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Dec 28, 2019
PTC Q1 2020 Earnings Report
PTC's Q1 2020 results demonstrated solid demand and strong sales execution.
Key Takeaways
PTC reported a solid start to fiscal 2020, with strong demand for its product development and digital transformation technologies. The company saw strong sales execution and expanded its global reach through its partner ecosystem. The addition of Onshape is expected to provide new opportunities for companies seeking cloud-based product development.
ARR was $1.16 billion, reflecting 11% growth compared to Q1 2019.
Cash flow from operations was $8 million, with free cash flow at $3 million and adjusted free cash flow at $12 million.
Operating margin was 9% on a GAAP basis and 26% on a non-GAAP basis.
Total cash, cash equivalents, and marketable securities were $294 million.
PTC
PTC
PTC Revenue by Segment
Revenue by Segment
Recurring Revenue
CapyFin.comPerpetual License Revenue
CapyFin.comProfessional Services Revenue
CapyFin.com Forward Guidance
PTC raised its guidance ranges for ARR, Adjusted Free Cash Flow, Revenue and EPS due to solid Q1 performance, visibility into the remainder of fiscal 2020, and favorable foreign exchange rates.
Positive Outlook
- ARR between $1,270 million and $1,295 million, 14% - 16% YoY
- Free cash flow between $218 million and $238 million
- Adjusted free cash flow between $260 million and $280 million, 6% - 14% YoY
- Revenue between $1,445 million and $1,525 million, 15% - 21% YoY
- Non-GAAP EPS between $2.15 and $2.65, 31% - 62% YoY
Challenges Ahead
- Operating expenses are expected to grow roughly 9%, slightly elevated due to the Onshape acquisition.
- Allows for potential impact of moderate weakening of macroeconomic conditions.
- Free cash flow and adjusted free cash flow exclude capital expenditures of $27 million.
- Adjusted free cash flow also excludes restructuring payments of $42 million.
- The FY’20 non-GAAP guidance excludes the estimated expense items outlined in the table below, as well as any tax effects and discrete tax items (which are not known nor reflected).
Revenue & Expenses
Visualization of income flow from segment revenue to net income