[Financial Highlights](index=1&type=section&id=Financial%20Highlights) Bentley Systems achieved solid Q2 and H1 2025 revenue growth, driven by subscriptions, maintaining strong profitability and ARR expansion [Second Quarter 2025 Results](index=1&type=section&id=Second%20Quarter%202025%20Results) Q2 2025 saw total revenues reach $364.1 million with 10.2% growth, driven by subscription revenues, alongside stable cash flow and increased Adjusted EPS Q2 2025 Key Financial Metrics (Year-over-Year, in millions) | Metric | Q2 2025 (in millions) | Q2 2024 (in millions) | % Change | Constant Currency % Change | | :--- | :--- | :--- | :--- | :--- | | **Total Revenues** | $364.1M | $330.3M (from P&L) | 10.2% | 9.2% | | **Subscriptions Revenues** | $333.5M | $297.4M (from P&L) | 12.1% | 11.2% | | **Operating Income Margin** | 23.2% | 24.3% | (1.1 pps) | N/A | | **Net Income per Diluted Share** | $0.22 | $0.22 | 0.0% | N/A | | **Adjusted EPS** | $0.32 | $0.31 | 3.2% | N/A | | **Cash Flows from Operations** | $61.1M | $62.6M | (2.4%) | N/A | - Annualized Recurring Revenues (ARR) reached **$1,379.2 million**, representing a constant currency growth rate of **11.5%** compared to June 30, 2024[2](index=2&type=chunk) - The last twelve-month recurring revenues dollar-based net retention rate was **109%**, an improvement from **108%** in the same period last year[2](index=2&type=chunk) [Six Months Ended June 30, 2025 Results](index=2&type=section&id=Six%20Months%20Ended%20June%2030%2C%202025%20Results) First half 2025 revenues grew 10.0% to $734.6 million, driven by subscriptions, with improved operating margin and increased net income per diluted share First Half 2025 Key Financial Metrics (Year-over-Year, in millions) | Metric | H1 2025 (in millions) | H1 2024 (in millions) | % Change | Constant Currency % Change | | :--- | :--- | :--- | :--- | :--- | | **Total Revenues** | $734.6M | $668.1M | 10.0% | 10.1% | | **Subscriptions Revenues** | $675.8M | $604.5M | 11.8% | 11.9% | | **Operating Income Margin** | 27.2% | 25.8% | 1.4 pps | N/A | | **Net Income per Diluted Share** | $0.50 | $0.44 | 13.6% | N/A | | **Adjusted EPS** | $0.67 | $0.62 | 8.1% | N/A | | **Cash Flows from Operations** | $280.5M | $267.6M | 4.8% | N/A | [Management Commentary](index=2&type=section&id=Management%20Commentary) Management expressed confidence in the company's performance and outlook, highlighting consistent results, business resilience, and strong financial positioning - **Executive Chair Greg Bentley:** Emphasized that results are on track for the **2025 outlook**, driven by long-term 'going digital' trends and the need for productivity gains in infrastructure engineering[4](index=4&type=chunk) - **CEO Nicholas Cumins:** Noted a strong quarter despite global uncertainties, attributing performance to a resilient business model and secular infrastructure investment[4](index=4&type=chunk) - **CFO Werner Andre:** Stated that Q2 performance met expectations with **11.5% constant-currency ARR growth**. He highlighted the company's **strong balance sheet and cash flow**, providing capacity for share repurchases, dividends, potential acquisitions, and refinancing debt[4](index=4&type=chunk) [Financial Statements](index=5&type=section&id=Financial%20Statements) The unaudited consolidated financial statements detail the company's financial position, reflecting increased assets, revenue growth, and strong operating cash flow [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets increased to $3.42 billion, while total liabilities decreased, leading to an increase in total equity Key Balance Sheet Items (in thousands) | Account | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :--- | :--- | :--- | | **Total Current Assets** | $439,522 | $442,073 | | **Total Assets** | $3,423,284 | $3,399,807 | | **Total Current Liabilities** | $858,364 | $814,334 | | **Long-term Debt** | $1,245,843 | $1,388,088 | | **Total Liabilities** | $2,261,114 | $2,358,687 | | **Total Equity** | $1,162,170 | $1,041,120 | [Consolidated Statements of Operations](index=7&type=section&id=Consolidated%20Statements%20of%20Operations) For the six months ended June 30, 2025, total revenues grew 10.0% to $734.6 million, resulting in increased gross profit and net income Key Income Statement Data (in thousands, YoY) | Account | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :--- | :--- | :--- | :--- | :--- | | **Total Revenues** | $364,106 | $330,337 | $734,648 | $668,100 | | **Gross Profit** | $295,330 | $267,144 | $600,213 | $543,077 | | **Income from Operations** | $84,430 | $80,177 | $199,614 | $172,108 | | **Net Income Attributable to Bentley Systems** | $70,482 | $72,046 | $161,850 | $142,356 | [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operating activities increased to $280.5 million for the first six months of 2025, leading to a net increase in cash and cash equivalents Summary of Cash Flows (in thousands, for Six Months Ended June 30) | Category | 2025 (in thousands) | 2024 (in thousands) | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $280,500 | $267,555 | | **Net cash used in investing activities** | ($7,135) | ($10,946) | | **Net cash used in financing activities** | ($257,509) | ($270,999) | | **Increase (decrease) in cash and cash equivalents** | $25,637 | ($17,134) | | **Cash and cash equivalents, end of period** | $89,646 | $51,278 | [Reconciliation of GAAP to Non-GAAP Financial Measures](index=9&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Financial%20Measures) This section reconciles GAAP to non-GAAP financial measures, clarifying calculations for Adjusted Operating Income, Adjusted Net Income, Free Cash Flow, and Adjusted EBITDA [Reconciliation to Adjusted Operating Income and Adjusted Net Income](index=9&type=section&id=Reconciliation%20to%20Adjusted%20Operating%20Income%20and%20Adjusted%20Net%20Income) Q2 2025 GAAP operating income of $84.4 million was adjusted to $124.5 million, and net income of $70.5 million to $105.5 million, primarily by adding back amortization and stock-based compensation Q2 2025 Reconciliation Summary (in thousands) | Metric | GAAP Value (in thousands) | Key Adjustments (in thousands) | Non-GAAP Value (in thousands) | | :--- | :--- | :--- | :--- | | **Operating Income** | $84,430 | +$11,405 (Amortization) <br> +$19,319 (Stock Comp.) | $124,542 (Adj. Op. Income) | | **Net Income** | $70,482 | +$11,405 (Amortization) <br> +$19,319 (Stock Comp.) | $105,478 (Adj. Net Income) | [Reconciliation to Free Cash Flow and Adjusted EBITDA](index=10&type=section&id=Reconciliation%20to%20Free%20Cash%20Flow%20and%20Adjusted%20EBITDA) Q2 2025 Free Cash Flow was $57.0 million, derived from operating cash flow, and Adjusted EBITDA was $129.3 million after various adjustments Q2 2025 Cash Flow Reconciliations (in thousands) | Reconciliation | Amount (in thousands) | | :--- | :--- | | **Cash flows from operations** | $61,085 | | Less: Purchases of property and equipment | ($4,091) | | **Free cash flow** | **$56,994** | | **Adjusted EBITDA** | **$129,318** | [Reconciliation to Constant Currency Revenues](index=10&type=section&id=Reconciliation%20to%20Constant%20Currency%20Revenues) A constant currency reconciliation for Q2 2025 shows a negative $3.6 million FX impact on total revenues, with constant currency growth of 9.2% for total revenue and 11.2% for subscriptions Q2 2025 Constant Currency Impact (in thousands) | Revenue Type | As Reported (in thousands) | Impact of FX (in thousands) | Constant Currency (in thousands) | | :--- | :--- | :--- | :--- | | **Total Revenues** | $364,106 | ($3,603) | $360,503 | | **Subscriptions Revenues** | $333,452 | ($3,191) | $330,261 | [Additional Information](index=2&type=section&id=Additional%20Information) This section provides investor logistical details and includes legal disclaimers regarding non-GAAP measures and forward-looking statements [Conference Call Information](index=2&type=section&id=Conference%20Call%20Information) Bentley Systems will host a live Zoom webinar on August 6, 2025, at 8:15 a.m. Eastern time to discuss Q2 2025 results - A live Zoom webinar to discuss Q2 2025 results is scheduled for **August 6, 2025**, at **8:15 a.m. Eastern time**[5](index=5&type=chunk) [Forward-Looking Statements and Non-GAAP Measures](index=3&type=section&id=Forward-Looking%20Statements%20and%20Non-GAAP%20Measures) This report contains forward-looking statements subject to risks and uncertainties, and utilizes non-GAAP financial measures with reconciliations available in the Form 8-K - The report contains **forward-looking statements** concerning future results and operations, which are subject to **numerous risks and uncertainties** detailed in the company's SEC filings[9](index=9&type=chunk)[10](index=10&type=chunk) - The company uses **non-GAAP financial measures**, and **reconciliations** to the most comparable GAAP measures are provided in the **Form 8-K** furnished to the SEC[8](index=8&type=chunk)

Core Insights - Wall Street analysts expect Bentley Systems, Incorporated (BSY) to report quarterly earnings of $0.29 per share, reflecting a year-over-year decline of 6.5% [1] - Revenue projections stand at $363.09 million, indicating a 9.9% increase from the same quarter last year [1] Earnings Projections - The consensus EPS estimate has remained unchanged over the past 30 days, indicating analysts' reassessment of their initial projections [1][2] - Revisions to earnings projections are crucial for predicting investor behavior and stock price performance [2] Revenue Estimates - Analysts forecast 'Revenues- Subscriptions and licenses' to reach $344.96 million, representing an 11.9% year-over-year increase [4] - 'Revenues- Services' are expected to be $19.30 million, showing a decline of 12.4% year-over-year [4] - The average prediction for 'Revenues- Subscriptions' is $334.07 million, indicating a 12.3% increase year-over-year [4] Additional Revenue Metrics - 'Revenues- Perpetual licenses' are projected at $11.64 million, reflecting a 7.2% year-over-year increase [5] - The consensus estimate for total revenue year-over-year growth is 9.9%, down from 11.3% in the previous year [5] - Estimated 'Annualized Recurring Revenues (ARR)' is projected at $1.35 billion, up from $1.22 billion in the same quarter last year [5] Subscription Growth - 'Revenue - Subscriptions - YoY growth' is expected to be 12.3%, compared to 14.7% in the same quarter last year [6] - Over the past month, Bentley Systems shares have increased by 4.3%, outperforming the Zacks S&P 500 composite's 1% change [6] - The company holds a Zacks Rank 3 (Hold), suggesting performance in line with the overall market [6]

Core Insights - Bentley Systems, Incorporated (BSY) is set to report second-quarter 2025 earnings on August 6, with a consensus estimate of 29 cents per share, indicating a year-over-year decline of 6.5% [1][9] - Revenue expectations for the second quarter are pegged at $363.1 million, reflecting a 9.9% increase from the previous year's $330.3 million [2][9] Factors Influencing Q2 Results - The company's performance is likely to benefit from favorable infrastructure spending trends in the U.S., particularly due to the Infrastructure Investment and Jobs Act [3] - New solutions like Seequent Evo and the adoption of AI-powered asset analytics, especially through a partnership with Google, are expected to drive demand for Bentley Systems' offerings [4] - The growing adoption of the E365 subscription model and Virtuosity platforms is anticipated to contribute to new customer acquisitions and upselling during the quarter [5] Cost and Market Challenges - The second quarter typically incurs costs from annual raises and promotional events, which may compress margins sequentially [6] - Delayed mining investments and macroeconomic sensitivity in commercial infrastructure could offset some benefits from positive trends [6] - Economic challenges in China are expected to negatively impact overall growth for the quarter [6] Earnings Prediction Insights - Current analysis does not predict a definitive earnings beat for Bentley Systems, as it holds a Zacks Rank 3 and an Earnings ESP of 0.00% [7]

Core Viewpoint - Bentley Systems, Incorporated (BSY) is anticipated to report a year-over-year decline in earnings despite an increase in revenues for the quarter ended June 2025, with the actual results being a significant factor influencing its near-term stock price [1][2]. Financial Expectations - The upcoming earnings report is expected to reveal quarterly earnings of $0.29 per share, reflecting a year-over-year decrease of 6.5%, while revenues are projected to be $363.09 million, representing a 9.9% increase from the previous year [3]. - The consensus EPS estimate has remained unchanged over the last 30 days, indicating a stable outlook from covering analysts [4]. Earnings Surprise Prediction - The Most Accurate Estimate for Bentley Systems is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -2.78%, suggesting a bearish sentiment among analysts regarding the company's earnings prospects [12]. - The stock currently holds a Zacks Rank of 3, complicating predictions of an earnings beat [12]. Historical Performance - In the last reported quarter, Bentley Systems exceeded the expected earnings of $0.30 per share by delivering $0.35, resulting in a positive surprise of 16.67% [13]. - Over the past four quarters, the company has beaten consensus EPS estimates twice [14]. Market Context - The overall market sentiment indicates that an earnings beat or miss may not solely dictate stock price movements, as other factors can also influence investor reactions [15]. - Despite the current outlook, the company does not appear to be a compelling candidate for an earnings beat, suggesting that investors should consider additional factors before making investment decisions [17].

Core Viewpoint - The content emphasizes the importance of conducting personal due diligence and consulting competent advisors before making any financial decisions, particularly in the context of investments and trading activities [1]. Group 1 - The website provides general news, publications, and personal analysis intended for educational and research purposes [1]. - It explicitly states that the information does not constitute any recommendation or advice for investment actions [1]. - Users are advised to perform their own research and consider their financial situation before making decisions [1]. Group 2 - The website includes information about complex financial instruments such as cryptocurrencies and contracts for difference (CFDs), which carry a high risk of losing money [1]. - It encourages users to understand how these instruments work and the associated risks before investing [1].

Group 1 - Bentley Systems, Incorporated (BSY) has shown a year-to-date return of 2.2%, outperforming the average return of -1.7% for the Computer and Technology sector [4] - The Zacks Consensus Estimate for BSY's full-year earnings has increased by 4.4% over the past 90 days, indicating improving analyst sentiment [4] - Bentley Systems is currently ranked 2 (Buy) in the Zacks Rank, which is a stock-picking model focusing on earnings estimates and revisions [3] Group 2 - Bentley Systems belongs to the Internet - Software industry, which consists of 167 companies and is currently ranked 51 in the Zacks Industry Rank [6] - The Internet - Software industry has seen an average gain of 6.9% year-to-date, indicating that BSY is slightly underperforming its industry [6] - In contrast, Broadcom Inc. (AVGO), another stock in the Computer and Technology sector, has a year-to-date return of 4.4% and is also ranked 2 (Buy) [5]

Core Viewpoint - The article discusses the investment potential of Bentley Systems (NASDAQ: BSY), highlighting a buy rating based on its valuation becoming attractive and the expectation of growth acceleration in the future [1]. Group 1: Investment Philosophy - The investment approach is fundamentally based, focusing on long-term durability and affordability rather than merely low multiples [1]. - The article emphasizes the importance of a robust balance sheet and steady long-term growth without cyclicality as key factors in selecting investment opportunities [1]. - It acknowledges the risks associated with investing in successful companies, particularly the potential of overpaying for stocks, underscoring the significance of valuation [1]. Group 2: Market Outlook - There is a belief that in certain situations, the potential for growth can outweigh immediate price concerns, suggesting a favorable outlook for companies with significant development runways [1].

Core Viewpoint - Flex (FLEX) has shown strong year-to-date performance compared to the broader Computer and Technology sector, which has experienced negative returns [1][4]. Company Performance - Flex has returned 9.6% year-to-date, significantly outperforming the Computer and Technology sector's average return of -1.3% [4]. - The Zacks Consensus Estimate for Flex's full-year earnings has increased by 2.5% over the past quarter, indicating improved analyst sentiment and a stronger earnings outlook [3]. Industry Context - Flex is part of the Electronics - Miscellaneous Products industry, which consists of 34 companies and currently ranks 155 in the Zacks Industry Rank. This industry has seen an average gain of 6.8% year-to-date, further highlighting Flex's superior performance [5]. - In contrast, Bentley Systems, Incorporated, another stock in the Computer and Technology sector, has a year-to-date return of 2.7% and belongs to the Internet - Software industry, which has performed better with a 10.1% increase year-to-date [4][6].

Revenue Growth - Total revenues for the three months ended March 31, 2025, were $370,542, representing a 9.7% increase compared to the same period in 2024[119] - Subscription revenues increased to $342,318 for the three months ended March 31, 2025, up 11.5% year-over-year[119] - Annual Recurring Revenue (ARR) reached $1,319,256 as of March 31, 2025, reflecting a constant currency ARR growth rate of 12%[119] - Revenues from the Americas increased by 8.0% to $198,975, driven by subscription revenue growth from existing accounts[128] - EMEA revenues grew by 13.0% to $107,005, primarily due to subscription revenue expansion in the United Kingdom, Africa, and the Middle East[128] - Last twelve-month recurring revenues rose by $147,017, reaching $1,272,574 in Q1 2025, driven by strong account retention and new accounts[156] - The recurring revenues dollar-based net retention rate improved to 110% in Q1 2025 from 108% in Q1 2024, indicating effective revenue growth from existing accounts[148] - Total revenues for the three months ended March 31, 2025, were $374.319 million, a 10.8% increase from $337.421 million in the same period of 2024[173] - Subscription revenues increased to $345.651 million in Q1 2025, up from $306.757 million in Q1 2024, reflecting a growth of 12.7%[173] Operating Performance - Operating income for the three months ended March 31, 2025, was $115,184, compared to $91,931 for the same period in 2024[119] - Cash flows from operations were $219,415 for the three months ended March 31, 2025, compared to $204,969 in the prior year[119] - Adjusted operating income for Q1 2025 was $143,525, up from $131,682 in Q1 2024, marking a year-over-year increase of 9.9%[169] - Operating cash flow for Q1 2025 was $219.415 million, an increase of $14.446 million compared to $204.969 million in Q1 2024[176] Expenses and Income - Research and development expenses increased to $72,450 for the three months ended March 31, 2025, up 6.0% year-over-year[137] - Total operating expenses increased by 3.1% to $189,699 for the three months ended March 31, 2025[137] - For the three months ended March 31, 2025, income before income taxes was $111,825, compared to $92,548 for the same period in 2024, representing a year-over-year increase of 20.8%[146] - The effective tax rate decreased to 18.3% in Q1 2025 from 24.0% in Q1 2024, primarily due to increased discrete tax benefits recognized[146] - The company recorded discrete tax benefits of $5,073 in Q1 2025, significantly higher than $2,138 in Q1 2024, contributing to the lower effective tax rate[146] Cash and Debt Management - Long-term debt decreased to $1.244 billion as of March 31, 2025, down from $1.388 billion at the end of 2024[180] - Cash and cash equivalents totaled $83.637 million as of March 31, 2025, compared to $64.009 million at the end of 2024[174] - The company has $1.299 billion available under the Credit Facility as of March 31, 2025[180] - Net cash used in investing activities was $3.044 million for Q1 2025, a decrease from $3.849 million in Q1 2024[176] Shareholder Returns - The company repurchased 673,898 shares for $30.014 million during the three months ended March 31, 2025, compared to 302,598 shares for $15.006 million in the same period of 2024[183] - The company paid quarterly dividends of $0.07 per share in Q1 2025, an increase from $0.06 per share in Q1 2024[186] Future Outlook - The company expects continued favorable growth in recurring revenues due to strong account retention and the addition of new accounts[154] - ARR resulting from contracts with consumption measurement durations of less than one year was 50% of total ARR in Q1 2025, up from 48% in Q1 2024[152]

Financial Performance - Bentley Systems' ARR reached $1319 million as of March 31, 2025 [138] - The company's LTM recurring revenues grew by 13% (13.6% in constant currency) to $1273 million [134] - First quarter revenue showed growth, with subscriptions up 13% (15% in constant currency) and total revenue up 10% (11% in constant currency) [131] - GAAP operating income increased by 25% to $115 million, while AOI less SBC increased by 12% to $126 million [141] - The company anticipates total revenues between $1461 million and $1490 million for the full year 2025 [150] Growth Drivers and Initiatives - E365 as a percentage of total ARR continues to increase [48] - Virtuosity has achieved its thirteenth consecutive quarter with at least 600 new logos [98] - The company is prioritizing going digital, with infrastructure engineering operating at capacity [85] Geographic Performance - The Americas generated $717 million in revenue, EMEA $388 million, and APAC $248 million in 2024 [76] - Latin America experienced a very strong quarter [108, 113] Capital Allocation - The company has $84 million in cash and $1300 million in available revolver credit capacity [146] - The company reduced net bank debt by $135 million [148]