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Sep 30, 2025
PTC Q4 2025 Earnings Report
PTC's Q4 2025 earnings report highlighted solid execution, record cash flow, and strategic portfolio sharpening through divestitures.
Key Takeaways
PTC delivered a strong fourth fiscal quarter and full fiscal year 2025, with significant revenue growth, record operating and free cash flow, and improved operating margins. The company's strategic focus on its Intelligent Product Lifecycle vision, including the divestiture of Kepware and ThingWorx, positions it for durable growth and increased financial flexibility.
Q4 2025 revenue increased by 43% year-over-year to $894 million, with full fiscal year revenue growing 19% to $2.739 billion.
Constant currency ARR grew by 8.5% in Q4 2025, reaching $2.446 billion, demonstrating solid subscription business health.
Record operating cash flow of $104 million and free cash flow of $100 million were achieved in Q4 2025, with full fiscal year growth of 16% for both metrics.
Non-GAAP operating margin expanded significantly to 59% in Q4 2025, up 1,470 basis points from the prior year, reflecting improved operational efficiency.
Revenue by Segment
Forward Guidance
PTC is introducing FY'26 guidance reflecting a simpler portfolio post-divestiture, continued double-digit cash flow expansion, and solid visibility from multi-year ramp contracts. The guidance includes constant currency ARR growth of 7% to 9%, operating cash flow of approximately $1.03 billion, and free cash flow of approximately $1 billion, with plans for significant share repurchases.
Positive Outlook
- FY'26 constant currency ARR growth expected between 7% to 9%, indicating continued subscription business strength.
- Operating cash flow projected to reach approximately $1.03 billion in FY'26, representing about 19% year-over-year growth.
- Free cash flow expected to be approximately $1 billion in FY'26, an increase of about 17% from FY'25.
- Planned share repurchases of approximately $200 million in Q1'26, part of a $2 billion authorization, demonstrating confidence in financial flexibility.
- Leverage below 1x and substantial cash flow capacity provide flexibility for investment and capital returns.
Challenges Ahead
- FY'26 revenue guidance of $2.650 billion to $2.915 billion implies a potential year-over-year decrease of 3% at the low end, or growth of up to 6%.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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