PTC (PTC) investor relations material

Deal rationale and strategic fit

• Divestiture of Kepware and ThingWorx enables increased focus on intelligent product lifecycle vision and streamlines operations to prioritize core growth areas.

• Transaction aligns with a strategy to concentrate on core business areas and drive future growth.

Financial terms and conditions

• Cash proceeds of $523 million received at closing, with net after-tax proceeds of approximately $375 million after costs and taxes.

• Maximum purchase price for the divestiture is $725 million, with up-front proceeds of $600 million and a potential $125 million future earn-out.

• Divestiture-related costs are expected at $40 million, and cash taxes related to the transaction are expected at $110 million in FY'26.

• Net after-tax transaction proceeds are $375 million, $10 million higher than previous estimate.

• Fiscal 2026 Free Cash Flow guidance is ~$850 million, $10 million higher than previous estimate.

Synergies and expected cost savings

• Absence of Kepware and ThingWorx cash flow post-divestiture is largely offset by net proceeds from a Transition Services Agreement.

• Fiscal 2026 benefits from $70 million related to the divested businesses, not expected to recur in fiscal 2027.

• Operating expenses are expected to grow at roughly half the rate of ARR over the midterm, with divested costs offsetting new investments.

• Divestiture-related costs and taxes are not expected to recur in future years.