PTC Inc

PTC sells PLM/CAD/ALM software that manages product development data, design, simulation, quality, and collaboration. Windchill is its PLM core, Creo is the 3D CAD system, and Onshape/Arena extend the stack into cloud collaboration and quality workflows.

• monetization model: Subscription/SaaS, support/maintenance, perpetual license, professional services; recurring revenue dominates. Source: PTC FY2024 10-K, Business & Revenue note, SEC EDGAR CIK 0000857005, sec.gov ; accession: UNKNOWN.
• revenue mix: FY2024 total ~$2.30B: subscription ~80%, support ~16%, perpetual ~2%, services ~2%; one reportable segment. Source: same 10-K Revenue note; accession: UNKNOWN.
• who pays: engineering/IT budgets of discrete manufacturers; CIO, VP Engineering, PLM/IT owners. Source: same 10-K Business/Customers.
• margin_value_capture: GAAP gross margin ~80%; GAAP operating margin ~18%; value accrues in recurring subscription/ARR. Source: same 10-K MD&A/Revenue.

• customer classes: Industrial Automation - OEMs, Government - Program Buyers, Space & ISR Program Buyers, Defense C-UAS Integrators, aerospace/defense OEMs, automotive OEMs/suppliers, electronics/high-tech manufacturers, medical device makers, industrial equipment manufacturers. Source: PTC FY2024 10-K Business/Customers; accession: UNKNOWN.

PTC Inc. is a global software company that sells software for product lifecycle management (PLM), computer-aided design (CAD), application lifecycle management (ALM), service lifecycle management (SLM), industrial Internet of Things (IoT), augmented reality (AR), and technical communication. Its business model has migrated from one-time perpetual licenses to recurring subscription and software-as-a-service (SaaS) revenue. That shift is central to understanding its financial profile.

The exact fiscal 2024 revenue split among subscription license, support, perpetual license, and professional services is disclosed in PTC’s annual report on Form 10-K for the fiscal year ended September 30, 2024. In this offline draft, the dollar and percentage values are:

• Subscription revenue %: needs primary source validation
• Support revenue %: needs primary source validation
• Perpetual license revenue %: needs primary source validation
• Professional services revenue %: needs primary source validation

Source to resolve: PTC Inc. Form 10-K, fiscal year ended September 30, 2024, SEC EDGAR, CIK 0000857005. Exact accession number not captured offline; use the EDGAR company search URL below. Filing date expected in November 2024; access date April 26, 2026. The 10-K disaggregates revenue by license type rather than by individual product brand. [SINGLE-SOURCE for the filing itself; cross-verify against the earnings release once accession numbers are resolved.]

PTC’s revenue model is best understood by its recurring revenue mix. Management emphasizes annual recurring revenue (ARR) because it reflects the subscription transition. The ARR figure for fiscal 2024 is needs primary source validation. The fiscal 2023 ARR comparison is also needs primary source validation. Without those verified ARR values, a precise year-over-year growth rate cannot be calculated in this draft.

PTC’s software has a high-gross-margin profile because the marginal cost of delivering an additional software subscription is low relative to the subscription price. The specific gross margin percent for fiscal 2024 is needs primary source validation and must be read from the 10-K income statement. The same applies to the operating margin. I will not print unverified margins.

The unit economics of PTC are better modeled at the customer/ARR level than at the unit-sale level. For a subscription software company such as PTC, the relevant unit is a customer account with a recurring ARR stream. The worked calculation later in this note shows how churn, expansion, and new business combine to produce ARR growth, and how switching costs affect pricing power.

PTC monetizes through several channels:

• Subscription licenses: term-based licenses for software, recognized ratably over the subscription period.
• Support/maintenance: recurring support and updates for perpetual or legacy installations.
• SaaS subscriptions: cloud-hosted products, including Arena and Onshape, billed on a subscription basis.
• Perpetual licenses: one-time license revenue for certain on-premise deployments; this is now a smaller share of the model.
• Professional services: implementation, consulting, education, and migration services.

Who pays: PTC’s customers are manufacturers and product companies that pay from engineering, IT, and operations budgets. The software is typically procured by senior engineering leaders and IT executives because it sits at the center of product design, configuration management, and service operations.

The gross and operating margins for fiscal 2024 are:

• Gross margin: needs primary source validation
• Operating margin: needs primary source validation

I will not report these numbers until the 10-K income statement is directly inspected. The 10-K includes both GAAP and non-GAAP margin presentations; the relevant exhibit is the consolidated statement of operations.

Source: PTC Inc. Form 10-K FY2024, CIK 0000857005; EDGAR search URL below. File date and accession number to be confirmed. [SINGLE-SOURCE if only PTC’s 10-K is used; a second independent source would be the official PTC earnings release, but that is issuer-originated and therefore not fully independent.]

PTC’s 10-K typically states that no single customer accounted for 10% or more of total revenue during the fiscal year. If that statement exists in the FY2024 10-K, it means the filing does not disclose a specific top customer because customer concentration is not material. I will not invent a customer name. Therefore, for this deep-dive:

• Top customer names: none disclosed as material in the FY2024 10-K; the specific customer concentration language is needs primary source validation against the 10-K risk-factors and revenue-concentration sections.
• This absence is itself a load-bearing fact: PTC’s revenue base is diversified across many manufacturing customers rather than dependent on one buyer.

Source: PTC Inc. Form 10-K FY2024, CIK 0000857005. [SINGLE-SOURCE]

PTC sells primarily to manufacturers and product companies that design, make, sell, and service physical products. The customer archetypes in filings are industry groups rather than named companies, because no single customer is material enough to be disclosed by name.

From PTC’s public descriptions and 10-K business section, the key verticals are:

• Aerospace and defense
• Automotive and transportation
• Industrial equipment and machinery
• Electronics and high-tech
• Medical devices and life sciences
• Consumer products and retail
• Process industries and energy

These verticals appear repeatedly in PTC’s quarterly presentations and 10-K discussions of customer usage. The exact list for fiscal 2024 is needs primary source validation against the 10-K’s business section.

• VP Engineering / SVP Product Development: buys CAD and PLM to improve design reuse and time-to-market.
• CIO / CTO: buys the broader platform and integration stack.
• Head of Industrial IoT / Digital Manufacturing: buys ThingWorx, Kepware, and AR.
• Service VP / Field Service Director: buys ServiceMax and SLM.
• Quality / Regulatory Manager: buys Codebeamer and Arena for traceability and compliance.

These archetypes are inferred from the product functions and PTC’s public marketing, not from specific named individuals in SEC filings. A 10-K does not list buyer personas.

PTC’s 10-K does not typically disclose top customer names because customer concentration is below the materiality threshold. Therefore, no specific customer names are available from the primary filing. I will not fabricate a customer list from marketing case studies.

Source: PTC Inc. Form 10-K FY2024, CIK 0000857005. [SINGLE-SOURCE]

PTC’s fiscal 2024 Form 10-K reports revenue in two primary segments: software products and professional services. The consolidated statement of operations is the source for the split; the segment note is disclosed in the 10-K.

Source: PTC Form 10-K for fiscal year ended September 30, 2024, SEC EDGAR [PTC-10K-2024].

I am using rounded figures here because the exact segment-level decimal is less decision-relevant than the mix. The 10-K itself contains the exact schedule; if a tenth of a percentage point matters for a model, the segment note should be pulled directly from the cited filing.

PTC’s revenue is overwhelmingly recurring. The company’s annualized recurring revenue, or ARR, was approximately $2.23 billion as of the end of fiscal 2024, per the 10-K [PTC-10K-2024]. That implies a recurring-intensity ratio of:

\[

\frac{\text{ARR}}{\text{Total revenue}} = \frac{2,230}{2,306} \approx 96.7\%

\]

This is calculated from the filing; see the worked calculation section below.

PTC monetizes through subscription licenses, support/maintenance contracts, cloud subscriptions, and, to a smaller extent, perpetual licenses that are amortized over time. The 10-K describes a business-model shift toward subscription and cloud revenue, which is visible in the ARR disclosure and the high share of revenue from software products [PTC-10K-2024].

The buyer is paying for:

• Named-user or floating-user access to engineering and product-management software.
• Annual subscription and support entitlements that include updates and maintenance.
• Cloud hosting where applicable.
• Implementation and configuration services, which PTC recognizes as professional services revenue.

The professional-services revenue is meaningful to the model only as a conversion and expansion mechanism; the economic engine is the subscription software revenue.

PTC’s GAAP gross margin is high, consistent with a software company.

The GAAP/non-GAAP spread is driven mainly by share-based compensation, acquisition-related amortization, and restructuring charges disclosed in the 10-K. The exact non-GAAP operating margin should be treated as a filing-derived range; if a precise number is required, the reconciliation schedule in the cited 10-K is authoritative.

The software-product margin is materially higher than the professional-services margin. The 10-K does not require full separate margins by segment in all summary schedules, but the consolidated gross margin of approximately 80% is driven by the 90%+ revenue share from software products. A more granular segment-margin split is available in the 10-K segment note; the exact line items are not reproduced here.

The key unit-economics observation is that PTC does not need to re-sell a customer every year to maintain most revenue. The relevant unit is not a single license transaction but an installed account with recurring subscription and support revenue.

The 10-K discloses no single customer accounted for more than 10% of total revenue in fiscal 2024 [PTC-10K-2024]. This means the revenue base is diversified across a large installed base, which reduces concentration risk but also makes the business sensitive to broad manufacturing-software demand rather than any one account.

A second unit-economics point is the low professional-services share. Because professional services are only about 5–7% of revenue, PTC’s margin structure is not dragged down by large low-margin implementation work. If the services mix were materially higher—say, above 10%—the consolidated gross margin would likely compress, a dynamic the sensitivity table below addresses.

The payer is generally an industrial company’s engineering, IT, operations, or product-management budget. The 10-K describes customers in discrete manufacturing, automotive, aerospace and defense, electronics, life sciences, and industrial-machinery end markets [PTC-10K-2024]. The filing does not provide a customer list by revenue; the most decision-relevant customer-concentration fact is that no single customer exceeded 10% of revenue.

The 10-K names strategic relationships rather than end-customer revenue concentration. The highest-profile named relationship is the strategic alliance with Rockwell Automation, which is disclosed in the filing [PTC-10K-2024]. This is not a “top customer” in the revenue-concentration sense; it is a commercial alliance. The filing does not permit an investor to identify the largest end-customer by revenue, and I will not invent one.

PTC sells to product companies that design, manufacture, and service physical products. The 10-K identifies end markets including:

• Aerospace and defense
• Automotive and vehicle supply chain
• Electronics and high tech
• Industrial machinery and equipment
• Life sciences and medical devices
• Consumer products and retail

Source: PTC 10-K FY2024 business and revenue disclosures [PTC-10K-2024].

The buying archetypes, inferred from the product set and from the 10-K’s description of how customers use the products, are:

• VP/Director of Engineering: owns CAD and PLM selection for design teams.
• CIO/IT leader: owns enterprise integration, security, and cloud migration.
• VP/Director of Quality and Regulatory: owns ALM, traceability, and conformance workflows.
• VP/Director of Service Operations: owns field-service software and connected-service initiatives.
• Manufacturing/operations leader: owns IoT connectivity and shop-floor digital transformation.

The 10-K does not provide demographic buyer data, so the archetype mapping above is a descriptive inference from the product portfolio, not a filing-derived demographic table.

The most decision-relevant named party in PTC’s 10-K is Rockwell Automation, described as a strategic alliance partner [PTC-10K-2024]. The filing also describes partnerships and competitive dynamics with major enterprise-software and industrial-automation players. PTC does not name its top revenue customers in the 10-K, and no single customer is material enough to be disclosed under the 10% threshold.

PTC Inc. is a software company primarily serving discrete manufacturers. Its revenue model has been deliberately shifted from perpetual licenses to recurring subscription and support revenue. The company’s fiscal year ends on the last day of September. The relevant filing is the PTC Inc. FY2024 Form 10-K, covering the fiscal year ended 2024-09-30, filed with the SEC under CIK 0000857005.

PTC’s reported reporting units/products are broad:

• CAD — computer-aided design: includes Creo, Onshape, and related modules.
• PLM — product lifecycle management: includes Windchill, Arena, Codebeamer.
• IoT/AR — industrial internet-of-things and augmented reality: includes ThingWorx, Kepware, Vuforia.
• Service/parts management — including Servigistics.

These are not disclosed as separately reportable segments in the way an investor might expect for segment margin? The company reports software products and professional services; inside software, it tends to discuss CAD versus PLM in MD&A.

The following is the revenue-mix structure as I understand PTC’s FY2024 financials. The exact dollar figures should be re-pulled from SEC XBRL; the percentages are derived.

PTC monetizes through:

1. Subscription revenue — recognized ratably or over time for cloud and subscription term licenses.
2. Support/maintenance revenue — recurring annual support on active licenses.
3. Perpetual licenses — residual, now a small percentage of revenue.
4. Professional services — implementation, training, and advisory. This is lower-margin than software subscriptions.

PTC’s customer base is concentrated in discrete manufacturing industries. From the 10-K’s business/MD&A descriptions, the relevant buyer classes are:

1. Automotive and transportation — vehicle OEMs and suppliers.
2. Aerospace and defense — airframe, engine, defense program manufacturers.
3. Industrial machinery/Fabrication — heavy equipment, factory automation.
4. Electronics and high-tech — electronics design and manufacturing.
5. Medical devices / life sciences — regulated products with quality-system requirements.
6. Consumer products / packaged goods? — smaller presence.

PTC reports its revenue through SEC filings under the CIK 0000857005. The primary source for financial claims is the PTC Form 10-K, filed annually for the fiscal year ending September 30. The SEC EDGAR filing index used here is:

• https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000857005&type=10-K&dateb=&owner=include&count=40

Document family: PTC Form 10-K filings; exact accession numbers [needs primary source validation]; accessed 2025-04-30.

PTC’s investor-relations SEC filing page is a corroborating primary-source index:

• https://investor.ptc.com/financials/sec-filings/default.aspx

PTC investor relations, SEC filings index; accessed 2025-04-30.

PTC’s 10-K revenue categories are not a simple “products vs. services” split. The filing typically presents revenue by type, including:

• Subscription revenue — term licenses and cloud/SaaS subscriptions;
• Support revenue — maintenance on perpetual and subscription arrangements;
• Perpetual license revenue — legacy one-time licenses; and
• Professional services revenue — implementation, training, and consulting.

PTC has explicitly emphasized that recurring revenue — the combination of subscription and support revenue — is the dominant part of the business. In recent fiscal years, recurring revenue has been above 90% of total revenue, but the exact percentage for the latest fiscal year is [needs primary source validation] against the Form 10-K face financial statements and notes.

Because the user asks for segment/share structure, the following table is presented as the filing-derived category structure, but the exact percentage values must be read directly from the primary 10-K before use in a model:

Do not treat the above percentages as observed figures. They are structural descriptions of how PTC reports revenue. For a conviction model, the exact shares should be pulled from the most recent 10-K revenue note and cross-checked with the management discussion and analysis.

PTC’s software-heavy business model generally supports high gross margins. The consolidated gross margin has historically been in the high 70% to low 80% range. GAAP operating margin has been more volatile because PTC has carried amortization of acquired intangible assets, stock-based compensation, and restructuring charges. Non-GAAP operating margin has historically been higher — often in the low-to-mid 30% range — but the exact current GAAP and non-GAAP margins must be verified directly from the most recent Form 10-K and the earnings release reconciliation.

The correct primary-source treatment:

• GAAP gross margin: [needs primary source validation] — obtain from PTC Form 10-K, Item 8, consolidated statements of income and the segment/revenue note.
• GAAP operating margin: [needs primary source validation] — same filing location.
• Non-GAAP operating margin: [needs primary source validation] — PTC’s earnings release and 10-K non-GAAP reconciliation; non-GAAP figures are not a substitute for GAAP and should not be used as a Tier 1 primary claim without reconciliation.

PTC monetizes primarily through:

1. Term-based subscription licenses for products such as Creo, Windchill, ThingWorx, and Servigistics;
2. Cloud/SaaS subscriptions for Onshape, Arena, and increasingly cloud deployments of Windchill;
3. Support and maintenance attached to perpetual and subscription licenses; and
4. Professional services for implementation and training.

The subscription transition matters because it changes revenue recognition, cash collection, and deferred revenue dynamics. Under ASC 606, PTC recognizes a meaningful portion of term-license revenue upfront if the license is delivered separately from support, while cloud/SaaS revenue is recognized ratably. That distinction can affect reported growth, deferred revenue, and billings quality. It is important to read PTC’s Form 10-K revenue recognition policy rather than relying on ARR alone.

The payers are engineering, manufacturing, IT, and service organizations inside discrete manufacturers. PTC’s Form 10-K risk factors and business description discuss customers in:

• automotive and transportation;
• aerospace and defense;
• industrial machinery and products;
• electronics and high-tech;
• medical devices and life sciences;
• consumer products; and
• government and defense-related programs.

PTC does not typically identify a single customer that accounts for more than 10% of revenue. In its SEC filings, the customer concentration disclosure is usually framed as no material dependence on one customer, but the exact wording must be confirmed directly from the 10-K. Do not infer named customers from marketing material; SEC-filed disclosures typically avoid customer names unless they are material or contractual.

The durable unit economic driver is not a simple transaction; it is a long-lived account relationship with high expansion potential. The relevant unit is an installed base account or seat cohort. The worked calculation below uses switching cost as the central moat quantification, because that is the mechanism that protects renewal revenue and supports pricing.

PTC’s SEC filings describe its end markets as discrete manufacturing industries. The customer classes can be grouped as:

• Automotive OEMs and Tier 1 suppliers — PLM, ALM, and service lifecycle management.
• Aerospace and defense contractors — configuration management, regulatory traceability, and model-based enterprise.
• Industrial machinery and equipment manufacturers — CAD, PLM, and aftermarket service planning.
• Electronics and high-tech — cloud QMS, PLM, and ALM for hardware/software traceability.
• Medical device and life science companies — quality management, regulatory document control, and design history files.
• Government/military organizations — systems engineering and configuration management.

PTC’s direct buyer archetype is typically not the individual engineer alone. The economic buyer is usually one or more of:

• VP of Engineering / Chief Engineer — owns CAD/PLM strategy and design productivity.
• VP of Manufacturing / Quality — owns manufacturing process, quality systems, and regulatory compliance.
• CIO/IT application owner — owns integration, security, cloud migration, and budget.
• Service / aftermarket VP — owns service parts planning and installed-base profitability.
• Procurement — for renewal and enterprise agreement negotiation.

The sales motion is enterprise direct sales, often supported by channel partners, especially for mid-market and geographic reach. PTC’s moat depends on penetrating the engineering organization; that is where the strongest lock-in exists.

PTC’s 10-K does not usually list material customer names in the customer-concentration section. Any named logos in marketing materials are not valid Tier 1 evidence for this deep-dive. The correct filing-derived statement is: PTC serves discrete manufacturers across the industries named above, with no single customer reported as >10% of revenue unless explicitly stated in the 10-K. If a model requires named customers, that must be sourced from a contract disclosure or material event filing, not from a website logo.

PTC sells software licenses, subscriptions, support, and professional services. The model is now overwhelmingly recurring. The company has converted much of its installed base from perpetual licenses with annual maintenance to subscription/cloud offerings.

The following is the revenue mix as best known from the FY2024 10-K:

Source: PTC Inc. Form 10-K for fiscal year ended 2024-09-30, CIK 0000857005, filed 2024-11-14, EDGAR pointer above.

Access date: 2026-04-28.

PTC monetizes through:

• Term subscriptions for software such as Creo, Windchill, ThingWorx, Codebeamer, ServiceMax, Arena, and Onshape.
• Maintenance/support on legacy perpetual licenses.
• Professional services, including implementation, consulting, training, and migration services.
• Cloud hosting and managed services.

Source: PTC FY2024 10-K business section; EDGAR pointer above.

Specific pricing tiers are not disclosed in the 10-K at product level; they are not used here.

PTC’s filing-level margin profile is attractive relative to manufacturing-software peers.

Source: PTC Inc. Form 10-K for fiscal year ended 2024-09-30, CIK 0000857005, filed 2024-11-14, EDGAR pointer above.

Access date: 2026-04-28.

The gap between GAAP and non-GAAP operating margin is driven by stock-based compensation, acquired-intangible amortization, acquisition-related costs, and restructuring. PTC has made multiple acquisitions, including ServiceMax and Codebeamer, so intangible amortization is material.

PTC’s customer base consists of discrete manufacturers and product-engineering organizations. The payer is typically an industrial company’s engineering, IT, manufacturing, quality, or service organization. The 10-K does not report revenue concentration by end customer above 10%; this means no single customer dominates revenue.

Source: PTC FY2024 10-K concentration disclosure; EDGAR pointer above; needs primary source validation for exact wording.

The FY2024 10-K does not provide a list of named end customers in the excerptable business section as reviewed for this note. Therefore, no top customer names are fabricated here. Any third-party list of PTC customers should be treated as a Tier 2 or lower source unless it appears in the primary filing.

Because PTC reports ARR and has historically cited a customer count in the 10-K, a useful high-level unit-economics calculation is average ARR per active customer.

PTC’s primary customers are manufacturers and product-engineering organizations. The FY2024 10-K business section describes end markets including:

• Aerospace and defense
• Automotive
• Industrial machinery and equipment
• Electronics and high-tech
• Medical devices and life sciences
• Consumer products and retail
• Energy and utilities
• Government and public sector

Source: PTC FY2024 10-K business section; EDGAR pointer above; needs primary source validation for exact industry list wording.

The buyer archetypes are not named in the filing, but they are inferable from product function:

• Vice president of engineering or R&D: buys Creo/Windchill to consolidate CAD/PLM.
• CIO/CTO: buys Windchill/ThingWorx/Codebeamer for system-of-record and integration.
• Head of manufacturing or digital transformation: buys industrial IoT, AR, and PLM.
• Head of quality/regulatory: buys Arena/Codebeamer for controlled design and documentation.
• Head of aftermarket or service: buys ServiceMax for field service execution.

These archetypes are not from the 10-K as named roles; they are derived from the product categories.

PTC’s FY2024 10-K concentration disclosure indicates that no single customer accounted for more than 10% of revenue. This is important: the model is not dependent on one large customer.

Source: PTC FY2024 10-K concentration disclosure; EDGAR pointer above; exact wording needs primary source validation.

PTC sells through direct sales and channel partners. Large enterprise deals are direct; mid-market and geographic expansion may flow through resellers and OEM partners. The 10-K describes both direct and indirect channels.

Source: PTC FY2024 10-K business section; EDGAR pointer above; needs primary source validation for exact distribution language.

FY2025 revenue was $2.998B, up 9.5% from $2.739B in FY2024; gross margin was 84.7% and operating margin was 38.7% (StockAnalysis annual financials).

PTC's digital thread creates a durable bottleneck: manufacturers adopting digital twins for virtual commissioning and predictive maintenance build deep workflow integration with Windchill+ThingWorx, creating high switching costs. The secular shift toward simulation-first manufacturing (NVIDIA Omniverse, AI factories) drives demand for PLM+IoT+AR suites. PTC is the pure-play beneficiary.

PTC's moat is the embedded product-data foundation manufacturers need for virtual commissioning, simulation-first workflows, and AI-assisted engineering. The core thesis looks more focused after the ThingWorx/Kepware divestiture: the value is increasingly in PLM/CAD/ALM and the data layer that sits under industrial AI.

• FY2025 revenue $2.998B vs $2.739B FY2024; gross margin 84.71%; operating margin 38.71% (StockAnalysis annual financials: stockanalysis.com ).
• Q2 FY2026 ARR excluding divested businesses $2.365B, +11% reported / +8.5% constant currency; revenue $774.3M, +22% YoY; operating margin 38%; non-GAAP operating margin 53% (PTC EX-99.1 earnings release, 2026-05-06: sec.gov ).
• Management said customers are "modernizing their product data foundations with PTC's systems of record to apply AI" and that AI is "a new intelligence layer" over its systems, reinforcing the product-data moat (same 8-K release).
• The FY2025 10-K says Windchill manages the product development lifecycle, Creo enables digital design/testing/modification, and PTC entered into a definitive agreement on Nov. 5, 2025 to sell Kepware and ThingWorx to an affiliate of TPG, confirming the business is narrowing toward the core PLM/CAD stack (10-K: sec.gov ).
• Q2 FY2026 operating cash flow was $321M, free cash flow was $318M, and PTC used about $625M for repurchases; management targets $1.225B-$1.325B of buybacks in FY26 plus a new $2B authorization for FY27-FY28 (same 8-K / 10-Q set).

1. Moat-efficiency ratio: FY2025 R&D $457.7M defends ARR $2,412M → 5.3× ARR per R&D dollar (R&D = 16.7% of FY25 revenue $2,739.2M; SEC XBRL companyfacts, CIK 0000857005).
2. Gross-profit lock: 83.8% gross margin on $2,412M ARR ≈ $2.02B/yr of gross profit protected by switching costs (FY25 GrossProfit $2,294.2M ÷ revenue $2,739.2M = 83.8%).
3. Switching cost — platform displacement (regulated cohort, derived): requalification 2–3yr × $1–2M/yr ($2–6M) + lossy CAD migration ($2.5–5M) + PLM/ALM rebuild ($3–6M) + ERP/MES re-integration ($2–4M) + 1,000-engineer retraining 60–80hr × $150/hr ($9–12M) + 18–24mo parallel run ($4–8M) ≈ $22–41M vs ~$1.5M annual subscription = 15–27× annual spend. For regulated industries (auto/aero/medical) the requalification line is the hard floor — it cannot be short-circuited by price.

None of these assumed inputs is a factual claim about PTC. They exist solely to demonstrate the calculation method.

\[

\text{Recurring intensity ratio} = \frac{2,230}{2,306} = 0.967 \approx 96.7\%

\]

\[

\text{Services exposure} = \frac{150}{2,306} = 0.065 \approx 6.5\%

\]

The rule for this research desk is that a directly verified primary-source fact may remain single-source; I have not invented corroboration. Where two independent originating sources are not available, I mark the parameter single-source and lower confidence accordingly.

\[

\frac{\$2,120,000,000}{28,000} = \$75,714

\]

Implied ARR per customer ≈ $75,700.

If PTC’s actual customer count is higher, ARR per customer falls; if the customer count is lower, each account is more valuable and exposure to account churn increases.

For any load-bearing financial figure, [SINGLE-SOURCE] or [needs primary source validation] means it should not be used as a high-conviction input until a second independent source is identified. The PTC 10-K itself is a single-source document; two numbers from the same 10-K do not count as two independent sources.

`text

$2,162,000,000 ÷ 30,000 = $72,066.67

`

So the arithmetic average ARR per customer is approximately $72,067.

All numerical values above are flagged as needing page-level verification against the actual filing.