It has been about a month since the last earnings report for PTC Inc. (PTC Quick QuotePTC - Free Report) . Shares have added about 2.6% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is PTC Inc. due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.

PTC's Q4 Earnings Beat Estimates

PTC reported fourth-quarter fiscal 2025 non-GAAP earnings per share (EPS) of $3.47, up 126% year over year. The figure beat the Zacks Consensus Estimate by 63%.

Revenues came in at $894 million, rising 43% year over year (up 39% at constant currency or cc). The top line beat the consensus estimate by 20.2%. Management projected revenues in the $725-$785 million band. For fiscal 2025, PTC’s revenues jumped 19% year over year to $2.7 billion. The most notable move was the divestiture agreement of Kepware and ThingWorx, acting as a pivotal step in sharpening PTC’s focus around its core pillars — Computer-Aided Design (CAD), Product Lifecycle Management (PLM), Application Lifecycle Management (ALM), and Service Lifecycle Management (SLM).

These four areas form the backbone of PTC’s Intelligent Product Lifecycle vision, a strategy aimed at helping companies design, manufacture, operate and service products more intelligently and efficiently. The divestitures are expected to simplify PTC’s portfolio, enabling a more cohesive product strategy and stronger focus on innovation within its core competencies.

Top-Line Details

Recurring revenues of $861 million rose 47.8% year over year.

Perpetual licenses decreased 15.9% to $8.4 million.

Revenues by License, Support and Services

License revenues (54.2% of total revenues) were $484.1 million, up 102.2% from the year-ago quarter figure.

Support and cloud services revenues (43.1%) of $385.4 million increased 9.2% year over year.

Professional services revenues (2.7%) were $24.4 million, down 28.7% year over year.

Revenues by Product Group

PLM and CAD businesses continue to witness healthy momentum.

In the fiscal fourth quarter, PLM revenues were $588 million, rising 44% year over year.

CAD revenues were $306 million, up 40% from a year ago.

ARR Growth Reflects Business Strength

Annualized recurring revenues (ARR) were $2.5 billion, up 10% year over year. At constant currency, ARR was $2.4 billion, up 8.5%. The uptick was driven by strong performance across all divisions and regions.

In the fiscal fourth quarter, PLM and CAD ARR were $1,503 million and $943 million, rising 8% and 9% year over year, respectively.

Operating Details

Total operating expenses were $343.3 million compared with $319.7 million in the prior-year quarter.

Operating income on a non-GAAP basis was $526.3 million, up from $276.6 million in the prior-year quarter.

Operating margin on a non-GAAP basis increased 1,470 basis points year over year to 59%.

Balance Sheet & Cash Flow

As of Sept. 30, 2025, cash and cash equivalents were $184 million compared with $266 million as of Sept. 30, 2024.

Total debt, net of deferred issuance costs, was $1.2 billion as of Sept. 30, 2025, compared with $1.7 billion as of Sept. 30, 2024.

Cash provided by operating activities was $104 million compared with the prior-year quarter figure of $98 million. The free cash flow was $100 million compared with $94 million reported in the year-ago quarter.

The company has a $2 billion share repurchase authorization in place and plans to execute $200 million in share buybacks in the first quarter of fiscal 2026. Over the course of fiscal 2026, PTC expects to repurchase between $150 million and $250 million of common stock per quarter, signaling strong confidence in its long-term growth trajectory.

Guidance

At the midpoint, PTC’s fiscal 2026 outlook suggests sustained double-digit growth in cash flow and strong visibility, supported by the activation of multi-year ramp-up contracts.

Revenues for fiscal 2026 are projected in the range of $2.65-$2.9 billion, indicating a change of (3)-6% year over year. Non-GAAP EPS is estimated in the $6.49-$8.95 band, suggesting a change of (19)-12%. For fiscal 2025, cash from operations is projected at around $1.03 billion, indicating a rise of 19% on a year-over-year basis. The free cash flow is forecasted at around $1 billion band, suggesting a 17% increase.

PTC projects 7.5% to 9.5% growth in ARR on a constant currency basis for fiscal 2026 (excluding Kepware and ThingWorx for the full year).

For the first quarter of fiscal 2026, PTC estimates revenues in the $600-$660 million band. Non-GAAP EPS is projected in the range of $1.26-$1.82. Cash from operations is expected to be $270-$275 million, and free cash flow is forecasted to be $265-$270 million. ARR growth is projected at 8.5-9%.

How Have Estimates Been Moving Since Then?

It turns out, fresh estimates flatlined during the past month.

The consensus estimate has shifted 10.03% due to these changes.

VGM Scores

At this time, PTC Inc. has a average Growth Score of C, however its Momentum Score is doing a bit better with a B. However, the stock has a grade of D on the value side, putting it in the bottom 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

PTC Inc. has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

PTC Inc. belongs to the Zacks Computer - Software industry. Another stock from the same industry, Cadence Design Systems (CDNS Quick QuoteCDNS - Free Report) , has gained 4% over the past month. More than a month has passed since the company reported results for the quarter ended September 2025.

Cadence reported revenues of $1.34 billion in the last reported quarter, representing a year-over-year change of +10.1%. EPS of $1.93 for the same period compares with $1.64 a year ago.

Cadence is expected to post earnings of $1.90 per share for the current quarter, representing a year-over-year change of +1.1%. Over the last 30 days, the Zacks Consensus Estimate has changed +0.2%.

The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Cadence. Also, the stock has a VGM Score of D.