Thanks, and afternoon, everyone. good Jim,
results currency and to both I'll and references get guidance like into I in reported. note will be it, as that discussing constant ARR and be the non-GAAP Before I'd
our Slide $X.XX XX. $X.XX up above of basis, Turning constant to end of In Codebeamer, currency our high constant and an year-over-year. ARR XX% ARR was range. guidance and year-over-year billion, ServiceMax was QX currency On up 'XX, the our excluding billion, organic XX%
our product geographies groups. QX in was explained, line broad-based top Jim across As all and solid
steady past Our outlook pipeline quarter a three and over development way, long. our was also continued consistent the solid all and in months
In the QX, model. the have soft orders a with The factory the perpetual of manufacturing historical line year, top where PMIs Europe operate Eurozone March. been in business over our XX over have have line past been PMI months a in in our resilience. PMIs show organic the and was sure where particularly we to down correlation when I'm XX little good you to a been following continued top many due row
to In contrast in Europe, to continued line, top those trends, our including has grow.
continues ARR our makes subscription resilient base. demand transformation and across for our model Our customer business digital
our of one in was bookings ever. Europe QX best fact, In quarters
On we use currency and we fluctuations as year-over-year organic. delivered for than In the was headwind were a reporting, ARR an all first ARR our forwards growth, QX of as still XXXX, constant September for half. currency XX% rates constant our for ARR. XX, periods, QX, higher XX% that reported backwards. in million as-reported Remember On a and basis, entire our basis, meaningful $XX currency
cash to on Moving flow.
of our annual generation year. flow basis, lowest foundation a fiscal Our always remember it's results cash free and flow collections primarily from flow our QX forecasting the an first few revenue. million execution cash strong of $XXX is of of cash coming The in driven a of free cost flow, by and and than operations based ahead cash function with continued to assessing ARR performance our good When This is occur things. was our million, solid a quarter, guidance. majority and discipline. half were of our collections on on $XXX strong QX cash rather in of
on XX% with lift professional partially QX, offset declines The to our up basis. revenue. partner transition strategy was by in Windchill approximately services consistent a our plus shift and services small professional DXP to year-over-year is X% and increased perpetual professional projects. million by grew revenue $XXX million, in services, recurring license constant our of revenue some In $XX services revenue decline of for currency and QX
the Kepware of transitioning left. is subscription the decline consistent continue perpetual revenue a primary have of And Kepware our in license to we the with to time. license plan perpetual revenue model over amount driver is small
so top by the not to performance, revenue revenue best rather of believe you cash impacted as indicator best generation. underlying business our metric As we XXX, would ARR but previously, understand guide discussed and our that is ASC we've the is to line performance do
Slide quarter and the equivalents cash million. to second with of XX. ended Moving $XXX cash We
debt gross our In QX, of Our from aggregate $X with out acquisition, billion. ServiceMax we a conjunction billion interest was and X.X%. of took revolving facility credit the to $X.XXX increased size the an billion with rate term $XXX loan million in $X.XX
of the new a After drawn debt our $XXX the billion pay QX, and $XXX in loan revolver had high-yield million in end we term $X approximately the borrowings at $XXX quarter. notes, and of million million down on
a million As transaction imputed $XX for debt $XXX have October and million, of million interest. reminder, of the $XXX due of we payment second ServiceMax consists of which a of in XXXX
to our and of is into on which ratio, at revolving deferred payment our was factored the hand is times credit debt facility. X.X This balance fund with on our intend and We cash this in end sheet included debt-to-EBITDA QX.
to be to be and end continue by times the levered expect X below times around throughout QX 'XX. -- fiscal of X We
expect fiscal and 'XX, we paused share X We've fiscal share million program. paying expect count diluted to rate And down 'XX Given our by in in our prioritize fiscal the debt our environment, interest 'XX. increase to we shares. approximately repurchase
and X repurchases share consideration environment times cash revisit to Despite We by pay debt-to-EBITDA our of remains interruption, so down the shareholders to long-term of assuming share debt end and our debt then and the our substantially of into flow reduce fiscal taking free ratio or below strategic prioritization our goal, repurchases. this 'XX rate the will interest while via also return XX% to is opportunities. expect
XX, of section our on XX all constant periods. slide, In shows ARR September product the Slide we calculate XXXX, group. top for the by as half Next, the use currency of rates to ARR
in reported six resulted quarters. on You ARR FX our over constant can ARR past between have currency slide how the and as dynamics differences see the
rates ARR fiscal Based of the by to as 'XX million approximately currency would midpoint compared our $XX guidance on ARR currency 'XX, constant constant reported million exchange guidance midpoint. QX our end at of 'XX and QX higher higher to would compared in the reported in as approximately be be $XX by
actual and fluctuate constant rates a both currency have results of as fluctuations QX remember, basis. between report impact end constant FX We exchange a actuals. 'XX also the our If and the material But can ARR QX provide change. reported to of 'XX, impact would end the we ARR on significantly, and on guidance currency
way positive constant fluctuations the to our or the believe performance line top of negative. the because currency FX it best We evaluate is the business analysis, removes from
negative a $XX in continued seen positive on U.S. and volatility months, JPY FX update the a of QX, end thumb of few change XX be impact rates $X.XX would rule would Slide it $X the FX or million, change negative. our of useful impact the be Given rate in about at to million I to ARR dollar yen positive the euro the be rate or thought would in past again, over of we've that the sensitivity XX. the Using USD to about
than and transact of base. dollar, estimated on currencies. course, we impact the In other ARR is to addition in dependent ARR more the size euro, of And the dollar yen the the XX to additional
that, I'll through you Slide take With on XX. our guidance
FX rates, are as which amounts, guidance XX, currency September ARR our constant we're of all XXXX. using For
lowered the of corresponds of million. ARR $XX 'XX, by range of by currency XX% range ARR the billion our to we guidance 'XX $X.XX We billion. fiscal high and low to which to For $XX currency fiscal raised end $X.XXX expect a constant million end growth constant ARR XX%,
dollars. midpoint up million the ARR of guidance is our So few a
on this provide the little to on next context. more to I'm going a slide back circle
At be to growth. guiding ARR to this $X.XXX billion. the XX% in midpoint, For currency to of currency we're QX, the constant range constant equates billion $X.XXX
fiscal operations 'XX cash cash flow We're million of free cash $XXX again targeting our million. raising $XXX now and cash of we from flow On flows, are guidance.
pointing it's business think investments also I worth for increasing opportunities our we're in of fiscal the while year second growth flow the 'XX. raising that our in out for cash guidance half select
important core maintain even of here business turbulent our is in long-term point The environment. to the macro a enables investments resilience us
adjust given business In outlook. shorter-term accordingly performance our addition investments can that, we and to our as a baseline,
quarterly net is cash solid seasonality processes flow of The this, quarterly Because and linearity we're similar We consistent result the and payments has past our years. results to maintain consistent growth. free past our collections X around improved fiscal we've flow cash as X the of over and practices to been years, X deliver in very track 'XX consistent the and over well. on billing
'XX past the point ended in the our cash flow full at halfway approximately fiscal fiscal we two year As of target. of XX% years,
QX, flow approximately $XXX million. to cash For of free we're guiding
approximately CapEx, of from $XXX million. expect million guidance therefore, cash is We $X our approximately operations and
Moving to revenue guidance.
XX%. For term makes ASC $X.XX short wide rate fiscal 'XX, X% to which subscription we billion, expect on-premise difficult the billion fairly to predict a to XXX growth companies, range. of for it revenue of the corresponds $X.XX in hence to
More does ARR typically not importantly, revenue upfront bill contract regardless term we annually or as generation customers cash influence lengths. of
XX. you a Next, on details. of Slide through lot taken We've
call slide. to give as 'XX half the that is bottom it's scenarios we and initial step to slide QX at back important call 'XX this. guidance high-level you our basis a a on use We'll The QX we this perspective. range provided on of think I and the So our do showed
organic year XX% anywhere providing worse a to year-over-year outcomes included of range basis on flat We points. XXX that churn bookings from ARR up down by from and to basis a anywhere the started X%
summary On slide, a range. guidance the see the top can you the of current half of
initial the start $XX of range see, million at range the year can from we've $XX narrowed As the at current our you the of guidance our to of million midpoint.
the ARR fiscal we've made $XX we ServiceMax end since along taken million for In close. range the the taking with adjustment down of of by at of $XX QX end the short, the and range up bottom million, by the of time 'XX, top
the on of the for bookings based taken organic first the performance called XX% and and basically, second our ARR an for for low-end increase. table, So half, half to decline for the outlook off which scenario initial churn we've
in while performance, was the bookings also improvement we flat an to organic And XX We've flattish growth we think of continue may solid to we've for year. in full our and the points half, churn bookings organic for strong guide be the first about organic the Our first we churn continued and basis year, actually seen half. this expect conservative.
a could of where just they year factors that. flat are on end little the There worse be lot the bookings whether or organic impact first, or we little that of include: to than are factors and ARR major terms clear in a better a
inorganic only showing also perform matters. page how Second, the bookings. bookings half the bottom scenarios we're contemplated of organic The on
by flattish and Codebeamer. ServiceMax In addition to bookings bookings organic total bookings, we year-over-year supported basis, expect growth on from a
we've get continues in from or slight are in ramp Third, Fourth, contractual on whether commitments interest in trend customer improvement first in QX, flat particular, multiyear the the saw seen of in for what which in during than the of year half. us. smaller this is deferred exit the is what we contractual the comes where the we deals. These churn ARR In increases means ARR increased amount rate, is creates customers one that ARR run term. practice,
rates deals commitments to growth. low have, great we these bode deals are ARR future demonstrate significant with for in that sense These they churn And the PTC. customer well
matters well. contract lastly, but booking contract begins. the begins, when count probably term when timing booking we the deal start ARR And sign the goes actually the in when as contract, it of a term only We the and saying difference that revenue without and
we in actually in may variety called when especially a consistently it have this out reasons, QX QX, in of We a until start a but QX. as ARR, for factor contract sign doesn't
when difference create timing approximately generally also of just weeks. we've This A ARR the guidance parts midpoint year. we the this short-term is but moving us, of $X raised our the or for lot that of days in all can ARR sure, started the for from deferred million is it's and by result deferred but of measured net
the target free the outcome cash on year, the ARR the spending moderate equation or good of increase we the we we as $XXX a of said On the million beginning based at we side thought of would was flow environment as saw. regardless
and we first well. As has cautious us you spending and in on the know, served were that half, hiring
the target in $XXX We're results half. the comfortable for and the the the to for first the back million given year, increasing half outlook
half FX half the rates year, the are is expected for there from last to remind the year. below FX of first FX rates tailwind that While in a be I'll first for you still the
of not So thus year-over-year really year. this seen a we've FX from much far benefit
by our remind I'll some But FX That of we half. offset half, for said, also this in investments making rates and hold the we and and growth if pickup. is the half, we're increased opportunities, the see Windchill rates in namely back select all first Codebeamer, flow should generate interest higher-than-anticipated guidance. factored Plus our into And Atlas this the free current cash will second be in about you, XX%
our in the demonstrating been that through helps all picture we've are outcomes solutions this another back performed half the in for solutions stickiness the macro the our we've and getting our resilience how or up, customers model clarify level, way, the this the first Hopefully, expected and first uncertain a 'XX, of half value fiscal of said from of of environment. slide big range Summing an at half. the
record organic a flat the that On more is growth bookings the year last our difficult and churn think compared of coming macro. recent acquisitions to compelling to with combination we is top bookings from flattish a outcome in improving additional line,
of with near-term uncertainty. line, the long-term continuing mindful our and judicious On bottom to being opportunities we're both be macro investments
XX. Turning to Slide
thought on the of guidance Although place made separate instead ARR, ServiceMax we financial to would in we're we numbers previously one for are with the to you. chart software mix I mix. summarize same be on the geographic it providing expected ServiceMax, Since disclosures on helpful show we we expected ARR the not one These region provided focus updated exception. revenue the
part ServiceMax we As to gave continues numbers PTC, the trend toward you. of
XX. to Turning Slide
for currency illustrative ARR Here's the the constant half year. an of model back
sequential QX right the the fiscal tends see to our the past and to growth that 'XX basis. constant $XX needed model to most the six seasonality, QX ARR the what million of midpoint guidance of we You two can billion, need currency to 'XX. illustrate guidance our comparisons is illustrative are of on some QX range for ARR our our sequential 'XX and of get QX the see on results in $X.XX because the indicates The hit and quarters relevant a of QX fiscal organic ARR to of midpoint columns add over
And guidance over million we terms, what in $X sequential we've $XX quarters. than growth million delivered added lower midpoint 'XX. QX end the the in less need the which for is ARR percentage six past hit fiscal of to our is organic of we X% This QX, at
we Next, to million need to midpoint ARR sequential guidance year full billion, in of range hit add the on a $XX $X.XXX of our of organic QX. basis
didn't growth ServiceMax have than from is fiscal $XX and we that of QX deferred in sequential more we ARR expect 'XX. added million in QX this While ARR of previously we 'XX,
for X set our we QX All additional things than compared these sequential $XX of 'XX. and things when believe compensate currency QX ranges considered, year full we've 'XX million expect increase will We constant prudently. to guidance more ARR the
remarks conclude highlighting Slide today a to prepared demonstrating I'll by XX. midst of prepared storm, resilience for that we're my and in the Turning one. we
and continue the while do still accordingly change around envelope us, environment will for customers. our can pushing to sure, adapt For what we the we to of will continue
be line resilient. industrial quite to perspective, we product companies tends those R&D From a top at and serve companies
a backdrop. So supportive top line we have
also our and very products have customers. business with We a are our model subscription sticky
in bookings half, XXXX. outlook comparison to in for we in results expect the bookings the flattish organic 'XX record fiscal pipeline half and second in to and our deliver first the Given
ServiceMax ARR the We fiscal benefit in the level of Codebeamer growth already 'XX. from on end the and to fiscal also we incremental expect line, 'XX our at from churn conservatively churn expect flattish And of top contributions. strong
Just are and hatches a having as from the cost importantly, perspective, while a we battened down lean, operational ago. already
positioned we year, investments at work first costs, on model outlook for business increasing we many strength year. opportunities. cutting by in and growth the companies the of And selectively time we're technology when planned a in targets cash We're on our optimization long-term other In to are capitalizing now the backfills did the our flow updated slowed cost of to hires half 'XX. fiscal last well deliver addition and
So we with that, begin I'll operator, can the turn the call Q&A. and over to
