UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) May 3, 2011

ASPEN TECHNOLOGY, INC.

(Exact name of registrant as specified in its charter)

Registrant’s telephone number, including area code  (781) 221-6400

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o            Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o            Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o            Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o            Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02              Results of Operations and Financial Condition.

On May 3, 2011, we issued a press release announcing financial results for the third quarter of fiscal 2011, ended March 31, 2011. The full text of the press release issued in connection with this announcement is attached as Exhibit 99.1 to this Current Report on Form 8-K.

The information in this Item 2.02, including Exhibit 99.1, shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934 except as expressly set forth by specific reference in such a filing.

Item 9.01              Financial Statements and Exhibits.

(d) Exhibits.

The following exhibit relating to Item 2.02 shall be deemed to be furnished, and not filed:

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

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EXHIBIT INDEX

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Exhibit 99.1

                30 YEARS OF OPTIMIZATION

Aspen Technology Announces Financial Results

for the Third Quarter Fiscal 2011

Burlington, Mass. — May 3, 2011 — Aspen Technology, Inc. (NASDAQ: AZPN), a leading provider of software and services to the process industries, today announced financial results for its third quarter of fiscal 2011, ended March 31, 2011.

Mark Fusco, Chief Executive Officer of AspenTech, said, “The company continued to execute at a high level during the third quarter, delivering solid growth and strong cash flow.  As AspenTech’s revenue model transition continues, we believe the company is well positioned to emerge with a combination of scale, growth, best-in-class margins, cash flow and a recurring revenue model.”

“The license portion of our total contract value grew by approximately 1.5% sequentially during the third quarter, leading to growth of approximately 7% for the first nine months of fiscal 2011 from the end of fiscal 2010.  With one quarter remaining, we are already within our full year license growth guidance range, and we are optimistic about our outlook based on continued high customer interest levels entering our seasonally stronger fourth quarter.” Fusco added, “Free cash flow of approximately $49 million for the first nine months of fiscal 2011 represents an increase of 128% year-over-year.  We believe the company is on track to achieve our free cash flow guidance for fiscal 2011, as well as our goal of generating free cash flow in the mid-$90 million range during fiscal 2013.”

Third Quarter Business Highlights

·                 Total contract value, including the value of bundled maintenance, grew approximately 2.4% sequentially during the third quarter, while the license portion of total contract value grew approximately 1.5% sequentially.

·                 Bookings were approximately $79 million for the third quarter of fiscal 2011.  Within bookings, new and expanded adoption drove the above mentioned sequential increase in the license portion of total contract value, and solid renewal activity contributed the remainder of total bookings.

·                 The value of future cash collections associated with the company’s subscription and multi-year term contracts was $695 million at the end of the third quarter, an increase from $688 million at the end of last quarter and $537 million at the end of the third quarter of fiscal 2010.

·                 The company closed 16 bookings of over $1 million during the third quarter, compared to 21 in the third quarter of fiscal 2010, and 47 bookings between $250,000 and $1 million, compared to 39 in the third quarter of fiscal 2010.

·                 Average deal size for bookings over $100,000 was approximately $609,000 in the third quarter, compared to approximately $807,000 in the third quarter of fiscal 2010.

Summary of Third Quarter Financial Results

AspenTech’s total revenue of $52.6 million increased 15% from $45.6 million in the third quarter of the prior year.

·                  Subscription revenue includes all revenue associated with the company’s aspenONE subscription offering. Subscription revenue was $17.2 million in the third quarter of fiscal 2011, an increase from $4.0 million in the third quarter of fiscal 2010.  Subscription revenue is recognized over the course of the multi-year agreement, and recognition begins when the first payment is due, which is typically 30 days after the contract is signed.

·                  Software revenue includes all non-subscription-based license revenue, including term-based contracts for point products as well as perpetual licenses.  Software revenue was $13.4 million in the third quarter of fiscal 2011, compared to $14.7 million in the year ago period.

·                  Services & other revenue, which includes professional services, maintenance and other revenue, was $21.9 million in the third quarter of fiscal 2011, compared to $26.9 million in the year ago period.

For the quarter ended March 31, 2011, AspenTech reported a loss from operations of $7.2 million due primarily to the multi-year revenue model transition following the introduction of the company’s aspenONE subscription offering, which has ratable revenue recognition, at the beginning of fiscal 2010.  For the quarter ended March 31, 2010, the company reported a loss from operations of $19.6 million.

Net loss was $5.7 million for the quarter ended March 31, 2011, leading to net loss per basic and diluted share of $0.06, compared to net loss per diluted share of $0.24 in the same period last fiscal year.

Non-GAAP loss from operations, which adds back stock-based compensation expense and restructuring charges, was $5.2 million for the third quarter of fiscal 2011, compared to a non-GAAP loss from operations of $17.9 million in the same period last fiscal year.  Non-GAAP net loss was $3.8 million, or ($0.04) per share, for the third quarter of fiscal 2011, compared to a non-GAAP net loss of $20.1 million, or ($0.22) per share, in the same period last fiscal year.  A reconciliation of GAAP to non-GAAP results is included in the financial tables included in this press release.

AspenTech had a cash balance of $151.0 million at March 31, 2011, an increase of $19.4 million from the end of the prior quarter.  The company generated $31.7 million in cash flows from operations and invested $1.7 million in capital expenditures, leading to free cash flow of $30.0 million for the three months ended March 31, 2011.  The company continued to reduce its secured borrowings balance, which was $55.5 million at the end of the third quarter, down $11.3 million compared to $66.8 million at the end of the second quarter of fiscal 2011.  During the quarter, the company used $2.9 million in cash as it executed against the previously announced share repurchase programs.

Use of Non-GAAP Financial Measures

This press release contains “non-GAAP financial measures” under the rules of the U.S. Securities and Exchange Commission. Non-GAAP financial measures are not based on a comprehensive set of accounting rules or principles. This non-GAAP information supplements, and is not intended to represent a measure of performance in accordance with, disclosures required by generally accepted accounting principles, or GAAP.  Non-GAAP financial measures should be considered in addition to, not as a substitute for or superior to, financial measures determined in accordance with GAAP.  A reconciliation of GAAP to non-GAAP results is included in the financial tables included in this press release.

Management considers both GAAP and non-GAAP financial results in managing AspenTech’s business.  As the result of adoption of new licensing models, management believes that, for the next few years, a number of AspenTech’s performance indicators based on GAAP, including revenue, gross profit, operating income (loss) and net income (loss), will be of limited value in assessing AspenTech’s performance, growth and financial condition. Accordingly, management instead is focusing on certain non-GAAP and other business metrics, including the non-GAAP metrics set forth in this press release, to track AspenTech’s business performance. None of these non-GAAP metrics should be considered as an alternative to any measure of financial performance calculated in accordance with GAAP.

Conference Call and Webcast

AspenTech will host a conference call and webcast today, May 3, 2011, at 4:30 p.m. (Eastern Time), to discuss the company’s financial results for the third quarter fiscal year 2011 as well as the company’s business outlook.  The live dial-in number is (877) 245-0126, conference ID code 58336688. Interested parties may also listen to a live webcast of the call by logging on to the Investor Relations section of AspenTech’s website, http://www.aspentech.com/corporate/investor.cfm, and clicking on the “webcast” link. A replay of the call will be archived on AspenTech’s website and will also be available via telephone at (800) 642-1687 or (706) 645-9291, conference ID code 58336688 through May 10, 2011.

About AspenTech

AspenTech is a leading global provider of mission-critical process optimization software solutions, which are designed to manage and optimize plant and process design, operational performance, and supply chain planning. AspenTech’s aspenONE® software and related services have been developed specifically for companies in the process industries, including energy, chemicals, pharmaceuticals, and engineering and construction. Customers use AspenTech’s solutions to improve their competitiveness and profitability by increasing throughput and productivity, reducing operating costs, enhancing capital efficiency, and decreasing working capital requirements. To see how the world’s leading process manufacturers rely on AspenTech to achieve their operational excellence goals, visit www.aspentech.com.

© 2011 Aspen Technology, Inc. AspenTech, aspenONE and the Aspen leaf logo are trademarks of Aspen Technology, Inc. All rights reserved.  All other trademarks are property of their respective owners.

Forward-Looking Statements

The second and third paragraphs of this press release contain forward-looking statements for purposes of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  Actual results may vary significantly from AspenTech’s expectations based on a number of risks and uncertainties, including, without limitation: customers’ failure to adopt the aspenONE subscription offering at the rate expected by AspenTech; AspenTech’s failure to realize the anticipated financial (including cash flow) and operational benefits of the aspenONE subscription offering; unforeseen difficulties or uncertainties in the application of accounting standards; weaknesses in AspenTech’s internal controls; and other risk factors described from time to time in AspenTech’s periodic reports filed with the Securities and Exchange Commission.

AspenTech cannot guarantee any future results, levels of activity, performance, or achievements. AspenTech expressly disclaims any current intention to update forward-looking statements after the date of this press release.

Source: Aspen Technology, Inc.

ASPEN TECHNOLOGY, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited and in thousands, except per share data)

ASPEN TECHNOLOGY, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited and in thousands, except share data)

ASPEN TECHNOLOGY, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited and in thousands)

ASPEN TECHNOLOGY, INC. AND SUBSIDIARIES

GAAP Results Reconciled to Non-GAAP Results

The following table reflects selected Aspen Technology GAAP results reconciled to non-GAAP results.
(Unaudited and in thousands, except per share data)