PTC ANNOUNCES FOURTH FISCAL QUARTER AND FULL YEAR 2022 RESULTS

Free Cash Flow and Adjusted Free Cash Flow: PTC provides information on free cash flow and adjusted free cash flow to enable investors to assess our ability to generate cash without incurring additional external financings and to evaluate our performance against our announced long-term goals and intent to return approximately 50% of our free cash flow to shareholders via stock repurchases. Free cash flow is cash provided by (used in) operations net of capital expenditures.  Adjusted free cash flow is free cash flow net of restructuring payments, acquisition and transaction-related payments, and non-ordinary course tax-related payments or receipts. Free cash flow and adjusted free cash flow are not measures of cash available for discretionary expenditures.

Constant Currency (CC): We present CC information to provide a framework for assessing how our underlying business performed excluding the effects of foreign currency rate fluctuations. To present CC information, FY'22 and comparative prior period results for entities reporting in currencies other than United States dollars are converted into United States dollars using the foreign exchange rate as of September 30, 2021, rather than the actual exchange rates in effect during that period.  All discussion of FY'23 and comparative prior period ARR results (including FY'22 baseline amounts) are reflected using the foreign exchange rates as of September 30, 2022.

Operating Measures

ARR: We provide an ARR (Annual Run Rate) operating measure to help investors understand and assess the performance of our business as a SaaS and on-premises subscription company.  ARR represents the annualized value of our portfolio of active subscription software, cloud, SaaS, and support contracts as of the end of the reporting period. 

We believe ARR is a valuable operating metric to measure the health of a subscription business because it captures expected subscription and support cash generation from customers.

Organic Constant Currency ARR: We provide an organic constant currency ARR measure to help investors understand and assess the performance of our business without the effect of ARR (other than insignificant amounts) from acquisitions in the comparative period and foreign exchange rate fluctuations.

Because our ARR measures represent the annualized value of customer contracts as of a point in time, they do not represent revenue for any particular period or remaining revenue that will be recognized in future periods.

Churn: We provide churn measures to enable investors to understand and assess our customer contract retention.  Churn represents the difference between the ARR amount for all subscription software, cloud, SaaS, and support contracts ended within a reporting period and the annualized renewal transactions started within a reporting period, as of the end of the reporting period.

Forward-Looking Statements

Statements in this press release that are not historic facts, including statements about our future financial and growth expectations and targets, and potential stock repurchases, are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those projected. These risks include: the macroeconomic and/or global manufacturing climates may not improve when or as we expect, or may deteriorate, due to, among other factors, the effects of the COVID-19 pandemic, including supply chain disruptions, increasing interest rates and inflation, volatile foreign exchange rates and the current strength of the U.S. dollar, and the effects of the Russia/Ukraine conflict, including the effect on energy supplies to Europe,  which could cause customers to delay or reduce purchases of new software, reduce the number of subscriptions they carry, or delay payments to us, all of which would adversely affect ARR and our financial results, including cash flow; our businesses, including our SaaS businesses, may not expand and/or generate the revenue or ARR we expect if customers are slower to adopt our technologies than we expect or if they adopt competing technologies; our strategic initiatives and investments, including our accelerated investments in our transition to SaaS, may not deliver the results when or as we expect; we may be unable to generate sufficient operating cash flow to return 50% of free cash flow to shareholders, and other uses of cash or our credit facility limits or other matters could preclude such repurchases; and foreign exchange rates may differ materially from those we expect.  In addition, our assumptions concerning our future GAAP and non-GAAP effective income tax rates are based on estimates and other factors that could change, including the geographic mix of our revenue, expenses, and profits. Other risks and uncertainties that could cause actual results to differ materially from those projected are detailed from time to time in reports we file with the Securities and Exchange Commission, including our most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q.

About PTC (NASDAQ: PTC)

PTC enables global manufacturers to realize double-digit impact with software solutions that enable them to accelerate product and service innovation, improve operational efficiency, and increase workforce productivity. In combination with an extensive partner network, PTC provides customers flexibility in how its technology can be deployed to drive digital transformation – on premises, in the cloud, or via its pure SaaS platform. At PTC, we don't just imagine a better world, we enable it.

PTC.com       @PTC       Blogs

PTC Investor Relations Contact
Matt Shimao
SVP, Investor Relations
Email Contact
Email Contact

 

PTC Inc.


UNAUDITED CONSOLIDATED STATEMENTS OF INCOME


(in thousands, except per share data)















Three Months Ended



Twelve Months Ended



September
30,



September
30,



September
30,



September
30,



2022



2021



2022



2021














Revenue:












Recurring revenue

$

463,156



$

429,350



$

1,736,188



$

1,616,328


Perpetual license


7,854




10,369




34,065




33,013


Professional services


36,915




40,937




163,094




157,818


Total revenue (1)


507,925




480,656




1,933,347




1,807,159














Cost of revenue (2)


95,530




99,748




385,980




371,102














Gross margin


412,395




380,908




1,547,367




1,436,057














Operating expenses:












Sales and marketing (2)


119,038




129,464




485,247




517,779


Research and development (2)


88,183




78,403




338,822




299,917


General and administrative (2)


50,705




48,589




204,732




206,006


Amortization of acquired intangible assets


9,105




7,688




34,970




29,396


Restructuring and other charges (credits), net


(653)




1,627




36,234




2,211


Total operating expenses


266,378




265,771




1,100,005




1,055,309














Operating income


146,017




115,137




447,362




380,748


Other income (expense), net


(8,639)




54,385




(50,264)




11,007


Income before income taxes


137,378




169,522




397,098




391,755


Provision (benefit) for income taxes


30,541




(123,421)




84,017




(85,168)


Net income

$

106,837



$

292,943



$

313,081



$

476,923














Earnings per share:












Basic

$

0.91



$

2.50



$

2.67



$

4.08


Weighted average shares outstanding


117,431




117,230




117,194




116,836














Diluted

$

0.90



$

2.46



$

2.65



$

4.03


Weighted average shares outstanding


118,634




118,921




118,233




118,367


























(1) See supplemental financial data for revenue by license, support, and professional services.


(2) See supplemental financial data for additional information about stock-based compensation.



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