PTC 2025 Q2 Earnings Strong Growth as Net Income Surges 40.8%

PTC (PTC) reported its fiscal 2025 Q2 earnings on April 30, 2025. The company's revenue increased by 5.5% to $636.37 million, with notable growth in net income, which surged by 40.8%. PTC exceeded its guidance across all metrics, indicating strong performance for the quarter. The company also raised its full-year guidance, reflecting confidence in sustaining growth despite macroeconomic challenges. PTC anticipates a continued positive trajectory in revenue and earnings, bolstered by its strategic positioning in the digital economy.

Revenue
PTC's total revenue for the second quarter of fiscal 2025 reached $636.37 million, marking a 5.5% increase from the previous year. Leading the revenue was the software segment, which contributed $607.38 million, followed by license revenue at $254.40 million. Support and cloud services generated $352.99 million, while professional services added $28.98 million. This diverse revenue structure underscores PTC's robust growth across various business segments.

Earnings/Net Income
PTC experienced a notable increase in earnings per share, which rose by 40.6% to $1.35 in 2025 Q2 from $0.96 in 2024 Q2. The company's net income also showed a significant improvement, reaching $205.25 million, up from $145.75 million in the previous year, marking a 40.8% growth. This impressive growth highlights PTC's strong financial performance and profitability.

Price Action
The stock price of PTC has edged up 2.18% during the latest trading day, climbed 4.92% during the most recent full trading week, and increased 0.11% month-to-date.

Post-Earnings Price Action Review
Following the earnings report, PTC's stock price saw a generally positive impact, with maximum returns of 6.67% observed across various time frames. The overall performance was relatively modest, with win rates of 50.00%, 50.00%, and 40.00% over 3-day, 10-day, and 30-day periods, respectively. This reflects a mixed but optimistic response from the market, with investors showing cautious optimism towards PTC's financial outlook and strategic direction.

CEO Commentary
“Q2 was a solid quarter for us, and I remain extremely optimistic about our position as an enabler of the digital economy – particularly our position as a supplier of software tools that make our customers more efficient,” said Neil Barua, President and CEO, PTC. He highlighted that despite current macroeconomic uncertainty, PTC is well-positioned to meet customer demand and facilitate their transition into the digital age. Barua expressed confidence in PTC’s capabilities to support customers during this period, underscoring the company's commitment to innovation and efficiency.

Guidance
PTC updated its FY’25 guidance to reflect first-half results and anticipated macroeconomic challenges. The company expects constant currency ARR growth of 7% to 9%, with free cash flow ranging from $840 million to $850 million. Revenue guidance is set between $2,445 million and $2,565 million, and earnings per share guidance is revised to $3.78 to $4.73. For Q3’25, PTC anticipates revenue between $560 million and $600 million, with earnings per share expected to be between $0.56 and $0.88.

Additional News
In recent developments, Adage Capital Partners GP L.L.C. acquired 7,500 shares of PTC, highlighting investor confidence in the company's growth prospects. Additionally, PTC announced an update to its fiscal year 2025 earnings guidance, with revised expectations for revenue and earnings per share. The company aims to navigate macroeconomic challenges while maintaining strong financial performance. Furthermore, PTC continues to focus on its capital allocation strategy, proceeding with share repurchases under its $2 billion authorization, demonstrating its commitment to returning value to shareholders.