Earnings release
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EX 99.1 1 PTC ANNOUNCES FOURTH FISCAL QUARTER AND FULL FISCAL YEAR 2026 RESULTS Strategic focus on Intelligent Product Lifecycle vision BOSTON, MA, November 4, 2026 - PTC (NASDAQ: PTC) today reported financial results for its fourth fiscal quarter and full fiscal year ended September 30, 2026. Fourth Fiscal Quarter and Full Fiscal Year 2026 Key Operating and Financial Metrics1 $ in millions, except per share amountsQ4’26 Q4'25 YoY Change As reported ARR excluding divested businesses$2,508 $2,320 8% Constant currency ARR excluding divested businesses (FY'26 Plan FX rates) $2,545 $2,320 9.7% Operating cash flow $47 $104 (55%) Free cash flow $38 $100 (63%) Revenue $673 $894 (25%) Operating margin 32% 49% (1,690 bps) Non-GAAP operating margin 46% 59% (1,320 bps) Earnings per share $1.44 $2.88 (50%) Non-GAAP earnings per share $2.03 $3.41 (40%) 1The 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. 2As reported ARR excluding divested businesses excludes Kepware and ThingWorx ARR from Q4’25 to facilitate period-to-period comparisons following the divestiture of those businesses in Q2’26. ARR increased 1% year over year on an as reported basis in Q4’26. 3On a constant currency basis, using our FY’26 Plan foreign exchange rates (rates as of September 30, 2025) for all periods. Constant currency ARR excluding divested businesses excludes Kepware and ThingWorx ARR from Q4’25. 4Revenue and, as a result, operating margin and earnings per share are impacted under ASC 606. 5Q4’26 cash flow included approximately $24 million of divestiture-related costs and approximately $75 million of divestiture-related cash taxes, all of which are not expected to recur in future years. Also, Q4’26 free cash flow included approximately $5 million of capital expenditures, which are not expected to recur in future years, related to moving a major R&D center to a new office. 6In Q4’26, revenue declined 24% year over year on a constant currency basis. $ in millions, except per share amountsFY’26 FY'25 YoY Change Operating cash flow $899 $868 4% Free cash flow $873 $857 2% Revenue $2,733 $2,739 (0%) Operating margin 33% 36% (310 bps) Non-GAAP operating margin 47% 48% (80 bps) Earnings per share $8.93 $6.08 47% Non-GAAP earnings per share $8.24 $7.94 4% 1Revenue and, as a result, operating margin and earnings per share are impacted under ASC 606. 2FY’26 cash flow included approximately $48 million of divestiture-related costs and approximately $83 million of divestiture-related cash taxes, partially offset by approximately $70 million of divestiture-related net free cash flow contribution, all of which are not expected to recur in future years. Also, FY’26 free cash flow included approximately $14 million of capital expenditures, which are not expected to recur in future years, related to moving a major R&D center to a new office. 3FY’25 cash flow absorbed approximately $20 million of outflows related to our go-to-market realignment. 4In FY’26, revenue declined 2% year over year on a constant currency basis. As previously announced on October 5th, 2026, PTC entered into a definitive agreement to be acquired by Schneider Electric. In light of the pending transaction, PTC is suspending quarterly earnings conference calls and is no longer providing quarterly or annual guidance. 2 3 5 5 4 6 4 4 4 4 2 3 2 3 1 4 1 1 1 1
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2 Important Information About Our Operating and Non-GAAP Financial Measures Non-GAAP Financial Measures We provide supplemental non-GAAP financial measures to our financial results. We use these non-GAAP financial measures, and we believe that they assist our investors, to make period-to-period comparisons of our operating performance because they provide a view of our operating results without items that are not, in our view, indicative of our operating results. These non-GAAP financial measures should not be construed as an alternative to GAAP results as the items excluded from the non- GAAP financial measures often have a material impact on our operating results, certain of those items are recurring, and others often recur. Management uses, and investors should consider, our non-GAAP financial measures only in conjunction with our GAAP results. Non-GAAP operating expense, non-GAAP operating margin, non-GAAP gross profit, non-GAAP gross margin, non-GAAP net income and non-GAAP EPS exclude the effect of the following items: stock-based compensation; amortization of acquired intangible assets; acquisition and transaction-related charges included in general and administrative expenses; impairment and other charges (credits), net; non-operating charges (credits), net shown in the reconciliation provided; and income tax adjustments. Additional information about the items we exclude from our non-GAAP financial measures and the reasons we exclude them can be found in “Non-GAAP Financial Measures” in our Annual Report on Form 10-K for the fiscal year ended September 30, 2025. Free Cash Flow: We provide information on 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 excess cash to shareholders via stock repurchases. Free cash flow is cash provided by (used in) operations net of capital expenditures. Free cash flow is not a measure 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 exchange rate fluctuations. To present CC information, FY’26 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, 2025, rather than the actual exchange rates in effect during that period. Operating Measure ARR: ARR (Annual Run Rate) represents the annualized value of our portfolio of active subscription software, SaaS, hosting, and support contracts as of the end of the reporting period. We calculate ARR as follows: · We consider a contract to be active when the product or service contractual term commences (the “start date”) until the right to use the product or service ends (the “expiration date”). Even if the contract with the customer is executed before the start date, the contract will not count toward ARR until the customer right to receive the benefit of the products or services has commenced. · For contracts that include annual values that change over time, we include in ARR only the annualized value of components of the contract that are considered active as of the date of the ARR calculation. We do not include any future committed increases in the contract value as of the date of the ARR calculation. · As ARR includes only contracts that are active at the end of the reporting period, ARR does not reflect assumptions or estimates regarding future contract renewals or non-renewals. · Active contracts are annualized by dividing the total active contract value by the contract duration in days (expiration date minus start date, adjusted for leap years), then multiplying that by 365 days. We believe ARR is a valuable operating measure to assess the health of a subscription business because it is aligned with the amount that we invoice the customer on an annual basis. We generally invoice customers
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3 annually for the current year of the contract. A customer with a one-year contract will typically be invoiced for the total value of the contract at the beginning of the contractual term, while a customer with a multi-year contract will be invoiced for each annual period at the beginning of each year of the contract. ARR increases by the annualized value of active contracts that commence in a reporting period and decreases by the annualized value of contracts that expire in the reporting period. As ARR is not annualized recurring revenue, it is not calculated based on recognized or unearned revenue and is not affected by variability in the timing of revenue under ASC 606, particularly for on-premises license subscriptions where a substantial portion of the total value of the contract is recognized as revenue at a point in time upon the later of when the software is made available, or the subscription term commences. ARR should be viewed independently of recognized and unearned revenue and is not intended to be combined with, or to replace, either of those items. Investors should consider our ARR operating measure only in conjunction with our GAAP financial results. About PTC (NASDAQ: PTC) 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.com @PTC Blogs PTC Investor Relations Contact Michael Maguire, CFA VP, Investor Relations investor@ptc.com
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4 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, 2026 2025 2026 2025 Revenue: Recurring revenue $ 645,247 $ 861,071 $ 2,621,914 $ 2,600,514 Perpetual license 3,881 8,371 17,144 31,375 Professional services 24,126 24,353 94,373 107,337 Total revenue 673,254 893,795 2,733,431 2,739,226 Cost of revenue 115,860 116,899 456,808 444,983 Gross margin 557,394 776,896 2,276,623 2,294,243 Operating expenses: Sales and marketing 144,357 142,197 561,628 566,516 Research and development 120,122 114,507 479,946 457,693 General and administrative 62,155 63,601 284,775 226,058 Amortization of acquired intangible assets 11,976 11,592 48,051 45,948 Impairment and other charges, net 6,161 11,430 6,161 15,643 Total operating expenses 344,771 343,327 1,380,561 1,311,858 Operating income 212,623 433,569 896,062 982,385 Other income (expense), net (17,594) (5,471) 401,181 (62,208) Income before income taxes 195,029 428,098 1,297,243 920,177 Provision for income taxes 37,766 80,305 263,959 186,180 Net income $ 157,263 $ 347,793 $ 1,033,284 $ 733,997 Earnings per share: Basic $ 1.45 $ 2.91 $ 8.97 $ 6.12 Weighted average shares outstanding 108,825 119,714 115,240 120,005 Diluted $ 1.44 $ 2.88 $ 8.93 $ 6.08 Weighted average shares outstanding 109,401 120,674 115,716 120,777 (1) See supplemental financial data for revenue by license, support and cloud services, and professional services. (2) See supplemental financial data for additional information about stock-based compensation. (1) (2) (2) (2) (2)
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5 PTC Inc. SUPPLEMENTAL FINANCIAL DATA FOR REVENUE AND STOCK-BASED COMPENSATION (in thousands, except per share data) Revenue by license, support and services is as follows: Three Months Ended Twelve Months Ended September 30, September 30, September 30, September 30, 2026 2025 2026 2025 License revenue $ 267,028 $ 484,081 $ 1,105,238 $ 1,162,709 Support and cloud services revenue 382,100 385,361 1,533,820 1,469,180 Professional services revenue 24,126 24,353 94,373 107,337 Total revenue $ 673,254 $ 893,795 $ 2,733,431 $ 2,739,226 (1) License revenue includes the portion of subscription revenue allocated to license. The amounts in the income statement include stock-based compensation as follows: Three Months Ended Twelve Months Ended September 30, September 30, September 30, September 30, 2026 2025 2026 2025 Cost of revenue $ 5,932 $ 5,979 $ 24,668 $ 22,690 Sales and marketing 19,276 15,078 70,649 61,750 Research and development 16,556 16,785 65,671 65,119 General and administrative 24,480 16,968 91,104 66,646 Total stock-based compensation $ 66,244 $ 54,810 $ 252,092 $ 216,205 (1)
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6 PTC Inc. NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS (UNAUDITED) (in thousands, except per share data) Three Months Ended Twelve Months Ended September 30, September 30, September 30, September 30, 2026 2025 2026 2025 GAAP gross margin $ 557,394 $ 776,896 $ 2,276,623 $ 2,294,243 Stock-based compensation 5,932 5,979 24,668 22,690 Amortization of acquired intangible assets included in cost of revenue 7,838 8,219 31,259 32,828 Non-GAAP gross margin $ 571,164 $ 791,094 $ 2,332,550 $ 2,349,761 GAAP operating income $ 212,623 $ 433,569 $ 896,062 $ 982,385 Stock-based compensation 66,244 54,810 252,092 216,205 Amortization of acquired intangible assets 19,814 19,811 79,310 78,776 Acquisition and transaction-related charges 2,497 6,694 42,519 9,116 Impairment and other charges, net 6,161 11,430 6,161 15,643 Non-GAAP operating income $ 307,339 $ 526,314 $ 1,276,144 $ 1,302,125 GAAP net income $ 157,263 $ 347,793 $ 1,033,284 $ 733,997 Stock-based compensation 66,244 54,810 252,092 216,205 Amortization of acquired intangible assets 19,814 19,811 79,310 78,776 Acquisition and transaction-related charges 2,497 6,694 42,519 9,116 Impairment and other charges, net 6,161 11,430 6,161 15,643 Non-operating credits, net (1,298) (13,100) (465,150) (13,100) Income tax adjustments (28,460) (16,183) 5,464 (81,833) Non-GAAP net income $ 222,221 $ 411,255 $ 953,680 $ 958,804 GAAP diluted earnings per share $ 1.44 $ 2.88 $ 8.93 $ 6.08 Stock-based compensation 0.61 0.45 2.18 1.79 Amortization of acquired intangibles 0.18 0.16 0.69 0.65 Acquisition and transaction-related charges 0.02 0.06 0.37 0.08 Impairment and other charges, net 0.06 0.09 0.05 0.13 Non-operating credits, net (0.01) (0.11) (4.02) (0.11) Income tax adjustments (0.26) (0.13) 0.05 (0.68) Non-GAAP diluted earnings per share $ 2.03 $ 3.41 $ 8.24 $ 7.94 (1) Operating margin impact of non-GAAP adjustments: Three Months Ended Twelve Months Ended September 30, September 30, September 30, September 30, 2026 2025 2026 2025 GAAP operating margin 31.6% 48.5% 32.8% 35.9% Stock-based compensation 9.8% 6.1% 9.2% 7.9% Amortization of acquired intangibles 2.9% 2.2% 2.9% 2.9% Acquisition and transaction-related charges 0.4% 0.7% 1.6% 0.3% Impairment and other charges, net 0.9% 1.3% 0.2% 0.6% Non-GAAP operating margin 45.6% 58.9% 46.7% 47.5% (2) In FY'26, we recognized gains of $463.9 million on the sale of our Kepware and ThingWorx businesses and $2.0 million related to the finalization of contingent consideration associated with the FY'22 sale of a portion of our PLM services business, offset by a $0.8 million financing charge related to a debt commitment agreement associated with the divestiture. In FY'25, we recognized a $13.1 million gain related to contingent consideration earned upon the achievement of performance milestones associated with the FY'22 sale of a portion of our PLM services business. (3) Income tax adjustments reflect the tax effects of non-GAAP adjustments which are calculated by applying the applicable tax rate by jurisdiction to the non-GAAP adjustments listed above. Additionally, in FY'25, adjustments exclude a $10.4 million benefit related to the tax impact of tax reserves related to prior years in foreign jurisdictions. (1) (2) (3) (2) (3)
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7 PTC Inc. UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands) September 30, September 30, 2026 2025 ASSETS Cash and cash equivalents $ 232,852 $ 184,415 Accounts receivable, net 1,107,131 1,001,085 Property and equipment, net 66,580 60,843 Goodwill and acquired intangible assets, net 4,139,199 4,317,979 Lease assets, net 125,555 114,974 Other assets 1,041,239 937,876 Total assets $ 6,712,556 $ 6,617,172 LIABILITIES AND STOCKHOLDERS' EQUITY Deferred revenue $ 821,091 $ 827,065 Debt, net of deferred issuance costs 1,609,763 1,197,434 Lease obligations 187,068 172,433 Other liabilities 682,452 594,011 Stockholders' equity 3,412,182 3,826,229 Total liabilities and stockholders' equity $ 6,712,556 $ 6,617,172
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8 PTC Inc. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) Three Months Ended Twelve Months Ended September 30, September 30, September 30, September 30, 2026 2025 2026 2025 Cash flows from operating activities: Net income $ 157,263 $ 347,793 $ 1,033,284 $ 733,997 Stock-based compensation 66,244 54,810 252,092 216,205 Depreciation and amortization 24,381 25,701 98,561 102,504 Amortization of right-of-use lease assets 8,304 8,453 34,027 32,912 Gain on divestiture of businesses (1,298) (13,100) (465,900) (13,100) Operating lease liability 2,348 (5,476) 16,670 (10,345) Accounts receivable (285,296) (294,609) (127,116) (121,052) Accounts payable and accruals (7,221) 30,219 197,364 19,890 Deferred revenue 109,480 54,225 4,816 37,753 Income taxes (66,017) 41,164 50,067 63,573 Other 39,130 (145,150) (195,256) (194,641) Net cash provided by operating activities 47,318 104,030 898,609 867,696 Capital expenditures (9,657) (3,546) (25,948) (11,008) Divestiture of businesses 8,176 - 531,482 - Borrowings (payments) on debt, net 186,250 (36,250) 411,250 (552,958) Repurchases of common stock (298,720) (75,011) (1,624,910) (299,998) Net proceeds associated with issuance of common stock 12,308 12,755 25,470 26,062 Payments of withholding taxes in connection with vesting of stock-based awards (5,958) (8,444) (73,301) (80,205) Settlement of net investment hedges (8,768) (6,193) 17,781 (20,753) Contribution to solar energy equity investment (50,146) - (100,292) - Other financing & investing activities - - (4,580) (7,942) Foreign exchange impact on cash 595 (2,247) (7,124) (2,372) Net change in cash, cash equivalents, and restricted cash (118,602) (14,906) 48,437 (81,478) Cash, cash equivalents, and restricted cash, beginning of period 352,027 199,894 184,988 266,466 Cash, cash equivalents, and restricted cash, end of period $ 233,425 $ 184,988 $ 233,425 $ 184,988 Supplemental cash flow information: Cash paid for interest $ 21,693 $ 18,767 $ 62,236 $ 77,828 (1) In Q2'26, we sold our ThingWorx and Kepware businesses. (2) In FY'25, net repayments include borrowings on our credit facility revolver to fund the $500 million bond repayment in February. (1) (2)
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9 PTC Inc. NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS (UNAUDITED) (in thousands) Three Months Ended Twelve Months Ended September 30, September 30, September 30, September 30, 2026 2025 2026 2025 Cash provided by operating activities $ 47,318 $ 104,030 $ 898,609 $ 867,696 Capital expenditures (9,657) (3,546) (25,948) (11,008) Free cash flow $ 37,661 $ 100,484 $ 872,661 $ 856,688