PTC · PTC Inc.

PTC Inc. delivered solid Q2 FY2026 results post-divestiture of Kepware and ThingWorx, with constant currency ARR excluding divested businesses growing 8.5% YoY to $2,388 million, meeting the company's guided range of 8% to 8.5%. Revenue surged 22% YoY to $774 million (15% constant currency), driven by subscription strength despite the divestiture impact, while operating margins expanded significantly to 38% GAAP (310 bps YoY) and 53% non-GAAP (600 bps YoY), reflecting disciplined cost management and go-to-market transformation. Non-GAAP EPS of $2.69 marked 50% YoY growth, underscoring operational leverage. GAAP EPS of $4.98 included a $463 million gain from the divestiture, offset by related expenses and taxes. CEO Neil Barua highlighted momentum in the Intelligent Product Lifecycle vision and rising AI interest, positioning PTC for durable multi-year growth as customers modernize product data foundations. CFO Jen DiRico affirmed commitment to FY’26 guidance and capital returns. Cash generation was robust, with operating and free cash flow up 14% YoY to $321 million and $318 million, enabling ~$625 million in Q2 share repurchases, including a $375 million accelerated agreement. The Board authorized a new $2.0 billion buyback through September 30, 2028, amending prior authorization, with FY’26 repurchases targeted at $1.225-$1.325 billion. FY’26 outlook remains unchanged at 7.5%-9.5% ARR growth, revenue $2,580-$2,820 million, and non-GAAP EPS $6.65-$8.90, incorporating divestiture effects like $40 million costs and $110 million cash taxes. Q3 guidance projects 8%-9% ARR growth and non-GAAP EPS $1.24-$1.78. These results and proactive capital allocation signal financial health and shareholder focus amid strategic AI investments.