Earnings-apalooza, part 2: PTC and AspenTech

Apr 24, 2019 | Hot Topics

This morning started strong, with news from SAP and Dassault Systèmes announcing nice revenue growth, highlighting customer adoption of their newer offerings. I’ll have more on those later, but here’s a quick snapshot fo the highlights.

Now we’re hearing from PTC and AspenTech, two very different companies that are, nonetheless, part of our PLMish universe. And the good news continued:

AspenTech reported total revenue of $148 million, up 16% as reported (but with adjustments that I’ll have to figure out). License revenue, the part of a term license that’s now allocated to the initial license, was $99 million, up 25%. Maintenance revenue, the part of the term license that’s on-going support, product enhancements, etc. was $42 million, up 2%. AspenTech says it saw “positive growth contributions from each product suite and geography,” and that it continued to see “an improving macroeconomic outlook for our Engineering & Construction and upstream customers, and strong execution by the AspenTech team.” More after the call.

PTC was expected to report revenue of $312 million, up +1.3% and exceeded that by a bit, reporting ASC 605 revenue of $315 million , up 2.5%. Unfortunately, PTC also reported a GAAP net loss of $12 million. Remember that accounting is complicated by the whole subscription transition, so don’t freak out over the GAAP net loss — PTC reports that it has $351 million in cash and equivalents and carries total debt of $739 million. And don’t freak out about that, either. Remember that all PTC has to do (like all of us who hold mortgages) is pay the monthly amount due — which it totally can. (How did I get down this rathole??)

Back to performance: PTC said that license and subscription bookings: were $112 million, up 18% in constant currencies (cc). This was driven by a strong quarter for IoT; for the first time IoT bookings surpassed both CAD and PLM in the quarter. Remember, bookings are about future revenue, so that’s a clear signal of the continuing importance of PTC’s IoT business.

Total software revenue was $277 million, up 6% as reported (up 8% cc). Within that bucket, recurring software revenue: Q2’19 software recurring revenue was $266 million, up 11% (up 14% cc). IoT software revenue is still tiny, at $37 million, but was up 27% (up 30% cc). Lots more to come on this.

One last bit of news about PTC: Kristian Talvitie will be the new CFO, taking over on May 15, 2019. You may recall that Mr. Talvatie was at PTC before, when he headed investor and analyst relations.

More on all of this tomorrow.