Barua said PTC is in a “turning the corner” phase of a broader transformation, citing what he characterized as momentum across product, go-to-market, and customer engagement. He highlighted five indicators:Management also reiterated that the divestiture of Kepware and ThingWorx is progressing and remains on track to close on or before April 1, with no material changes to figures previously provided.On the company’s fiscal first-quarter earnings call, CEO Neil Barua said PTC grew constant-currency ARR 9% yea ...

PTC (NasdaqGS:PTC) Q1 2026 Earnings call February 04, 2026 05:00 PM ET Company ParticipantsJennifer DiRico - CFOMatt Shimao - Head of Investor RelationsNeil Barua - CEORobert Dahdah - Chief Revenue OfficerConference Call ParticipantsAdam Borg - AnalystBlair Abernethy - AnalystDaniel Jester - AnalystJason Celino - AnalystJay Vleeschhouwer - AnalystJoe Vruwink - AnalystJoshua Tilton - AnalystKen Wong - AnalystMatt Hedberg - AnalystNay Soe Naing - AnalystSiti Panigrahi - AnalystTyler Radke - AnalystYun Kim - A ...

PTC (NasdaqGS:PTC) Q1 2026 Earnings call February 04, 2026 05:00 PM ET Company ParticipantsJennifer DiRico - CFOMatt Shimao - Head of Investor RelationsNeil Barua - CEORobert Dahdah - Chief Revenue OfficerConference Call ParticipantsAdam Borg - AnalystBlair Abernethy - AnalystDaniel Jester - AnalystJason Celino - AnalystJay Vleeschhouwer - AnalystJoe Vruwink - AnalystJoshua Tilton - AnalystKen Wong - AnalystMatt Hedberg - AnalystNay Soe Naing - AnalystSiti Panigrahi - AnalystTyler Radke - AnalystYun Kim - A ...

Financial Data and Key Metrics Changes - The company reported a constant currency ARR of $2.341 billion, up 9% year-over-year excluding Kepware and ThingWorx, and $2.5 billion, up 8.4% including them [15][4] - Free cash flow grew 13% year-over-year, reaching $267 million, which included $10 million of divestiture costs related to Kepware and ThingWorx [15][4] - The company repurchased $200 million of common stock in Q1 under a $2 billion share repurchase authorization, with plans to repurchase approximately $250 million in Q2 [16][15] Business Line Data and Key Metrics Changes - The company is experiencing strong demand for its Intelligent Product Lifecycle vision, with record deferred ARR under contract and increased seller productivity [10][11] - The divestiture of Kepware and ThingWorx is progressing, with a target close date on or before April 1 [15][4] - The company is embedding AI across its product portfolio, with new functionalities introduced in Codebeamer and Windchill [8][9] Market Data and Key Metrics Changes - The company noted that customers are increasingly seeking AI embedded directly into their trusted systems of record, which is a key differentiator in the market [8][9] - The demand capture has been strong, with a record-setting Q1 for large deal volume and competitive displacements [10][11] Company Strategy and Development Direction - The company is focused on transforming its product lifecycle management through connected systems, enterprise-wide cloud access, and AI integration [6][7] - The strategy emphasizes the importance of leveraging product data to drive better decisions across engineering, manufacturing, and service [6][7] - The company aims to build a more durable, multi-year growth engine through its transformation initiatives [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the transformation and the demand being captured, highlighting the importance of modernizing product development environments [4][12] - The company anticipates a significant increase in deferred ARR starting in Q4 2026, which is expected to positively impact future growth [19][20] - Management acknowledged the challenges of the macroeconomic environment but noted strong demand across various verticals and regions [88][90] Other Important Information - The company raised its fiscal 2026 revenue guidance to a range of $2.675 billion to $2.940 billion and non-GAAP EPS guidance to $6.69 to $9.15 [21][20] - The company expects to return additional capital to shareholders following the divestiture, with net after-tax proceeds expected to be approximately $365 million [16][20] Q&A Session Summary Question: What level of visibility do you have on deferred ARR deals for Q4? - Management indicated that the deferred ARR is triple what was present last Q4, with strong demand capture contributing to this increase [25][62] Question: Are we starting to see more material AI capabilities that could impact demand decisions? - Management confirmed that AI capabilities are being embedded into core products, and while the immediate economic impact is immaterial, it is expected to grow as deployments scale [31][32] Question: Can you parse out the growth mix from expansion versus competitive displacement? - Management noted that the majority of growth is still from expansion, but competitive displacement is also increasing as customers consolidate their systems [39][41] Question: What is the outlook for SaaS demand and customer spending? - Management reported strong momentum for SaaS products, particularly Windchill Plus and Creo Plus, with customers increasingly opting for cloud solutions [50][52] Question: How is the company addressing churn in ServiceMax? - Management acknowledged residual churn but highlighted strong demand capture and cross-sell opportunities as positive indicators for ServiceMax's future [76][78]

Strategic focus on Intelligent Product Lifecycle vision Solid execution in Q1'26 Constant currency ARR growth of 8.4%; 9.0% excluding Kepware and ThingWorx Operating and free cash flow growth of 13% Embedding AI across portfolio and building common AI infrastructure to drive customer adoption and value Executing on our $2 billion share repurchase authorization: $200 million of repurchases in Q1'26; expect to use net after-tax proceeds from the Kepware and ThingWorx divestiture for incremental repurchase ...

Core Insights - PTC Inc. has been selected by Reditus Space to provide its cloud-native Onshape CAD and PDM platform for the development of reusable spacecraft and related hardware [1][11] Group 1: Reditus Space and Its Mission - Reditus Space is preparing to launch its first reusable satellite, ENOS Mk1, scheduled for July 2026 aboard a SpaceX Falcon 9 rideshare mission [2] - The ENOS Mk1 mission aims to deploy a reusable spacecraft into low Earth orbit, host commercial payloads, remain in orbit for approximately eight weeks, and return safely to Earth for recovery and reuse [2] Group 2: PTC's Role and Technology - Reditus Space was introduced to PTC through the Onshape Startup Program and utilized the platform to transition from early concepts to flight-ready designs [3] - PTC's cloud-native tools provide a strategic advantage by enabling secure collaboration, rapid iteration, and regulatory compliance within a single platform [4] - As demand for aerospace and defense solutions grows, platforms like Onshape are becoming critical for both emerging space companies and established defense contractors [5] Group 3: PTC's Business Outlook - For fiscal 2026, PTC projects revenues between $2.65 billion and $2.9 billion, reflecting a year-over-year change of -3% to -6% [9] - The company targets 7% to 9% ARR growth for fiscal 2026 and anticipates generating $1 billion in free cash flow, supported by strong deferred ARR and a capital return program to buy back $150 million to $250 million of stock per quarter [9] - PTC's fiscal 2026 outlook indicates ongoing double-digit cash flow growth and solid visibility as multi-year ramp contracts begin [9] Group 4: Competitive Positioning - PTC's solutions enhance operational efficiency, accelerate product and service innovation, and boost workforce productivity across industrial enterprises [8] - The company's major technology platforms, including Creo, Windchill, ThingWorx, and Vuforia Studio, are expected to drive revenue growth [8]

Core Insights - PTC's cloud-native Onshape platform has been selected by Reditus Space to support the development of reusable spacecraft and related hardware [1][3] - Reditus Space is preparing for its first orbital mission, ENOS Mk1, scheduled to launch in July 2026, utilizing SpaceX's Falcon 9 [2][3] - The transition to Onshape Government allows Reditus to meet ITAR and EAR compliance while maintaining rapid development [3][4] Company Overview - Reditus Space is focused on creating the world's first reusable satellites to enhance orbital return efficiency, headquartered in Atlanta, GA [7] - PTC is a global software company that aids manufacturers in digitally transforming their design, manufacturing, and service processes, employing over 7,000 people and serving more than 30,000 customers worldwide [8][9] Technology and Innovation - Onshape enables rapid movement from concept to launch-ready designs, providing professional-grade CAD and PDM tools without the burden of license management [4] - The platform supports secure collaboration, rapid iteration, and regulatory compliance, which are critical for aerospace and defense sectors facing high demand and innovation pressure [4][5] - PTC's vision for the Intelligent Product Lifecycle emphasizes building a product data foundation that accelerates AI-driven transformation and enhances product quality and compliance [5]

Core Insights - PTC Inc. is enhancing its Application Lifecycle Management (ALM) portfolio to address rising software complexity and regulatory challenges with the launch of Codebeamer 3.2, Codebeamer AI 1.0, and Pure Variants 7.2, targeting highly regulated industries such as automotive and aerospace [1][9] Group 1: Product Enhancements - The new releases focus on three core priorities: stronger traceability, improved change management, and governed AI assistance aligned with regulatory standards [1] - Codebeamer 3.2 and Pure Variants 7.2 introduce Stream Baselines, allowing teams to capture complete snapshots of projects, facilitating faster identification of project states and simplifying impact analysis [3] - Pure Variants 7.2 includes Feature-Based PLE enhancements that automate stream and baseline creation, supporting concurrent development across platforms [4] Group 2: AI Integration - Codebeamer AI 1.0 introduces two AI assistants designed for regulated environments, improving requirements quality by identifying ambiguities and inconsistencies [5] - The Test Case Assistant in Codebeamer AI generates test cases directly from requirements, enhancing traceability and speeding up validation processes [6] Group 3: Strategic Moves - PTC's divestiture of Kepware and ThingWorx aims to sharpen its portfolio around core strengths in CAD, PLM, ALM, and SLM, simplifying its product strategy [8] - The company's go-to-market realignment is intended to enhance customer value and capture new opportunities in a competitive market [10] Group 4: Market Position - PTC has experienced a decline of 16.1% in stock price over the past six months, compared to a 13.1% decline in the Zacks Computer-Software industry [12]

Core Insights - PTC has announced updates to its application lifecycle management (ALM) portfolio, including Codebeamer® 3.2, Codebeamer AI 1.0, and Pure Variants™ 7.2, aimed at helping organizations manage product complexity and regulatory demands more effectively [1][6] Product Enhancements - Codebeamer 3.2 and Pure Variants 7.2 introduce new features that enhance traceability, change management, and visibility across the product lifecycle, reinforcing PTC's ALM suite as a leading system for software development in regulated industries [1][6] - Codebeamer AI 1.0 introduces two AI assistants: the Requirements Assistant and the Test Case Assistant, which automate the detection of requirement quality issues and the generation of test cases, respectively, thereby improving accuracy and reducing manual effort [4][5] Strategic Vision - PTC's updates align with its vision for the Intelligent Product Lifecycle, which aims to build a robust product data foundation in engineering and extend its value across the enterprise, facilitating AI-driven transformation [5][6] - The integration of digital thread capabilities with PTC's Windchill® PLM solution enhances interoperability and compliance management across software and hardware development, reducing manual work and accelerating delivery [7] User Experience Improvements - New UI upgrades to the Review Hub allow for bulk approvals and clearer notifications, streamlining the review process and reducing errors [7] - Feature-Based Product Line Engineering (PLE) automates the creation of streams and stream baselines, supporting concurrent development and optimizing reuse across product lines [7]

Core Insights - PTC Inc. is collaborating with Automobili Lamborghini to modernize product development through its Intelligent Product Lifecycle solutions, emphasizing digital innovation for future challenges [1][10] Group 1: Collaboration and Tools - Lamborghini is adopting PTC's Windchill PLM and Codebeamer ALM solutions to enhance product data traceability, streamline engineering change management, and improve team collaboration [2] - PTC's Creo CAD software is utilized by Lamborghini for designing complex engines, which helps accelerate development cycles while maintaining high standards of craftsmanship and performance [3] Group 2: AI Integration and Demonstration - PTC plans to showcase its Intelligent Product Lifecycle at CES 2026, featuring AI-enhanced tools like Codebeamer AI, Windchill AI, and ServiceMax AI to demonstrate the full lifecycle of product development [4][10] Group 3: Strategic Focus and Financial Outlook - PTC is divesting Kepware and ThingWorx to concentrate on an AI-driven Intelligent Product Lifecycle, with positive feedback and early operational gains already noted [7] - The company targets 7%-9% ARR growth for fiscal 2026 and aims for $1 billion in free cash flow, supported by strong deferred ARR and a stock buyback program of $150-$250 million per quarter [8]