PTC Inc at Stifel Cross Sector Insight Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Adam Borg - Stifel Nicolaus and Company, Incorporated - Analyst : So maybe just opening up big picture, for those that maybe newer to the PTC story, talk a little bit about an overview of PTC and the big opportunities you're going after.

Question: Adam Borg - Stifel Nicolaus and Company, Incorporated - Analyst : That's awesome. So that's a great overview of the stack, I'll call it. And let's get a little perspective about yourself, right? So you joined -- officially became CEO back in February, joined via the ServiceMax acquisition. And maybe talk a little bit about the big observations you've had so far coming into the seat and maybe even the biggest surprises.

Question: Adam Borg - Stifel Nicolaus and Company, Incorporated - Analyst : That's great. And so if you think about this vertically integrated stack across the portfolio that you talked about, how complete is this portfolio today? Is it something where we need to make major acquisitions? Is it tuck-in? Is it just execute? Talk through how you're thinking about the completeness today and the vision going forward.

Question: Adam Borg - Stifel Nicolaus and Company, Incorporated - Analyst : Super clear. So I'd love to go through a deeper dive of the portfolio. But even just before we do that, just talk about the macro, it's hard not to think about design software in general and then PTC in particular without at least acknowledging the cyclical end markets perhaps that some of your customers are in. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 04, 2024 / 2:55PM, PTC.OQ - PTC Inc at Stifel Cross Sector Insight Conference And PMIs have been turning up, and there's a little bit mix potentially in yesterday's reading but globally still up. Maybe talk a little bit about PTC's ability to bifurcate from the macro. And how important are these macro data points should investors be thinking about those as you think about the PTC business and the drivers going forward?

Question: Adam Borg - Stifel Nicolaus and Company, Incorporated - Analyst : Got it. And if you think about the key priorities for PTC, going deeper in PLM is, correct me if I'm wrong, priority number one. Talk a little bit about the opportunity that you see for core PLM and the evolution of how customers are using PLM and how that's been changing over time.

Question: Adam Borg - Stifel Nicolaus and Company, Incorporated - Analyst : Got it. And so taking that a step further, you've talked about the definition or the usage of PLM expanding both within R&D and outside of R&D departments. I'd love to flesh that opportunity out.

Question: Adam Borg - Stifel Nicolaus and Company, Incorporated - Analyst : Got it. And maybe last point on PLM before switching gears. It's been a really big growth engine, really durable, call it, low- to mid-teens growth in recent years. Is this a trend that's nearing its end? Or is this still a multi-year tailwind for the reasons you just talked about?

Question: Adam Borg - Stifel Nicolaus and Company, Incorporated - Analyst : Makes a ton of sense. Thanks for that. Maybe talking about ALM application life cycle management. You gave a brief overview at the top. Talk a little bit more about what Codebeamer is, how companies are using it, and why this has been a growing opportunity for PTC?

Question: Adam Borg - Stifel Nicolaus and Company, Incorporated - Analyst : And how do we think about the opportunity around tip of spear? So in other words, not just cross-selling Codebeamer into your installed base but using Codebeamer as a foot in the door to then go back to potentially Creo or Windchill over time.

Question: Adam Borg - Stifel Nicolaus and Company, Incorporated - Analyst : And maybe just closing the loop competition-wise, who are you competing against? Is it homegrown? And then potentially, who are you replacing?

Question: Adam Borg - Stifel Nicolaus and Company, Incorporated - Analyst : Got it. And on the last earnings call, you did talk about I thought a pretty interesting customer win with an elevator manufacturer. And I think you talked to some of the cross-selling opportunities. Maybe talk a little bit more about either this deal or more broadly cross-selling opportunity and integration overall. Where we are in the integration between ServiceMax and the broader portfolio? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 04, 2024 / 2:55PM, PTC.OQ - PTC Inc at Stifel Cross Sector Insight Conference

Question: Adam Borg - Stifel Nicolaus and Company, Incorporated - Analyst : Makes a ton of sense. Maybe one more question and then we'll open it up. Just competitively, similar question to what we talked about for Codebeamer a few minutes ago. Talk about the competitive landscape for ServiceMax and who you typically replace.

Question: Adam Borg - Stifel Nicolaus and Company, Incorporated - Analyst : Awesome. So what's on your mind? Keep thinking. Yeah, please. Unidentified Participant (inaudible - microphone inaccessible)

Question: Adam Borg - Stifel Nicolaus and Company, Incorporated - Analyst : Sure. And maybe just to repeat the question of share buybacks and when can we start resuming those.

Question: Adam Borg - Stifel Nicolaus and Company, Incorporated - Analyst : Just assessing the buyback, does that mean the same as 50%, more or less?

Question: Adam Borg - Stifel Nicolaus and Company, Incorporated - Analyst : Let's talk about SaaS for a minute. So it's just super interesting. You've articulated it's a 10-plus year journey to SaaS. So let's first talk about what does that mean? What is going to SaaS really talk about in terms of Windchill+ and Creo+? And candidly, given some of the innovation, talk about why shouldn't it even be faster than 10 years.

Question: Adam Borg - Stifel Nicolaus and Company, Incorporated - Analyst : Super clear. And just as a SaaS follow-up, are there certain either geographies or verticals where you expect to see the shorter end of 10 years plus versus the longer end?

Question: Adam Borg - Stifel Nicolaus and Company, Incorporated - Analyst : Great. What else? Unidentified Participant Can you just talk about go-to-market alignment between ServiceMax and like rest of PTC, how you're thinking about alignment with Salesforce, and what key thing you're looking at (inaudible)

Question: Adam Borg - Stifel Nicolaus and Company, Incorporated - Analyst :

Question: Adam Borg - Stifel Nicolaus and Company, Incorporated - Analyst : Since you teed me up, I'd love to ask about AI. Talk about the AI opportunity for PTC. How you think about it internally? How you think about productizing it?