PTC Completes $523M Divestiture, Announces $375M Share Repurchase Program

By Chris Stiles • Monday, March 16 11:27 • Permanent Link

PTC (NASDAQ: PTC) has completed the divestiture of its Kepware® industrial connectivity and ThingWorx® Internet of Things (IoT) businesses, resulting in cash proceeds of $523 million upon closing. After accounting for working capital adjustments and divestiture-related costs, the net after-tax transaction proceeds are estimated to be approximately $375 million. These proceeds will be used for share repurchases, with PTC announcing a $375 million accelerated share repurchase program in Q2'26.

Following the divestiture, PTC has updated its financial guidance for fiscal year 2026 and the second fiscal quarter. The revised guidance reflects the impact of the divestiture on various financial metrics, including operating cash flow, free cash flow, revenue, and earnings per share (EPS).

For fiscal year 2026, the company now expects revenue in the range of $2,540 million to $2,805 million, compared to the previous guidance of $2,675 million to $2,940 million. Additionally, the earnings per share (EPS) guidance has been adjusted to $6.94 to $9.66, up from the previous range of $4.42 to $6.93.

Similarly, the second quarter guidance for revenue and EPS has been updated to $685 million to $745 million and $4.09 to $4.74, respectively, reflecting the impact of the divestiture.

The company also provided a breakdown of the impact of the divestiture on operating cash flow and free cash flow. The updated operating cash flow guidance for fiscal year 2026, excluding Kepware and ThingWorx, is approximately $880 million, down from the previous guidance of around $1,030 million. Likewise, the free cash flow guidance has been revised to approximately $850 million, compared to the previous estimate of $1,000 million.

PTC's financial guidance includes assumptions about the constant currency basis, churn, cash flow seasonality, operating expenses, capital expenditures, cash interest payments, and tax rates.

In addition to the financial impact, PTC also intends to repurchase approximately $250 million of common stock in Q2'26, with plans for incremental share repurchases using the net after-tax proceeds from the divestiture. The company expects a decrease in fully diluted shares to approximately 118 million shares in Q2'26, compared to 121 million shares in Q2'25.

PTC will host a conference call to discuss the divestiture and updated guidance at 5:00 pm ET on Monday, March 16, 2026. Following these announcements, the company's shares moved -0.08%, and are now trading at a price of $166.75. If you want to know more, read the company's complete 8-K report here.

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