Core Insights - PTC Therapeutics has received FDA acceptance for the New Drug Application (NDA) for vatiquinone, targeting a PDUFA action date of August 19, 2025, for the treatment of Friedreich's ataxia (FA) [1][2] - Vatiquinone, if approved, would be the first therapy for pediatric patients with FA and a potential treatment alternative for adults, addressing a significant unmet need [2][4] - The NDA is based on data from the MOVE-FA study and two long-term studies, showing significant evidence of slowing disease progression and demonstrating safety across all age groups [2][5] Company Overview - PTC Therapeutics is a global biopharmaceutical company focused on developing and commercializing medicines for rare disorders, with a robust and diversified pipeline [7] - The company has submitted four approval applications to the FDA in 2024, all of which have been accepted for review [3] Product Information - Vatiquinone is a first-in-class selective inhibitor of 15-Lipoxygenase, aimed at alleviating mitochondrial dysfunction and oxidative stress associated with Friedreich's ataxia [4] - The MOVE-FA trial enrolled 146 patients, primarily under 18 years, and while the primary endpoint was not statistically significant, a significant effect was observed on the upright stability subscale [5] Disease Context - Friedreich's ataxia is a rare, debilitating neuromuscular disorder affecting coordination and muscle strength, primarily caused by a genetic defect in the frataxin gene [6] - Approximately 25,000 individuals are affected by Friedreich's ataxia globally, with symptoms including poor balance, difficulty in speech and swallowing, and serious heart conditions [6]

Company Announcement - PTC Therapeutics, Inc. will host a webcast conference call on February 27, 2025, at 4:30 p.m. EST to report its fourth quarter and full year 2024 financial results and provide a business update [1] - The call can be accessed via phone registration, and participants are advised to join 15 minutes early to avoid delays [2] Company Overview - PTC Therapeutics is a global biopharmaceutical company focused on discovering, developing, and commercializing clinically differentiated medicines for rare disorders [3] - The company's innovative approach to identifying new therapies and global commercialization supports a robust and diversified pipeline of transformative medicines [3]

Core Insights - PTC has launched ServiceMax AI, a field service management assistant powered by generative artificial intelligence (GenAI) to enhance technician productivity and streamline service operations [1][2][6] - The new AI capabilities allow technicians to automate documentation, scheduling tasks, and receive proactive maintenance recommendations based on comprehensive asset history [1][6] Company Overview - PTC is a global software company headquartered in Boston, Massachusetts, with over 7,000 employees and more than 30,000 customers worldwide [4] - The company focuses on enabling manufacturers and product companies to digitally transform their design, manufacturing, and service processes [4] Technology and Features - ServiceMax AI utilizes extensive field service expertise and GenAI technology to modernize workflows and improve technician experiences [2][6] - The solution intelligently searches manuals, troubleshooting guides, and service history to provide answers to technician inquiries and recommend service resolutions [6]

Revenue Growth - ARR grew 7% (11% constant currency) to $2.21 billion as of the end of Q1'25 compared to Q1'24[89] - Revenue increased by 3% (2% constant currency) to $565 million in Q1'25 compared to Q1'24, driven by growth in support and cloud services revenue[91] - Total recurring revenue rose by 4% to $524.3 million in Q1'25 compared to Q1'24[94] - PLM ARR grew 8% (11% constant currency) from Q1'24 to Q1'25[106] - CAD ARR increased by 5% (9% constant currency) from Q1'24 to Q1'25[106] Cash Flow and Operating Activities - Cash provided by operating activities grew 27% to $238 million in Q1'25 compared to Q1'24[90] - Free cash flow increased by 29% to $236 million in Q1'25 compared to Q1'24[90] - Cash provided by operating activities increased by $51.1 million to $238.4 million in Q1'25 compared to $187.3 million in Q1'24, driven by higher collections and lower vendor disbursements[132] - Cash provided by operating activities rose to $238.4 million in Q4 2024, compared to $187.3 million in Q4 2023, marking an increase of 27.3%[151] - Free cash flow improved to $235.7 million in Q4 2024, up from $182.8 million in Q4 2023, representing a growth of 29.0%[151] Earnings and Profitability - Diluted earnings per share rose 23% to $0.68 in Q1'25 compared to $0.55 in Q1'24[91] - Income before income taxes increased by 9% to $93.2 million in Q1'25 compared to $85.6 million in Q1'24, while the provision for income taxes decreased by 43% to $10.9 million[121] - GAAP diluted earnings per share increased to $0.68 in Q4 2024 from $0.55 in Q4 2023, reflecting a growth of 23.6%[151] - Non-GAAP net income for Q4 2024 was $133.3 million, slightly up from $133.0 million in Q4 2023, indicating a stable performance[151] Expenses and Margins - Total operating expenses increased by 5% to $337.8 million in Q1'25 from $321.5 million in Q1'24, driven by a $20 million increase in compensation expenses and a $5 million increase in outside services[113][114] - Total gross margin increased by 3% to $453.3 million in Q1'25 compared to Q1'24[109] - Professional services revenue decreased by 12% to $31.4 million in Q1'25 compared to Q1'24[102] - Professional services gross margin decreased in Q1'25 compared to Q1'24, primarily due to higher compensation costs related to severance from go-to-market realignment[111] - Non-GAAP operating margin decreased to 33.9% in Q4 2024 from 36.2% in Q4 2023, showing a decline of 6.3%[152] Debt and Financing - Total debt decreased to $1,547.5 million as of December 31, 2024, from $1,752.6 million, with $524.9 million classified as current debt[135][136] - Interest expense decreased by 38% to $22.0 million in Q1'25 from $35.3 million in Q1'24 due to lower aggregate debt[117] - Cash used in financing activities in Q1'25 included $205.1 million in net payments on the credit facility and $75.0 million for common stock repurchases[134] Taxation - The effective income tax rate for Q1'25 was 12%, down from 22% in Q1'24, primarily due to changes in the geographic mix of income[121] Capital Expenditures - Capital expenditures for Q4 2024 were $(2.8) million, a decrease from $(4.6) million in Q4 2023, indicating improved capital efficiency[151] Market Risk - The company reported no significant changes in market risk exposure as per the 2024 Annual Report[153]

Core Viewpoint - PTC's shares declined by 8.8% following a disappointing first-quarter 2025 earnings report, but the underlying metrics suggest a potential buying opportunity [1] Group 1: Earnings Performance - Q1 earnings aligned with management's previous guidance, indicating that the earnings themselves were not the issue [2] - The updated full-year guidance raised concerns among investors, particularly due to the company's reorganization of its go-to-market strategy [2][3] Group 2: Full-Year Guidance Changes - PTC's full-year 2025 revenue guidance was revised down from $2,430 million to $2,530 million to a new range of $2,505 million to $2,605 million [4] - Non-GAAP earnings per share guidance was also lowered from $5.30 to $6 to a new range of $5.60 to $6.30 [4] - Annual run rate (ARR) growth and free cash flow guidance remained unchanged, indicating stability in these metrics [4] Group 3: Financial Metrics and Future Outlook - PTC emphasizes free cash flow (FCF) and annual run rate (ARR) as key indicators of progress, which remain on track for 2025 [5][6] - The company argues that traditional accounting standards complicate revenue and earnings forecasting, particularly for on-premise subscription sales [5] - Given the maintained guidance for FCF and ARR, there is potential for stock recovery in the future [6]

Core Insights - PTC Inc reported first-quarter fiscal 2025 non-GAAP EPS of $1.10, exceeding the Zacks Consensus Estimate by 20.9% and showing a slight decrease from $1.11 in the prior-year quarter [1] - Revenues reached $565 million, reflecting a 3% year-over-year increase, and surpassed the consensus estimate by 2.4%, driven by strong demand for PLM and CAD solutions [2] Financial Performance - Recurring revenues amounted to $524.3 million, up 3.6% year over year, while perpetual licenses increased by 11.4% to $9.4 million [4] - License revenues constituted 30.6% of total revenues at $172.8 million, down 6.1% year over year, whereas support and cloud services revenues (63.9%) rose 9.2% to $361 million [5] - PLM revenues were $353 million, up 1% year over year, and CAD revenues were $212 million, up 5% year over year [6] ARR and Growth Metrics - Annualized recurring revenues (ARR) reached $2.205 billion, a 7% increase year over year, with a constant currency ARR of $2.277 billion, up 11% [7] - In the fiscal first quarter, PLM and CAD ARR were $1,357 million and $848 million, rising 8% and 5% year over year, respectively [7] Operating Metrics - Non-GAAP gross margin remained stable at 82.7%, while total operating expenses increased by $17 million year over year to $338 million [8] - Operating income on a non-GAAP basis fell 4% year over year to $191 million, but operating margin improved by 240 basis points to 34% [8] Balance Sheet and Cash Flow - As of December 31, 2024, cash and cash equivalents were $196 million, down from $266 million as of September 30, 2024, while total debt decreased to $1.544 billion [10] - Cash provided by operating activities was $238 million, compared to $187 million in the prior-year quarter, and free cash flow increased to $236 million from $183 million [10] Financial Outlook - For the second quarter of fiscal 2025, PTC estimates revenues between $590 million and $620 million, with non-GAAP EPS projected in the range of $1.30 to $1.50 [11] - Full fiscal 2025 revenues are now projected between $2,430 million and $2,530 million, indicating a 6-10% year-over-year rise, with non-GAAP EPS estimated at $5.30 to $6.00 [12] - Cash from operations is expected to be between $850 million and $865 million, reflecting a 13% to 15% year-over-year increase [13]

Financial Data and Key Metrics Changes - For Q1 2025, the company's constant currency ARR was $2.277 billion, reflecting an 11% year-over-year increase [42] - Free cash flow for Q1 was $236 million, up 29% year-over-year, despite absorbing $11 million related to go-to-market realignment [43][46] - The company ended Q1 with cash and cash equivalents of $196 million and gross debt of $1.548 billion, maintaining a leverage ratio of 1.7 times [45][46] Business Line Data and Key Metrics Changes - Constant currency ARR growth was 9% in CAD, driven primarily by Creo, and 11% in PLM, primarily driven by Windchill, Codebeamer, IoT, and ServiceMax [44] - The ARR growth was 9% in the Americas and 12% in both Europe and Asia Pacific [44] Market Data and Key Metrics Changes - The company continues to experience a challenging selling environment, impacting close rates, but remains optimistic about future growth [42][41] - The macroeconomic environment is showing signs of improvement, with manufacturing PMI bouncing back above 50, which could positively influence sales [90] Company Strategy and Development Direction - The company is focused on a go-to-market transformation, emphasizing vertical alignment to capture long-term growth opportunities [9][12] - Key leadership changes have been made, including the appointment of a new Chief Revenue Officer to enhance sales performance and alignment across teams [10][11] - The company is concentrating on five core areas: PLM, ALM, SLM, CAD, and SaaS, to drive customer value [14] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about exiting fiscal 2025 with increased momentum, driven by product releases and AI initiatives [7][39] - The company expects to achieve low-double-digit ARR growth over the medium term, supported by a resilient subscription model and low churn rates [12][41] Other Important Information - The company is investing in AI capabilities across its product portfolio, with upcoming launches in ServiceMax and Codebeamer [22][25] - The company plans to return approximately 50% of free cash flow to shareholders through share repurchases, with a target of $300 million in fiscal 2025 [48] Q&A Session Summary Question: Comments on AI product organization and investment - The company is evolving its AI development efforts, with a focus on practical applications and alignment across product segments [72] Question: Competitive environment in PLM - The company is actively competing in the PLM space, focusing on the integration of Windchill and Codebeamer to enhance product development cycles [80] Question: Trajectory of net new ARR - The company anticipates a back-half loaded year, with expectations for improved performance in Q4 as go-to-market changes take effect [86][90] Question: Progress on go-to-market alignment - The company is pleased with the progress made in Q1 regarding go-to-market changes and is optimistic about future execution [125] Question: AI product launches across the portfolio - The company plans to expand AI capabilities beyond just Codebeamer and ServiceMax, with more developments expected across the entire product line [130]

Core Insights - PTC Inc. reported revenue of $565.13 million for the quarter ended December 2024, reflecting a year-over-year increase of 2.7% [1] - The company's EPS was $1.10, slightly down from $1.11 in the same quarter last year, but exceeded the consensus estimate of $0.91 by 20.88% [1] - The reported revenue surpassed the Zacks Consensus Estimate of $551.92 million, resulting in a surprise of 2.39% [1] Financial Performance Metrics - Annual Recurring Revenue (ARR) was reported at $2.21 billion, below the three-analyst average estimate of $2.28 billion [4] - Recurring Revenue reached $524.31 million, exceeding the four-analyst average estimate of $515.94 million, with a year-over-year increase of 3.6% [4] - Professional Services revenue was $31.41 million, slightly above the four-analyst average estimate of $31.14 million, but showed a year-over-year decline of 12.1% [4] - Perpetual License revenue was reported at $9.41 million, significantly above the four-analyst average estimate of $6.76 million, marking an 11.4% year-over-year increase [4] Stock Performance - PTC Inc. shares have returned 4.4% over the past month, outperforming the Zacks S&P 500 composite's 1.7% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [3]

PTC Inc. (PTC) came out with quarterly earnings of $1.10 per share, beating the Zacks Consensus Estimate of $0.91 per share. This compares to earnings of $1.11 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 20.88%. A quarter ago, it was expected that this product development software maker would post earnings of $1.43 per share when it actually produced earnings of $1.54, delivering a surprise of 7.69%.Over the last four quar ...

EX 99.1 PTC ANNOUNCES FIRST FISCAL QUARTER 2025 RESULTS First Fiscal Quarter 2025 Highlights Key operating and financial highlights are set forth below. The definitions of our operating and non-GAAP financial measures and reconciliations of non-GAAP financial measures to comparable GAAP measures are included below and in the reconciliation tables at the end of this press release. | $ in millions | Q1'25 | Q1'24 | YoY Change | Q1'25 Guidance | | --- | --- | --- | --- | --- | | ARR as reported | $2,205 | $2,0 ...