PTC Creo - Nasdaq Corporate Solutions

Transkript

PTC FY’15 Investor Day
NASDAQ MarketSite
New York, New York
November 13, 2014
Safe Harbor Statement
Today’s presentations and Q&A session may include forward-looking
statements regarding PTC’s future financial performance and strategic
outlook and expectations, anticipated future operations, and products and
markets. Any such statements will be based on the current assumptions of
PTC’s management and are subject to risks and uncertainties that could
cause actual events and results to differ materially. Information concerning
these risks and uncertainties is contained in PTC’s most recent Form 10-K on
file with the SEC.
Unless otherwise indicated, all financial measures in today’s presentation are
non-GAAP financial measures. A reconciliation between the non-GAAP
measures and the comparable GAAP measures is located at the end of this
presentation and in the Q4 2014 Press Release document on the Investor
Relations page of our website at www.ptc.com.
2
Investor Day Agenda
Time
8:00 – 8:15am
Topic
Registration
Speaker
8:15 – 9:30am
PTC Growth & Profit Strategy
PTC’s Smart/Connected Products Growth Opportunity
9:30 – 9:45am Q&A
Jim Heppelmann
PTC Solutions – Delivering Value for Customers
9:45 – 10:25am
10:40 – 11:05am
11:05 – 11:35am
11:50 – 12:50pm
SLT & IoT
10:25 – 10:40am Break
EPLM
CAD
11:35 – 11:50am Q&A
Rob Gremley
Brian Shepherd
Mike Campbell
Lunch with PTC Management
Go-To-Market Strategy
12:50 – 1:10pm
1:10 – 1:30pm
Global Sales
Global Services
1:30 – 1:45pm Q&A
Bob Ranaldi
Matt Cohen
Financial Targets: FY’15 – FY’18
1:45 – 2:15pm
Financial Update
2:15 – 2:50pm Final Q&A
2:45pm
Adjourn
Jeff Glidden
3
PTC Strategic Outlook
Jim Heppelmann
President & CEO
November 13, 2014
The PTC Team
Jim Heppelmann
President & CEO
C O R P O R AT E
Jeff Glidden
EVP & Chief
Financial Officer
Aaron von Staats
CVP, General Counsel
BUSINESS UNITS
Mike Campbell
EVP, CAD
Segment
Brian Shepherd
EVP, Extended PLM
Segment
Richard Shou
DVP and President,
PTC China
Rob Gremley
EVP, IoT & SLM
Segments
Tony DiBona
EVP, Global Support
Barry Cohen
EVP, Strategy & HR
& Tech Support
Russ Fadel
President & GM,
ThingWorx IOT
FUNCTIONS
Bob Ranaldi
EVP, Sales
Matt Cohen
EVP, Global Services
& Partners
Jane Wachutka
EVP, Core R&D
What We Do At PTC
Technology solutions
that transform the way
you create, operate, and
service products
6
Macro Forces Have Driven Our Strategy
DIGITIZATION
REGULATION
CAD
PLM
CONNECTIVITY
Computer Aided Design
Creo & MathCad
Supply Chain Planning
Product Analytics & Compliance
IoT
Internet of Things
PLM
PERSONALIZATION
Product Architecture Mgmt
Windchill
Service Lifecycle Management
Arbortext, Servigsitics & more
SERVITIZATION
SLM
Application Lifecycle Mgmt PLM GLOBALIZATION
Integrity & Artisan
Product Lifecycle Management
Windchill
ALM
SOFTWARE-INTENSIVE PRODUCTS
Value is shifting from
hardware to software
embedded to cloud
product to service
External forces are
creating new threats
and opportunities
7
The Internet of Things
By 2020, Experts Predict 50 Billion “Things”
Will Be Connected To The Internet
IOT Is The Ultimate Technology For
Transforming The Way You Create, Operate, And Service Products!
8
Smart, Connected Products Will Transform Your Business
Harvard Business Review Cover Story – November 2014
• Co-Authored With Professor Michael Porter
• Powerful Call To Action For CXO Audiences
Jim,
I read your article in the HBR a week ago. I thought it was the best summary of the
various aspects (layers of the IoT stack, business models, etc.) of the IoT that I have
seen so far. I have shared it with my executive team and my board.
Phil is planning on reaching out to your team and set up a follow-on conversation…
Best,
CEO of $4B Revenue
Manufacturing Company
9
Evolution of Smart, Connected Products
Product Cloud
Database, Application Platform,
Rules / Analytics Engine, Smart Product Applications
Connectivity
One to One, One to Many, Many to Many
Smart,
Connected
Product
01101010111000110010000110
00010100001010000011100011
01010111000110010000110000
10100001010000011100110110
01001100101100110100110010
10001101010000111101101010
11100011001000011000010100
00101000001110001101010111
00011001000011000010100001
Smart Product
11100011001000011000010100
00101000001110001101010111
00011001000011000010100001
01000001110011011001001100
10110011010011001010001101
01000011110100110010110011
01001100101000110101000011
11011010101110001100100001
10000101000010100000111000
Enhanced UI
Ability to Interact
Software
Ability to Instruct
Sensors
Ability to Sense
Electronics and Controls
Ability to Process
Physical Product
Electrical
Mechanical
10
Smart, Connected Product Technology Stack
PRODUCT CLOUD
Smart Product
Applications
Software Applications running on remote servers
that manage the monitoring, control, optimization,
and autonomous operation of product functions
The rules, business logic, and big data analytical
Rules/Analytics
capabilities that populate the algorithms involved in
Engine
product operation and reveal new product insights
Identity &
Security
Tools that
manage user
authentication
and system
access, as well
as secure the
product,
connectivity, and
product cloud
layers
Application
Platform
An application development and execution
environment enabling the rapid creation of smart,
connected business applications using data
access, visualization, and run-time tools
Product Data
Database
A big data database system that enables
aggregation, normalization, and management of
real-time and historical product data
COMMUNICATIONS
Network
The protocols that enable communications
Communication between the product and the cloud
PRODUCT
Product
Software
An embedded operating system, onboard software
applications, an enhanced user interface, and
product control components
Product
Hardware
Embedded sensors, processors, and a
connectivity port/antenna that supplement
traditional mechanical and electrical components
External
Information
Sources
A gateway for
information from
external sources
– such as
weather, traffic,
commodity and
energy prices,
social media,
and geomapping – that
informs product
capabilities
Integration
with
Business
Systems
Tools that
integrate data
from smart,
connected
products with
core enterprise
business
systems such as
ERP, CRM, and
PLM
11
PTC’s Role in Smart, Connected Product Technology Stack
PRODUCT CLOUD
Smart Product
Applications
Software Applications running on remote servers
that manage the monitoring, control, optimization,
and autonomous operation of product functions
The rules, business logic, and big data analytical
Rules/Analytics
capabilities that populate the algorithms involved in
Engine
product operation and reveal new product insights
Identity &
Security
Tools that
manage user
authentication
and system
access, as well
as secure the
product,
connectivity, and
product cloud
layers
Application
Platform
An application development and execution
environment enabling the rapid creation of smart,
connected business applications using data
access, visualization, and run-time tools
Product Data
Database
A big data database system that enables
aggregation, normalization, and management of
real-time and historical product data
COMMUNICATIONS
Network
The protocols that enable communications
Communication between the product and the cloud
PRODUCT
Product
Software
An embedded operating system, onboard software
applications, an enhanced user interface, and
product control components
Product
Hardware
Embedded sensors, processors, and a
connectivity port/antenna that supplement
traditional mechanical and electrical components
External
Information
Sources
A gateway for
information from
external sources
– such as
weather, traffic,
commodity and
energy prices,
social media,
and geomapping – that
informs product
capabilities
Integration
with
Business
Systems
Tools that
integrate data
from smart,
connected
products with
core enterprise
business
systems such as
ERP, CRM, and
PLM
12
Capabilities of Smart, Connected Product
Smart, connected products enable new categories of capabilities, with each building
on the preceding one
4. Autonomy
3. Optimization
2. Control
1. Monitoring
• Sensors and external
data sources
• Software embedded in
the product or in the
product cloud
• Monitoring and control
capabilities enable
algorithms that optimize
product operation and
use
• Combining monitoring,
control, and optimization
allows autonomy
13
Alert and Notify of Changes
Monitor Product
Condition
Monitor the Product’s
External Environment
Monitor Product
Operation / Use
Control Product Operation / Use
Personalize User Experience
Enhance Product
Performance
Perform Diagnostics /
Service and Repair
Autonomous in Coordination with Other Products and Systems
Autonomous Product
Operation
Autonomous Product
Diagnostic / Service
Autonomous Product
Optimization
Impact of Smart, Connected Products on Industry Structure
Determinants of Industry Structure
(+) Smart, connected products can offer superior performance, value,
and customization relative to traditional substitute products
(-) New business models create a substitution threat by eliminating the
need for product ownership
(-) Entirely new types of substitution threat emerges as smart, connected
products become part of broader product systems
Threat of substitute
products or services
(+) Dramatically expanded opportunities for product features and
differentiation
(+) Analyze product-usage data to extend customer relationships
and increase switching costs
(+) Reduce dependency on distribution or service partners,
potentially increasing power or even disintermediating these
channels
(-) “Product as a service” business models can reduce buyers’
switching costs compared to ownership models
Rivalry among
existing competitors
Bargaining power
of suppliers
(+) Software can reduce the need for physical tailoring and the
number of physical component varieties, reducing the
leverage of traditional suppliers
(-) Introduction of powerful new suppliers (e.g. providers of
software, operating systems, data analytics) that will be
essential to differentiation
(-) New suppliers may gain greater leverage through capturing
product usage data and forging stronger direct
relationships with end users
Buyers
(+) New paths for innovation, differentiation, and value-added
services can reduce commoditization and shift competition
away from price
(+) Opportunities to broaden the value proposition beyond
products to include information and enhanced service
offerings
(-) Migration towards higher fixed cost and lower variable costs
due to upfront costs of the technology stack, increasing
discounting pressures
(-) Zero [sum] competition on feature functionality that raises
costs which cannot be recovered in higher prices
Barriers to entry
Bargaining
power of
Channels
Bargaining
power of
end users
(+) Barriers go up because of high fixed costs from more complex
design and the need for new IT infrastructure
(+) Barriers rise as agile incumbents who collect and analyze
product data to improve products and services capture firstmover advantage
(-) New entrants can leapfrog incumbents who hesitate to fully
embrace their SCP strategy
(-) New shared-consumption models can enable firms to compete
with incumbents based on differentiated platforms
18
Expanding Industry Boundaries
Farm Equipment
PRODUCT
SMART
PRODUCT
+
SMART, CONNECTED
PRODUCT
PRODUCT SYSTEM
TRACTORS
+
TILLERS
+
SYSTEM OF SYSTEMS
Farm
Equipment
System
COMBINE
HARVESTERS
Farm
Equipment
System
PLANTERS
Irrigation
System
Field
sensors
Irrigation
nodes
Irrigation
application
Farm
Management
System
Platform
Seed
Optimization
System
Weather Data
System
Rain, humidity,
temperature
sensors
Farm performance
database
Weather
maps
Seed database
Weather
forecasts
Seed optimization
application
Weather data
application
19
Nike’s Products Are Evolving From Fitness Equipment
to Fitness Monitoring Systems
Physical
Product
Physical
Running
sneakers
Fitness journal
Stop watch
Smart
Smart
Product
Smart,
Connected
Smart
and
Product
Connected
Nike+ sensor
to track
number of
steps,
distance, pace,
etc.
Nike+ sensor
connected to
internet site to
track running
route, distance
exercise patterns
Product System
System
Product
Multiple
System
of Systems
Industries
Nike+ Sports
watch
connected to:
Nike+ FuelBand
connected to:
Nike+ FuelBand
Fitbit
Nike+ Wearlink
Connected scale
Nike+
SportBand
Connected
treadmill
MapMyFitness
20
20
Impact of Smart, Connected Products on the Value Chain
• Connectivity to enable communicating with products,
business systems and other information sources
• Storage and analysis of new streams of data requires
“big data” technology
• Robust security management to protect the data
flowing to, from, and between products; protect
products against unauthorized use; and secure
access between the product technology stack and
other corporate systems
• Design increases
in complexity with
combined physical
and digital
elements
• Much greater
product usage
data enables
major design and
quality
improvements
• New design
principles emerge
(design for
service, upgrades,
and
customization)
• Need for new roles, such as data scientists
and UI software developers
• New processes and strategies to recruit,
integrate and retain new talent, often in high
demand and in other geographies
• Manage reorganization and increased
collaboration between IT, Product and Service
organizations
• Sourcing physical parts and inventory
management is can be simplified,
reducing items purchased and
dependency on physical parts
suppliers
• But need to establish relationships with
new and potentially powerful suppliers
of technology, connectivity and
services adds complexity
Firm Infrastructure
Human Resource Management
M
Technology Development
a
Procurement
r
g
Inbound
Logistics
Operations
• Complexity of physical
parts and production is
often simplified as
variability is delivered
via software
Outbound
Logistics
Marketing
& Sales
• Focus shifts from a product sale to
maximizing return over the product’s life
• Improved segmentation, pricing models,
and after-sale opportunities through deep
access to customer usage data
• Potential new business models delivering
products-as-a-service
After-Sales
Service
i
n
• Analyze product usage data to improve
service efficiency, warranty
management, and technician utilization
• Focus shifts to value added services,
and potentially product-as-a-service
• Potential to disrupt channels and service
providers through direct connections to
customer and products
21
Ten Key Strategic Choices
Expand scope? 10
Sell data to outside
parties?
Change the
business model?
1
9
Which capabilities to pursue?
2
8
Disintermediate
channel network?
Functionality:
embedded vs. cloud?
3
7
How to manage the data?
4
6
5
Open or closed
system?
Technology development:
internal or outsource?
What data to capture?
22
Equity Analyst Coverage of IoT Shows Opportunity
Barclays | Global Technology Outlook
Internet of Things: Beyond the Hype
CLSA Securities
Deep Field: Discovering IoT
Goldman Sachs
Software and the IoT
Morgan Stanley
The Internet of Things is Now
JP Morgan
Industrial Automation and IoT
UBS
Software: Trillion Dollar Revolution
23
PTC Mindshare In IOT Expanding Rapidly
“PTC hit it out of the park with the acquisition of
ThingWorx. It is really foresighted of the board to make
this investment as it represents a real game change on
so many fronts.”
– Michael Blumberg, President
“By adding ThingWorx to its portfolio, PTC can now
offer its customers an innovative product that can be
embedded in numerous points in the manufacturing life
cycle.”
– Denise Lund, Research Director
BARKAI CONSULTING
“PTC is in an excellent position to help companies realize
the value of the Internet of smart connected devices, and
I expect it will reach market leadership.”
– Joe Barkai, Market Strategist
“This is an exciting move by PTC, allowing them to
expand their vision and addressable market, and to help
differentiate them from the PLM pack.”
– Stan Przybylinski, Vice President of Research
SCHNITGER CORPORATION
“Add PTC to your list of potential solution providers; the
acquisition of ThingWorx changes the competitive
dynamics in each of these markets.”
“So you connect things to the Internet; what data do
you gather and what do you do with that data? That’s
where PTC’s ThingWorx’s comes in.”
– Dr. Marc Halpern, P.E., Ph.D., Research Director
– Monica Schnitger, CEO
“That was the most cogent talk on the value of the
Internet of Things I have heard. Beyond the buzz there
is real and practical value for IoT for PTC and many of
their customers.”
– Ann Grackin, CEO
“Talking about ‘how it works’ focuses more on how great
the vendor is; talking about ‘what it does’ focuses more
on how it will help the customer – and its customers. A
masterful job!”
– Bill Pollock, President
24
PTC’s Future: Smart, Connected Products
IoT Opportunity Will Change PTC’s Future:
• IoT is a natural fit - we have a compelling strategy that creates substantial
value for our customers
• We have an unmatched technology suite
• We are grabbing top mindshare as an IoT leader
We Are Making Changes To Operationalize This Exciting Future:
• IOT-enabled feedback loops are changing our concept of CAD, PLM, ALM,
and SLM
• We are deploying a coverage model that maximizes the full opportunity
• We are evolving our business model to build an IoT Subscription business
• Portfolio mix changes elevate our growth prospects
25
Further Optimizing Sales Segmentation
Strategic Sellers - 85%
Leverage Top Customers To Drive Financial Success
CAD
PLM
ALM
LAND the customer
SLM
IoT
EXPAND the footprint
Strategic Sellers Segment Into Product Development, Service, and Full Product Line Reps
IOT New Logo Sellers - 15%
Capture New Logos To Drive Market Share
IoT
SLM
ALM
LAND the customer
PLM
CAD
26
PTC Is Adopting A Hybrid Business Model
We Are We Embracing Subscription Model in FY15
• Why Do It?
– Aligns With Customer Buying Preference
– Expands Addressable Market
– Increases Net Present Value of Customer
Relationship
• Why Now?
– IOT Business Is Already Subscription
– Cloud Services Business Is Already
Subscription
– Market Momentum For Subscription
– Need For Reporting Transparency
• We Plan To Report Both Perpetual
And Subscription Results To
Shareholders For Full Transparency
27
License & Subscription Solutions (L&SS) Mix
Bookings Mix Drives Variability in Reported License & Subscription Solutions Revenue
*Note: Apples to Apples TCV = ACV x 2 or
ACV = TCV / 2
Customer
New Solution
Purchase
Perpetual
or
Subscription
Booking?
Perpetual Assumption*: 85%
Purchase
(TCV)
Total
Reported
Assumption*: 15%
L&SS
Revenue
New Subscription
Run-Rate Subscription
Deferred
License &
Subscription
Solutions
Revenue
Deferred Support
Revenue
Perpetual
Revenue Recognized
In Current Period
28
$17B Addressable Market
Total
Addressable
Market Size
Market Growth
Rate
PTC Assumed L&SS
Growth Rate
Computer-Aided Design (CAD)
$4.3B
~4%
3%-5%
Product Lifecycle Management
(PLM)
$5.2B
~6%
6%-8%
Application Lifecycle
Management (ALM)
$3.5B
~8%
7%-9%
(SLM)
$4.0B
~11%
10%-15%
Internet of Things (IoT)
$1.1B
~38%
~40%
End Market
PTC estimates informed by composite of industry analysts
29
Mix Shift Increases Growth Opportunity
ALM
PLM
ALM
SLM
CAD
SLM
PLM
IoT
IoT
CAD
FY’15 L&SS Mix
• Organic L&SS Growth = 10%
• M&A = 2%-4%
• PTC L&SS Growth = ~13%
FY’18 L&SS Mix
• Organic L&SS Growth = ~15%
• M&A = 2%-4%
30
A Time Of Change & Opportunity
Our Vision For
PTC In 2018
•
•
•
•
•
•
Acknowledged IOT leader
Reinvented CAD, PLM, ALM, And SLM
Satisfied And Committed Customers
Strong Growth In A Subscription Model
30% Non-GAAP Operating Margins
Substantial Increase In Shareholder Value
Driving PTC Growth with the
Internet of Things and
Rob Gremley, EVP IoT & SLM Segments
Russ Fadel, President & GM, IoT Segment
November 13, 2014
Internet of Things (IoT)
FY’15
Addressable
Market
Momentum
~$1.1B
• High-impact, high-interest disruptive technology wave
• Associated fast growth markets for IoT platform and
applications
• Well-known target buyers (namely broad PTC installed base)
Market
Growth
~38%
• Differentiated IoT technology stack (combines best of
ThingWorx, PTC Axeda, and PTC technologies)
• Simple packaging for the platform and applications
• Enhanced segmentation of PTC sales force (Bob Ranaldi)
PTC Estimates
• Early focus on “logo” acquisition (expected to yield high
connected-asset counts in the future)
PTC
L&SS
Growth
Opportunities
~40%
• Connected applications (combination of new IoT technology
stack and existing PTC software solutions)
• Expansion of existing partner ecosystem
• Innovative GTM approaches (capture development community
and online market opportunity)
PTC Estimates
34
Momentum
35
High-Impact, High-Interest Disruptive Technology Wave
Potential economic impact of $2.7T to $6.2T per year in 2025
Mobile Internet
3.7–10.8
Automation of
knowledge work
5.2–6.7
Internet of Things
2.7–6.2
Cloud technology
1.7–6.2
Advanced robotics
1.7–4.5
Autonomous and nearautonomous vehicles
Next-generation
genomics
0.2–1.9
0.7–1.6
Energy storage
0.1–0.6
3D printing
0.2–0.6
Advanced materials
0.2–0.5
Advanced oil and gas
exploration and recovery
0.1–0.5
Renewable energy
0.2–0.3
Source: McKinsey Global Institute analysis
36
Broad Reach Across Manufacturing Vertical
What does the
Internet of Things
mean to manufacturers?
$2.3T
annual economic impact
in 2025
%
80-100
potential reach
in 2025
Source: McKinsey Global Institute analysis
37
IoT Markets: Application Enablement Platforms and
Connected Product Applications
IoT Markets,
$M
2,888
+38%
2,248
1,710
1,099
2015e
2016e
2017e
2018e
Sources: ABI, ARC, McKinsey
38
Target Buyers for IoT and SLM
Solution developers that are
developing OOTB solutions for
operators
PTC
Vertical Solution
Providers
System
Integrators
Owner/Operators
End owner/operators of
systems of smart connected
products
Focus of our IoT Segment
Manufacturers that want to
create smart connected
products
Creators of
Smart Connected
Products
Service
Organizations
Manufacturer or third party
organization that drives
service operations
Focus of our SLM Segment
39
Key Acquisitions
Acquired December 2013
Acquired August 2014
40 employees, based in Exton, PA
170 employees, based in Foxboro, MA
Award-winning technology for IoT
application enablement
Focused on providing a cloud-based
solution for remote monitoring and
service
Focused on making it easy to develop
applications for the IoT
40
•
Innovative clinical diagnostic
equipment
•
Real-time connection to the
device
•
Rapid problem resolution
•
Improved equipment uptime
“ThingWorx enabled us to build our Next Generation Remote Service Application 3-5X faster.”
– Steve Postma Director, Remote Service
•
Integrated self-service retail
kiosks
•
Developed OpteView Remote
Service apps
•
Reduce field service visits
•
Problem resolution reduced
from ~3 hours to ~30 minutes
“With Axeda applications, we can in some cases correct the failure without waiting for a
technician to go on-site.”
– Paul Mercina Director, Service Product Management
Solution Architecture
Applications
“CREATE”
“OPERATE”
“SERVICE”
Applications
Applications
Applications
CAD
Custom Apps
Customer/Partner Built
SLM
PTC Axeda “Out of
the Box” Applications
PLM
PTC Axeda Apps
PTC Connected Apps
Custom Apps built by
customers, partners
ALM
IoT Application Platform
Application
Enablement
Platform
Secure, Scalable
Communications
Industrial
Data
Connectors
Machine
Cloud
Application
Development and
Runtime Tools
3rd Party
Device
Clouds
Device Management
and Connectivity
Network
Policy Server
Sensors, Devices
& Equipment
Support for connected
assets using ThingWorx
Agent, PTC Axeda
Agent, or direct
43
Packaging of Platform and Applications
Apps
Platform




Deliver World Class Service
Reduce Service Costs
Increase Service Sales
Rapid ROI
Application Development Enablement





Reduce Development Cost
Deliver Apps at 10X the Speed
Standardize On Leading IoT Technology
Create Differentiated Products
Unlock New Business Models
44
IoT “Value Curve”
Level 6+
INNOVATE
MANAGE
Level 5
CONNECT
Optimized
• Enterprise
integration
with current
CRM, ERP,
SLM, PLM
Level 4
Level 2
Level 1
Unconnected
• Limited
visibility into
product and
customer use
Connected
• Reactive
remote access
Level 3
Serviceable
• Proactive
monitoring
and electronic
software
delivery
Intelligent
• Usage
analytics and
predictive
maintenance
Differentiated
• New
revenuegenerating
capabilities
including
mobile apps
45
Acquisition of New Logos Expected to Drive Long Term
Asset Growth
Customer connected-asset volume increases with production rollout
Customer Assets Deployed
per quarter, since initial deployment
Illustrative
100%
Typical window of
acceleration
75%
50%
Deployed Assets
(% of Total)
25%
0%
1
2
3
4
5
6
7
8
9
10
11
12
Quarters after launch
IoT Segment
Strategy Focus
Today
New logo
acquisition
Asset and revenue growth
1 year
from now
46
Opportunities
47
Connected Applications
• “Connected Apps” are a
combination of our IoT technology
stack and (existing) PTC solutions
• Connected SLM
– Connected Knowledge & Diagnostics
– Connected Field Service Mgmt.
– Connected Parts Planning
• Connected CAD
– Monitoring use of PTC Creo
– Optimized Design of Smart, Connected
Products
• Connected PLM
– Connected Product Quality Monitoring
48
IoT Partner Network – Largest & Rapidly Growing
System Integrator
(SI)
Value Added
Reseller (VAR)
Solution Partner
Telco Operator
Partner
IoT Strategic
Partners
ThingWorx Ready
Implements solutions for end customers that leverage the
ThingWorx platform. Acts as influencer in key customers
Sells and supports the ThingWorx platform in a designated
territory and/or market
Builds a Vertical IoT Application on the ThingWorx platform and
sells it as a service (aka Powered-by-ThingWorx). Solution
Partner apps can also be sold through Telco/OEM partners
Channel to market through Telco “M2M” offerings. Required
infrastructure for many Vertical IoT Apps such as: Telematics,
Smart Farming, UBI, etc.. Cellular M2M Connections growing
from 300M today to 2.2B by 2022
Company that embeds and/or white labels the ThingWorx
platform into their own product or solution offering that
expands our market opportunity
A product (hardware, software, or other IP component)
integration and marketing partner relationship, where a product
such as a sensor, device, software, or system is pre-integrated
into the ThingWorx platform, certified by ThingWorx, and made
available through the Marketplace
49
•
Markets and sells IoT
solutions based on the
Axeda platform
•
Hosts a private cloud based
in Japan, managed by PTC
•
Focused on remote
monitoring, asset tracking,
and analytics
“This agreement represents a new phase of development and growth for our company, and brings
significant added-value controls and services to our Internet of Things offering.”
– Ryuichi Mizutani
Executive Officer, Hitachi High-Tech
•
Sells an AT&T-branded IoT
offering, hosted by PTC
•
Focused on mobile assets
and fixed assets that
require cellular connection
•
Examples include heavy
equipment asset tracking
and gas pump monitoring
“Customers are turning to us to make their M2M connectivity easy to manage and monitor in virtual
real-time. Our relationship with Axeda has fueled customer interest globally.”
– Mike Troiano
Vice President, Advanced Mobility Solutions, AT&T Business Solutions
ThingWorx Marketplace
The first “App Store” for the Internet of Things
• The “App Store” for the ThingWorx IoT Platform
• The Centerpiece for the ThingWorx Ready program where partners can develop
and market extensions, services, and applications to the global ThingWorx
customer base
• Provides a vehicle for:
− Adding Extensions to the Platform
− Ecosystem Advertising
− Ecosystem Monetization
• Private versions available for OEMs
and End Users
52
Low Touch Program
53
Service Lifecycle Management (SLM)
FY’15
Addressable
Market
Market
Growth
Momentum
~$4.0B
• Large and growing market for SLM applications
• Broad SLM portfolio anchors leadership position
• Existing Axeda “Connected SLM” applications
• Strong SLM pipeline
~11%
Challenges & Opportunities
PTC Estimates
• “Connected SLM” leverages strong position in both
SLM and IoT
• Increasing SLM close rates
PTC
L&SS
Growth
~10-15%
PTC Estimates
54
Momentum
55
SLM Market
PTC definition: Service Lifecycle Management (SLM) solutions enable closed-loop business processes employed by
manufacturers throughout their service network to ensure products perform as intended throughout their serviceable life to
maximize service revenue and profitability. SLM helps OEMs plan, manage and analyze service programs to provide feed back
into product performance information throughout the service lifecycle for continual service and product improvement.
Market Size
$ Billions
4.9
+11%
8.2
2.0
8.1
7.8
7.4
3.32.1
2.5
2.8
2013
4.4
4.0
3.6
’14e
3.3
3.8
’15e
’16e
’17e
Sources: Gartner, ABI, SLM Segment Team, PTC Market Analytics
56
PTC Service Knowledge
& Diagnostics
PTC Field Service
Management
PTC Warranty &
Contract Management
Create Service Information
PTC Remote
Service (Axeda)
Execute Service Delivery
Optimize Service Supply
Chain
PTC Technical
Information
PTC Service Parts
Management
PTC Service Parts
Information
PTC Service
Parts Pricing
PTC Service
Network
Management
PTC Axeda Applications for Connected SLM
Connected Machine Management Applications
PTC Axeda
Connected
Service
Monitoring
• Collect data from
the device and
configure alarms
• Enable proactive
fault detection
• View asset
dashboards
• Diagnose, and
repair problems
remotely
PTC Axeda
Connected
Access
PTC Axeda
Connected
Content
PTC Axeda
Connected
Reporting
PTC Axeda
Connected
Configuration
Remote
Access
Content
Distribution
Reports and
Dashboards
Configuration
Management
• Securely log into
remote devices and
products to
diagnose and
resolve issues
• Automate software
deployment to
many devices
• View most common
device information
and metrics with
canned reports
• Store and access
assets
configurations
• Share desktops
and run diagnostic
tools through a
patented FirewallFriendly connection
• Content includes
message files,
docs, test data,
marketing
messages
• Distribute files to
devices
• Easily build and
deliver dashboards
and reports on
performance,
compliance, and
operational metrics
• Take action based
on asset configs
• Leverage in content
distribution, recall
and entitlement
management,
compliance
58
59
Connected Service Delivery
Identified as a “top three” IoT use case in manufacturing
2) ThingWorx monitors
sensor data and
determines that problem
or other conditions exist
that trigger SLM events
3) SLM Knowledge Base,
Diagnostics Rules, and
maintenance schedules are
used to identify required
action for situation
4) Warranty management
determines service entitlement
& ensures compliant product
usage
5) Required parts are
identified and ordered via
optimal inventory location
6) Field Service ticket is
automatically opened and
a technician is scheduled
8) Proactive service is
performed, restoring
asset to proper condition
1) Sensor data gathered
from a connected asset
7) Required service information is
located and attached to service order for
technician including KM Service Session
and access to additional KM diagnostics
60
Accelerating Development of Connected SLM
Expand from Remote Monitoring to “Connected Service Delivery”
Connected Knowledge &
Diagnostics
Automate issue diagnosis and/or
enable remote diagnostics by
combining connected products with
an intelligent knowledge base and
rules management system
•
Essential building block for Connected Service
Delivery use case
•
First step towards a ‘decision support system’ for
connected products
Connected Field Service
Management
•
Standardizes common integration found in PTC
Axeda and ThingWorx deployments
•
Integrates with Connected Diagnostics Solution
•
Strengthens Flagship Product with Clear
Differentiator
Integrates connected product with
field service solution for
embedded remote monitoring, and
technician efficiency
Connected Parts Planning
Forecasted and installed based
inventory optimization and
•
automated replenishment based on
up to date status of machine location,
configuration, and status
Integrates with Other Solutions to Further
Strengthen System Level Opportunity
61
SLM Pipeline and Close Rates
Working pipeline replenishment and close rates in parallel are top FY’15 priorities
Pipeline management &
replenishment
• Historical “cyclic” pipeline performance
largely a factor of 1) Servigistics onboarding and 2) PTC sales readiness
• Entering FY’15 with stronger and more
mature “PTC-developed” SLM pipeline
• Hyper-focused on pipeline
replenishment during FY’15 in prep for
continued growth in FY’16
Increasing SLM close rates
• Given large pipeline, business is highly
sensitive to close rates
• Opportunity to increase close rates by 35% in FY’15…
– Improved pipeline cleansing and hygiene
– Improved operational rhythm with sales
franchises (targeting, deal sponsorship)
– Leverage product improvements
– Drive to increase SLM corporate visits
* In addition to traditional metrics of revenue, forecast, pipeline coverage, close rates, # of deals
62
Key Takeaways
• Massive, fast-growing IoT market is applicable to 80-100% of
manufacturers
• Combination of PTC, ThingWorx, and Axeda gives PTC a differentiated
technology leadership position
• Large & dedicated IoT-focused sales force
• Expanding GTM reach from partner ecosystem and marketing programs
• Large and growing market for service applications
• Existing broad portfolio of SLM applications
• “Connected SLM” opportunity by combining SLM portfolio with new IoT
stack
63
EPLM Strategy Update
Brian Shepherd
EVP Extended PLM
November 13, 2014
EPLM Segment Growth Rates
PLM
FY’15
Addressable
Market
Market
Growth
ALM
~$5.2B
~6%
Market
Growth
~$3.5B
~8%
PTC Estimates
PTC Estimates
PTC
L&SS
Growth
FY’15
Addressable
Market
6%-8%
PTC Estimates
Note: Supply Chain Management solution area now included within PLM
PTC
L&SS
Growth
7%-9%
PTC Estimates
66
EPLM Executive Summary
Well positioned for EPLM Revenue and Profit Growth for FY’15 and Beyond
• Great Products & Customers
– We have an outstanding and broad EPLM portfolio of leading products built through organic
development and strategic acquisitions in use across our large installed base of customers
• Differentiated “Closed Loop Lifecycle Management” Message
– PTC has a broad “lifecycle management” message with special points of differentiation
– With PTC’s leading IoT capabilities, we have a differentiated offering for “closing the loop” in
product development
• Compelling Installed Base Upsell & Cross-Sell Opportunities
– Repeatable and compelling sales plays focused on PTC’s large installed base of happy
customers provide many opportunities to upsell and cross-sell additional solutions and products
to broaden the EPLM footprint
• Improving Profit Through Better Mix of Software & Services
– More service partners and an overall reduction in the amount of services required for EPLM
solutions means faster time to value and lower TCO for customers while providing a better profit
margin for the EPLM segment
67
PTC Windchill is a PLM Market Leader
Enterprise software for securely managing the content and
process of product development throughout the lifecycle
• Comprehensive capabilities enabling
business process improvements
• Proven architecture for
performance & security
• Easy to learn & use
• Low total cost of ownership
EXAMPLE LARGE CUSTOMERS (5,000+ SEATS)
Seats:
Retention:
1,500,000
99.5%
1
#1 Aerospace & Defense PLM
#1 Industrial Equipment PLM
1
#1 China PLM
2
#1 Retail PLM
1
Sources: 1-CIMdata, 2-IDC
68
PTC Windchill Improvements Address Customer Needs
PTC Windchill 10.2 Key Enhancement Areas
• User Experience: Enhanced relationship
explorer; better document management
• Global Product Development: Enhanced
internal/supplier collaboration and improved
CAD data management
• Global Platforms: Improved support of
rule-based product configurations with ability
to publish options/variants to SAP
Process Consumptions Shown in 3D
• Product Analytics: Cost management and
materials compliance improvements
• MPM: Easier and faster MBOM and
manufacturing process planning
• Security: Fine grain access control
and policy management via security labels
69
Raytheon Video Here
70
Expanding Value and Reach with
PTC Cloud Services for PLM
(Managed Services for Strategic Customers)
Immediate Access
Expert Application Management
Secure Hosting
Optimal Performance
EXPANDED SAAS OFFERINGS FOR CHANNEL CUSTOMERS: (FQ2’15 expected availability)
PTC PLM Cloud – Basic
Offering
(New version of On Demand)
Hosting Type
Multi-Tenant (Public/Shared) Windchill Instance
Full Service
Offering
Upgrade option
PTC PLM Cloud – Standard
(New Service)
Dedicated (Private) Windchill Instance
Everything Included
Hardware, software, maintenance, upgrades, backup & security with no setup fees
1 year minimum contract – “Active User” Licensing
71
Creating Smart, Connected Products Requires
Improved Software and Systems Engineering
“Senior executives in engineering companies
need to see software and systems
engineering as an essential
competency that spans traditional ALM,
PLM, and SLM silos.”
– Ovum, 2014
“…forward-looking manufacturers of
‘software intensive’ products will
increasingly view software not
only as a product component but as a key
source of innovation and
differentiation.”
– IDC, 2014
72
PTC’s ALM Portfolio for Software and
Systems Engineering
• PTC Acquires MKS (Integrity) –
June 2011
– Best-in-class functionality for managing
product-related software development,
from requirements management to test
management
– Traceability functionality ideal for software
development in safety critical / audited
processes (ISO 26262, Automotive
SPICE, etc.)
– $60M+ in 2010 revenue with 1000
customers worldwide
• PTC Acquires Atego (Artisan) –
June 2014
– Technology leader and domain experts in
architecture modeling and model-based
systems engineering (MBSE)
– Specialized and unique capabilities in
safety critical applications and product
line engineering
– $20M+ in revenue, 100+ people, based in
Europe and North America
73
PTC’s EPLM Portfolio for AVL
“The PTC EPLM solutions allow us to unify all of our engineering teams through a
common, model-based systems engineering approach, enabling us to deliver higherquality products that win in the marketplace.”
– Dirk Denger
Synergistic Methods, AVL
74
PTC’s EPLM Solutions Enable
“Closed-Loop Lifecycle Management”
Operate
Connected
Operations
Support
Connected
Service
Connected
Manufacturing
Requirements
Management
Validation
System Architecture
Plan
Produce
Verification
Software
Electrical
Test
Mechanical
Manufacturing
Service
Develop
75
Core Plays Expand Presence
in Existing EPLM Customers
Connected
Operations
Connected
Service
Systems
Engineering
Connected
Manufacturing
Requirements
Management
Validation
System Architecture
Verification
Software
Electrical
Drive Parts
Reuse
Mechanical
Manufacturing
Service
Manufacturing
Engineering
Quality Lifecycle
Management
Visual
Collaboration
& Reviews
76
Connected Operations Enables
Connected Product Development
CAPABILITIES
• View real-time and
historical sensor data
from fleet
• Blend with data from
other enterprise systems
• Identify usage patterns,
cost savings, and quality
improvement ideas:
– “Continuous test” to
identify early failures
– Product misuse
– High value and/or
unused features
BENEFITS
Design Engineer
Product Marketing
Quality Engineer
VP Engineering
Correct early life failures
sooner to reduce costs,
improve quality
Reduce warranty costs
and brand risks through
rapid issue response
Grow revenue and
profit from current
and future products
77
Improving EPLM Profit Through Software/Services Mix
Software & Support
Services
22% Mix
33% Mix
2013
26% Mix
2015 e
2018 e
• As part of overall strategy to improve PTC’s profit margin, we are intentionally reducing the
amount of services required to implement EPLM solutions and increasing the use of partners to do
lower margin work as well as increasing the value/margin of the services work done by PTC
• This strategy benefits our customers (lower TCO and faster time to value), our partners (more
revenue opportunity), and PTC (improved sales efficiency and improved profit margins)
78
EPLM Executive Summary
Well positioned for EPLM Revenue and Profit Growth for FY’15 and Beyond
• Great Products & Customers
• Differentiated “Closed Loop
Lifecycle Management” Message
• Compelling Installed Base Upsell
& Cross-Sell Opportunities
• Improving Profit Through Better
Mix of Software & Services
79
CAD Strategy Update
Michael Campbell
EVP CAD Segment
November 13, 2014
Koichi Shimizu
Project General Manager
Engineering Management Division
Toyota
82
Toyota Video Here
83
Computer-Aided Design (CAD)
Momentum
FY’15
Addressable
Market
Market
Growth*
~$4.5B
* PTC Estimates
• New Creo Offerings: About half the CAD revenue is now driven
by new Creo Apps, Extensions and Packages
• New Release: Creo 3.0 includes “Unite” Technology (AnyData);
opens potential to displace competitive CAD within PTC base
~4%
* PTC Estimates
PTC
L&SS
Growth*
• Customer Satisfaction: Majority of customers have upgraded to
Creo; are extremely happy with the product capabilities,
performance and quality
• Strong R&D Pipeline of CAD Differentiators: Development
underway on IoT-driven CAD product enhancements and 3D
Printing support
• Low-end market / channel presence: While much of the
growth in the CAD market is from the SMB space, PTC’s CAD
focus is skewed toward mid-market and larger, sophisticated
customers that are likely to purchase other PTC Offerings
3%-5%
• Less focus on CAM, CAE: While CAM & CAE are fastergrowing segments of the overall CAD market, PTC is focused on
core competencies of CAD, CAID; Supports differentiation in our
Creo and PTC Strategies
• Challenging Comparisons: Faster-than expected adoption of
Creo by larger customers drove higher growth in FY’14; Continue
to expect market CAGR through FY’18
84
FY’14 CAD Update: Adoption & Revenue
PTC Creo Adoption more than doubled worldwide….
PTC Creo Adoption
from around 35% to over 75%
…and helped grow FY’14 CAD license revenue
PTC Creo
Pro/ENGINEER
by approximately 13% Y/Y
Americas: ~80%
PTC Creo
Adoption
BY REGION
Europe: ~60%
Japan : ~55%
Pac Rim : ~35%
85
Organizations are Making the Move to PTC Creo…
and are Very Satisfied
86
Satisfied Customers Adopting PTC Creo Have Unlocked
Creo-Driven CAD Revenue Growth
$80.0
Creo-Driven CAD Revenue
grew over 20% in FY’14
80%
70%
$70.0
60%
in $MM USD
$60.0
50%
$50.0
40%
$40.0
30%
$30.0
$20.0
20%
$10.0
10%
$-
0%
FY11
FY12
Creo-Driven* Revenue
FY13
FY14
Creo Adoption
* Creo-Driven Revenue is CAD license revenue generated by new Apps, Extensions and Packages
that were not available before the release of PTC Creo
87
These Companies Drove Over $50M in CAD License
Revenue in FY’14…
88
And Most of Them are Running PTC Creo 2.0!
89
Why Have They Adopted PTC Creo?
PTC Creo is a scalable, interoperable suite of product
design software that delivers fast time to value.
PTC Creo Parametric
PTC Creo Direct
PTC Creo Simulate
PTC Creo Schematics
PTC Creo Options Modeler
PTC Creo View MCAD
PTC Creo Layout
PTC Creo Sketch
PTC Creo View ECAD
PTC Creo Illustrate
New Apps (Available with PTC Creo)
PTC Creo Customers consistently report
double-digit productivity gains over previous CAD tools
90
PTC Creo Breakthrough Technologies
AnyRole Apps
AnyMode
Modeling
3D Parametric Modeling
PTC Creo Parametric
PTC Creo Simulate
PTC Creo
Direct
PTC Creo Schematics
PTC Creo Options Modeler
PTC Creo Layout
PTC Creo View MCAD
PTC Creo Sketch
PTC Creo View ECAD
PTC Creo Illustrate
AnyData
Adoption
2D Conceptual
Layout
3D Direct
Modeling
…
AnyBOM
Assembly
…
SE
…
91
Unite Technology in PTC Creo 3.0
Eliminates biggest obstacle to competitive CAD displacement
Enabling Optimal Multi-CAD Collaboration and Consolidation
• Import common 3D CAD formats
– SolidWorks, CATIA, NX, Inventor, Solid Edge
• Open key 3D CAD formats
– SolidWorks, NX, and CATIA
• Automatically update new versions
of non-PTC Creo data within Creo
designs
• Save As key 3D CAD formats
– SolidWorks, NX, and CATIA
…
An estimated 40%
of PTC CAD customers have
competitive 3D CAD seats
92
Value of Unite Technology
Consolidate CAD
systems to improve
quality, speed time to
market, lower costs for
both Engineering and IT
CONSOLIDATION
BEST IN CLASS COMPANIES
ARE 35% MORE LIKELY TO
STANDARDIZE ON ONE
CAD SYSTEM1
Support more
effective product
development and drive
on-time delivery by working
more efficiently with other
departments, suppliers or
development partners.
COLLABORATION
59% OF PEOPLE HAVE
DIFFICULTY MANIPULATING
IMPORTED MODELS2
1
Working with Multi-CAD? Overcoming the Engineering Collaboration
Bottleneck – Aberdeen Group
2 PTC survey of 7,000 manufacturing organizations, October, 2011
93
The New Paradigm for Multi-CAD Design
PTC Creo 3.0 Multi-CAD Consolidation Capabilities
Demo Here
94
CAD Consolidation Opportunity
PTC Creo is already a viable replacement for Competitive CAD seats within PTC’s base!
And similar opportunities are being identified for 2015
Leading European
Manufacturer of sailing
yachts
Opportunity to standardize
on PTC Creo; Displace
150 Seats of CATIA
Leading Supplier of fluid
flow control solutions for
power, oil & gas industries
Opportunity to standardize
on PTC Creo; Displace
300 Seats of SolidWorks,
Inventor
Global Technology Leader
in robotic-assisted surgery
solutions
Opportunity to capture all
CAD seats, by displacing
~300 seats of SolidWorks
95
CAD Sales Plays for FY’15
Focus for Direct Sellers,
serving Strategic Accounts
Upgrade Legacy
Packages
Expand PTC Creo
Footprint
Consolidate
Competitive CAD
Focus for Channel Partner Sellers,
serving SMB & Mid-Market Accounts
Upgrade Legacy
Packages
Expand PTC Creo
Footprint
Drive New Names
96
PTC Creo and Additive Manufacturing
Slicing
CAD Model
Model Preparation
Tray placement
Printability Checking
3D Printing
• PTC Customers are adopting 3D Printing, and are looking to PTC to
address the challenges of CAD / 3D Printing workflows
• PTC is partnering with 3D Printing Industry leaders to address these
challenges in FY’15
• Planned capabilities include:
– Printability checks, to ensure the model
can be successfully printed.
– 3D Lattices, to minimize material usage,
and time required to 3D Print.
– “Design for Additive Manufacturing”
via Topology optimized solid models,
to minimize weight and maximize strength
97
Smart, Connected Products CAD Strategy
Smart, Connected
PTC Products
Design and Validation of Smart,
Connected Products
To measure and improve the
efficiency of Engineering
organizations through PTC products
To optimize product designs using realworld usage information and conditions,
collected by Smart & Connected products
• Process Optimization Rules Engine
• Optimize designs by simulating their
performance based on conditions reported by
sensors on existing products in the field
• Data Tracking and Alerts
• Usage Driven Features & Specifications
• Determine immeasurable measurements with
Virtual Sensors
• Design for “Smart, Connectedness”
Observe
Improve
Analyze
98
Opportunity #1: Smart, Connected PTC Products
• Provides Data-driven Intelligence
• Continually Improves Engineering Processes, and
Increases Product Development Efficiency
• Increases Product Development Efficiency
Improved PTC Creo
and PTC Windchill
User Proficiency
Monitor System and
Solution Health
99
Opportunity #2:
Optimized Design of Smart, Connected Products
100
PTC Global Sales
Bob Ranaldi
Executive Vice President of Sales & Distribution
November 13, 2014
PTC Sales – Carrying Momentum into 2015
• FY14 Primary Business Goal Achieved – “Hit our License Targets each and
every Quarter”
• FY14 Sales Productivity up 7%
• Excitement in PTC’s Products. Reflected in a Strong Pipeline (380%)
• Excitement in PTC’s IoT Strategy and the Future it brings
• Excitement in Subscription offering and the ability to “Sell to customers how
they want to buy”
• Excitement in PTC’s GTM and related “Tip of Spear” Sales Plays
103
2015 Worldwide Sales Kick Off, Barcelona
CEO
Vision
Past and
Future
Customer
Buyer Panels
• “How can you not be
jacked up by his
message?”
• “Great start to the
meeting. Clear message
of the need to accelerate”
• “These customer panels
are very valuable. Please
keep them for future
events”
• “Great vision and great
momentum”
• “Crisp delivery. Clear
marching orders. FY15
excitement was felt
throughout presentation”
• “Hearing from customers
directly is always critical
and of huge value”
• “Great and emotional
introduction”
• “Customer panels are
great!”
• “Perfect!, Fantastic
Energy, Great speech,
Outstanding….”
Sales Plays
via SAVO
• “SAVO: GREAT !!!
Looks very promising”
• “A compelling story with
very good play examples,
gives me high confidence
that this is the best
solution on the market!”
“I am among these kind of guys who say when things go wrong….but also when they go well. Personally I do think that this SKO
(Manager last week + Sales this week) is from far, the greatest I ever had in 10 years at PTC. So many new great thinks; strategy
and solutions (IoT, System Engineering, SLM…), Sales productivity (Velocity including IPAD ☺, Deal Desk, ISS), Hybrid pricing
model… Congrats to both of you, it will support Sales for sure! Keep on going like that!”
Cyril Bardoul
Sales Regional Director
104
“Tip of Spear” Sales Playbooks
Our traditional model is a proven way to grow
STRATEGIC ACCOUNTS
CAD
PLM
ALM
LAND the customer
SLM
IoT
Strategic Sellers Segment Into Product Development, Service, and Full Product Line Reps
This new model is a better way to land
NEW ACCOUNTS
IoT
SLM
ALM
LAND the customer
PLM
CAD
105
Strategic “Tip of Spear” (Example)
CAD
PLM
ALM
SLM
IoT
The world’s industry leader in designing and manufacturing electronic
scoreboards, programmable display systems and large screen video
displays.
PTC CAD and PLM used at Daktronics. A long standing customer.
Recent Daktronics and & PTC meetings resulted in a ThingWorx Pilot
then subsequent order for Remote Control and Service.
106
Hunting “Tip of Spear” (Example)
IoT
SLM
ALM
PLM
CAD
Over 90 years experience as a global leader in the development,
manufacture, distribution and service of underground mining
machinery for the extraction of coal and other bedded materials.
ThingWorx used for Remote Mining along with very limited use of
other PTC Products.
Recent Joy & PTC Executive meetings exploring other areas in
which PTC can bring business value to include PLM and SLM for
Remote Service.
107
Segmented Sales Capacity
•
•
Quota Carrying Sales Capacity increase of ~97 from FY’10 to FY’15
Sellers are broken into 4 Distinct Groups: Full Product, Product Development, Service, & IoT
Americas 128
Europe 120
Pac Rim 85
Japan 35
FPL: 34
FPL: 33
FPL: 0
FPL: 21
PD: 53
PD: 57
PD: 73
PD: 9
SVC: 12
SVC: 9
SVC: 0
SVC: 2
IoT: 29
IoT: 21
IoT: 12
IoT: 3
WW 368
Full Product Line Sales Reps: 88
Product Development Sales Reps: 192
Service Sales Reps: 23
IoT New Logo Sales Reps: 65
A Buyer Centric Approach to:
• Focused Marketing
• Focused Solutions
• Focused Sellers
• Focused Plays
108
Stronger Pipeline Coverage Than Last Year
Total four-quarter direct perpetual equivalent software pipeline vs. new revenue
~350%
Coverage
~380%
Coverage
Direct perpetual equivalent CAD, EPLM, SLM
Direct perpetual equivalent new IoT
Close rate assumptions in FY15 lowered to de-risk Asia Pac, IoT, and SLM
Channel revenue of $90 M+ excluded from both years
Run-rate revenue (Axeda + FY14 subscriptions) of $40 M+ excluded from FY15
* Perpetual Equivalent = ACV * 2
109
PTC Global Services
Matt Cohen
EVP PTC Global Services and Partners
November 13, 2014
Agenda
• PTC Global Services
• Key Strategic Highlights
– Accelerated Deployments
– Partner Strategy
• Margin Expansion
112
Global Services Strategic Goals
Leading
Client Transformation
Provide expertise in closed-loop
lifecycle management
Sustainable
Margin Expansion
Deliver 20% Net Margin by FY18
(excludes 2% contribution from Cloud
Services)
Deliver programs with immediate
business impact
Contribute to accelerated license &
subscription solutions growth
Enable transformative business
value
Broaden PTC’s Ability to Deliver
Solutions into the Marketplace
113
PTC Global Services
Service
Offerings
Business Alignment
Process Transformation
Accelerated Deployment
Enterprise Adoption
Continuous Optimization
Global Team
35
Countries
1,300
Experts in PTC Solutions
6
Centers of Excellence
Premier Partner
Ecosystem
200
Learning Centers
Lines of
Business
Consulting
Learning and Adoption
Cloud Services
25 years
Delivering Client Transformation
DEPTH OF
KNOWLEDGE across the
connected product &
service lifecycle
DEEP
UNDERSTANDING
of business
processes
114
Accelerate Deployment and Drive Sustained Client Value
Immediate Access
Expert Application Management
Secure Hosting
Optimal Performance
Value Based
Outcomes
Process Best
Practice
Driven
Scalable,
Flexible,
Configurable
Predictable
Time, Cost,
and Risk
Value Ready Deployment
115
Expanded Service Partner Program
“We partner with leading PLM companies like PTC because of our shared vision of driving
business transformation with product development solutions.”
“A heavy investment in PTC Partner Program is a key component of KPIT strategy for bringing
the highest value business solutions to our customers.”
“PTC IoT platform is the critical backbone of our IoT practice.”
450
Direct Consulting Ecosystem
400
350
200
300
250
60
120
Outcomes
200
150
100
231
220
210
FY11
FY15
FY18
50
0
Global Services Direct
Certified Partner
116
Margin Expansion Runway Remains
e
Levers for Margin Expansion
e
* Cloud Services excluded
from revenue and margin view
Revenue Focus
• Evolution of what we sell
• Finish strategic program investments
• Strategic accounts
• Continued workforce optimization
• Pricing/discounting discipline
• Newer segments
• Joint delivery with Partners
• Growth of high margin offerings
• Higher margin services
117
Financial Results & Outlook
Jeff Glidden
EVP & CFO
November 13, 2014
Growth and Profitability
Non-GAAP Revenue
Non-GAAP Op Income
FY 2014 REVENUE BY VERTICAL
Other:
Non-GAAP EPS
9%
US$ in millions
1,500
Retail &
Consumer:
EPS
$3.00
1,250
31%
1,297
$2.50
1,170
4%
Industrial Products:
8%
1,358
1,258
Life Sciences:
Automotive:
14%
$2.17
1,010
1,000
$1.81
938
Electronics &
High Tech:
$2.00
15%
$1.51
750
19%
$1.50
$1.26
FY 2014 REVENUE BY REGION
$1.00
500
Federal, Aerospace
& Defense:
$1.00
$0.80
Americas:
41%
Europe:
39%
AP:
20%
340
207
250
121
247
286
$0.50
158
$0.00
0
FY09
FY10
FY11
FY12
FY13
FY14
120
Revenue Trends FY’09 – FY’14
Growth CAGR 2009-14:
L&SS = 13%
Support = 7%
Services = 4%
$M
1,500
1,250
1,000
1,258
348
354
295
285
279
614
658
693
FY'12
FY'13
FY'14
1,170
938
213
1,010
267
226
387
342
296
750
1,358
1,297
218
500
250
499
496
560
FY'09
FY'10
FY'11
0
Support
Professional services
Perpetual license & subscription solutions
Note: Recast to the FY’15 reporting framework
121
Regional Revenue Trends 2009-2014
Regional Growth CAGRs: Americas 10%; Europe 7%; Asia Pacific 5%
Revenue by Region
Americas
$M
Europe
Asia Pacific
1,500
1,358
1,258
1,250
1,170
1,010
1,000
938
214
250
291
271
236
467
372
270
296
750
500
1,297
481
480
528
389
352
386
431
FY09
FY10
FY11
481
525
560
FY12
FY13
FY14
-
122
Revenue Mix by Business
Portfolio Transition FY09 – FY14
FY09 Revenue by Segment
$ in millions
$377,
40%
$513,
55%
$47,
5%
Ext PLM
SLM
FY14 Revenue by Segment
$ in millions
$582,
43%
$599,
44%
$177,
13%
CAD
Ext PLM
SLM
CAD
Note: IoT included in SLM for FY’14
123
Support Metrics and Revenue Growth
Delivering software upgrades and high-value customer support
Support Revenue & Deferred Support
PLM & CAD Active Seats (000's)
2,000
1,800
1,720
270
800
260
700
250
600
240
500
693
1,592
1,600
1,415
658
614
1,200
246
560
249
242
969
1,000
230
234
800
735
600
220
216
213
US$ in millions
1,225
CAD
Extended PLM
1,400
498
497
400
422
445
374
300
210
200
200
100
190
0
320
400
200
Q4’09 Q4'10 Q4'11 Q4'12 Q4'13 Q4'14
Q1'10
Extended PLM
CAD
2010
2011
Support Revenue
2012
2013
2014
Deferred Support *
* Deferred Support includes deferred support revenues, plus unbilled
support bookings
124
Financial Results: FY 2014 vs. FY 2013 (Non-GAAP)
Margin Expansion: Operating Model Leverage
$ in millions
FY 2013
FY 2014
$ Increase
% Increase
$1,297
$1,358
$61
5%
Gross profit
952
1,013
61
6%
Operating expense
666
673
7
1%
Operating profit
$286
$340
$54
19%
Net income
$219
$260
$41
19%
EPS
$1.81
$2.17
$0.36
20%
% Gross margin
73.4%
74.6%
+120 bps
% Operating expense
51.3%
49.5%
-180 bps
22.1%
25.1%
+300 bps
$225
$305
$80
17.3%
22.5%
+520 bps
Total revenue
Operating margin %
Cash Flow from Operations
% Cash Flow to Revenue
36%
125
Summary Balance Sheet and Cash Flow
$ in millions
2012
2013
2014
$490
$242
$294
Accounts Receivable
217
229
236
Property & Equipment
63
65
68
Goodwill & Intangibles
796
1,042
1,349
Other Assets
226
251
253
$1,792
$1,829
$2,200
$158
$179
$222
Deferred Revenue
328
337
383
Debt
370
258
612
Other Liabilities
139
129
129
Equity
797
926
854
$1,792
$1,829
$2,200
61
60
58
$218
$225
$305
Cash & Securities
Total Assets
Account Payable & Accruals
Total Equity & Liabilities
DSO
Cash Flow from Operations
FY 2015 Planned Uses of Cash
Pay-down of Debt
$100M
Stock Repurchases
$125M
Pension Funding & Close-out $45M
Q4 FY14 Restructure
$27M
126
FY 2015 Outlook & FY 2018 Targets
127
Non-GAAP FY’15 Guidance
FY'14
Support
Professional services
Total revenue
growth
Support growth
Professional services growth
Total revenue growth
387
693
279
1,358
FY'15
Low
405
700
260
1,365
FY'15
High
425
700
260
1,385
9%
4%
10%
5%
-2%
5%
1%
-6%
0%
1%
-6%
2%
Gross margin
Operating margin
Other income (expense)
Tax rate
Share count
EPS
EPS growth
75%
25%
-10
21%
120
$2.17
20%
75%
26%
-15
18%
117
$2.33
7%
76%
26%
-15
18%
117
$2.40
10%
Note: FX Assumptions: USD/EURO = 1.25; YEN/USD = 115
Unfavorable FY15 FX impacts vs FY14 lowers FY15 revenue by ~$50M (4% points of YoY growth) and reduces EPS by $0.15 (7% points of YoY growth).
128
Another Way to Look at a Hybrid Model
($ in millions)
Non-GAAP
FY14
415 = 353 + 62
387 = 357 + 30
Total L&SS Book of Business
Perpetual License TCV
Subscription Solutions TCV
Total L&SS Business
Fx Adjustment
Fx Adjusted L&SS Business
% Y/Y
Perpetual
Equivalent
=
ACV
FY15 Guidance
Midpoint
357
30 x 2
417
417
x
f
Pricing
Renewal Rate
Support
Time
=
353
62 x 2
477
13
490
18%
ACV
x
2
129
Reporting Frameworks for 2015
Pipeline…Bookings…Billings…Cash Flow…Revenue & Deferred Revenue
Market Drivers & Trends
• Growth of Subscription software models & ratable revenue streams
• Customer flexibility & growth over time
• Easier to do business with and consistent with Customer intent
• Broader Customer funding sources (Operating Expense & Capital Acquisitions)
Higher growth of PTC ratable/subscription with deferral of revenue over time
Bookings & Billings represent leading metrics of growth & success
• Subscription Solutions
• Cloud Services – Hosting & Managed Services
New Bookings (ACV)
Billings = Revenue + Change in Deferred Revenue
• Subscription Solutions
• Cloud Services
• Support for perpetual
licenses
Software licenses (perpetual licenses)
Subscription Solutions
Cloud Services
Perpetual License and Subscription Solutions
Support (for perpetual licenses)
Professional Services (consulting, implementation, & education)
130
Subscription Model
Market Opportunity
Customer Benefits
• Broader IoT market (“net new”)
• Flexibility & growth over time
• Extensions to current markets: SLM, ALM, PLM
& CAD (expanded TAM)
• Cloud services: faster time-to-value
• Costs more matched to “realized” value
• Clearly differentiated strategy
• Funding sources: CapEx & Opex
• PTC: market leader in application enablement
platforms for IoT
• Simpler contracting/procurement
PTC Sales Benefits
PTC Financial Benefits
• Core strategic accounts (upsell & cross sell)
• Growth of recurring revenue streams
• Targeted growth accounts (new logos)
• Monetize based upon growth of users & assets
(# of connected things)
• Land and expand account strategy
• Reduced “friction” in sales process
• Higher customer LTV (lifetime value)
• Increased deferred revenues
• Driving greater LT cash flow
131
Perpetual & Subscription Software Revenue Models
Illustrative Example: Cumulative revenue over 5 years
$3,000
5 year NPV ~ $2400
$2,500
$2,000
5 year NPV ~ $1,800
$1,500
$1,000
$500
$Year 1
Year 2
Year 3
Perpetual w/Support
Year 4
Year 5
Subscription
132
License & Subscription Solution Mix
Bookings Mix Drives Variability in Reported License & Subscription Solutions Revenue
*Note: Apples to Apples TCV = ACV x 2 or
ACV = TCV / 2
Customer
New Solution
Purchase
Perpetual
or
Subscription
Booking?
Perpetual Assumption*: 85%
Purchase
(TCV)
Total
Reported
Assumption*: 15%
L&SS
Revenue
New Subscription
Run-Rate Subscription
Deferred
License &
Subscription
Solutions
Revenue
Deferred Support
Revenue
Perpetual
Revenue Recognized
In Current Period
133
Supplemental Business Information
($ in millions)
FY14
Estimates
FY15 Guidance
Midpoint
Annual Contract Value (ACV) BOOKINGS
% Mix of Perpetual Bookings
Perpetual Bookings
New Subscription Bookings
Total New Bookings
95%
357
19
376
92%
353
30
383
PERPETUAL EQUIVALENT BOOKINGS
Perpetual Bookings
New Subscription Bookings (2 x ACV)
Total New Bookings
91%
357
37
395
85%
353
60
413
92%
357
30
387
279
692
1,358
85%
353
62
415
260
700
1,375
Operating Profit
Operating Margin
340
25%
352
26%
EPS
2.17
2.36
Non-GAAP
REVENUE
% Mix of Perpetual License
Perpetual License
Perp License & Subsc. Solutions
Professional Services
Support
Total Revenue
134
Impact of Subscription Equivalent Mix Shift
FY15 Scenario
($ in millions)
Non-GAAP
5% of Perpetual
Equivalent Bookings
Convert
$
$ Var
FY14
Estimates
FY15 Guidance
Midpoint
ACV BOOKINGS
Perpetual Bookings
New Subscription Bookings
Total New Bookings
95%
357
19
376
92%
353
30
383
89%
335
41
376
(18)
11
(7)
PERPETUAL EQUIVALENT BOOKINGS
Perpetual Bookings
New Subscription Bookings (2 x ACV)
Total New Bookings
91%
357
37
395
85%
353
60
413
80%
335
81
416
(18)
21
4
92%
357
30
387
279
692
1,358
85%
353
62
415
260
700
1,375
84%
335
66
401
260
699
1,360
(18)
3
(14)
(1)
(15)
REVENUE
% Mix of Perpetual License
Perpetual License
Perp License & Subsc. Solutions
Professional Services
Support
Total Revenue
Operating Profit
340
Operating Margin
25%
352
26%
EPS
2.17
2.36
337
(15)
25%
-1%
2.26
(0.11)
Note: every 1% change in perpetual equivalent bookings results in ~($3M) in FY’15 revenue impact and ~($0.02) EPS
but favorable perpetual equivalent bookings impact of $4M
135
Stronger Pipeline Coverage Than Last Year
Total four-quarter direct perpetual equivalent software pipeline vs. new revenue
~350%
Coverage
~380%
Coverage
Direct perpetual equivalent CAD, EPLM, SLM
Direct perpetual equivalent new IoT
Close rate assumptions in FY15 lowered to de-risk Asia Pac, IoT, and SLM
Channel revenue of $90 M+ excluded from both years
Run-rate revenue (Axeda + FY14 subscriptions) of $40 M+ excluded from FY15
* Perpetual Equivalent = ACV * 2
136
6%
10%
3%
0%
0%
-9%
-40%
-12%
FY'14
-30%
FY'13
-6%
FY'12
-20%
FY'11
-3%
FY'10
-10%
PTC Weighted Industrial Production % Y/Y
PTC License Revs (CC Organic)
Monthly Manufacturing PMI Trend
World Manufacturing Output (Y/Y Growth)
65
9%
15% PTC Sales
60
US PMI 56.2
Japan PMI 52.4
China PMI 50.4
Eurozone PMI
50.6
55
50
45
6%
3%
85% PTC Sales
0%
40
35
PTC Weighted Industrial Production
% Y/Y
20%
FY'09
• UNIDO Q214 report on world manufacturing production (issued Sept.
2014), shows growth deceleration (+4.8% y/y Q1  +3.3% Q2) with
worsening trends in both industrialized regions (+2.5% Q1  +1.5% Q2)
and developing regions (+8.6% Q1  +6.5% Q2)
9%
FY'08
World Manufacturing Production Slows
30%
FY'07
• October global manufacturing PMI of 52.2 was unchanged from
September with overall US strength and a near-term rebound in Japan
offset by ongoing weakness in Europe and China
12%
FY'06
Manufacturing PMI subdued in Eurozone & China
40%
FY'05
PTC organic constant currency license growth historically
correlated to measures of global manufacturing economy,
including GDP, industrial production, and manufacturing PMI
Organic CC License Revenue
Growth
Mixed Global Manufacturing Outlook
2010
2011
US PMI
2012
Eurozone PMI
Source: J.P. Morgan, Markit, ISM, and IFPSM
2013
-3%
2014
Japan PMI
China PMI
Dec-12
Mar-13
World
Jun-13
Sep-13
Dec-13
Developing
Mar-14
Jun-14
Industrialized
Source: J.P. Morgan, Markit, ISM, and IFPSM
137
Mix Shift Increases Growth Opportunity
ALM
PLM
ALM
SLM
CAD
SLM
PLM
IoT
IoT
CAD
FY’15 L&SS Mix
• Organic L&SS Growth = 10%
• M&A = 2%-4%
FY’18 L&SS Mix
• Organic L&SS Growth = ~15%
• M&A = 2%-4%
138
New Long-Term Financial Metrics & Targets
EPS CAGR of 15% FY’15-FY’18
FY'10
FY'11
FY'12
FY'13
FY'14
FY'15
Outlook
FY'18
Target
Perpetual license &
subscription solutions growth
39%
16%
2%
2%
9%
4%-10%
12%-15%
Support growth
(1%)
13%
10%
7%
5%
1%
2%-4%
Professional services growth
(4%)
23%
11%
(4%)
(2%)
(6%)
(0%)-(3%)
8%
16%
8%
3%
5%
0%-2%
6%-10%
Gross margin
72%
71%
72%
73%
75%
75%-76%
76%-78%
Sales & marketing
30%
29%
29%
27%
26%
25%-26%
24%-25%
R&D
19%
17%
16%
16%
16%
15%-16%
15%-16%
G&A
8%
7%
7%
8%
8%
7%-8%
7%-8%
Operating margin
16%
18%
20%
22%
25%
~26%
28%-30%
Tax rate
23%
24%
24%
22%
21%
18%
18%-20%
Shares outstanding
120M
121M
121M
121M
120M
~117M
~112M
EPS growth
25%
26%
20%
20%
20%
7%-10%
~15%
Non-GAAP
Growth Metrics
Revenue
Total revenue growth
Operating Metrics
1) FX assumption FY15-18, EURO = US$1.25; US$ = 115 Yen.
2) Impacts included above: Return of Capital Program contributes ~2% point to EPS growth, while the lower tax rate of 18% contributes
~1% point.
139
Long-term Outlook and Opportunity
• Large Customer Base, Upsell and Cross Sell Opportunities
• Highly Differentiated Strategy
• Expanded Market Opportunity
• Most Complete IoT Offerings
• Sales Focus & Execution
• Building Pipeline & Coverage
• Recurring Revenue Streams
• Increasing Productivity and Efficiency
• Building Shareholder Value
140
Thank You
141
Non-GAAP Financial Measures and Reconciliations
(Unaudited)
FY'09
GAAP revenue
$
Fair value adjustment of acquired deferred revenue
FY'10
938.2
$
-
FY'11
1,010.0
$
-
FY'12
1,166.9
$
2.6
FY'13
1,255.7
$
2.5
FY'14
1,293.5
$
1,357.0
3.0
1.2
Non-GAAP revenue
$
938.2
$
1,010.0
$
1,169.5
$
1,258.2
$
1,296.5
$
1,358.2
GAAP gross margin
$
628.4
$
702.4
$
810.2
$
883.6
$
920.5
$
983.3
-
-
2.6
2.5
3.0
Fair value adjustment to deferred costs
-
-
-
-
-
(0.1)
10.4
Stock-based compensation
Amort of acquired intangible assets in cost of revenue
8.2
9.1
7.7
8.9
9.5
19.7
18.4
15.4
15.8
18.6
1.2
18.1
Non-GAAP gross margin
$
656.3
$
729.9
$
835.9
$
910.8
$
951.6
$
1,013.0
GAAP operating income
$
19.3
$
74.8
$
117.1
$
128.1
$
127.3
$
196.6
-
-
2.6
2.5
3.0
-
-
-
-
-
(0.2)
43.3
48.9
45.4
51.3
48.8
50.9
19.7
18.4
15.4
15.8
18.6
18.1
Amortization of acquired intangible assets
15.6
15.6
18.3
20.3
26.5
32.1
Charges included in general and administrative expenses
-
-
7.8
3.8
9.9
13.1
In-process research & development
0.3
-
-
-
-
-
22.7
-
-
24.9
52.2
28.4
Restructuring charges
1.2
Non-GAAP operating income
$
120.9
$
157.7
$
206.6
$
246.8
$
286.3
$
340.3
GAAP net income
$
31.5
$
24.4
$
85.4
$
(35.4)
$
143.8
$
160.2
-
-
2.6
2.5
3.0
-
-
-
-
-
(0.2)
43.3
48.9
45.4
51.3
48.8
50.9
19.7
18.4
15.4
15.8
18.6
18.1
Amortization of acquired intangible assets
15.6
15.6
18.3
20.3
26.5
32.1
-
-
7.8
3.8
9.9
13.1
In-process research & development
0.3
-
-
-
-
-
22.7
-
-
24.9
52.2
28.4
-
1.2
Non-operating one-time gain
-
-
5.1
0.8
(5.7)
Gain on litigation resolution
-
(9.0)
-
-
-
-
(39.5)
21.3
(27.8)
98.8
(77.8)
(43.5)
Income tax adjustments
Non-GAAP net income
(In Millions)
$
93.6
$
119.6
$
152.2
$
182.9
$
219.2
$
260.4
142
(Unaudited) Continued
FY'09
GAAP diluted earnings per share
$
FY'10
0.27
$
0.20
$
-
-
FY'12
FY'11
0.71
$
FY'13
(0.30)
$
1.19
$
0.03
0.02
0.02
FY'14
1.34
0.01
-
-
-
-
-
-
0.37
0.41
0.38
0.42
0.40
0.42
Amortization of acquired intangibles
0.30
0.28
0.28
0.30
0.37
0.42
-
-
0.06
0.03
0.08
0.11
Non-operating one-time gain
Income tax adjustments
Non-GAAP diluted earnings per share
GAAP operating margin
0.20
-
-
0.21
0.43
0.24
-
(0.08)
0.04
0.01
(0.05)
-
0.18
(0.34)
$
0.80
$
1.00
0.82
(0.23)
$
1.26
$
1.51
(0.64)
$
1.81
(0.36)
$
2.17
2.1%
7.4%
10.0%
10.2%
9.8%
14.5%
0.0%
0.0%
0.2%
0.2%
0.2%
0.1%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
4.6%
4.8%
3.9%
4.1%
3.8%
3.8%
Amortization of acquired intangibles
3.8%
3.4%
2.9%
2.9%
3.5%
3.7%
0.0%
0.0%
0.7%
0.3%
0.8%
1.0%
2.4%
0.0%
0.0%
2.0%
4.0%
2.1%
12.9%
15.6%
17.7%
19.6%
22.1%
25.1%
Non-GAAP operating margin
143
FY'09
GAAP revenue
Non-GAAP revenue
GAAP to Non-GAAP revenue by line of business:
GAAP License Revenue
Non-GAAP License Revenue
$
$
$
$
GAAP Support Revenue
Non-GAAP Support Revenue
$
GAAP Services Revenue
Non-GAAP Services Revenue
$
$
$
FY'10
938.2
938.2
$
212.7
212.7
$
499.1
499.1
$
226.4
226.4
$
$
$
$
$
FY'11
1,010.0
1,010.0
$
296.0
296.0
$
496.4
496.4
$
217.6
217.6
$
$
$
$
$
FY'13
FY'12
1,166.9
2.6
1,169.5
$
342.1
342.1
$
557.7
2.6
560.3
$
267.1
267.1
$
$
$
$
$
1,255.7
2.5
1,258.2
$
348.4
348.4
$
612.0
2.5
614.5
$
295.3
295.3
$
$
$
$
$
FY'14
1,293.5
3.0
1,296.5
$
344.2
344.2
$
654.7
3.0
657.7
$
294.7
294.7
$
$
$
$
$
1,356.9
1.2
1,358.2
369.7
0.7
370.4
692.3
0.3
692.6
295.0
0.2
295.2
(In Millions)
144
GAAP to Non-GAAP revenue by geography:
FY'09
GAAP Americas Revenue
Non-GAAP Americas Revenue
$
GAAP Europe Revenue
Non-GAAP Europe Revenue
$
GAAP Asia Pac Revenue
Non-GAAP Asia Pac Revenue
$
$
$
$
FY'10
351.9
351.9
$
372.4
372.4
$
213.9
213.9
$
513.4
513.4
$
377.4
377.4
$
47.4
47.4
$
$
$
$
FY'11
385.8
385.8
$
388.5
388.5
$
235.7
235.7
$
509.3
509.3
$
444.3
444.3
$
56.4
56.4
$
$
$
$
FY'12
429.2
1.4
430.6
$
466.5
0.9
467.4
$
271.2
0.3
271.5
$
587.8
587.8
$
503.1
2.6
505.7
$
76.0
76.0
$
$
$
$
479.8
1.5
481.3
480.4
0.6
481.0
295.5
0.4
295.9
FY'13
$
$
$
$
$
$
522.8
2.4
525.2
479.9
0.4
480.3
290.9
0.2
291.1
FY'14
$
$
$
$
$
$
558.7
1.1
559.8
528.1
0.1
528.2
270.2
270.2
GAAP to Non-GAAP revenue by segment:
GAAP CAD Revenue
Non-GAAP CAD Revenue
$
GAAP EPLM Revenue
Non-GAAP EPLM Revenue
$
GAAP SLM Revenue
Non-GAAP SLM Revenue
$
$
$
$
$
$
$
$
$
$
$
$
$
573.5
573.5
$
604.3
2.5
606.8
$
77.9
77.9
$
$
$
$
552.5
552.5
$
571.1
571.1
$
170.0
3.1
173.1
$
$
$
$
581.5
581.5
599.3
599.3
176.2
1.2
177.4
(In Millions)
145
(Unaudited)
Our FY’15 non-GAAP operating profit target excludes $4 million of
adjustments related to the fair value of acquired deferred revenue, $57
million of stock-based compensation expense, $55 million of intangible asset
amortization expense and $9 million of other charges, net (primarily
acquisition-related and pension plan termination related expense). The FY’15
GAAP operating profit target is approximately $220 million. FY’15 GAAP and
non-GAAP operating profit excludes settlement losses related to the
termination of our U.S. pension plan estimated to be approximately $65
million.
146

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