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PTC · PTC

26 filings

10-K

PTC 10-K Annual Reports

PTC - 26 annual reports

Filing record · 2016–202610-K1010-Q338-K130

2025
PTC Annual Report, Year Ended Sep 30, 2025
PTC Inc. reported fiscal 2025 (year ended September 30, 2025) as a strong year on its subscription model, with 95% of 2025 revenue recurring in nature. ARR grew 10% (8.5% constant currency) to $2.48 billion, total revenue grew 19% to $2.74 billion, and diluted earnings per share rose 95% to $6.08. Operating income was $982.4 million versus $588.1 million in fiscal 2024, and net income was $734.0 million. Cash provided by operating activities was $868 million and free cash flow was $857 million, both up 16%. The filing notes that revenue and margins can swing under ASC 606 because on-premises subscription license revenue is recognized up front, so reported results may not track ARR or cash flow period to period. The company's balance sheet and capital allocation were active during the year. Total debt was $1.20 billion at September 30, 2025, down from $1.75 billion, after the 2025 senior notes were redeemed and net debt repayments of $553 million were made. PTC repurchased $300 million of stock in fiscal 2025 under a $2 billion authorization running through September 30, 2027, and expects to repurchase roughly $150 to $250 million per quarter in fiscal 2026. On November 5, 2025, PTC agreed to sell its Kepware and ThingWorx businesses to an affiliate of TPG for up to $725 million, including up to $600 million at closing, with the transaction expected to close in the first half of calendar 2026. The filing also discloses an unrecognized tax benefit of $109 million tied to an IRS consent received in October 2025, which will be released in the first quarter of fiscal 2026. The auditor, PricewaterhouseCoopers LLP, issued an unqualified opinion on the financial statements and on internal control over financial reporting as of September 30, 2025. Legal proceedings are described as immaterial, and the filing reports no material weaknesses.
Nov 21, 2025
2024
PTC Annual Report, Year Ended Sep 30, 2024
PTC Inc. reported fiscal 2024 (year ended September 30, 2024) revenue of $2.30 billion, up 10% (9% in constant currency) from $2.10 billion in fiscal 2023, with software revenue of $2.17 billion and professional services of $132.2 million. Annual Run Rate (ARR), the company's key operating measure, grew 14% (12% constant currency) to $2.25 billion. The company states that 93% of 2024 revenue was recurring in nature, reflecting its subscription model. Growth was helped by the ServiceMax acquisition in early fiscal Q2 2023, and the company also acquired pure-systems for $93.5 million in October 2023. Profitability improved meaningfully. GAAP operating income rose 28% to $588.1 million, with operating margin of 25.6% versus 21.9% a year earlier. GAAP diluted EPS was $3.12, compared with $2.06, and non-GAAP diluted EPS was $5.08, compared with $4.34. Cash provided by operating activities increased 23% to $750.0 million, and free cash flow reached $735.6 million. The effective tax rate fell to 20% from 26%, aided by a $14.4 million foreign tax credit benefit from a U.S. Tax Court ruling. The balance sheet carries significant leverage. Gross debt was $1.75 billion at year-end, with a weighted average interest rate of 5.1%, against cash of $266 million. The company must redeem its $500 million 3.625% Senior Notes due February 2025, and it expects to repurchase approximately $300 million of stock in fiscal 2025 under a $2 billion authorization covering October 2024 through September 2027.
Nov 14, 2024
2023
PTC Annual Report, Year Ended Sep 30, 2023
PTC Inc. reported fiscal 2023 (year ended September 30, 2023) total revenue of $2.10 billion, up 8% from $1.93 billion in fiscal 2022 (12% in constant currency). Growth was driven mainly by the ServiceMax and Codebeamer acquisitions. Annual Run Rate (ARR) grew 26% to $1.98 billion, and organic ARR, excluding ServiceMax, grew 15% to $1.81 billion. Net income fell to $245.5 million, or $2.06 diluted EPS, from $313.1 million and $2.65 a year earlier. Non-GAAP diluted EPS was $4.34, versus $4.58 in fiscal 2022. Operating income rose 2% to $458.5 million, and operating margin was 21.9% versus 23.1%. Cash flow from operations was $610.9 million, up from $435.3 million, and free cash flow was $587.0 million, up from $415.8 million. The company reports over 90% of annual revenues as recurring. Cash and cash equivalents ended at $288.1 million. Gross debt was $1.70 billion at a weighted average rate of 5.2%, and interest expense rose to $129.4 million from $54.3 million, reflecting ServiceMax-related borrowings. The filing notes a $620 million deferred ServiceMax payment liability, and a $650 million installment was paid in October 2023 using a revolver draw. In October 2023 the company also acquired pure-systems GmbH for approximately $98 million. The filing describes significant risks, including cybersecurity exposure, reliance on third-party cloud providers, increased leverage, and an uncertain tax position charge of $21.8 million related to transfer pricing in a foreign jurisdiction. Management's internal control assessment concluded that controls were effective, with ServiceMax excluded from that assessment.
Nov 20, 2023
2022
PTC Annual Report, Year Ended Sep 30, 2022
PTC Inc. reported fiscal 2022 (year ended September 30, 2022) revenue of $1.93 billion, up 7% from $1.81 billion in FY'21 (11% in constant currency). Operating income rose to $447.4 million from $380.7 million, and diluted EPS was $2.65 versus $4.03 in FY'21, which included a $68.8 million gain on an equity investment. Non-GAAP diluted EPS was $4.58, up from $3.97. Annual Recurring Revenue (ARR) reached $1,572.0 million, up 7% (16% constant currency). Operating cash flow was $435.3 million and free cash flow was $415.8 million, up from $344.1 million the prior year. The company acquired the Codebeamer application lifecycle management business from Intland Software for a purchase price of $278.1 million net of cash acquired, and sold a portion of its PLM services business to ITC Infotech for approximately $60.4 million in total consideration. Total debt was $1.36 billion at September 30, 2022, including $1 billion of senior notes due 2025 and 2028 and $359 million drawn on the credit facility. Management stated a long-term goal of returning about 50% of free cash flow to shareholders through share repurchases, and repurchased $125 million of stock in FY'22. A $1 billion repurchase authorization runs through September 30, 2023. The company also reported a restructuring plan initiated in Q1 2022 that resulted in $33.1 million of charges, mainly for termination benefits for about 330 employees, and total headcount fell 3% to 6,503. Management identified its transition to SaaS as a major execution risk, and the filing notes that the Creo CAD product line declined 1% in software revenue, driven by currency headwinds in Europe.
Nov 15, 2022
2021
PTC Annual Report, Year Ended Sep 30, 2021
PTC Inc. reported fiscal 2021 (year ended September 30, 2021) as a year of strong top-line and profit growth. Total revenue was $1.81 billion, up 24% from $1.46 billion in FY'20 (20% in constant currency). ARR increased 16% to $1,474.7 million, and the company cited its fourth consecutive year of double-digit ARR growth. Operating income rose to $380.7 million from $210.9 million, operating margin reached 21.1% versus 14.5%, and diluted EPS more than doubled to $4.03. GAAP results were boosted by a $69 million gain on its Matterport, Inc. equity stake and a $137.4 million valuation allowance release on U.S. deferred tax assets. Non-GAAP operating margin was 35.1%, and non-GAAP diluted EPS was $3.97. Cash generation improved substantially, with operating cash flow of $368.8 million (up 58%) and free cash flow of $344.1 million (up 61%). The company spent $718 million on acquisitions, primarily Arena, funded partly by $600 million borrowed under its credit facility. Total debt was $1.45 billion at September 30, 2021, versus $1.018 billion a year earlier, and cash and cash equivalents were $326.5 million. Management stated it expects to return about 25% of estimated free cash flow excluding restructuring payments (about $450 million) to shareholders through buybacks in FY'22. Looking forward, PTC is shifting toward a SaaS model and committed in November 2021 to a workforce reorganization and facility consolidation, with a charge and cash payments of approximately $45 million to $50 million expected in 2022. Management noted that professional services revenue is expected to trend flat-to-down over time and that a higher share of sales will shift to ratably recognized cloud services, which may affect the timing of revenue recognition.
Nov 22, 2021
2020
PTC Annual Report, Year Ended Sep 30, 2020
PTC Inc. (Nasdaq: PTC) reported fiscal 2020 (year ended September 30, 2020) total revenue of $1.46 billion, up 16% year over year, with recurring revenue up 26%. GAAP operating income rose to $210.9 million (14.5% operating margin) from $63.0 million, and GAAP diluted EPS was $1.12 versus a loss of $(0.23) in FY'19. Non-GAAP operating margin was 29.0%, and non-GAAP diluted EPS was $2.57. Annual Recurring Revenue (ARR) grew 14% to $1,270 million (11% in constant currency), and management noted it was the third consecutive year of double-digit ARR growth. Growth Products ARR rose 34%, Core ARR rose 14%, and FSG ARR declined 2%. Cash from operations was $233.8 million, down from $285.1 million, mainly due to higher interest and restructuring payments. Free cash flow was $213.6 million. The company ended the year with $335.1 million of cash and marketable securities against $1,018 million of total debt. Debt rose sharply after the roughly $469 million acquisition of Onshape, funded with $1 billion of Senior Notes issued in February 2020 (3.625% due 2025 and 4.000% due 2028), which were used to redeem the 6.000% notes due 2024 and repay credit facility borrowings. The company also disclosed a new $1 billion stock repurchase authorization approved November 13, 2020. The filing highlights risks tied to COVID-19, including higher churn (8.6% in FY'20 versus 7.4% in FY'19), weaker professional services revenue (down 14%), and exposure to discrete manufacturing demand. Other items include an open South Korean tax dispute (about $12 million paid, with potential additional exposure of $17 million) and a putative ERISA class action filed September 17, 2020, for which the company could not estimate the outcome.
Nov 20, 2020
2019
PTC Annual Report, Year Ended Sep 30, 2019
PTC Inc. (Nasdaq: PTC) reported fiscal 2019 (year ended September 30, 2019) total revenue of $1.26 billion under ASC 606 ($1.31 billion under ASC 605), with GAAP net loss of $27.5 million under ASC 606 (net income of $3.0 million under ASC 605). Under ASC 605, ARR grew 10% to $1,116 million (12% at the guidance rate), recurring software revenue rose 10% to $1,079 million, and IoT and AR ARR grew 26%. Operating cash flow was $285 million, up from $248 million, and management said IoT and AR now exceed 12% of total ARR and one-third of total bookings. Non-GAAP operating margin under ASC 605 was 22.4%, up from 18.3%, and non-GAAP diluted EPS was $1.74 versus $1.45. The company completed its transition to subscription-only licensing in January 2019 (excluding Kepware). Subscription mix shift weighed on revenue and earnings, and management expects the transition's effect to moderate in fiscal 2020 and expects revenue growth and margin expansion in fiscal 2020. Restructuring charges rose to $51.1 million, including a $32.7 million charge tied to exiting the Needham headquarters, and a workforce realignment toward IoT and AR is expected to bring up to $25 million of additional restructuring in 2020. After fiscal year-end, PTC acquired Onshape, a SaaS CAD platform, for approximately $470 million net of cash acquired, funded by a $455 million borrowing under its credit facility. Total debt rose to approximately $1.1 billion as of November 15, 2019, the revolving commitment was increased to $1 billion, and the company plans to suspend its share repurchase program in 2020 to accelerate debt repayment.
Nov 18, 2019
2018
PTC Annual Report, Year Ended Sep 30, 2018
PTC Inc. is a global software and services company that delivers solutions for its industrial customers' digital transformations, with products spanning Internet of Things (IoT), CAD and PLM. For fiscal 2018 (year ended September 30, 2018), total revenue was $1,241.8 million, up 7% from $1,164.0 million in 2017 (up 4% on a constant currency basis). GAAP operating income rose to $73.2 million from $40.9 million, GAAP diluted EPS was $0.44 versus $0.05, and non-GAAP diluted EPS was $1.45 versus $1.17. Cash provided by operations was $247.8 million, compared with $135.2 million in 2017. Subscription revenue rose to $482.0 million from $279.2 million, while support revenue fell to $496.8 million from $574.7 million, reflecting the company's transition to a subscription model. The filing highlights a $1 billion equity investment by Rockwell Automation in the fourth quarter of 2018, which funded a $1 billion accelerated share repurchase; total share repurchases in 2018 were $1,100.0 million. Unbilled deferred revenue (backlog) reached $911 million, and total deferred and unbilled revenue was $1,410 million. Total debt was $648.1 million at September 30, 2018, including $500 million of 6.00% Senior Notes due 2024 and $148.1 million drawn on a credit facility amended to $700 million. The company expects further headwinds to revenue and earnings in fiscal 2019 as the subscription mix rises by 1100 to 1300 basis points, and it adopts ASC 606 effective October 1, 2018, with an expected $350 million to $380 million adjustment to retained earnings. Investors should weigh the strong bookings and recurring revenue growth against the near-term revenue pressure from the subscription transition, the planned headquarters move with potential rent-shortfall charges, and the restructuring charge of approximately $18 million announced in October 2018.
Nov 16, 2018
2017
PTC Annual Report, Year Ended Sep 30, 2017
PTC Inc. reported fiscal 2017 (year ended September 30, 2017) total revenue of $1.164 billion, up 2% from $1.140 billion in 2016, with GAAP net income of $6.2 million ($0.05 per diluted share) compared with a net loss of $54.5 million in 2016. Growth was driven by the subscription transition: subscription revenue rose 136% to $279.2 million while perpetual license revenue fell 23% and support revenue fell 12%. Recurring revenue reached 73% of total revenue. License and subscription bookings grew 4% to $419 million (10% excluding a $20 million 2016 mega-deal), and Annualized Recurring Revenue was approximately $905 million, up 12%. GAAP operating margin improved to 3.5% from negative 3.2%, while non-GAAP operating margin was 16.1% versus 15.1%. Non-GAAP diluted EPS declined 2% to $1.17. Cash and marketable securities totaled $330 million at year-end, and operating cash flow was $134.6 million, down from $183.2 million. Total debt was $718 million at September 30, 2017, including $500 million of 6.00% senior notes due 2024 and $218 million outstanding under a $600 million credit facility. The company repurchased $51.0 million of stock in 2017 and approved a new $500 million repurchase program covering October 2017 through September 2020. Management plans to stop selling perpetual licenses in the Americas and Western Europe effective January 1, 2018, which it expects will further pressure near-term revenue during the transition. The filing also discloses a planned headquarters move to a 250,000 square foot Boston Seaport lease starting in January 2019, with overlapping rent on the Needham facility through November 2022. Management attributes the IoT Group's growth to the ThingWorx and Vuforia platforms, which it describes as a nascent, high-growth market, while the Solutions Group (CAD, PLM, SLM) returned to modest growth.
Nov 29, 2017
2016
PTC Annual Report, Year Ended Sep 30, 2016
PTC Inc. reported fiscal 2016 (year ended September 30, 2016) with total revenue of $1.14 billion, down from $1.26 billion in 2015, and a GAAP operating loss of $37.0 million versus operating income of $41.6 million in 2015. The decline was driven primarily by the company's transition from perpetual licenses to subscriptions, which shifted revenue recognition to ratable over the subscription term. Subscription bookings rose to 56% of license and subscription bookings in 2016 from 17% in 2015, and GAAP diluted EPS was $(0.48) compared with $0.41 a year earlier. Non-GAAP diluted EPS was $1.19, down from $2.23, and non-GAAP operating margin was 15.1% versus 24.2%. Restructuring charges of $76.3 million, incurred under a plan that affected 810 employees, were a major contributor to the GAAP loss. The balance sheet and cash position reflect the strategy shift. Total debt rose to $758 million at September 30, 2016, from $668 million, after PTC issued $500 million of 6.00% senior notes due 2024 and borrowed under its $900 million credit facility. Cash from operations was $183.2 million, and cash and cash equivalents ended the year at $277.9 million. The company made no share repurchases in 2016 because covenant limits on its credit facility restricted borrowing capacity, and it expects to resume repurchases in the second half of fiscal 2017. Management said it expects a significant majority of license and subscription bookings in 2017 to be subscriptions, and it does not expect net operating expense reductions in 2017 compared with 2016. The company also reorganized into three reportable segments (Solutions Group, IoT Group and Professional Services) and made two IoT acquisitions in fiscal 2016, Vuforia and Kepware, for a combined $165.8 million in cash, net of cash acquired. Investors should weigh the near-term revenue and earnings pressure from the subscription transition against the growth reported in IoT and subscription bookings.
Nov 18, 2016
2015
PTC Annual Report, Year Ended Sep 30, 2015
PTC Inc. (Needham, Massachusetts) reported fiscal 2015 (year ended September 30, 2015) revenue of $1.255 billion, down from $1.357 billion in 2014, as a shift toward subscription licensing, weaker manufacturing demand, and foreign currency headwinds reduced results. GAAP operating income fell to $41.6 million from $196.6 million, reflecting a $66.3 million U.S. pension settlement loss, a $28.2 million accrual related to the China investigation, and $43.4 million of restructuring charges. GAAP diluted EPS was $0.41 versus $1.34 in 2014, while non-GAAP diluted EPS was $2.23 versus $2.17. Cash from operations declined to $179.9 million from $304.6 million. Management is reorganizing the company into a Solutions Group (CAD, PLM, ALM, SLM) and a Technology Platform Group (IoT, analytics, augmented reality), and is pushing a transition to subscription licensing, with 2016 revenue guided down 3% to 5% and subscription revenue expected to grow about 35%. Recent acquisitions include ColdLight ($98.6 million, May 2015) and Vuforia from Qualcomm ($65 million, November 2015). A new $1 billion revolving credit facility maturing in 2019 was entered into in November 2015, with $718 million outstanding as of November 4, 2015. Investors should weigh the sharp decline in GAAP profitability and cash flow against management's plan to build recurring subscription revenue and grow the IoT business, while the company remains in discussions with the SEC and DOJ over the China matter.
Nov 23, 2015
2014
PTC Annual Report, Year Ended Sep 30, 2014
PTC Inc. reported fiscal 2014 (year ended September 30, 2014) total revenue of $1.36 billion, up 5% year over year, with GAAP operating income of $196.6 million (14.5% operating margin) versus $127.3 million in 2013. GAAP diluted EPS rose to $1.34 from $1.19, and non-GAAP diluted EPS rose to $2.17 from $1.81. Cash provided by operations was $304.6 million, up from $224.7 million. The company says it is positioning itself around the Internet of Things through the 2014 acquisitions of ThingWorx, Axeda and Atego, which together added $9.8 million to 2014 revenue and approximately $12 million in operating losses. The company adopted a capital allocation strategy aiming to return about 40% of free cash flow to shareholders over time. The Board authorized up to $600 million of share repurchases through September 30, 2017, and PTC entered a new $1.5 billion credit facility maturing September 15, 2019. At year-end, $612 million was outstanding under the facility, with $408 million available to borrow under the revolver subject to covenants. The company repurchased 5.1 million shares for $224.9 million in 2014, including $37.5 million held back pending final settlement of an accelerated share repurchase. For fiscal 2015, PTC guided to revenue growth of 0% to 2% and non-GAAP operating margin of 26%, with GAAP EPS of $1.33 to $1.40 and non-GAAP EPS of $2.33 to $2.40. The company also disclosed a $27 million restructuring charge affecting 283 employees, an ongoing SEC and Department of Justice investigation into payments in China that could result in fines but for which no liability has been recorded, and a planned termination of its U.S. pension plan with estimated pre-tax settlement losses of approximately $65 million.
Nov 26, 2014
2013
PTC Annual Report, Year Ended Sep 30, 2013
PTC Inc. (Nasdaq: PMTC; ticker later changed to PTC in December 2013) reported fiscal 2013 results for the year ended September 30, 2013, with total revenue of $1,293.5 million, up 3% year over year (up 4% on a constant currency basis). The company said the result was held back by a slowdown in global manufacturing, particularly in Europe and the Americas, and by unfavorable currency movements. Organic revenue, excluding $95 million from businesses acquired in 2013, was down 5% year over year. License revenue was $344.2 million, down 1%, and organic license revenue fell 9%. Support revenue grew 7% to $654.7 million and service revenue was flat at $294.7 million. GAAP results improved sharply. Net income was $143.8 million, or $1.19 diluted EPS, compared with a net loss of $35.4 million in 2012, which had included a $124.5 million non-cash tax charge. GAAP operating income was $127.3 million, a 9.8% operating margin. Non-GAAP operating margin rose to 22.1% from 19.6%, and non-GAAP diluted EPS rose to $1.81 from $1.51. The company recorded $52.2 million of restructuring charges, mostly severance for about 550 employees, and expects these actions to reduce operating expenses by $16 million per quarter. Cash and cash equivalents fell to $241.9 million from $489.5 million, mainly because of the Servigistics, Enigma and NetIDEAS acquisitions and debt repayment. Debt outstanding under the credit facility was $258.1 million at year end. The filing also flags material uncertainties. PTC is cooperating with the SEC and the Department of Justice on an investigation into certain payments in China that raise Foreign Corrupt Practices Act questions. The company has not recorded a liability because it cannot estimate the amount. For fiscal 2014, management targets revenue growth of 2% to 3%, non-GAAP operating margin of about 25%, and non-GAAP EPS of $2.00 to $2.10.
Nov 22, 2013
2012
PTC Annual Report, Year Ended Sep 30, 2012
Parametric Technology Corporation (PTC) reported fiscal 2012 (year ended September 30, 2012) total revenue of $1,255.7 million, up 8% from $1,166.9 million in 2011 (up 10% on a constant currency basis), while GAAP net results turned to a loss of $35.4 million, or $(0.30) per diluted share, compared with net income of $85.4 million in 2011. The loss was driven primarily by a non-cash $124.5 million income tax charge to establish a valuation allowance against U.S. net deferred tax assets, plus $24.9 million of restructuring charges. On a non-GAAP basis, operating margin rose to 19.6% from 17.7% and non-GAAP diluted EPS grew 20% to $1.51. License revenue was $348.4 million, up 2%, while maintenance revenue reached $612.0 million, up 10%, and consulting and training revenue was $295.3 million, up 11%. Cash and cash equivalents rose to $489.5 million at September 30, 2012, with operating cash flow of $218.0 million. Debt increased to $370 million under the credit facility, including $230 million drawn to finance the acquisition of Servigistics, Inc., which closed on October 2, 2012 for approximately $220 million. For fiscal 2013, management targets revenue growth of 8% to 10% including Servigistics, non-GAAP operating margin of approximately 21.5%, and GAAP operating margin of approximately 12%. The company also disclosed an ongoing investigation of payments by certain business partners and employees in China, which may carry fines or sanctions it is unable to estimate, and management expects a restructuring charge of approximately $16 million in the first quarter of 2013. The filing notes that the company expects the U.S. to generate a taxable loss in 2013 that would produce cumulative three-year losses, and that the company does not expect near-term U.S. taxable income sufficient to realize its U.S. net deferred tax assets. Investors should weigh the strong maintenance and services growth and Enterprise momentum against weaker license revenue, the Desktop license decline, the tax valuation allowance, and the open China matter.
Nov 16, 2012
2011
PTC Annual Report, Year Ended Sep 30, 2011
Parametric Technology Corporation (PTC) reported record fiscal 2011 revenue of $1.17 billion ($1,166,949 thousand), up 16% from 2010 (12% on a constant currency basis). GAAP operating income rose to $117.1 million from $74.8 million, and GAAP diluted earnings per share were $0.71 versus $0.20 in 2010. Non-GAAP operating income was $206.6 million and non-GAAP diluted EPS was $1.26. Growth was driven by strong Desktop license revenue following the June 2011 launch of the Creo CAx suite, a recovery in Enterprise maintenance and services, and the acquisition of MKS Inc. on May 31, 2011, which contributed $26.8 million to 2011 revenue. Cash flow from operations fell to $78.7 million from $156.6 million, mainly because of a litigation payment that reduced cash by about $48 million and slower collections on receivables, which rose to $230.2 million. The balance sheet shows $167.9 million of cash and $200 million outstanding under the revolving credit facility, which was used to fund the MKS acquisition. Goodwill increased to $613.4 million. The company's leverage ratio was 0.85 to 1.00 against a 2.50 to 1.00 covenant, and it had authorized up to $100 million of share repurchases for October 2011 through September 2012. Management guided to 14% to 15% revenue growth for fiscal 2012, with license revenue growth of approximately 20%, and a goal of improving operating margin by 100 basis points. Key risks disclosed include an investigation of certain payments and expenses in China that raises possible Foreign Corrupt Practices Act questions, with China historically representing 6% to 7% of revenue; a European Commission investigation of anticompetitive practices in CAD software, under which no charges have been filed; quarterly revenue concentration in the last month of each quarter; and dependence on large enterprise deals and on foreign currency movements, since about two-thirds of revenue is transacted in currencies other than the U.S. dollar.
Nov 23, 2011
2010
PTC Annual Report, Year Ended Sep 30, 2010
Parametric Technology Corporation (PTC) develops, markets and supports product lifecycle management (PLM) software and CAx (CAD, CAM and CAE) solutions, generating revenue from software licenses, maintenance services, and consulting and training services. For fiscal 2010 (year ended September 30, 2010), total revenue rose to $1,010.0 million from $938.2 million, and license revenue increased 39% to $296.0 million, driven by a 73% increase in PLM license revenue. Operating income was $74.8 million versus $19.3 million in 2009, and cash flow from operations was $156.6 million. GAAP diluted earnings per share fell to $0.20 from $0.27 because of a one-time $43.4 million tax provision tied to a legal entity reorganization; non-GAAP diluted EPS was $1.00 versus $0.80. Management expects revenue to grow 10% to 12% and license revenue to grow 20% to 25% in fiscal 2011, and is modestly increasing investment in direct sales, research and development, and services. Cash and cash equivalents were $240.3 million at year end, and the company had no borrowings under a new $300 million revolving credit facility. Known near-term cash outflows include an approximately $48 million payment in the first quarter of fiscal 2011 to resolve litigation with GE Japan Corporation, and the company repurchased $62.5 million of stock in 2010 with $118.0 million remaining under its authorization. The filing also highlights the launch of the Creo product initiative, with Creo 1.0 expected in the summer of 2011, and the renewal of the Needham, Massachusetts headquarters lease. Management characterizes the economic recovery as uncertain, and the company's results depend on large PLM deals that are lumpy and difficult to predict quarter to quarter.
Nov 23, 2010
2009
PTC Annual Report, Year Ended Sep 30, 2009
Parametric Technology Corporation (PTC) reported a sharp downturn in fiscal 2009 (year ended September 30, 2009) as customers reduced and delayed purchases amid the adverse global economic environment. Total revenue was $938.2 million compared with $1,070.3 million in 2008, and license revenue fell 36% to $212.7 million. Operating income declined to $19.3 million from $125.2 million, and net income fell to $31.5 million from $79.7 million. Foreign currency movements, particularly the weaker Euro, reduced reported revenue by $39 million while lowering reported costs and expenses by $41 million. Cash flow from operations was $69.7 million, down from $222.2 million, and the company held $235.1 million in cash and cash equivalents at year-end. Management cut costs through a hiring freeze, elimination of merit pay increases, reduced travel and marketing spending, and a workforce reduction that produced $22.7 million of restructuring charges. The company nonetheless increased research and development spending to $188.5 million, and it expects license revenue to grow in fiscal 2010 while maintenance and services revenue remain roughly flat. Investors should also note an ongoing lawsuit by GE Financial Services Corporation seeking $47 million in U.S. damages, plus a Japanese claim of about $65 million, with $51.9 million of related revenue deferred as customer advances.
Nov 24, 2009
2008
PTC Annual Report, Year Ended Sep 30, 2008
Parametric Technology Corporation (PTC) develops, markets and supports product lifecycle management (PLM) software and related services, including mechanical CAD/CAM/CAE tools (Pro/ENGINEER, CoCreate, Mathcad, Arbortext) and data management and collaboration solutions (Windchill, ProductView). For fiscal 2008 (ended September 30, 2008), total revenue was $1,070.3 million, up 14% from $941.3 million in 2007 (8% on a constant currency basis). Operating income was $125.2 million, up from $92.8 million, and net income was $79.7 million, down from $143.7 million in 2007, which benefited from a $58.9 million one-time tax benefit from a valuation allowance release. Operating cash flow was $222.2 million, and days sales outstanding improved to 61 days from 74 days. Non-U.S. revenue accounted for 66% of total revenue. Growth was driven largely by the first-quarter 2008 acquisition of CoCreate Software GmbH for $247.5 million net of cash acquired, financed with $220 million of revolver borrowings and cash. Acquisitions of LBS ($13.1 million) and DHI ($1.0 million) also closed in the quarter. The company reports that the macroeconomic climate and the recent decline in the Euro are the most significant risks for 2009. Management plans to modestly increase investment in research and development, its reseller channel, and globalization efforts, particularly in China, and expects no restructuring charges in 2009 related to current initiatives. The filing also discloses a pending lawsuit by GE Capital Leasing Corporation seeking $47 million in damages, trebled, plus attorneys' fees, related to Toshiba financing transactions in Japan. PTC has deferred $43.8 million of related revenue as customer advances and has not accrued any other liability. The company repurchased 1.7 million shares for $27.3 million in 2008 and increased its repurchase authorization to $100 million in November 2008.
Nov 26, 2008
2007
PTC Annual Report, Year Ended Sep 30, 2007
Parametric Technology Corporation (PTC) filed this Form 10-K for the fiscal year ended September 30, 2007, a year in which it restated its fiscal 2006 and 2005 financial statements. The restatement stems from an Audit Committee investigation into transactions involving Toshiba Corporation of Japan, for which the company had recorded about $41 million of revenue during fiscal 2001 through 2006. The company reduced previously recorded revenue by about $8 million in fiscal 2006, $15 million in fiscal 2005, $9 million in fiscal 2004, $2 million in fiscal 2003 and $7 million in prior years. The related $40.3 million Customer Advances liability remains on the balance sheet until the Toshiba matters are resolved. Restated net income was $143.7 million, or $1.22 per diluted share, for 2007, compared with $56.8 million, or $0.50 per diluted share, for 2006. Results were boosted by a one-time $58.9 million tax benefit from releasing part of the U.S. deferred tax valuation allowance. Total revenue rose 11% to $941.3 million, with license revenue up 12% to $296.1 million and Enterprise Solutions revenue up 21%. Operating income increased from $66.5 million to $92.8 million. The company recorded a $15.3 million restructuring charge in the fourth quarter and expects about $10 million more in 2008. Management also reported a material weakness in internal control over income tax accounting, and the disclosure controls conclusion was that they were not effective as of September 30, 2007. The company is defending a lawsuit filed by GE Capital Leasing Corporation seeking $47 million in damages, which it asks to be trebled plus attorneys' fees. On November 28, 2007, PTC borrowed about $220 million under its revolving credit facility to fund the planned $250 million acquisition of CoCreate Software GmbH, which is expected to close in the first quarter of 2008.
Nov 29, 2007
2006
PTC Annual Report, Year Ended Sep 30, 2006
Parametric Technology Corporation (PTC) develops, markets and supports product lifecycle management (PLM) and enterprise content management (ECM) software and related services. In fiscal 2006 (year ended September 30, 2006), total revenue was $854.9 million, up 19% from 2005, including license revenue of $263.5 million, up 26%. Net income was $60.9 million, or $0.54 per diluted share, compared with $83.6 million, or $0.75 per diluted share, in 2005. Operating income declined to $71.7 million from $85.8 million. The filing attributes higher operating expenses mainly to the adoption of SFAS 123(R), which produced $40.5 million of stock-based compensation expense, and to acquisitions completed over the prior two years. Growth was driven by Enterprise Solutions revenue of $293.5 million, up 35%, and Desktop Solutions revenue of $561.4 million, up 12%. The company acquired Mathsoft for $64.4 million in cash in 2006 and ITEDO in October 2006 for approximately $17 million. Cash and cash equivalents declined to $183.4 million at year-end, and the company had no borrowings under a $230 million revolving credit facility entered into in February 2006. The filing notes that a full valuation allowance of $134.3 million remains against deferred tax assets, and that management anticipates it may reverse some or all of the U.S. valuation allowance of $109 million during 2007, which would produce a significant one-time non-cash benefit to net income. The company also reported a settlement of its lawsuit with Rand, a former largest distributor, with a $2.3 million charge recorded in general and administrative expense, and a $5.9 million net restructuring charge in 2006. Management concluded that internal control over financial reporting was effective as of September 30, 2006.
Dec 14, 2006
2005
PTC Annual Report, Year Ended Sep 30, 2005
Parametric Technology Corporation (PTC) develops, markets and supports product lifecycle management (PLM) and enterprise content management (ECM) software and related services. For fiscal 2005 (year ended September 30, 2005), total revenue was $720.7 million, up from $660.0 million in 2004, and net income rose to $83.6 million from $34.8 million. Operating income was $85.8 million compared with $37.4 million the prior year. License revenue was $209.7 million and service revenue was $511.0 million, with maintenance making up the bulk of services. The filing attributes the improvement to higher revenue, lower restructuring charges (a $(1.3) million credit in 2005 versus $42.9 million in 2004) and growth in Enterprise Solutions, which rose to $217.6 million from $179.3 million. The company's main 2005 event was the July 19, 2005 acquisition of Arbortext, Inc., an enterprise publishing software provider, for approximately $194.8 million in cash. The acquisition added $150.1 million of goodwill and expanded PTC's ECM offerings into life sciences, publishing, government and financial services markets. Cash and cash equivalents fell to $204.4 million from $294.9 million, reflected in part by $198.9 million of cash paid for acquisitions and $12.7 million paid in a stock option exchange. Stockholders' equity increased to $323.8 million. Investors should note the pending Rand A Technology Corporation and Rand Technologies Limited lawsuit, in which Rand quantified claimed actual damages above $50 million and asserted trebling, while the company says the claims are without merit and that it cannot predict the outcome. The filing also discloses an internal review of sales order irregularities in the Asia-Pacific region, which management concluded were not material and did not require restatement. The company does not pay cash dividends, and management reported internal control over financial reporting as effective as of September 30, 2005.
Dec 14, 2005
2004
PTC Annual Report, Year Ended Sep 30, 2004
Parametric Technology Corporation (PTC), headquartered in Needham, Massachusetts, develops product lifecycle management (PLM) software, including its Pro/ENGINEER design solutions and Windchill-based collaboration and control solutions. For fiscal 2004 (ended September 30, 2004), total revenue was $660.0 million, down from $671.9 million in 2003, with license revenue of $198.9 million and service revenue of $461.1 million. The company returned to profitability, with operating income of $37.4 million and net income of $34.8 million, compared with a net loss of $98.3 million in 2003. The improvement was attributed primarily to reductions in the operating cost structure, including headcount cuts and total costs and expenses falling to $622.6 million from $751.6 million. Net income also benefited from a one-time $18.9 million tax benefit tied to a favorable IRS examination resolution. Design solutions revenue fell to $480.7 million, while collaboration and control solutions revenue rose to $179.3 million. Management described the design solutions market as mature and saturated in North America and Europe, and pointed to Asia-Pacific as the greatest growth opportunity. Management also noted that customer reluctance to make large software purchases and weak technology spending in manufacturing continue to weigh on results. Cash, cash equivalents and investments totaled $294.9 million at year-end, with operating cash flow of $101.3 million. The company disclosed an ongoing lawsuit brought by its former largest distributor, Rand A Technology Corporation, which seeks substantial damages, and management believes the claims are without merit.
Dec 14, 2004
2003
PTC Annual Report, Year Ended Sep 30, 2003
Parametric Technology Corporation (PTC), headquartered in Needham, MA, reported a net loss of $98.3 million for fiscal 2003 (year ended September 30, 2003), compared with a net loss of $93.6 million in 2002 and $10.1 million in 2001. Total revenue was $671.9 million in 2003, down from $742.0 million in 2002 and $937.5 million in 2001. The company attributes the decline to weak technology spending in the global manufacturing economy, customers' reluctance to make large enterprise-wide software purchases, and saturation and increased competition in the design solutions market. License revenue fell to $205.3 million, while service revenue was $466.6 million, or 69% of total revenue. The company is shifting its focus from its traditional Pro/ENGINEER design software toward its Windchill-based collaboration and control solutions for product lifecycle management (PLM). Design solutions revenue declined to $498.4 million, while collaboration and control solutions revenue was $173.5 million. Management has begun cost-reduction initiatives aimed at lowering quarterly operating costs to approximately $150 million, excluding restructuring charges, by the end of fiscal 2004, and expects restructuring charges of $35 million to $45 million in 2004. Cash and investments totaled $205.3 million at September 30, 2003, and the company has not paid cash dividends. The filing also discloses nine shareholder class action lawsuits alleging misrepresentation of financial results for fiscal 1999 through 2001, and a lawsuit by its former largest distributor, Rand A Technology Corporation. Management believes the claims are without merit and intends to defend them vigorously. In addition, the company disclosed a software issue affecting Pro/ENGINEER that could cause inter-process communications to time out on January 10, 2004, for which corrective patches are being distributed.
Dec 24, 2003
2002
PTC Annual Report, Year Ended Sep 30, 2002
Parametric Technology Corporation (PTC), headquartered in Needham, MA, develops product lifecycle management (PLM) software, comprising its Pro/ENGINEER design solutions and its Windchill-based collaboration and control solutions. This 10-K for fiscal 2002 (year ended September 30, 2002) was filed late, on January 28, 2003, following a restatement of 1999 through 2002 maintenance revenue. Total revenue fell to $741,957 thousand in 2002 from $937,549 thousand in 2001 (restated), while the net loss widened to $93,621 thousand from $10,138 thousand. The loss was driven by an operating loss of $78,486 thousand, $31,150 thousand of restructuring charges, and a $48,000 thousand increase in the deferred tax valuation allowance that pushed the tax provision to $19,282 thousand. The filing shows design solutions revenue declining to $564,882 thousand from $720,253 thousand, while collaboration and control (Windchill-based) revenue fell to $177,075 thousand from $217,296 thousand. Management attributes the decline to weak technology spending in the manufacturing economy and lost market share in design solutions. Cash and investments dropped to $210,414 thousand from $249,098 thousand, and cash used by operations was $22,614 thousand. Shareholders' equity declined to $289,928 thousand from $385,092 thousand. The filing also discloses a Nasdaq Staff Determination letter, received January 15, 2003, citing the late filing and subjecting the stock to possible delisting; a hearing was set for February 14, 2003, and the company's ticker was changed to PMTCE during the delay. Management expects weak spending to continue for several quarters.
Jan 28, 2003
1996
PTC Annual Report, Year Ended Sep 30, 1996
Parametric Technology Corporation's Form 10-K for the fiscal year ended September 30, 1996 describes a company that develops, markets and supports the Pro/ENGINEER family of mechanical CAD/CAM/CAE software, with more than 70 application modules. Total revenue for fiscal 1996 was $600.1 million, up 52% from $394.3 million in fiscal 1995, with license revenue of $448.7 million (up 56%) and service revenue of $151.4 million (up 43%). Net income was $137.9 million, or $1.04 per share, which includes a $32.1 million nonrecurring charge for the write-off of purchased in-process research and development from the Reflex technology acquisition. Excluding acquisition and related costs, net income was $158.4 million, or 26.4% of revenue. Operating income was $204.7 million, and international customers accounted for 56% of revenue, up from 50% in fiscal 1995. The balance sheet remained strong at September 30, 1996, with cash, cash equivalents and investments of $456.1 million, working capital of $416.1 million, and stockholders' equity of $512.4 million. Operating cash flow was $229.7 million. The company repurchased 1,779,000 shares for $66.6 million during the year under a 6,000,000-share buyback plan authorized in May 1994. Management expects revenue to grow in fiscal 1997 and plans to keep spending on research and development and the sales organization, while stating that it believes existing resources will be sufficient through at least fiscal 1997. The filing also flags risks that investors should weigh, including quarterly results that are hard to predict because a high share of revenue is booked in the third month of each quarter, competition from larger rivals such as IBM/Dassault, Computervision, EDS/Unigraphics and Intergraph, and stock price volatility. The company had 2,774 employees at year-end and reported no material legal proceedings. Its auditor changed from Price Waterhouse to Coopers & Lybrand for fiscal 1996.
Dec 24, 1996
1995
PTC Annual Report, Year Ended Sep 30, 1995
Parametric Technology Corporation's Form 10-K for the fiscal year ended September 30, 1995 describes a company that develops, markets and supports seven families of integrated mechanical CAD/CAM/CAE software, led by its Pro/ENGINEER product line. Fiscal 1995 revenue rose to $394,310,000 from $266,974,000 in fiscal 1994, an increase the filing states as 47.7%, and net income was $77,362,000, or $1.20 per share. The filing notes that net income as a percentage of revenue fell to 19.6% in fiscal 1995 from 25.5% in fiscal 1994, mainly because of two non-recurring charges: $19,000,000 for purchased research and development from the CDRS acquisition and $10,438,000 related to the Rasna merger. Excluding those charges, the company reports net income at 25.0% of revenue. The company made two acquisitions in 1995. It bought the Conceptual Design and Rendering System (CDRS) business from Evans & Sutherland for $33,507,000 in cash, and it merged Rasna Corporation in a pooling-of-interests transaction that involved issuing approximately 3,793,000 shares. Licensed seats rose to approximately 15,900 in fiscal 1995 from 11,800 in fiscal 1994, and the average price per seat was about $18,100. Service revenue reached 26.9% of total revenue, and revenue outside North America was 49.8%. The balance sheet at September 30, 1995 showed $145,638,000 in cash and cash equivalents and $162,610,000 in short-term investments, with total stockholders' equity of $370,929,000. Net cash provided by operations was $119,017,000. Management stated that existing cash and investments, together with cash from operations, should be sufficient through at least fiscal 1996. The company also planned to repurchase shares to offset option-related dilution, and the full remaining authorized repurchase program was estimated at approximately $175,000,000.
Dec 28, 1995