01—Abstract
Summary
Summary of the 8-K filed May 6, 2026. Cited figures are marked; the original filing is the authoritative source.
PTC Inc. reported results for its second fiscal quarter ended March 31, 2026 (Exhibit 99.1, press release dated May 6, 2026).
Total revenue was $774.3 milliona versus $636.4 million a year earlier, GAAP net income was $590.7 million (diluted EPS $4.98), and non-GAAP diluted EPS was $2.69 versus $1.79. The GAAP results were lifted by a $462.6 million gain on the sale of the Kepware and ThingWorx businesses, which closed March 13, 2026. Constant currency ARR excluding divested businesses grew 8.5% year over year to $2.388 billion, and operating cash flow and free cash flow each rose 14%, to $320.9 million and $318.2 million respectively.
Management reaffirmed FY'26 guidance for constant currency ARR growth of 7.5% to 9.5% and raised the GAAP EPS range to $7.21 to $9.70b from $6.94 to $9.66, reflecting the divestiture gain. Non-GAAP EPS guidance moved to $6.65 to $8.90 from $6.36 to $8.84. Revenue guidance was raised to $2.58 billion to $2.82 billion from $2.54 billion to $2.81 billion.
Operating cash flow guidance of about $880 millionc and free cash flow guidance of about $850 million were unchanged. The company repurchased $626.1 million of stock in the quarter and expects total FY'26 repurchases of $1.225 billion to $1.325 billion. Separately, on May 4, 2026 the Board authorized up to $2.0 billion of share repurchases for October 1, 2026 through September 30, 2028, and extended the existing repurchase authorization, announced November 6, 2024, to expire September 30, 2026.
02—Key points
Key Highlights
- Q2 FY'26 total revenue of $774.3 million, up from $636.4 million; constant currency revenue grew 15% year over year.
- Constant currency ARR excluding divested businesses of $2.388 billion, up 8.5% year over year; as-reported ARR grew 3%.
- GAAP diluted EPS of $4.98 included a $462.6 million gain on the sale of Kepware and ThingWorx; non-GAAP diluted EPS was $2.69 versus $1.79.
- Operating cash flow of $320.9 million and free cash flow of $318.2 million, each up 14% year over year.
- FY'26 guidance reaffirmed for constant currency ARR growth of 7.5% to 9.5%; operating and free cash flow guidance held at about $880 million and about $850 million.
- Company repurchased $626.1 million of stock in Q2 and expects $1.225 billion to $1.325 billion of FY'26 repurchases.
- Board authorized a new $2.0 billion repurchase program for October 1, 2026 through September 30, 2028 and set the prior authorization to expire September 30, 2026.
03—Questions
Frequently Asked Questions
How much of the Q2 earnings increase came from the divestiture?
The filing shows a $463 million gain on the sale of Kepware and ThingWorx, which drove GAAP net income to $590.7 million and GAAP diluted EPS to $4.98. Excluding non-GAAP adjustments, which include removing this gain, non-GAAP diluted EPS was $2.69 versus $1.79 a year earlier.
What is the outlook for full-year FY'26 ARR and cash flow?
The company reaffirmed constant currency ARR growth of 7.5% to 9.5% for FY'26. Operating cash flow guidance is about $880 million and free cash flow guidance is about $850 million, both unchanged from prior guidance.
How is PTC returning capital to shareholders?
PTC used $626.1 million for repurchases in Q2 and expects $1.225 billion to $1.325 billion of repurchases in FY'26, including an accelerated share repurchase begun March 17, 2026. The Board also authorized a new $2.0 billion program covering October 1, 2026 through September 30, 2028.
Why is reported ARR growth lower than constant currency ARR growth?
The filing states that as-reported ARR grew 3% year over year, reflecting the divestiture of Kepware and ThingWorx. Constant currency ARR excluding those divested businesses grew 8.5%.
04—Continue