Key Takeaways PTC partners with Lamborghini to unify CAD, PLM and ALM, modernizing product development.PTC tools like Windchill, Codebeamer and Creo improve traceability, collaboration and speed.PTC plans to showcase its Intelligent Product Lifecycle with AI features at CES 2026.PTC Inc. (PTC) recently announced that Automobili Lamborghini S.p.A. is leveraging its Intelligent Product Lifecycle solutions to modernize product development by unifying design, engineering and operations on a centralized, AI-driv ...

Core Insights - Jennifer DiRico has been appointed as the new Chief Financial Officer of PTC, effective January 1, 2026, succeeding Kristian Talvitie [1][2][3] - DiRico brings extensive experience from her previous roles, including CFO at Commvault and leadership positions at Toast, where she contributed to the company's IPO and global expansion [2][4] - PTC's President and CEO Neil Barua expressed confidence in DiRico's ability to lead the finance organization and support the company's growth strategy [3] Company Overview - PTC is a global software company focused on enabling manufacturers and product companies to digitally transform their design, manufacturing, and service processes [7] - The company is headquartered in Boston, Massachusetts, employs over 7,000 people, and serves more than 30,000 customers worldwide [7] Leadership Transition - DiRico's appointment follows a thorough executive search process, and she will report directly to the CEO [1][3] - Kristian Talvitie will continue to serve as CFO until the end of 2025, during which he will assist in the transition [1][3] Strategic Vision - DiRico aims to help PTC capture growth opportunities while maintaining strong financial discipline [3] - The company is focused on advancing its Intelligent Product Lifecycle vision, which is critical for addressing customer challenges and driving shareholder value [3]

Core Insights - PTC has expanded its partnership with Garrett Motion to include the adoption of Codebeamer+ ALM and Windchill+ PLM solutions, enhancing Garrett's product development tools and practices [1][6] - The integration of these solutions aims to unify engineering disciplines and improve collaboration across global teams, supporting Garrett's SaaS-driven transformation [3][4] Company Overview - Garrett Motion is a leader in differentiated technology for emission reduction and energy efficiency in the automotive sector, with a 70-year history of innovation [4] - The company focuses on developing technologies for Zero Emission Vehicles, including fuel cell compressors and electric propulsion systems, and operates six R&D centers and 13 manufacturing sites globally [4] Technology and Innovation - The successful implementation of PTC's Onshape platform has democratized access to CAD data and improved collaboration among cross-functional teams at Garrett [3] - The adoption of Codebeamer+ and Windchill+ is expected to enhance data access to software and hardware requirements, bills of material, and product configurations, aligning with PTC's Intelligent Product Lifecycle vision [3][6] Strategic Goals - The partnership aims to create an AI-ready architecture that will advance Garrett's differentiated technologies in the automotive industry [2] - PTC's vision includes deep integrations between CAD, PLM, and ALM to transform engineering processes and build a robust product data foundation necessary for AI adoption [4]

Core Insights - PTC Inc reported a significant increase in non-GAAP EPS of $3.47 for Q4 fiscal 2025, marking a 126% year-over-year growth and surpassing the Zacks Consensus Estimate by 63% [1][9] - The company's revenues reached $894 million, reflecting a 43% year-over-year increase, and exceeded the consensus estimate by 20.2% [2][9] - PTC's fiscal 2025 revenues totaled $2.7 billion, a 19% increase from the previous year, with a strategic divestiture of Kepware and ThingWorx to sharpen focus on core areas [2][3] Revenue Breakdown - Recurring revenues amounted to $861 million, up 47.8% year over year, while perpetual licenses decreased by 15.9% to $8.4 million [4] - License revenues constituted 54.2% of total revenues at $484.1 million, a 102.2% increase from the prior year, while support and cloud services revenues rose 9.2% to $385.4 million [5] - PLM revenues were $588 million, increasing 44% year over year, and CAD revenues reached $306 million, up 40% [6] ARR and Operating Performance - Annualized recurring revenues (ARR) grew to $2.5 billion, a 10% increase year over year, with strong performance across all divisions [7] - Total operating expenses were $343.3 million, compared to $319.7 million in the prior-year quarter, while operating income on a non-GAAP basis rose to $526.3 million [8][10] Balance Sheet and Cash Flow - As of September 30, 2025, cash and cash equivalents were $184 million, down from $266 million a year earlier, while total debt decreased to $1.2 billion [11] - Cash provided by operating activities was $104 million, and free cash flow was $100 million, both showing improvements from the previous year [11] Share Repurchase and Guidance - PTC has a $2 billion share repurchase authorization and plans to execute $200 million in buybacks in Q1 fiscal 2026, indicating confidence in long-term growth [12] - For fiscal 2026, PTC projects revenues between $2.65 billion and $2.9 billion, with non-GAAP EPS estimated between $6.49 and $8.95 [14][15]

Financial Performance & Guidance - Q4'25 ARR as reported reached $2478 million, a 10% YoY increase[22] - FY'25 Free Cash Flow was $857 million, a 16% YoY increase[23] - FY'26 Free Cash Flow guidance is approximately $1000 million[19,29] - FY'26 constant currency ARR growth guidance, excluding Kepware and ThingWorx, is 75% to 95%[16,29] - Q1'26 Free Cash Flow guidance is $265 million to $270 million[29] Kepware and ThingWorx Divestiture - The divestiture involves Kepware industrial connectivity and ThingWorx IoT businesses[9] - Estimated net transaction proceeds from the divestiture are approximately $365 million[12,14] - Kepware and ThingWorx contribute approximately $160 million of ARR and $200 million of revenue[15] - Kepware and ThingWorx contribute an estimated $70 million of free cash flow[17] Capital Allocation - The company intends to repurchase between $150 million and $250 million of its common stock per quarter in FY'26[40,80]

Core Insights - TPG has reached a definitive agreement to acquire PTC's Kepware and ThingWorx businesses, aiming to enhance their growth and leadership in industrial connectivity and IoT solutions [1][2][7] - The transaction is expected to close in the first half of 2026, pending regulatory approvals and other conditions [4] Company Focus - PTC is shifting its focus towards its Intelligent Product Lifecycle vision, concentrating resources on core offerings such as CAD, PLM, ALM, and SLM, while leveraging AI and SaaS technologies [3][7] - The sale of Kepware and ThingWorx will allow PTC to better address customer challenges by optimizing product data utilization throughout the product lifecycle [3][7] Investment and Growth Potential - TPG plans to invest in the acquired businesses through its U.S. and European private equity platform, providing additional capital and expertise to accelerate growth [2][3] - The acquisition is seen as a generational opportunity to enhance manufacturing processes by bridging operational and information technology [3][7] Business Operations - Kepware serves as a communication platform that facilitates data exchange across various industries, including manufacturing and utilities, while ThingWorx is an IoT platform that enables remote device management and data analysis [3][7] - The partnership with TPG is expected to support the scaling and evolution of these software platforms to meet the changing needs of customers [3][7]

Core Insights - PTC reported strong financial results for Q4 and FY'25, highlighting a strategic focus on its core offerings and a simplified portfolio following the divestiture of Kepware and ThingWorx [2][4][7] - The company achieved record annual cash flow and significant growth in revenue and earnings per share, indicating robust operational execution [2][4][8] Financial Performance - Q4'25 revenue reached $894 million, a 43% increase year-over-year, with constant currency revenue growth of 39% [2][3] - Annual recurring revenue (ARR) was reported at $2.478 billion, reflecting a 10% increase from the previous year, with constant currency ARR growth of 8.5% [2][4] - Operating cash flow for FY'25 was $868 million, a 16% increase year-over-year, while free cash flow also grew by 16% to $857 million [4][8] Earnings Metrics - Earnings per share (EPS) for Q4'25 was $2.94, up 182% from $1.04 in Q4'24, with non-GAAP EPS at $3.47, a 126% increase [2][4] - For FY'25, GAAP EPS was $6.14, compared to $3.12 in FY'24, indicating a 97% increase, while non-GAAP EPS rose to $8.00 from $5.08 [5][6] Strategic Focus - The divestiture of non-core businesses is expected to enhance PTC's focus on its Intelligent Product Lifecycle vision, which includes CAD, PLM, ALM, and SLM [2][4][7] - The company plans to increase share repurchases under a $2 billion authorization, with approximately $200 million expected in Q1'26 [4][8] Future Guidance - For FY'26, PTC anticipates constant currency ARR growth of 7% to 9%, operating cash flow of approximately $1.03 billion, and free cash flow of around $1 billion [4][8] - Revenue guidance for FY'26 is set between $2.650 billion and $2.915 billion, reflecting a potential year-over-year change of -3% to 6% [8][9]

Summary of PTC Conference Call Company Overview - **Company**: PTC (Parametric Technology Corporation) - **Industry**: Software, specifically focusing on product lifecycle management (PLM) and computer-aided design (CAD) solutions - **Key Products**: Windchill (PLM), Creo (CAD), CodeBeamer (Application Lifecycle Management), Onshape (cloud-based CAD), ServiceMax Core Insights and Arguments 1. **Customer Engagement**: The CEO, Neil Barua, emphasized the importance of engaging with customers globally to understand their needs and challenges, particularly the demand for faster product development amidst increasing complexity in business environments [5][10][45] 2. **Strategic Positioning**: PTC is positioned as a critical player in the software vertical, with a strong relationship with customers built over 40 years, which is essential for their product development processes [10][11] 3. **Go-to-Market Transformation**: The company is undergoing a transformation in its go-to-market strategy, focusing on verticalization to enhance customer engagement and increase market share [12][13] 4. **Financial Guidance**: PTC adjusted its full-year growth targets to the high single digits, reflecting a stable macro environment and improved execution in Q3 [15][19] 5. **Product Lifecycle Management**: Windchill is highlighted as a flagship product with significant growth potential, particularly as companies seek to integrate software and hardware development processes [29][30] 6. **AI Integration**: PTC is embedding AI into its solutions, enhancing product capabilities and improving operational efficiency [37][39] 7. **ServiceMax Performance**: The ServiceMax segment faced challenges but is expected to align better with PTC's offerings, creating opportunities for growth [48][50] Additional Important Points 1. **Market Dynamics**: The company noted that while the macro environment remains challenging, it has not worsened, allowing for a more stable outlook [19][20] 2. **Customer Sentiment**: There is a sense of urgency among customers to invest in digital transformation, which PTC is well-positioned to support [45][46] 3. **M&A Strategy**: PTC is focused on tuck-in acquisitions that enhance its product data foundation and align with its strategic vision [62][63] 4. **Cash Flow Management**: PTC operates on a cash basis, providing visibility into cash inflows and outflows, which supports its financial stability [55][58] 5. **Internal AI Utilization**: The company is leveraging AI internally to improve customer support and R&D processes, leading to productivity gains [59][60] This summary encapsulates the key points discussed during the PTC conference call, highlighting the company's strategic direction, product focus, and market positioning.