PTC Inc. Reports 14% ARR Growth and $2.3 Billion Revenue in FY'24

By Bobby Samwell • Friday, November 15 10:30 • Permanent Link

PTC Inc. has recently released its 10-K report, detailing its financial performance for the fiscal year ending September 30, 2024. The company operates as a software company, providing a suite of products including Windchill, ThingWorx, ServiceMax, and Arena, among others. PTC's Annual Run Rate (ARR) grew 14% to $2.25 billion, and cash provided by operating activities grew 23% to $750 million in FY'24 compared to FY'23.

The company's revenue grew 10% to $2.3 billion in FY'24, with total recurring revenue reaching $2.13 billion, a 12% increase over the previous year. PTC's non-GAAP operating income grew 18% to $894.3 million, and non-GAAP diluted earnings per share increased to $5.08 from $4.34 in the previous year. The company ended FY’24 with cash and cash equivalents of $266 million and gross debt of $1.75 billion, with an aggregate weighted average interest rate of 5.1%.

Approximately 50% of PTC's revenue and 35% of its expenses are transacted in currencies other than the U.S. Dollar. Changes in foreign currency exchange rates were a slight tailwind to reported income statement results in FY’24. ARR was positively impacted by improvements in currency exchange rates, particularly the Euro to U.S. Dollar exchange rate, as of September 30, 2024, compared to September 30, 2023.

The company's software revenue growth in FY'24 was driven by Product Lifecycle Management (PLM) and Computer-Aided Design (CAD). PLM software revenue grew by 12%, and CAD software revenue grew by 9% in FY'24. PTC's total gross margin increased by 12% to $1.85 billion, with a gross margin percentage of 81%. Operating expenses increased by 6% to $1.27 billion, primarily due to higher compensation and benefits expense, stock-based compensation expense, and outside services.

Interest expense decreased by 8% to $119.7 million in FY'24, and the company reported a provision for income taxes of $92.6 million, resulting in an effective income tax rate of 20%. PTC's effective tax rate for FY’24 was impacted by a U.S. Tax Court ruling and procedural guidance from the Internal Revenue Service.

The market has reacted to these announcements by moving the company's shares -0.6% to a price of $189.91. If you want to know more, read the company's complete 10-K report here.

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