The Altium Limited (ASX: ALU) share price will be on watch on Wednesday.
This follows the release of a COVID-19 update by the electronic design software company.
What did Altium announce?
This morning Altium confirmed its strong operational and market position in the new COVID-19 environment.
It advised that electronic design is anticipated to be relatively resilient and weather the prevailing and unfolding market conditions.
The company's CEO, Aram Mirkazemi, said: "We are fortunate that our operating model is robust and highly adaptable to the new global conditions, as our marketing and direct selling are conducted through the Internet and via telephone. Moreover, we are well diversified across industry segments and regions worldwide."
"At an industry level, electronic design is holding up relatively well in the new environment as engineers use excess time and capacity from the slowdown in manufacturing and supply chain to revert back to prototype designs," the CEO added.
However, management warned that the situation remains uncertain due to the unknown duration of the pandemic and the potential business, industry, economic, and social impacts that may arise.
In light of this uncertainty, the company has decided to withdraw its earnings guidance for FY 2020.
Altium's CFO, Joe Bedewi, explained: "In light of the rapidly evolving COVID-19 environment, whose duration remains uncertain, Altium feels it is prudent to withdraw its formal FY20 earnings guidance. Altium management nevertheless remains firmly committed to its long-established aspirational market leadership target of US$200 million for FY20."
What now?
The company is now accelerating the rollout of its new cloud platform Altium 365. This is in response to worldwide demand growing rapidly for cloud-based collaborative tools across all sectors and all regions.
It feels Altium 365 is particularly relevant to the circumstances that are unfolding under COVID-19, as it allows engineers to work from anywhere, and connect with anyone.
This could be opportune timing for Altium 365's rollout. Management notes that this product is a core enabler of its strategy of industry transformation through market dominance and supports its drive to 100,000 subscribers by 2025.
Finally, Altium is also accelerating the rollout of its online/high volume selling approach. It expects this to dramatically extend its inside sales capacity to support its drive through the fourth quarter and beyond.
