Download PDF

1. Company Snapshot

1.a. Company Description

PTC Inc.operates as software and services company in the Americas, Europe, and the Asia Pacific.The company operates in two segments, Software Products and Professional Services.


It offers ThingWorx platform, which offers a set of capabilities that enable enterprises to digitally transform every aspect of their business with innovative solutions that are simple to create, easy to implement, scalable to meet future needs, and designed to enable customers to accelerate time to value; and Vuforia, which enables the visualization of digital information in a physical context and the creation of AR.The company also provides Onshape, a software-as-a-service product development platform unites computer-aided design with data management, collaboration tools, and real-time analytics; Arena, a PLM solution enables product teams to collaborate virtually anytime and anywhere; Creo, a 3D CAD technology enables the digital design, testing, and modification of product models; and Windchill, a product lifecycle management software.In addition, it offers Integrity, an application lifecycle management solution; Servigistics, service parts management solution; and consulting, implementation, training, cloud, and license and support services.


The company was formerly known as Parametric Technology Corporation and changed its name to PTC Inc.in January 2013.PTC Inc.


was incorporated in 1985 and is headquartered in Boston, Massachusetts.

Show Full description

1.b. Last Insights on PTC

PTC Inc.'s recent performance was negatively impacted by the upcoming Q1 2026 earnings release, which is projected to show earnings of $1.59 per share and revenue of $635.4440 million, potentially missing analyst expectations. The company's recent announcements, such as the launch of Windchill AI Parts Rationalization and new ALM releases, may not be enough to offset the potential disappointment from the earnings release. Additionally, the recent stake purchases by Strs Ohio and Federated Hermes Inc. may not be enough to offset the potential negative sentiment surrounding the upcoming earnings release.

1.c. Company Highlights

2. PTC Inc. Delivers Solid Q1 2026 Results with Strong ARR Growth

PTC Inc. reported a strong Q1 2026, with constant currency ARR excluding Kepware and ThingWorx growing 9% year over year to $2.341 billion, and including Kepware and ThingWorx, ARR was $2.5 billion, up 8.4% year over year. The company's EPS came in at $1.92, beating estimates of $1.59. Operating cash flow and free cash flow both grew 13% year over year, demonstrating the company's ability to generate cash from its operations.

Publication Date: Feb -06

📋 Highlights
  • ARR Growth:: Excluding Kepware/ThingWorx, ARR rose 9% YoY ($2.341B), including them at 8.4% ($2.5B).
  • Free Cash Flow:: Increased 13% YoY, with Q1 2026 operating cash flow up similarly.
  • Share Repurchases:: $200M in Q1 under $2B authorization; $150–250M expected in Q3/Q4 2026.
  • Deferred ARR Momentum:: Record deferred ARR under contract, driven by strategic cross-product wins and competitive displacements.
  • SaaS Pricing Lift:: SaaS portfolios (e.g., Windchill Plus, Creo Plus) see 1.5–2.5x pricing uplift vs. on-prem.

Revenue Growth and Profitability

The company's revenue growth was driven by its core products, which define how product data is created, governed, and used across the enterprise. PTC Inc.'s product and AI roadmaps are focused on making the intelligent product life cycle real for its customers, with deeper product integrations and AI embedded directly into its products. As Neil Barua mentioned, "Our customers' development processes are changing significantly, with products becoming more complex, software-driven, and regulated."

Valuation and Growth Expectations

With a P/E Ratio of 22.45 and an EV/EBITDA of 16.17, the market is pricing in a certain level of growth for PTC Inc. Analysts estimate next year's revenue growth at 6.7%. The company's ROE of 22.47% and ROIC of 16.1% indicate a strong ability to generate returns on equity and invested capital. The stock's Free Cash Flow Yield of 4.83% is also attractive, suggesting that the company is generating significant cash from its operations.

Key Drivers of Growth

The company's go-to-market transformation is showing positive results, with two quarters of demand capture related to deferred revenue. The deferred ARR is driven by the fact that PTC Inc. is winning strategic cross-product deals and competitive displacements. As Neil Barua stated, "We're taking the commitment, which is committed dollars from the customer, and it's starting to build ARR in Q1 and Q2." The company's SaaS portfolio, including Windchill Plus and Creo Plus, is also driving growth, with a lift in pricing of 1.5 to 2.5 times compared to on-prem.

Outlook and Guidance

PTC Inc. expects to grow constant currency ARR excluding Kepware and ThingWorx by 8% to 8.5% in Q2 2026, and including Kepware and ThingWorx by 7.5% to 8%. The company is confident in its ability to deliver a step up in Q4, driven by the solid progress made with its go-to-market initiatives and commercial initiatives. With a strong track record of delivering on its guidance, PTC Inc. is well-positioned to continue its growth trajectory.

3. NewsRoom

Card image cap

PTC Inc. (PTC) Presents at Morgan Stanley Technology, Media & Telecom Conference 2026 Transcript

Mar -05

Source: seekingalpha.com

Card image cap

PTC Expands Onshape With Advanced Cloud-Native MBD Features

Mar -03

Source: zacks.com

Card image cap

PTC Will Participate in Upcoming Investor Conferences

Feb -27

Source: prnewswire.com

Card image cap

PTC's Onshape Launches Cloud-Native Model-Based Definition Capabilities

Feb -26

Source: prnewswire.com

Card image cap

PTC Therapeutics to Participate at Upcoming Investor Conferences

Feb -23

Source: prnewswire.com

Card image cap

PTC Therapeutics: Sephience As A Major Growth Driver

Feb -23

Source: seekingalpha.com

Card image cap

Aurora Investment Counsel Sells 5,716 Shares of PTC Inc. $PTC

Feb -22

Source: defenseworld.net

Card image cap

AI Bust or a Once-in-a-Decade Buying Opportunity for This Software Stock?

Feb -20

Source: fool.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.29%)

6. Segments

Support and Cloud Services

Expected Growth: 8.5%

PTC's Support and Cloud Services growth is driven by increasing adoption of IoT and AR technologies, expansion of ThingWorx and Vuforia platforms, and rising demand for digital transformation solutions. Additionally, strategic partnerships, such as the Microsoft Azure alliance, and a growing subscription-based model contribute to the 8.5% growth.

License

Expected Growth: 7.5%

Strong demand for Industrial Internet of Things (IIoT) and Augmented Reality (AR) solutions drives growth. PTC's ThingWorx and Vuforia platforms are well-positioned to capitalize on this trend. Additionally, increasing adoption of digital twins and servitization in industrial companies fuels license sales. The company's strategic partnerships and acquisitions also contribute to its growth momentum.

Professional Services

Expected Growth: 10.5%

PTC Inc.'s Professional Services segment growth of 10.5% is driven by increasing demand for Industrial Internet of Things (IIoT) solutions, digital transformation initiatives, and adoption of cloud-based product lifecycle management (PLM) solutions. Additionally, strategic partnerships, acquisitions, and expansion into new markets have contributed to the segment's growth.

7. Detailed Products

Creo

A 3D computer-aided design (CAD) software that enables users to create, analyze, and view product designs

Windchill

A product lifecycle management (PLM) software that helps manage product data and collaborate across the enterprise

ThingWorx

An industrial internet of things (IIoT) platform that enables the rapid development of IoT applications

Vuforia

An augmented reality (AR) platform that enables the creation of interactive, 3D experiences

Servigistics

A service parts management software that helps optimize spare parts inventory and logistics

Onshape

A cloud-based CAD software that enables real-time collaboration and data management

8. PTC Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

PTC Inc. operates in the industrial automation and IoT software industry, where substitutes are limited. However, the increasing adoption of open-source alternatives and cloud-based services poses a moderate threat.

Bargaining Power Of Customers

PTC Inc. has a diverse customer base, and no single customer accounts for a significant portion of its revenue. This reduces the bargaining power of customers.

Bargaining Power Of Suppliers

PTC Inc. relies on a few key suppliers for its hardware and software components. While there are alternative suppliers available, the switching costs are moderate, giving suppliers some bargaining power.

Threat Of New Entrants

The industrial automation and IoT software industry has high barriers to entry, including significant R&D investments and established relationships with customers and suppliers. This makes it difficult for new entrants to gain traction.

Intensity Of Rivalry

The industrial automation and IoT software industry is highly competitive, with established players like Siemens, GE Digital, and Dassault Systemes. PTC Inc. faces intense competition in terms of product offerings, pricing, and innovation.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 41.49%
Debt Cost 3.95%
Equity Weight 58.51%
Equity Cost 9.87%
WACC 7.41%
Leverage 70.91%

11. Quality Control: PTC Inc. passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Zoom Video

A-Score: 5.5/10

Value: 3.6

Growth: 8.1

Quality: 8.8

Yield: 0.0

Momentum: 6.0

Volatility: 6.3

1-Year Total Return ->

View Full Report
Stock-Card
PTC

A-Score: 5.1/10

Value: 2.1

Growth: 8.3

Quality: 8.9

Yield: 0.0

Momentum: 4.0

Volatility: 7.3

1-Year Total Return ->

View Full Report
Stock-Card
Alarm.com

A-Score: 4.9/10

Value: 5.3

Growth: 8.2

Quality: 6.2

Yield: 0.0

Momentum: 2.5

Volatility: 7.3

1-Year Total Return ->

View Full Report
Stock-Card
Progress Software

A-Score: 4.2/10

Value: 4.4

Growth: 6.4

Quality: 5.9

Yield: 1.0

Momentum: 0.5

Volatility: 6.7

1-Year Total Return ->

View Full Report
Stock-Card
Elastic

A-Score: 3.8/10

Value: 3.2

Growth: 8.0

Quality: 4.9

Yield: 0.0

Momentum: 3.0

Volatility: 4.0

1-Year Total Return ->

View Full Report
Stock-Card
Alkami Technology

A-Score: 3.5/10

Value: 4.6

Growth: 7.1

Quality: 4.1

Yield: 0.0

Momentum: 0.5

Volatility: 4.7

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

162.71$

Current Price

162.71$

Potential

-0.00%

Expected Cash-Flows