cutting NOx emissions by half. In addition to the fuel source, commercial aerospace companies are using ANSA simulation to boost the efficiency of their aircraft. For example, technical aircraft services leader Lufthansa Technic has used ANSYS multiphysics simulation to design a biomimetic coating that emulates shark skin to significantly reduce fuel consumption and the associated carbon dioxide emissions. Using ANSYS, the company quickly modeled aircraft and aerodynamic behavior in an accurate, robust, and computationally efficient manner and accelerated critical certification from the European and U.S. aviation agencies. In its current stage of development, the air shock modification already makes two types of Boeing 777 long-haul aircraft more efficient, which will have a positive environmental impact. Another consideration for those commercial aerospace leaders is who will pilot the aircraft. Automation technology has already had a profound impact on the industry, and it is one that will continue for the foreseeable future. To better prepare the industry, OneSky Systems is integrating its airspace domain expertise and technology with Ansys Solutions to create AI-based software that streamlines and optimizes the development, validation, and certification of autonomous advanced air mobility systems. The collaboration enables OneSky and ANSYS customers to train and validate neural networks with mission-driven simulation to reduce the risk, time, and costs required for airworthiness certification. Our success in the commercial aerospace sector was in display at the recent Paris Air Show, where ANSYS exhibited. During the event, we encountered a number of ANSYS customers that are using our simulation to further disrupt the industry. For example, ANSYS customer Rolls-Royce was in Paris to meet with its clients. The company recently announced that it has reduced the time that it takes to perform a crucial thermomechanical model of its gas turbine engines from 1,000 hours to less than 10 hours using ANSYS simulation in a high-performance computing environment. As a result, Rolls-Royce is able to rapidly deliver clean and complex propulsion solutions for safety critical applications. Now, no discussion of the aerospace and defense industry is complete without touching upon developments in the space sector. Given the unforgiving environment of space and the inability to perform physical testing there, Simulation is playing a critical role for Space 2.0 companies. One of our key contracts in Q2 was with the Space 2.0 leader that takes advantage of the full Ansys portfolio, including our core products as well as newer solutions for materials, motor design, digital mission engineering, and digital twins. This three-year agreement increases the number of products the company is leveraging as well as the number of users of ANSYS solutions. One of the trends amongst our Space 2.0 customers is to employ microsatellites to perform certain missions, such as delivering radar coverage or broadband services. These small light satellites are less expensive to develop and launch than the heavier traditional ones. ANSYS customer Astronis launched its first satellite earlier this year, with the aim of delivering low-cost broadband service anywhere in the world. With its use of Ansys mechanical, fluids, electronics, and digital mission engineering solutions, Astronis is a great example of customers expanding the role of simulation to include more products and more users. Similarly, we reached an agreement in Q2 with longtime Space 2.0 customer iSci, which uses Ansys analysis and simulation solutions to help deliver synthetic aperture radar coverage of the globe through constellations of small satellites. ANSYS Digital Mission Engineering Solutions helped the company to design and operate its satellite systems, ensuring unparalleled accuracy for Earth imaging and satellite maneuver planning. Here in Pittsburgh, we are eagerly awaiting the launch later this year of Astrobotic Technologies' lunar lander called Peregrine. Using ANSYS multi-physics technology, the company rapidly iterates through lander designs that are capable of withstanding the tremendous pressures of launch, the vacuum of space, and the impact of landing. Astrobotic is understanding how its craft will operate in space using guidance navigation simulation. This will help put humans back on the moon and beyond and will further expand our knowledge of the cosmos. Given aircraft's increasing complexity, the need to quickly explore all design options, and the complexities of space travel, we believe that simulation will play an even greater role in commercial airspace and Space 2.0 in the near future. Companies in these sectors must take advantage of all areas of physics including structures, fluids, electromagnetics, optics, and materials. And with our highly scalable solutions and access to high-performance computing via the cloud, Ansys is in a unique position to propel the industry forward. Turning to our partnership activities, Intel Foundry Services has certified our leading semiconductor solutions for power integrity sign-off verification of integrated circuits designed with the Intel 16 silicon manufacturing process. ANSYS solutions provide unparalleled capacity to analyze a full chip design while verifying the effectiveness of that chip's electrostatic discharge protection circuitry. I'm also pleased to announce a number of developments in our relationship with Samsung Foundry. At the Foundry's recent SAFe conference, where my presentation reviewed the importance of 3D ICs and the critical role that ANSYS plays in designing them, Samsung certified ANSYS RedHawk SC for the company's family of heterogeneous multi-die packaging technologies. RedHawk SC, as you may remember, is our power integrity and thermal verification platform. Samsung foundry also certified ANSYS Redhawk SC, and Ansys Totem Power Integrity sign-off solutions for Samsung's latest 2-nanometer silicon process technology. We have also expanded our relationship with Synopsys. Our two companies recently announced a new reference flow for Samsung's 14-LPU technology, which delivers the accuracy of Ansys' golden sign-off electromagnetic analysis with leading custom design flow from Synopsys. In Q2, we also announced an expansion of our partnership with PTC. Our teams are pursuing more integrated materials management and sustainability workflows between PTC's Creo and Wincho products and Ansys Granto. This collaboration will help engineers balance performance and environmental footprint priorities as they design products. Turning to our ESG initiatives, I'm very happy to report that ANSYS has been named to USA Today's inaugural list of America's climate leaders. The list recognizes companies that have achieved the greatest reduction in core emissions intensity between 2019 and 2021. Finally, I'm excited that ANSYS has been named to Newsweek's list of most loved global workplaces. This recognition celebrates companies with employees who feel included, recognized, and valued. Ansys ranked 27th globally on this prestigious list, which is yet another indication of our tremendous team and the impact we are having around the world. In summary, Q2 was another excellent quarter for Ansys. I am excited that the market is vibrant and that the demand for Ansys solutions remains robust thanks to the unique value proposition that we provide. With our strong pipeline, our industry-leading portfolio, and our deep customer relationships, I am confident in our ability to meet our short- and long-term goals. And with that, I will turn the call over to Nicole. Nicole?