PTC Q3 FY26: revenue down 6.8%, but ARR and cash flow beat guidance
PTC's third fiscal quarter was a split decision: revenue fell 6.8% to $600.0 million and GAAP EPS slid to $1.03, yet constant-currency ARR excluding divested businesses rose 9.1% and free cash flow of $249.3 million beat the top of guidance. Read this as a smaller, subscription-heavy business after the Kepware and ThingWorx sales, and judge it on ARR, cash flow and share count rather than the headline top line.
1 · Expected vs. Actual
Free preview belowGAAP EPS of $1.03 fell from $1.17, and non-GAAP EPS of $1.58 came in a hair below the $1.5825 consensus and down from $1.64 a year ago. The gap between the two EPS figures is mostly $59.4 million of stock-based compensation plus $19.7 million of acquired-intangible amortization. Non-GAAP net income was $181.4 million against GAAP net income of $118.8 million.
Revenue of $600.0 million was 6.8% below the $643.9 million reported a year earlier, and the company itself flags an 8.0% constant-currency decline. The mix is overwhelmingly recurring: $576.0 million of recurring revenue, $23.3 million of professional services, and just $0.7 million of perpetual licenses. Gross margin slipped to 81.7% from 82.9%, so this is a divestiture and volume story, not a pricing one.
Management raised FY26 revenue guidance to $2.69 billion to $2.75 billion from a prior $2.58 billion to $2.82 billion, and lifted the constant-currency ARR growth range to 9.0% to 9.5% from 7.5% to 9.5%. Free cash flow guidance was reaffirmed at about $850 million. The Q4 revenue guide of $630 million to $690 million has a midpoint of $660 million with a 4.5% tolerance, implying a sequential step-up from this quarter.
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Figures on this page come from the company's original SEC filings. The analysis is generated automatically and checked against validation rules, but may still contain errors or omissions. Not investment advice. · Generated 2026-09-17
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