PTC has introduced it has accomplished the beforehand introduced sale of the corporate’s Kepware industrial connectivity and ThingWorx Web of Issues (IoT) companies to TPG, a world different asset administration agency.
“We are pleased to complete the divestiture of our Kepware and ThingWorx businesses as we increase our focus on our Intelligent Product Lifecycle vision,” mentioned Neil Barua, the president and CEO of PTC. “We want to thank the teams moving over for their years of service, and we wish them well moving forward.”
Monetary particulars
PTC obtained money proceeds of $523 million upon closing (beforehand estimated at $525 million), reflecting closing changes of $42 million associated to working capital and indebtedness (beforehand estimated at $40 million). Internet after-tax transaction proceeds will likely be roughly $375 million (beforehand estimated at roughly $365 million), after the cost of divestiture-related prices of roughly $40 million (beforehand estimated at roughly $35 million) and money taxes associated to the divestiture of roughly $110 million (beforehand estimated at roughly $125 million).
PTC will use the online after-tax proceeds for share repurchases and intends to enter right into a $375 million accelerated share repurchase settlement in Q2’26, with closing settlement anticipated in Q3’26.
As anticipated, they’re updating our steerage for money movement, income and EPS to account for the divestiture. There aren’t any extra modifications to our earlier steerage offered on February 4, 2026.
Full fiscal yr 2026 and second fiscal quarter steerage
(1) On a continuing forex foundation, utilizing our FY’26 Plan overseas change charges (charges as of September 30, 2025) for all durations.
(2) Confer with the GAAP to non-GAAP reconciliation tables on web page 2.
(3) Up to date steerage for money movement, income, and EPS displays the impact of the Kepware and ThingWorx divestiture. FY’26 money movement steerage consists of roughly $150 million of divestiture-related outflows, which aren’t anticipated to recur in future years. This quantity is comprised of roughly $40 million of divestiture-related prices and roughly $110 million of divestiture-related money taxes. Q2’26 money movement steerage consists of roughly $5 million of divestiture-related prices. FY’26 and Q2’26 GAAP EPS steerage consists of roughly $145 million and $135 million, respectively, of divestiture-related bills and taxes. FY’26 and Q2’26 GAAP EPS steerage additionally features a $464 million acquire on the sale of our Kepware and ThingWorx companies.
(4) FY’26 free money movement steerage consists of roughly $20 million of capital expenditures which aren’t anticipated to recur in future years, associated to shifting a R&D centre to a brand new workplace.
Reconciliation of FY’26 working money movement steerage together with Kepware and ThingWorx to FY’26 working money movement steerage excluding Kepware and ThingWorx
Reconciliation of FY’26 free money movement steerage together with Kepware and ThingWorx to FY’26 free money movement steerage excluding Kepware and ThingWorx
(1) Confer with the Reconciliation of Working Money Move Steerage to Free Money Move Steerage desk beneath.
Reconciliation of working money movement steerage to free money movement steerage
Reconciliation of EPS steerage to non-GAAP EPS steerage
FY’26 monetary steerage consists of the next assumptions:
- They supply ARR steerage on a continuing forex foundation, utilizing our FY’26 Plan overseas change charges (charges as of September 30, 2025) for all durations.
- They anticipate churn to stay low.
- For money movement, because of largely related invoicing seasonality and timing of bills, and in step with the previous 5 years, they anticipate nearly all of their collections to happen within the first half of our fiscal yr and for fiscal This fall to be our lowest money movement era quarter.
- FY’26 GAAP working bills are anticipated to extend roughly 3%, primarily as a result of divestiture-related bills. Other than the divestiture-related bills, GAAP and non-GAAP working bills are anticipated to be comparatively flat, as investments to drive future development are offset by internet proceeds from the divestiture-related Transition Companies Settlement and decrease working bills because of divested prices.
- They anticipate the absence of FY’26 Kepware and ThingWorx money movement post-divestiture to be largely offset by FY’26 internet proceeds from the divestiture-related Transition Companies Settlement.
- Capital expenditures are anticipated to be roughly $30 million, with roughly $20 million of capital expenditures in FY’26 that aren’t anticipated to recur in future years, associated to shifting a R&D centre to a brand new workplace.
- Money curiosity funds are anticipated to be roughly $50 million to $70 million.
- Money tax funds are anticipated to be roughly $240 million to $260 million, of which roughly $110 million is said to the Kepware and ThingWorx transaction and never anticipated to recur in future years.
- GAAP and non-GAAP tax charges are anticipated to be roughly 20% to 25%.
- GAAP P&L outcomes are anticipated to incorporate the gadgets beneath, netting to a acquire of roughly $90 million to $120 million, in addition to their associated tax results:
- roughly $465 million of non-operating credit, primarily associated to a acquire on the sale of our Kepware and ThingWorx companies, partially offset by
- roughly $230 million to $260 million associated to stock-based compensation,
- roughly $80 million associated to amortisation of acquired intangible property, and
- roughly $35 million associated to acquisition and transaction-related expenses, of which roughly $25 million is anticipated in Q2’26.
- In Q2’26, they intend to repurchase roughly $250 million of frequent inventory. As well as, they’ll use the online after-tax proceeds from the Kepware and ThingWorx transaction for incremental share repurchases and intend to enter right into a $375 million accelerated share repurchase settlement in Q2’26, with closing settlement anticipated in Q3’26. In Q2’26, they anticipate a lower in totally diluted shares to roughly 118 million shares, in comparison with 121 million shares in Q2’25. As well as, within the second half of FY’26, they intend to repurchase between $150 million and $250 million of frequent inventory per quarter. In whole, they anticipate to repurchase roughly $1.125 billion to $1.325 billion of our shares in FY’26.
PTC investor replace name
PTC will host a convention name to debate the divestiture and up to date steerage at 5:00 pm ET on Monday, March 16, 2026. To take part within the reside convention name, dial (888) 596-4144 or (646) 968-2525, present the passcode 9277628, and press # or log in to the webcast, out there on PTC’s Investor Relations web site. A replay will even be out there.
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