The strategic focus is on the vision of "intelligent product lifecycle".

Boston, November 4th / PRNewswire / -- PTC (Nasdaq ticker: PTC) today announced its financial results for the fourth quarter ending September 30, 2026, as well as for the full fiscal year 2026.

Key operational and financial indicators for the fourth quarter and the full year of fiscal year 2026 1

As previously announced by the company on October 5, 2026, PTC has signed a final agreement to be acquired by Schneider Electric. In light of this proposed transaction, PTC will suspend its quarterly financial report conference calls and will no longer provide quarterly or annual performance guidance.

Important information about our operations and non-GAAP financial indicators

Non-GAAP Financial Indicators

We provide additional disclosure of certain non-GAAP financial indicators in addition to our financial results. We use these non-GAAP financial indicators and believe they are helpful for investors to compare our performance from period to period, as they provide a perspective that excludes items we do not consider to reflect the actual operating results. Non-GAAP financial indicators should not be regarded as a substitute for the GAAP results, as the items excluded often have a significant impact on our operating results; some of these items are recurring, while others occur frequently as well. Management uses these non-GAAP financial indicators, and investors should also consider them in conjunction with our GAAP results.

Excluding GAAP operating expenses, GAAP operating profit margin, GAAP gross profit, GAAP gross profit margin, GAAP net profit, and GAAP earnings per share, the figures have been adjusted to exclude the following items: equity incentives; amortization of intangible assets acquired through acquisitions; acquisition and transaction-related expenses included in general and administrative expenses; net impairment and other expenses (gains); non-operating expenses (gains) listed in the reconciliation statements; and income tax adjustments. For more information on the items excluded from our GAAP financial indicators and the reasons for such exclusions, please refer to the "Non - GAAP Financial Measures" section of our annual report 10-K for the fiscal year ending September 30, 2025.

Free Cash Flow: We disclose free cash flow in order to help investors assess our ability to generate cash without the need for additional external financing, as well as to evaluate our performance relative to our announced long-term goals and our intention to return excess cash to shareholders through share repurchases. Free cash flow is the amount of cash provided by operating activities (or used for operating activities) after deducting capital expenditures. Free cash flow does not represent cash that is available for discretionary spending.

Fixed Exchange Rate ( CC ): We disclose fixed exchange rate information in order to provide a framework for assessing core business performance after excluding the impact of foreign exchange rate fluctuations. To present fixed exchange rate information, the financial results of entities denominated in currencies other than US dollars for the fiscal year 2026 and comparable periods are converted into US dollars using the exchange rate as of September 30, 2025, rather than the actual exchange rates during that period.

Business Indicators

ARR: ARR (Annual Operating Rate) represents the annualized value of our active subscription software, SaaS, managed and support contract portfolio as of the end of the reporting period. We calculate ARR in the following manner:

• From the commencement of the contract period for the products or services under the contract (“Start Date”) until the end of the usage rights for those products or services (“Expiry Date”), we consider such contract to be in an active state. Even if a customer signs the contract before the Start Date, the contract will not be recorded under ARR until the customer obtains the rights to use the products or services.
• For contracts that include annual amounts that change over time, we only include the annualized value of those contract components that are considered active as of the calculation date ARR in ARR. We do not include any future commitments that may increase in value as of the calculation date ARR.
• Since ARR only includes contracts that are active at the end of the reporting period, ARR does not reflect any assumptions or estimates regarding future renewals or non-renewals.
• Active contracts are annualized by dividing the total value of active contracts by the number of days in the contract period (the expiration date minus the start date, adjusted for leap years), and then multiplying by 365 days.

We believe that ARR is a valuable operational indicator for assessing the health of subscription services, as it aligns with the amount we invoice customers on an annual basis. We typically issue invoices to customers based on the annual amount stipulated in the contract for that year. For one-year contracts, we usually issue an invoice for the total contract amount at the beginning of the contract period; for multi-year contracts, we issue invoices at the beginning of each year of the contract.

ARR will increase with the annualized value of active contracts that commence during the reporting period, and it will also decrease with the annualized value of contracts that expire during the reporting period.

Since ARR is not an annual recurring income, it is not calculated based on confirmed revenue or deferred revenue, nor is it affected by fluctuations in revenue recognition timing under ASC 606. This is particularly true for locally deployed licensing subscription services, where a significant portion of the total contract value is recognized as revenue in a lump sum at some point later in the software's availability period or at the start of the subscription term.

ARR should be considered independently of recognized revenue and deferred revenue, and should not be combined with or substituted for these items. Investors should consider this operational indicator, ARR, only in conjunction with our GAAP financial results.

About PTC (Nasdaq Code: PTC)

PTC (Nasdaq ticker: PTC) is a global software company that helps industrial and manufacturing enterprises transform their engineering, manufacturing, and service processes in a digital manner to support the physical products on which the world relies. PTC is headquartered in Boston, Massachusetts, with over 7,000 employees and more than 30,000 customers worldwide. For more information, please visit www.ptc.com.

PTC.com @ PTC Blogs

PTC Investor Relations Contact Person

Michael Maguire, CFA

Vice President of Investor Relations

investor @ ptc.com