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Mar 31, 2021
PTC Q2 2021 Earnings Report
PTC's Q2 2021 performance reflected strong execution and double-digit top-line growth, leading to robust operating and free cash flows.
Key Takeaways
PTC reported a strong second quarter in 2021, marked by double-digit revenue growth and expanding margins. Key highlights include solid ARR growth, increased revenue, strong EPS, and significant cash flow generation. The acquisition of Arena Solutions contributed to record bookings, and the company is optimistic about its position in the SaaS market.
ARR reached $1.39 billion, representing 18% growth (15% in constant currency).
Revenue increased to $462 million, a 28% growth (22% in constant currency).
Operating margin was 22%, with a non-GAAP operating margin of 37%.
Cash flow from operations was $122 million, and free cash flow was $116 million.
PTC
PTC
PTC Revenue by Segment
Revenue by Segment
Perpetual License Revenue
CapyFin.comProfessional Services Revenue
CapyFin.com Forward Guidance
PTC updated its FY'21 financial guidance to reflect Q2 performance and the changing currency impact, remaining on track on a constant currency basis.
Positive Outlook
- Macroeconomic conditions related to the COVID-19 crisis improve in the second-half of FY’21.
- Organic ARR growth of 10% to 12% on a constant currency basis and Arena contributes ~400 basis points of ARR growth.
- Changes in foreign currency versus prior guidance effectively eliminate the prior ~200 bps currency tailwind to ARR. Our current guidance assumes that currency effects in FY’21 are now relatively flat with FY20.
- FY’21 ARR growth is inclusive of a ~2% headwind from lower Deferred ARR exiting FY’20, primarily due to lower bookings in FY’20 reflecting the effect of the COVID pandemic.
- ARR YoY growth rates, on an organic constant currency basis, are expected to be approximately linear each quarter throughout FY’21.
Challenges Ahead
- Macroeconomic conditions related to the COVID-19 crisis improve in the second-half of FY’21.
- Organic ARR growth of 10% to 12% on a constant currency basis and Arena contributes ~400 basis points of ARR growth.
- Changes in foreign currency versus prior guidance effectively eliminate the prior ~200 bps currency tailwind to ARR. Our current guidance assumes that currency effects in FY’21 are now relatively flat with FY20.
- FY’21 ARR growth is inclusive of a ~2% headwind from lower Deferred ARR exiting FY’20, primarily due to lower bookings in FY’20 reflecting the effect of the COVID pandemic.
- ARR YoY growth rates, on an organic constant currency basis, are expected to be approximately linear each quarter throughout FY’21.
Revenue & Expenses
Visualization of income flow from segment revenue to net income