1. PTC reported Q2'25 revenue growth of 6% YoY. 2. Annual recurring revenue (ARR) increased by 10% YoY. 3. Free cash flow rose 13% year-over-year, underscoring financial health. 4. Adjusted FY'25 guidance reflects macroeconomic uncertainties. 5. Stock repurchase strategy continues with $75M planned for Q3.
Solid revenue and ARR growth indicate strong operational performance, likely boosting investor confidence. Past cases, like Q1'24, where strong earnings led to stock price increases, suggest a pattern.
Strong revenue, ARR growth, and free cash flow highlight PTC's stability and growth potential, crucial in the software market.
Immediate positive reactions from financial results typically manifest in the days following release. Previous earnings reports resulted in stock price upticks within the same quarter.
"Q2 was a solid quarter for us, and I remain extremely optimistic about our position as an enabler of the digital economy – particularly our position as a supplier of software tools that make our customers more efficient as they design, manufacture, and service their products," said Neil Barua, President and CEO, PTC.
"While the current macroeconomic uncertainty makes it challenging for us to predict precisely how our customers will react, PTC is in a better position today to meet our customers' demand than ever before. I am confident that PTC can help our customers navigate this period by accelerating their continued transition into the digital age," concluded Barua.
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 | Q2'25 | Q2'24 | YoY Change | Q2'25 Guidance |
|---|---|---|---|---|
| ARR as reported | $2,290 | $2,088 | 10 % | - |
| Operating cash flow | $281 | $251 | 12 % | ~$274 |
| Free cash flow | $279 | $247 | 13 % | ~$270 |
| Revenue | $636 | $603 | 6% | $590 to $620 |
| Earnings per share | $1.35 | $0.95 | 42 % | $0.79 to $1.05 |
"In Q2'25, the selling environment remained challenging. Given this backdrop, our ARR was solid, growing 10% year over year. Our Q2'25 cash flow was also solid, with operating cash flow growing 12% year over year and free cash flow growing 13% year over year, driven by our ARR growth, subscription business model, and diligent financial management,” said Kristian Talvitie, CFO.
| $ in millions; % rounded to the nearest half | FY'25 Previous Guidance | FY'25 Guidance | FY'25 YoY Growth Guidance | Q3'25 Guidance |
|---|---|---|---|---|
| Operating cash flow | $850 to $865 | $855 to $865 | 14% to 15% | $234 to $239 |
| Free cash flow | $835 to $850 | $840 to $850 | 14% to 16% | $230 to $235 |
| Revenue | $2,430 to $2,530 | $2,445 to $2,565 | 6% to 12% | $560 to $600 |
PTC (NASDAQ: PTC) is a global software company that enables industrial and manufacturing companies to digitally transform how they engineer, manufacture, and service the physical products that the world relies on. Headquartered in Boston, Massachusetts, PTC employs over 7,000 people and supports more than 30,000 customers globally. For more information, please visit www.ptc.com.
PTC Investor Relations Contact:
Matt Shimao
SVP, Investor Relations
[email protected]