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Altair (NASDAQ: ALTR) is a company that offers a range of solutions in the areas of simulation, data analytics, and high-performance computing. While Altair heavily promotes its AI capabilities, its history shows average growth and efficiency, suggesting that AI may not provide a significant boost to the companys valuation.

Altair operates in different markets with varying sizes, growth drivers, and competitive dynamics. Its primary market is simulation software, which involves analyzing and optimizing product designs using virtual prototypes. Simulation is increasingly used across industries to improve product quality, lower costs, and reduce time to market.

Altairs market opportunity includes software for high-performance computing (HPC) infrastructure and running simulations. The company is positioned to capture spending related to workload management systems for high-end HPC servers. Altair also has exposure to the Internet of Things (IoT) and analytics markets, which are projected to exceed $110 billion by 2025.

Despite the current hype around AI, Altairs peers are experiencing decelerating growth and indicators suggest softening demand in Altairs markets. The number of job openings mentioning simulation software provider ANSYS has declined, indicating weaker demand. Similarly, job openings mentioning data science requirements continue to decrease.

Altair offers a portfolio of engineering simulation software and services. Its solutions include tools for simulation, high-performance computing, and data analytics. Altairs software optimizes design performance across various disciplines and supports multi-physics simulation. The company also offers AI, visualization, and rendering solutions.

Altair aims to lower the barriers to performing simulations and has invested in SimSolid, a next-generation simulation technology. SimSolid allows structural simulation using CAD models without the need for geometry simplification or meshing. This technology significantly improves the productivity of users and may help Altair penetrate the mid-market and lower end of the market.

Overall, while Altairs business spans multiple markets, its current valuation appears stretched, and the weakening demand environment poses downside risk. The companys focus on simulation, data analytics, and high-performance computing positions it for growth but relies on overcoming industry challenges and delivering innovative solutions.

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Altair: A Provider of Simulation, Data Analytics, and High ... - Fagen wasanni