Good afternoon. My name is Vanessa, and I will be your conference operator today. At this time, I would like to welcome everyone to the Second Quarter 2012 Earnings Conference Call. [Operator Instructions] I would now like to turn the presentation over to your Chief Financial Officer, Mr. Mark Sullivan. Please go ahead, sir.

Okay. Thank you. Good afternoon, everyone. Thank you for joining us to review our second quarter fiscal 2012 results for the period ended December 31, 2011. I am Mark Sullivan, CFO of AspenTech. And with me on the call today is Mark Fusco, President and CEO. Before we begin, I will make the usual Safe Harbor statement that during the course of this call, we may make projections or other forward-looking statements about the financial performance of the company that involve risks and uncertainties. The company's actual results may differ materially from such projections or statements. Factors that might cause such differences include, but are not limited to, those discussed in today's call and in our Form 10-Q for the second quarter of fiscal 2012, which is now on file with the SEC. Also, please note that the following information is related to our current business conditions and our outlook as of today, January 31, 2012. Consistent with our prior practice, we expressly disclaim any obligation to update this information. The structure of today's call will be as follows: I'll begin with a review of our financial results for the second quarter, and then Mark will discuss some additional business highlights before we open up the call for Q&A. Let me start with a review of the supplemental metrics that we provide, starting with our term contract value, or TCV metric, which measures the renewal value of our multiyear term contracts. Growing TCV is a key focus for us, and we increased the value of the metric by adding customers, expanding product usage and increasing prices across our customer base. Our license-only TCV was $1.36 billion at the end of the quarter, which was up 12.9% compared to the second quarter of fiscal 2011, and up 4.1% on a sequential basis. As a reminder, beginning in fiscal 2010, maintenance is generally included as part of our subscription and term contracts. Including the value of bundled maintenance, total term contract value was $1.54 billion at the end of the quarter, which was up 17.9% compared to the prior-year period and 5.2% sequentially. The second quarter of fiscal 2012, our annual spend, which is a proxy for the value of our recurring term license business at the end of each time period, specifically the annualized value of our term license and maintenance revenue, was approximately $284 million, which is an increase of approximately 12% on a year-over-year basis. As we shared last quarter, the growth of our annual spend metric should naturally be slightly lower than the growth of our license TCV metric. The reason for this is that license TCV is calculated using each contract's terminal year annual payment. And therefore, it takes into consideration the total price escalation over the course of the multiyear time period, whereas annual spend only takes into consideration the current year's level of spend. Moving on to additional metrics. Future cash collections is the sum of the company's billings backlog, accounts receivable, and the undiscounted value of installments and collateralized receivables. The company's future cash collections at the end of the second quarter were $858 million compared to $795 million at the end of last quarter and $688 million at the end of the year-ago period. The largest component of our future cash collections is billings backlog, which was $732 million at the end of the quarter compared to $662 million at the end of last quarter and $490 million at the end of the year-ago period. As we discussed previously, future cash collections was one of the transitory metrics introduced at the launch of our new aspenONE subscription model to help provide investors with increased visibility into future cash flow potential and to provide support that our cash flow is scaled from the $30 million range to the $90 million range in just a few years. As we met our fiscal 2010 and 2011 cash flow targets, and are on pace to do the same in fiscal 2012, it is more likely than not that there will no longer be a need for this metric beyond the end of this fiscal year. Now let me turn to our financial results on a GAAP basis. Total revenue was $66.6 million, which was up 34% from $49.8 million in the prior-year period. This is well above our guidance of revenue in the range of $52 million to $53.5 million. Of the $13 million in revenue overage, approximately $10 million related to a few sizable transactions that I will detail. First, we mentioned at the time we provided our guidance that there was potential for variability due to the fact that we had a few sizable customer contracts, with payments due at the end of the quarter. We recognize revenue from those contracts on a cash basis. These transactions were excluded from our guidance. However, we did, in fact, collect approximately $4 million in cash before the end of the quarter, resulting in revenue recognition of an equal amount. Second transaction involved a contract renewal with one of the world's largest energy companies that is currently undergoing a significant change to its business structure. This customer had an expiring legacy contract for point products, and they simply wanted to renew what they already had in place, because they're currently focused on managing the change in their business structure. The contract was renewed on its original terms, with prescribed escalation, but the original terms did not include bundled maintenance for the life of the contract. And as such, the revenue was recognized on an upfront basis. We've had other customers with similar renewal rights in the past. However, this is the first time in the 2.5 years since the introduction of our new subscription model that we've had a customer renewal legacy contract. As such, we view this as an unusual circumstance. While we do not typically call out the specific size of customer transactions, we do not plan on making it a standard component of our future disclosure. We thought it was important to provide extra color in this situation given the magnitude of the revenue and profitability upside. In addition, the fact that we recorded $10 million in revenue during the second quarter that will not reoccur in our third quarter clearly influences our upcoming sequential comparison of our P&L. Looking at additional details of our P&L. Subscription and software revenue was $46.5 million in the second quarter, which is an increase from $25.3 million in the prior-year period to $31.9 million last quarter. The completion of our revenue model transition alone should lead to continued steady increases in our subscription revenue for the next several years. In order to provide further transparency into our subscription and software line, we provided additional details on a few of the components within that revenue line that can have quarter-to-quarter variability. During the second quarter, we had $1.1 million of subscription and software revenue that was related to perpetual licenses and $13.7 million that was related to legacy term license agreements not recognized on a daily basis, which spiked from last quarter due to the large transactions I just referred to. Our growing subscription business positively impacts our deferred revenue balance, which was $144.2 million at the end of the second quarter, representing a 41% increase compared to the end of the year-ago period. Services and other revenue was $20.1 million, down from $24.5 million in the year-ago period. Consistent with our previous commentary, maintenance revenue was increasingly being reported within the subscription revenue line as more contracts are converted to the new aspenONE licensing model. As a result, we continue to expect the run rate in our services and other revenue line to be variable quarter-to-quarter, but trend downward as our revenue model transition completes. Turning to profitability. Gross profit was $53.6 million, with a gross margin of 80.6%, which compares to $36.3 million and a gross margin of 72.8% in the prior-year period. Increasing gross margin was driven primarily by the significant growth of subscription and software as a percentage of our total revenue, due in part to the large transactions recognized during the quarter. Operating expenses for the quarter were $46.6 million. Total GAAP costs, including cost of revenue, were $59.5 million, which was relatively consistent with $59.1 million in the year-ago period and down from $66.8 million last quarter. Higher-than-guidance revenue, combined with continued solid expense management, led to operating income of $7 million, well above our guidance of an operating loss in the quarter, and compares to an operating loss of $9.3 million in the year-ago period. Net income for the quarter was $3.8 million or $0.04 per share, an improvement compared to a net loss of $10.3 million or $0.11 per share in the second quarter of fiscal 2011. Our non-GAAP operating and net income for the second quarter, which exclude the impact of stock-based compensation expense and restructuring, were $10.1 million and $6 million, respectively, an improvement from a non-GAAP operating and net loss of $6.9 million and $8 million, respectively, in the year-ago period. Our non-GAAP income per diluted share was $0.06 in the second quarter of fiscal 2012 based on 96.3 million shares outstanding compared to a non-GAAP loss per share of $0.09 based on 93.3 million shares outstanding in the second quarter of fiscal 2011. The increase in the shares outstanding on a year-over-year bases is primarily due to the fact that the second quarter of fiscal 2012 uses a fully diluted share number as a result of the GAAP profit that AspenTech generated for that quarter. Reconciliation of GAAP to non-GAAP results is provided in tables within our press release, which is also available on our website. Turning to the balance sheet and cash flow. The company ended the second quarter with $143.3 million in cash, a decrease of $2.1 million from the end of the prior quarter. We used $11.1 million of cash to repurchase common shares during the second quarter and continue to reduce our secured borrowings balance, as I'll detail in a moment. We also generated $23 million in cash flow from operations and $22.3 million in free cash flow after taking into consideration $700,000 of capital expenditures in capitalized software. At the halfway point of the year, the company has generated $28.3 million in cash flow from operations and $27 million in free cash flow. We are ahead of where we expected to be at this point in the year, due primarily to the very strong collections during our second fiscal quarter. Our fourth quarter -- the fourth quarter always has a significant amount of collections that are due at the very end of the fiscal year, which can add an element of variability. We are moving in to our seasonally strongest cash flow quarter and are comfortable increasing our full year free cash flow target from the mid-$70 million range to approximately $80 million. The company once again did not sell any installments receivable to raise cash during the second quarter of fiscal 2012, and we ended the quarter with total secured borrowings of approximately $35.5 million, which is down $14.6 million compared to the end of the first quarter. As a reminder, we have approximately $18 million of secured borrowings that is currently being reported on our accrued expense and other current liability balance. This amount is down from approximately $25 million at the end of last quarter. We continue to evaluate whether we will replace the underlying receivables with other receivables or to buy them back. Pending on our final decision, it will either move back to our secured borrowings balance or be redeemed for cash. Similar to our prior guidance, there's no change to our expectation that secured borrowings will be retired by the end of fiscal 2013. And it will go down by relative equal amounts in fiscal '12 and fiscal '13. With that, let me turn it over to Mark Fusco. Mark?

Thanks, Mark, and thanks to everyone for joining us today. We are very pleased with the company's performance during the second quarter. By any measure, the company met or exceeded each of its primary financial objectives for the quarter. I am particularly pleased that AspenTech delivered accelerated year-over-year growth in total license contract value for both the second quarter and first half of fiscal 2012 as compared to growth in prior fiscal-year periods. Our second quarter sequential license TCV growth of 4.1% compared to 3.5% growth in the year-ago period contributing to 12.9% year-over-year growth at the halfway point of the year, up from 11% growth at the same point last fiscal year. The uncertainty regarding the global economy remains high and is top area of focus among investors. As we shared last quarter, there is no software vendor that is immune to macroeconomic pressures, particularly as they become more intense. However, AspenTech's accelerated license TCV growth for the second quarter and first half of this fiscal year is evidence that we have not seen any change in our demand environment thus far. Our business has not typically experienced a material increase or decrease due solely to changes in economic growth which we believe is a result of the combination of our strong market position, long-term contracts, mission-critical nature of our applications and our blue chip customer base. While AspenTech is the leading global supplier of software to the process manufacturing industries, most of our customers are still only using a small portion of our end-to-end product suite. Although many customers have already adopted our engineering suite, they are only using a minority of the modules within the suite. For those that have deployed our engineering suite more aggressively, many have not implemented our manufacturing and supply chain solutions yet. We believe there is a significant amount of value that our customers can realize by implementing best practices and additional modules that have been already proven in similar companies in the energy, chemicals, and engineering and construction verticals. Looking at our second quarter performance, our business remained strong across our big 3 verticals and across our major product lines. Energy, chemicals, and engineering and construction continue to represent 90% or more of the company's total bookings, with the energy vertical representing our largest vertical contributor. And it's worth a reminder that approximately 80% of our businesses is related to owner operators where our solutions are used every day to run and optimize existing plants. That is the major reason why there is demand for our software in robust and in challenging economic environments. From a geographic perspective, we do not get overly focused on quarterly results because our detailed metrics vary quarter-to-quarter based on the timing of a relatively small number of sizable transactions. With that said, I can share that our business momentum remains solid on a global basis. Looking at our 10 largest transactions in the quarter, there was again a mix of engineering-, manufacturing- and supply-chain-driven deals. Customer response to our subscription-based aspenONE licensing model continues to be favorable. And we believe our strategy of putting all of our software in the hands of our customers to drive increased usage is working. In summary, AspenTech continues to deliver against its commitments. We have achieved each of our primary business and financial objectives during the first half of the fiscal year, and we believe we are on track to do the same for the full year. From a long-term perspective, we believe that AspenTech will have a very attractive business model characterized by solid growth, strong profitability margins and consistently growing free cash flow. In addition, we plan to be responsible with our growing cash flow, deploying it in ways that we believe will maximize shareholder value. With that, I'll turn it back to Mark.

Okay. Thanks. I'd like to close with some additional thoughts regarding our financial outlook for fiscal 2012. Based on a solid first half performance and continued customer demand, we are adjusting our expectation for growth to the high end of our original guidance. At the start of the year, we shared that we were targeting upper single-digit to double-digit growth in license total contract value for the full fiscal year 2012. While there continues to be a high level of economic uncertainty, we are comfortable narrowing our full year growth target to the upper end or 10% level, given our strong first half performance and solid pipeline of opportunities for the second half of the fiscal year. We discussed many times we believe our non-GAAP growth metrics, license TCV and annual spend and free cash flow are the most meaningful measures of AspenTech's business during our revenue model transition. As a reminder, we now expect free cash flow of approximately $80 million for fiscal 2012, which is an increase from our prior guidance of the mid-$70 million range. We are also increasing our P&L guidance, due in large part to the previously discussed large renewal, where we were required to recognize the revenue on an upfront basis as compared to a subscription basis. We are now expecting fiscal 2012 revenue of $235 million to $240 million, which is up from our original guidance of $225 million to $235 million. From an expense perspective, we currently expect total GAAP cost and expenses of approximately $260 million to $270 million for the full year, which is better than our original guidance of $260 million to $275 million. Taken together, GAAP operating loss is expected to be in the range of $23 million to $33 million, which is an improvement from our prior guidance of $30 million to $40 million, as well as from an operating loss of $54.6 million for fiscal 2011. We continue to assume a GAAP net loss of $20 million to $30 million or a loss of $0.21 to $0.32 per share. We are now assuming a lower level of non-operating income, due primarily to fluctuations in exchange rates. In addition, the level of U.S. tax benefit for fiscal 2012 will vary with the level of our pretax loss and other discrete tax items. From a non-GAAP perspective, we now expect a non-GAAP operating loss in the range of $13 million to $23 million, an improvement from our prior guidance of non-GAAP operating loss of $20 million to $30 million. We continue to expect a non-GAAP loss per share of $0.09 to $0.19, which is consistent with our prior guidance. Similar to my commentary regarding GAAP loss per share, there's a range of variability on a few items below the operating loss line. Our current focus remains on providing full year P&L guidance and direction -- and direction from a quarterly perspective. We will provide an added level of detail for the third quarter due to nonstandard drivers to the significant revenue upside in the second quarter. We currently expect third quarter revenue of approximately $57 million to $60 million for the third quarter. We expect to report a GAAP operating loss in the range of $8 million to $10 million for the third quarter. And a non-GAAP -- and on a non-GAAP basis, that would translate to a non-GAAP operating loss of approximately $5.5 million to $7.5 million. It's worth pointing out that we expect our shares outstanding for the third quarter to be approximately 93 million, which is back down from the second quarter, due to the fact that we expect to move back into a loss position. As such, we will not incur the dilutive impact of options on our share count. With that, we're now happy to take your questions. Operator, let's begin the Q&A.

[Operator Instructions] Your first question comes from the line of Richard Davis with Canaccord.

So, Mark, when you sell someone to aspenONE, you've kind of gone out and try to give people best practices and things like that, and the organic growth rate has been accelerating. So that's all awesome, but what is the gating issue to get people to move up in terms of -- because you mentioned today in your prepared remarks move up and buy more Aspen stuff. Is it just conservatism? Is it cultural? Is it -- are you pushing aside a SAP? Or what can you do to translate that into a bigger share? I mean, is there anything that modulates that? Or is there any delta or elbow in the curve?

Well, certainly, when we started this transition 2.5 years ago, the thesis was that we would give people our software and they would use it. And we shared some information at our Investor Day last May about what the uptake in software had been, although it had only been 6 or 7 quarters at that time. And certainly, we've seen, since that time, increased number of users and increased number of modules or applications being used by the companies who are on the new module, the new commercial model. So clearly, the transition is working. There is a limit to how process manufacturing companies are going to adopt software, how often they're going to change things, how quickly they can do things in their operating environments. But we've clearly seen the benefit of the model change 2.5 years ago in the growth rate of the company, which you can see here today, and which has been consistently up and to the right over time. And I think in the spring or sometime this calendar year, we'll probably have another Investor Day. And at that time, we'll talk a little bit more about what's going on, specifically with user counts and amount of modules that have being used.

Okay. Can I just have one quick follow-up with [ph] Mark Sullivan. The services side of the services and maintenance line, have you ever broken out the mix of services from maintenance, because you mentioned that maintenance will go down and/or could you tell us kind of what you plan to run services margins at so that we can kind of figure out the longer-term line item there?

Yes, Rich, it's Mark Fusco. On the services line, if you remember back in the day, we always said we'd run a blended services model sort of in the 50% margin range. You can see that the maintenance has been moving up into the subscription and software line over a period of time. That said, in the second quarter, I think the professional services business ran somewhere in the high-40s, 47%, 48%, something in that range from a margin perspective. And we run normally in our maintenance business above 80% margin. So nothing in particular has changed with how we run the business over a period of time. It's just moved around a little bit.

And specifically to your question, there is more detail in the Q that breaks those line items out separately.

And your next question comes from the line of Sterling Auty with JPMorgan.

I'm kind of curious on the large deal that you mentioned. So if we look into the energy industry, especially in oil and gas, kind of the break-up idea of taking out refinery from the other parts of the business, seems to be a theme that might reoccur. So how should we think about this license opportunity in some of the structural changes that may occur in some of your core customers?

Well, clearly, depending on which part of the world you're in, there has been, in some cases, some companies are moving and splitting themselves into more upstream assets and more downstream assets. There's been several here in the U.S. that have done that, and there are a few others that are planning to. I wouldn't read too much into this specific transaction. This one, they did have a renewal right, which they took advantage of. We would expect to convert that customer over time to our aspenONE model. I suspect it'll take a little bit as they work their way through their own operating transitions. But clearly, the refining business has been in transition and it's historically a tough business, and it continues to be so. That said, we see opportunities all over to get customers converted to the aspenONE suite and expand their usage of the modules that we have.

And you mentioned the heavy usage in the Engineering Suite on a couple of modules but not fully across. Can you review for us, which of the modules are the most popular in terms of being used, which ones do you think you could see further uptake that will drive token and additional utilization? And as you look at penetrating on the operation side, what do you think is the natural first step or the modules in the operations side that looked most likely to upsell, to gain traction on the kind of across all idea?

So in the Engineering Suite, the portfolio -- the software portfolio has evolved over a period of time, not surprisingly the company gets the most usage from its 2 core simulation products: one for chemicals and one for refining. But we now view those products really as the hub for how our users will use all the different applications that we have. And the latest release of software that came out this past year, you start doing your flow sheet with our simulation product, and then that is the environment from which you launch all the different other applications that we have, whether it's our economics and costing package or heat exchanger package or flare analysis package. So there's lots of different applications on the ribbon now that people can use in an integrated fashion. And so it would be those more ancillary products that we would think there will be lots of additional usage, but we're also seeing additional usage in the core simulation applications as well. So we think we're not sold out by a long shot here. We've got lots of growth opportunities, and you can see it in the market share data that came out over the summer with the gains that we have in the market share, we're getting it in the core apps and on some of the other applications as well. In the manufacturing and supply chain space, we really look through some of the perpetual licenses and installed base that we have from around the world. As you know, AspenTech has the largest installed base of advanced process control software in this industry. Not -- very few of them have been converted to the new aspenONE model, so we’ll be looking at those things. The same thing could be said for manufacturing software, planning and scheduling and all the supply chain software and chemical supply chain as well. So we're really taking a look at what the installed base looks like, and then we'll see whether we can convert them over a period of time onto our aspenONE into [ph] our model and then get them using more software. It also presupposes -- which you will have seen at the user conference last spring, that the software is more integrated. So every day it gets more integrated. And there's more value that can be created across different applications in the sharing of data and ability to make decisions with different pieces of information. So this is a multiyear transition that we've been undergoing since 2005 when we announced aspenONE, and we are in alignment now with software that's integrated and getting more so every day, which gives our users lots of opportunity, and we have a commercial model that's integrated along with it. And of course, we sell them usage and give them the software and help them use it.

And last question, on the manufacturing and supply chain, the aspenONE penetration, is it that you just need those -- especially the perpetual licenses to get to a point where they need a certain amount of usage and you think that upsell looks more economically attractive to go aspenONE? What do you think is going to be the trigger to gain traction with aspenONE in that base?

Well, I think it's awareness from the customer base about the things that we're doing. We invest quite a bit of money in our products every year, just north of $50 million. And as we've talked about in the past, we will be acquiring technology from other companies that we'll be putting into our aspenONE suite. And all those things can create value for our customers. We do see increased uses and increased opportunity over time. This quarter we had a stronger manufacturing and supply chain quarter than we've had in recent quarters. It doesn't presuppose or don't -- please don't read into my comments that we had a weak engineering quarter, because we didn't. But we had strength in the MSC space, which is good, because we clearly see lots of whitespace in that area that we want to take advantage of.

Your next question comes from the line of Tom Ernst with Deutsche Bank.

It's Stan Zlotsky sitting in for Tom. So in the very beginning of the call you mentioned price increases. Is that just the typical stuff? Or is that something -- was there something a little bit more to it than usual, 2% or so?

Yes, I think what we were referring to is the one deal, sort of, old-style deal that went upfront from a rev rec perspective. The contract renewal call for escalation in the deal, which is the normal 2%, 3%, but not price increases per se.

In the early part of the talk, we just talked about the general things that drive TCV, as well, which price increase is one. Doesn't meant to be called out as anything specific for the second quarter.

Okay. Got it. Just sort of following up on what Sterling was talking about earlier. How much of your total portfolio has already been switched over to the new suite? I think last quarter it was around in the 60%, 66% or something.

Yes, it's about 70%.

Okay. And last one, on life sciences last quarter, it didn't do so great. How did it do this quarter, if you have any updates?

I had more questions than I care to answer last quarter because I talked about how the [indiscernible] business did. It's a small part of our business. They actually had a pretty good quarter in the second quarter, and that's why we don't get into it particularly on a quarter-to-quarter basis because it does bounce around a little bit, and it's nothing to be concerned about one way or the other.

This is Tom Ersnt. Just one follow-up to Stan's first question on the pricing side. So I recognize that there wasn't anything systemic today. But do you feel like you've got a good sense for your pricing power over your market today? Have you had a chance to test that in any markets and whether or not there's plans to enact that? Where do you feel you are in the relationship with customers?

Well, I think we understand where the market is, and we certainly try to price our products to capture some value given the large amounts of value that they create for the customers. We've been doing this a long time. Prices have risen a little bit over time, as we've -- certainly during my tenure here at Aspen. But we are -- and we -- so we look at different modules and how we price them and what the legacy contracts look like and the like, and it's not that we try to give everybody to same, but we certainly take a look at discount levels based on volume and other things. So I think we understand where the market is, and we try to monetize our opportunities the best we can.

Your next question comes from the line of Peter Goldmacher with Cowen and Company.

Earlier this year, one of the big changes you made to comp plans was paying reps on new business, and that's just not for renewal. Can you talk a little bit about how that behavior has impacted results? And also, talk a little bit about how you make sure that once they sell a deal they're working in that installed base to make sure that they continue to adopt incremental products.

Yes, so we did change, in July, the comp plan. It had been incrementally changing over a period of time, but this was the year where we really got away from bookings as a metric that we give externally, and we got away from it on -- from a compensation perspective, not only in the sales force, but all the way through the company, including how the executive team is paid. Two quarters is not a trend. It's -- I guess it's better than one quarter. But clearly, we're seeing increased growth in the business. We're also seeing lots more attention to the losses. I mean, we always lose a little bit of business, maybe not to a competitor, but people don't need the software or whatever it may be. We track those now on a weekly basis on the company's forecast call. Everybody has their portfolio, and they need to monetize those opportunities and make sure that they increase their overall installed base in order to get their commissions. So I think it's definitely driving behavior in the company around usage of our software, number of users and how we grow the installed base, which at the end of the day is going to drive the revenue growth of the company. So there's no doubt it's changed the company materially for the better, in my view. And we'll see how we do over the next few quarters to see whether the dots connect into a trend that we like. I will say that when we look at the overall percentage of new business as a percentage of total bookings, it's substantially up from what it would have been 2 or 3 years ago, so I think it's absolutely driving the right behavior. And in some markets we are seeing acquisition of new customers in a much more material way than maybe they would've done in the past because growth is growth and it all increases their own bottom line. So I think it is driving the right behavior. It's still a little early yet to know exactly how this all turns out, but it was the right thing to do, and it really does get the sales force and the executive team and everybody here at Aspen aligned with creating value for the customers and getting them to use more of our software.

Your next question comes from the line of Philip Rueppel with Wells Fargo Securities.

This quarter you had mentioned that there was potentially some big deals that weren't included in the guidance, and you mentioned that you did that account for $4 million of the upside. Is there any -- is that pretty much done for the rest of the fiscal year? Or do we still have some cash basis legacy deals that could go into one of the next couple of quarters?

There's nothing material of a similar nature. These are 2 legacy deals that got booked several years ago in the calendar fourth quarter. So it's just the timing of the cash. We have other cash-basis deals, but they're not going to move the needle.

Okay. That's fine. Great. And then maybe, Mark, you could give a little color, as we start to hear about potential new refineries in different locales or new chemical plants, are we likely to see that? Is there any shift in terms of the purchase pattern for Aspen between the engineering and construction companies and then -- or the major end-user customers? Or is it pretty much business as usual? And are you starting to see any increased activity for kind of new plants and facilities?

Well, it's a bit of a mixed answer depending on which vertical, I guess, we're looking at. In the E&C space we would account for a deal sold to Bechtel in the United States. They may use it anywhere in the world, but we would count that as a North American deal. From an owner operator perspective, either in the engineering space or in the MSC space, those deals would get counted in the local market where the owner operator happened to be. And I think that is driving some of the growth that we're seeing in Asia, in Latin America, in Russia and, for the first quarter in the December quarter, in the Middle East. So I do think that the execution of the team locally will drive revenue, not only for the engineering space, but more specifically for the MSC space. But in the E&C, specifically, we really count that wherever we sell it as opposed to wherever they use it.

Your next question comes from the line of Brendan Barnicle with Pacific Crest Securities.

Question, Mark, when you were answering Richard Davis' question about increasing modules, you referred back to the Analyst Day last year, and I think that you had mentioned I think a 20% uplift that you were seeing in deals sizes from folks who went to aspenONE, and you referenced I think at that event several customers who were over 100%. As you've gone through now the first half of the year, are you seeing that trend accelerate towards greater than 20%? Are you below that? Or you're just staying in line? Any more color you could give us around that trajectory.

We have the same question, Brendan, in -- at the end of the September quarter. We haven't given any metrics on that. I think we'll give that out again in May. I think it's safe to say that the deals that we're doing, whether they're natural renewals or early renewals, have nice growth along the way with them. That's consistent with what we would've said in the past. We're getting good growth. We're starting to get some growth of customers coming back for additional usage, who signed an aspenONE deal maybe a year or 2 ago early in the conversion cycle. So we're starting to see a little bit of difference, but I would say it's all positive at the moment. And I think we'll give out some more information about usage and how contracts change in the spring.

Great. And then just following up on the Middle East, you've now had, I think, a direct selling effort for I think almost a year. I'm wondering if you have any color on how that's going, and is that loss in I think what the resellers at? Are they still in existence or is that wrapped up?

Well, that arbitration still exists. You'll see it in the Q. There's been no determination by the tribunal yet. The company doesn't have any change to its opinion about it. And we think we're fully disclosed in the Q. We're just waiting to find out what happened. We thought it was going to be several months ago. It hasn't been. So we're waiting just like you are. But as far as the Middle East, specifically, our team is in place now. We've got offices in multiple countries there. We had a good quarter in December, which was the first one. And in fact, we closed a nice deal in the home country of our former partner, which was nice. So I think we're active there, and we're doing the right things. And we'll see how we do, but getting that territory back for the company as a direct sales model, like we sell every else in the world, was important, and it's nice that the team is starting to put things together.

Your next question comes from the line of Richard Williams with Cross Research.

First of all, did I miss it, or did you not give the ASP in large deal metrics?

Yes, we didn't give it out, Rich. Since we don't do the bookings anymore, we didn't give out the ASP or anything. We did have a bunch of big deals in the quarter. So I'm sure if we'd given out the number, the ASP would've been quite high, but we didn't give it out.

Okay. Also, could you give some geographic color on the supply chain business?

From a geographic perspective, overall, we were really solid across all the different geographies. They all did pretty well. We had some that were obviously bigger than others. But they all did well, including the topic which we always get asked about, which is Europe, which had a very good quarter as well in the second quarter. So overall, it was really well-balanced geographically. And as I mentioned earlier, we don't break it out geo by geo from a engineering or MSC perspective, but we did have a good manufacturing and supply chain quarter in the second quarter. And we're spending a lot of time at it because it is a highly differentiated part of Aspen's offering. And it's something that we think there's lots of opportunity to grow. So we don't break it out in the quarters, but we did well. And all the geographies were strong.

Also, could you break it out by customer type, any color there?

No, we really don't. We stopped about 5 years ago giving out specific customer contracts sort of information for a lot of different reasons. Suffice it to say, energy, as we mentioned in the prepared remarks, was strong for us. Engineering and construction as well. Chemical is a little less so -- but again, that bounces around quarter-to-quarter, and I wouldn't necessarily read much into it.

Yes. Because I was looking more for just general type of customer on the supply chain side.

Your last question comes from Mark Schappel with The Benchmark Company.

Just one question here. Mark, there have been several announcements in recent months of oil refinery closures, particularly here in the U.S. East Coast. And I was wondering if you had a chance to really kind of sit back and decipher how do you think that's going to impact your business going forward?

We could, and there's it's also been some divestitures or other things. Usually, when there's divestitures or M&A activity, it tends to be a positive for our business as new acquirers come in and buy assets and do things. It hasn't impacted the business so far. You're right, there are some refineries that have been closed. There's obviously others that are being built and other things that are going on in other parts of the world. So it hasn't affected us yet; it may, but we don't see it so far.

And there are no further questions at this time.

Okay. Thank you very much to everyone for joining us on the call. Thanks to the Aspen team around the world for another good quarter of performance. And I look forward to seeing you at various events this quarter and next. And again, thanks for your interest in AspenTech and participating with us here today. Thanks.

This concludes today's conference. You may now disconnect.