PTC (PTC) 10-K risk factor changes: FY2023 vs FY2022

Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially adversely affect our business, financial [removed: condition and/or] [added: condition,] operating [removed: results.][added: results, and prospects.]

If we are unable to provide products and solutions that address customers’ needs as well as our competitors’ products and solutions do, or to align our pricing, licensing and delivery models with customer preferences, we could lose customers and/or fail to attract new customers, which could [removed: cause us to lose revenue] [added: adversely affect our business, financial condition, operating results,] and [removed: market share.][added: prospects.]

If we are unable to compete successfully with competitors offering SaaS solutions, we could lose customers and/or fail to attract new customers, which could [removed: cause us to lose revenue and market share, which would] adversely affect our [removed: business and] [added: business,] financial [removed: results.][added: condition, operating results, and prospects.]

A breach of security in our products or computer systems, or those of our third-party service providers, could compromise the integrity of our products, cause loss of data, harm our reputation, create additional liability and adversely [removed: impact] [added: affect] our [added: business,] financial [removed: results.][added: condition, operating results, and prospects.]

The potential for a security breach or system disruption has significantly increased over time as the scope, number, intensity and sophistication of attempted cyberattacks and cyber intrusions have increased – particularly cyberattacks and intrusions designed to access and exfiltrate information and to disrupt and [removed: lock-up] [added: lock up] access to systems for the purpose of demanding a ransom payment.

It is impossible for us to eliminate the risk of a successful cyberattack or intrusion, and, in fact, we [added: regularly] deal with security issues [removed: on a regular basis] and have experienced security incidents from time to time.

A significant breach of the security and/or integrity of our products or systems, or those of our third-party service providers, whether [removed: or] intentional or by human error by our employees or others, could disrupt our business operations or those of our customers, could prevent our products from functioning properly, could enable access to sensitive, proprietary or confidential information of our customers, or could enable access to our sensitive, proprietary or confidential information.

This could require us to incur significant costs of investigation, remediation and/or payment of a ransom; harm our reputation; cause customers to stop buying our products; and cause us to face lawsuits and potential liability, any of which could have a material adverse effect on our business, financial [removed: condition] [added: condition, operating results,] and [removed: results of operations.][added: prospects.]

We increasingly rely on third-party providers of cloud infrastructure services to deliver our offerings to users on our platform, and any disruption of or interference with our use of these services could adversely affect our [removed: business.][added: business, financial condition, operating results, and prospects.]

Any of the above circumstances or events may harm our reputation and brand, reduce the availability or usage of our platforms and impair our ability to attract new users, any of which could adversely affect our business, financial [removed: condition and] [added: condition,] results of [removed: operations.][added: operations, and prospects.]

We may be unable to hire or retain [removed: personnel] [added: employees] with the necessary skills to operate and grow our business, which could adversely affect our ability to [removed: compete.][added: compete and adversely affect our business, financial condition, results of operations, and prospects.]

Our success depends upon our ability to attract and retain highly skilled [removed: managerial, sales] [added: employees to develop our products] and [removed: marketing, technical, financial] [added: solutions] and [removed: administrative personnel] to operate and grow our business.

Competition for such [removed: personnel] [added: employees] in our industry is [removed: intense,] [added: intense worldwide, and] particularly in the Boston, Massachusetts area where our global headquarters is located.

If we are unable to attract and retain [added: employees with] the [removed: personnel we need] [added: requisite skills] to develop [removed: compelling] [added: our] products and solutions, [removed: and] [added: or to] guide, operate and support our business, we may be unable to [removed: successfully compete,] [added: compete successfully,] which would adversely affect our business, financial [removed: condition and] [added: condition,] results of [removed: operations.][added: operations, and prospects.]

We depend on sales within the discrete manufacturing sector and our business could be adversely affected if manufacturing activity does not [removed: grow,] [added: grow] or if it contracts, or if manufacturers are adversely affected by other macroeconomic factors.

Manufacturers worldwide continue to face uncertainty about the global macroeconomic environment due to, among other factors, the effects of earlier and ongoing supply chain disruptions, rising interest rates and inflation, volatile foreign exchange rates and the current relative strength of the U.S. [removed: dollar, the effects of the Russia—Ukraine conflict, including on the supply of energy resources in Europe,] [added: Dollar,] and the U.S. [removed: Government’s] [added: government’s] focus on technology transactions with non-U.S. entities.

[removed: In light of these challenges and concerns, customers] [added: Customers] may delay, reduce, or forego purchases of our [removed: solutions,] [added: solutions due to these challenges and concerns,] which [removed: would] [added: could] adversely affect our [removed: business and] [added: business,] financial [removed: results.][added: condition, results of operations, and prospects.]

[removed: If] [added: If] we [removed: fail] [added: are unable] to successfully [removed: manage our transition to a SaaS company,] [added: establish these new offerings and navigate] our business [removed: and] [added: transition, our business,] financial [added: condition,] results [added: of operations, and prospects] could be adversely [removed: affected.][added: affected.]

[removed: Becoming a] [added: Transforming our business to offer and support] SaaS [removed: company] [added: solutions] requires considerable additional investment in our organization.

Whether [removed: our transition] [added: we] will be successful and will accomplish our business and financial objectives is subject to [added: risks and] uncertainties, including but not limited to: customer demand, attach and renewal rates, channel adoption, our ability to further develop and scale infrastructure, our ability to include functionality and usability in such offerings that address customer requirements, [added: our ability] and [added: the ability of] our [added: partners to transition existing customer implementations and subscriptions to SaaS, and our] costs.

Because our sales and operations are globally dispersed, we face additional compliance [removed: risks] [added: risks,] and any compliance failure could adversely affect our business and [removed: financial results.][added: prospects.]

Those laws include, but are not limited to, anti-corruption laws and regulations (including the U.S. Foreign Corrupt Practices Act (FCPA) and the U.K. Bribery Act 2010), data privacy laws and regulations (including the European Union's General Data Privacy Regulation), and trade and economic sanctions laws and regulations (including laws administered by the U.S. Department of the Treasury’s Office of Foreign Assets Control, the U.S. State Department, the U.S. Department of Commerce, the United Nations Security Council and other [removed: relevant] sanctions authorities).

Our compliance risks are heightened due to the go-to-market approach for our business that relies heavily on a partner ecosystem, the fact that [added: some of the countries] we operate in [removed: countries with] [added: have] a higher incidence of corruption and fraudulent business [removed: practices than others,] [added: practices,] the fact that we [removed: deal with] [added: sell to] governments and state-owned business enterprises, and the fact that global enforcement of laws has significantly increased.

Violations of such laws can lead to civil and/or criminal prosecutions, substantial fines and other sanctions, including the revocation of our rights to continue certain operations, and also cause business loss and reputational harm, which could adversely affect our [added: business,] financial [added: condition,] results [removed: and/or stock price.][added: of operations, and prospects.]

Businesses we acquire may not generate the [removed: revenue] [added: sales] and earnings we anticipate and may otherwise adversely affect our [removed: business.][added: business and prospects.]

If we fail to successfully integrate and manage the businesses and technologies we acquire, if an acquisition does not further our business strategy [added: or return a level of sales] as we expect, or if a business we acquire has unexpected legal or financial liabilities, our [removed: operating] [added: business, financial condition,] results [removed: will] [added: of operations, and prospects could] be adversely affected.

unanticipated operating difficulties in connection with the acquired entities, including potential declines in [removed: revenue] [added: sales] of the acquired entity;

litigation arising from the transaction, including potential intellectual property claims or disputes following [removed: our] [added: an] acquisition;

We may incur significant debt or issue a material amount of debt or equity securities to finance an acquisition, which could adversely affect our operating [removed: flexibility] [added: flexibility, business] and [removed: financial statements.][added: prospects.]

The increases in these expenses and in our leverage could constrain our ability to operate as we might otherwise or to borrow additional [removed: amounts.][added: amounts and could adversely affect our business, financial condition, results of operations, and prospects.]

If we were to issue a significant amount of equity securities in connection with an acquisition, existing stockholders would be diluted and [removed: earnings per share] [added: our stock price] could [removed: decrease.][added: decline.]

Our inability to maintain or develop our strategic and technology relationships could adversely affect our [removed: business.][added: business and prospects.]

We have many strategic and technology relationships with other companies with which we work to offer complementary solutions and services, that market and sell our [removed: solutions] [added: solutions,] and that provide technologies that we embed in our solutions.

We may not realize the expected benefits from these [removed: relationships and such relationships may be terminated by the other party.]

If these companies fail to perform or if a company terminates or substantially alters the terms of the relationship, we could suffer delays in product development, reduced sales or other operational difficulties and our business, [added: financial condition,] results of [removed: operations] [added: operations,] and [removed: financial condition] [added: prospects] could be materially adversely affected.

We may be unable to adequately protect our proprietary rights, which could adversely affect our business and our [removed: ability to compete effectively.][added: prospects.]

If our measures to protect our intellectual property rights fail, others may be able to use those rights, which could reduce our competitiveness and [removed: revenues.][added: adversely affect our business, financial condition, operating results, and prospects.]

In addition, any legal action to protect our intellectual property rights that we may bring or be engaged in could be costly, may distract management from day-to-day operations and may lead to additional claims against us, and we may not succeed, all of which [removed: would materially] [added: could] adversely affect our [added: business, financial condition,] operating [removed: results.][added: results, and prospects.]

Intellectual property infringement claims could be asserted against us, which could be expensive to [removed: defend and] [added: defend,] could result in limitations on our use of the claimed intellectual [removed: property.][added: property, and could adversely affect our business and prospects.]

[removed: If a lawsuit of this type is filed, it] [added: Any such claim] could result in significant expense to us and divert the efforts of our technical and management personnel.

We face significant competition, which could adversely affect our business, financial condition, operating results, and prospects if we are unable to successfully compete.

For example, customer demand for SaaS solutions is increasing.

While our Arena, ServiceMax, and Onshape solutions are cloud-native SaaS solutions, and we have introduced our Windchill+, Creo+, and Kepware+ SaaS solutions, customers may not adopt them as we expect.

Such outages could adversely impact our business, financial condition, results of operations, and prospects.

If we fail to successfully transform our operations to support the sale of SaaS solutions and to develop competitive SaaS solutions, our business and prospects could be adversely affected.

relationships and such relationships may be terminated by the other party.

We have faced such lawsuits from time to time.

If our results of operations do not meet market or analysts’ expectations, our stock price could decline.

Our quarterly operating results fluctuate depending on many factors, including the effect of ASC 606 on revenue recognition for the on-premises software subscriptions we offer, variability in the timing of start dates for our subscription and SaaS offerings, length of contracts, and renewals, and significant unexpected expenses in a quarter.

Accordingly, our quarterly results are difficult to predict and we may

If our quarterly operating results do not meet market or analysts’ expectations, our stock price could decline.

exposure of our operations and employees to political instability and armed conflict in the countries and regions in which we operate, including Israel;

We face significant competition, which may reduce our profitability and limit or reduce our market share.

For example, the COVID-19 pandemic caused companies worldwide to close their offices and their employees to have to work remotely from their homes, and there remains uncertainty about the extent to which employees will return to the office in the long term.

This has focused companies on the need for solutions that empower and support remote work by employees.

We believe customers and potential customers will increasingly seek software solutions that support remote work by employees.

Although many of our solutions support remote work, others are less efficient at doing so.

We have embarked on an effort to make our solutions available on a SaaS platform; however, this will require significant effort and investment and we cannot be sure that we will be able to make our solutions available as SaaS solutions as quickly as we expect or that customers will adopt them as we expect.

In addition, competitive pressures could cause us to reduce our prices, which could reduce our revenue and margins.

Such outages could trigger our service level agreements with customers and require us to issue the issuance of credits to our cloud-based product customers, which could adversely impact our business, financial condition and results of operations.

The technical personnel required to develop our products and solutions are in high demand.

If we are unable to attract and retain technical personnel with the requisite skills, our product and solution development efforts could be delayed, which could adversely affect our ability to compete and thereby adversely affect our revenues and profitability.

The managerial, sales and marketing, financial and administrative personnel necessary to guide our operations, market and sell our solutions and support our business operations are also in high demand due to intense competition in our industry.

If we are unable to successfully establish these new offerings and navigate our business transition due to these risks and uncertainties, our business and financial results could be adversely impacted.

issuing equity awards to, or assuming existing equity awards of, acquired employees, which may more rapidly deplete share reserves available under our shareholder-approved equity incentive plans;

In addition, the financial and operating covenants under the credit facility may limit our ability to borrow funds, including for strategic acquisitions and share repurchases.

Our credit facility has variable interest tied to LIBOR and we could become subject to higher interest rates if the replacement rate we agree on with our banks is higher.

Borrowings under our revolving credit facility use the London Interbank Offering Rate (LIBOR) as a benchmark for establishing the interest rate.

On March 5, 2021, the Intercontinental Exchange Benchmark Administration, the U.K. Financial Conduct Authority (FCA) regulated and authorized administrator of LIBOR, announced, and the FCA confirmed, that one week and two-month USD LIBOR settings will cease on December 31, 2021, and that the USD LIBOR panel for all other tenors will cease on June 30, 2023.

The credit facility provides a mechanism pursuant to which we and the administrative agent may agree, under certain circumstances, to transition to an alternate base rate borrowing or amend the credit facility to establish an alternate interest rate to LIBOR that includes consideration of the then-prevailing market convention for determining interest rates for syndicated loans in the United States at that time.

Although we believe the alternative rates will not materially increase the rates on our credit facility, the final agreed rate may increase the cost of our variable rate indebtedness.

Our operating results fluctuate from quarter to quarter, making future operating results difficult to predict; failure to meet market expectations could cause the price of our securities to decline.

Our quarterly operating results historically have fluctuated and are likely to continue to fluctuate depending on many factors, including:

our adoption of Accounting Standards Update 2014-09, *Revenue from Contracts with Customers: Topic 606* in 2019 creates significant revenue volatility;

variability in our contracts, including timing of start dates, length of contracts, and mix of on-premises and cloud-based purchases, which would impact our revenue and earnings;

the rate at which our existing contracts renew or churn;

a significant percentage of our orders comes from transactions with large customers, which tend to have long lead times that are less predictable;

because our operating expenses are largely fixed in the short term and are based on expected bookings, any failure to achieve our bookings targets could cause us to miss our near term earnings and cash flow targets;

because a significant portion of our revenue and expenses are generated from outside the U.S., shifts in foreign currency exchange rates have had and could continue to have an adverse effect on our reported results; and

we may incur significant expenses in a quarter in connection with corporate development initiatives, restructuring efforts or the investigation, defense or settlement of legal actions that would increase our operating expenses and reduce our earnings for the quarter in which those expenses are incurred.

Any failure to meet our quarterly revenue or earnings expectations could adversely impact the market price of our securities.

Further, our stock price has been more volatile than that of other software companies.

We ended [removed: FY’22] [added: FY’23] with cash and cash equivalents of [removed: $272] [added: $288] million and gross debt of [removed: $1.36] [added: $1.70] billion, with an aggregate [added: weighted average] interest rate of [removed: 3.9%.][added: 5.2%.]

For discussion of our [removed: FY'21] [added: FY'22] results and comparison to our [removed: FY'20] [added: FY'21] results, refer to *Management's Discussion and Analysis of Financial Conditions and Results of Operations* in our Annual Report on Form 10-K for the [removed: fiscal] year ended September 30, [removed: 2021.][added: 2022.]

| | | [removed: 2022] [added: 2023] | | | | [removed: 2021] [added: 2022] | | | | Actual | | | | Constant Currency(1) | | |

| ARR as of September [removed: 30(2)] [added: 30] | | $ | [removed: 1,572.0] [added: 1,978.6] | | | $ | [removed: 1,468.5] [added: 1,572.0] | | | | [removed: 7] [added: 26] | % | | | [removed: 16] [added: 23] | % |

| Total recurring [removed: revenue(3)] [added: revenue(2)] | | $ | [removed: 1,736.2] [added: 1,907.9] | | | $ | [removed: 1,616.3] [added: 1,736.2] | | | | [removed: 7] [added: 10] | % | | | [removed: 12] [added: 13] | % |

| Perpetual license | | | [removed: 34.1] [added: 38.6] | | | | [removed: 33.0] [added: 34.1] | | | | [removed: 3] [added: 13] | % | | | [removed: 6] [added: 17] | % |

| Professional services | | | [removed: 163.1] [added: 150.5] | | | | [removed: 157.8] [added: 163.1] | | | | [removed: 3] [added: (8] | [removed: %] [added: )%] | | | [removed: 9] [added: (5] | [removed: %] [added: )%] |

| Total revenue | | | [removed: 1,933.3] [added: 2,097.1] | | | | [removed: 1,807.2] [added: 1,933.3] | | | | [removed: 7] [added: 8] | % | | | [removed: 11] [added: 12] | % |

| Total cost of revenue | | | [removed: 386.0] [added: 441.0] | | | | [removed: 371.1] [added: 386.0] | | | | [removed: 4] [added: 14] | % | | | [removed: 7] [added: 16] | % |

| Gross margin | | | [removed: 1,547.4] [added: 1,656.0] | | | | [removed: 1,436.1] [added: 1,547.4] | | | | [removed: 8] [added: 7] | % | | | [removed: 12] [added: 11] | % |

| Operating expenses | | | [removed: 1,100.0] [added: 1,197.6] | | | | [removed: 1,055.3] [added: 1,100.0] | | | | [removed: 4] [added: 9] | % | | | [removed: 6] [added: 11] | % |

| Operating income | | $ | [removed: 447.4] [added: 458.5] | | | $ | [removed: 380.7] [added: 447.4] | | | | [removed: 17] [added: 2] | % | | | [removed: 30] [added: 10] | % |

| Non-GAAP operating income(1) | | $ | [removed: 732.2] [added: 758.9] | | | $ | [removed: 634.4] [added: 732.2] | | | | [removed: 15] [added: 4] | % | | | [removed: 23] [added: 8] | % |

| Operating margin | | | [removed: 23.1] [added: 21.9] | % | | | [removed: 21.1] [added: 23.1] | % | | | | | | | | |

| Non-GAAP operating margin(1) | | | [removed: 37.9] [added: 36.2] | % | | | [removed: 35.1] [added: 37.9] | % | | | | | | | | |

| Diluted earnings per share | | $ | [removed: 2.65] [added: 2.06] | | | $ | [removed: 4.03] [added: 2.65] | | | | | | | | | |

| Non-GAAP diluted earnings per share(1) | | $ | [removed: 4.58] [added: 4.34] | | | $ | [removed: 3.97] [added: 4.58] | | | | | | | | | |

| Cash flow from [removed: operations(4)] [added: operations(3)] | | $ | [removed: 435.3] [added: 610.9] | | | $ | [removed: 368.8] [added: 435.3] | | | | | | | | | |

| Capital expenditure | | | [removed: (19.5] [added: (23.8] | ) | | | [removed: (24.7] [added: (19.5] | ) | | | | | | | | |

| Free cash flow | | $ | [removed: 415.8] [added: 587.0] | | | $ | [removed: 344.1] [added: 415.8] | | | | | | | | | |

Recurring revenue is comprised of on-premises subscription, perpetual support, [removed: and] SaaS, and cloud revenue.

Cash flow from operations for [removed: FY’22] [added: FY'23] and [removed: FY’21] [added: FY'22] includes [removed: $40.8] [added: $1.5] million and [removed: $14.5] [added: $40.8] million of restructuring payments, respectively.

Cash from operations for [removed: FY’22] [added: FY'23] and [removed: FY’21] [added: FY'22] includes [removed: $11.8] [added: $19.6] million and [removed: $15.0] [added: $11.8] million of acquisition and transaction-related payments, respectively.

Approximately [removed: 55%] [added: 50%] of our revenue and [removed: 40%] [added: 35%] of our expenses are transacted in currencies other than the U.S. Dollar.

Changes in foreign currency exchange rates [removed: have been] [added: were] a headwind to reported [added: income statement] results in [removed: FY’22.][added: FY’23.]

The results of operations in the table above, and the tables and discussions below about revenue by line of [removed: business, product group,] [added: business] and [removed: geographic region] [added: product group] present both actual percentage changes year over year and percentage changes on a constant currency basis.

Our constant currency disclosures are calculated by multiplying the results in local currency for [removed: FY'22] [added: FY'23] and [removed: FY'21] [added: FY'22] by the exchange rates in effect on September 30, [removed: 2021.][added: 2022.]

If [removed: FY'22] [added: FY'23] reported results were converted into U.S. [removed: dollars] [added: Dollars] using the rates in effect as of September 30, [removed: 2021,] [added: 2022,] ARR [removed: as of September 30, 2022] would have been [removed: higher] [added: lower] by [removed: $134 million] [added: $38 million, revenue would have been lower by $59 million,] and [removed: operating income in FY'22] [added: expenses] would have been [removed: $27 million higher.][added: lower by $26 million.]

Under ASC 606, the volume, mix, and duration of contract types (support, SaaS, on-premises subscription) starting or renewing in any given period [removed: may] [added: can] have a material impact on revenue in the period, and as a result can impact the comparability of reported revenue [removed: period-over-period.][added: period over period.]

We recognize revenue for the license portion of on-premises subscription contracts up front when we deliver the licenses to the customer, typically on the start date, and we recognize revenue on the support [removed: element] [added: portion] of on-premises subscription contracts and stand-alone support contracts ratably over the term.

We continue to convert existing [added: perpetual] support contracts to on-premises subscriptions, resulting in a shift to up-front recognition of on-premises subscription license revenue in the period converted compared to ratable recognition for a perpetual support contract.

[removed: As] [added: We expect that over time a higher portion of our revenue will be recognized ratably as] we continue to expand our SaaS [removed: offerings and] [added: offerings,] release additional cloud functionality into our products, and [removed: customers begin to] migrate [added: customers] from on-premises subscriptions to [removed: SaaS products, we expect that over time a higher portion of our revenue will be recognized ratably.][added: SaaS.]

Given the different mix, duration and volume of new and renewing contracts in any period, year-over-year or sequential revenue [removed: comparisons] can vary significantly.

| | | [removed: 2022] [added: 2023] | | | | [removed: 2021] [added: 2022] | | | | Actual | | | | Constant Currency | | |

| [removed: License (1)] [added: License(1)] | | $ | [removed: 782.7] [added: 747.0] | | | $ | [removed: 738.1] [added: 782.7] | | | | [removed: 6] [added: (5] | [removed: %] [added: )%] | | | [removed: 10] [added: (1] | [removed: %] [added: )%] |

| Support [removed: (2)] and cloud [removed: services] [added: services(2)] | | | [removed: 987.6] [added: 1,199.5] | | | | [removed: 911.3] [added: 987.6] | | | | [removed: 8] [added: 21] | % | | | [removed: 13] [added: 25] | % |

| Total software revenue | | | [removed: 1,770.3] [added: 1,946.6] | | | | [removed: 1,649.3] [added: 1,770.3] | | | | [removed: 7] [added: 10] | % | | | [removed: 12] [added: 13] | % |

| Total revenue | | $ | [removed: 1,933.3] [added: 2,097.1] | | | $ | [removed: 1,807.2] [added: 1,933.3] | | | | [removed: 7] [added: 8] | % | | | [removed: 11] [added: 12] | % |

Includes perpetual licenses and the license portion of [added: on-premises] subscription sales.

Includes support on perpetual [removed: licenses and] [added: licenses,] the support portion of [added: on-premises] subscription [removed: sales.][added: sales, SaaS, and cloud services.]

ARR grew 26% (23% constant currency) to $1.98 billion as of the end of FY'23 compared to FY’22.

Organic ARR, which excludes contributions from the ServiceMax business we acquired in Q2'23, grew 15% (13% constant currency) year over year to $1.81 billion.

Organic ARR growth was driven by double-digit growth across all product groups and geographies.

We generated $611 million of cash from operations in FY’23 compared to $435 million in FY’22, an increase of 40%.

Free cash flow of $587 million in FY'23 increased 41% from $416 million in FY'22.

Our cash flow growth is attributable to strong collections driven by our solid top-line growth from our subscription business model and operational discipline.

Interest payments were $41 million higher in FY'23 compared to FY'22, while restructuring payments decreased $39 million year-over-year.

Revenue growth of 8% (12% constant currency) in FY'23 compared to FY'22 was primarily due to the contributions from ServiceMax and Codebeamer.

The timing of revenue recognition for on-premises subscription revenue can vary significantly, impacting reported revenue and growth rates.

Interest expense was $75 million higher in FY'23 compared to FY'22, which adversely affected our net income and earnings per share results.

The increase was driven by debt and liabilities related to the ServiceMax acquisition.

However, ARR was positively impacted by improvements in currency exchange rates, particularly the Euro to U.S. Dollar exchange rate, as of September 30, 2023 compared to September 30, 2022.

If FY'22 reported results were converted into U.S. Dollars using the rates in effect as of September 30, 2022, ARR would have been the same, revenue would have been lower by $112 million, and expenses would have been lower by $50 million.

| Professional services | | | 150.5 | | | | 163.1 | | | | (8 | )% | | | (5 | )% |

Software revenue in FY'23 benefited from contributions from ServiceMax, acquired early in Q2'23, and Codebeamer, acquired in Q3'22.

Changes in foreign currency exchange rates were a headwind to year-over-year revenue growth.

Within software revenue, license revenue is impacted by the quantity and size of expiring and renewing multi-year on-premises subscription contracts, along with the duration of those contracts that start in the period.

In FY'23, the weighted-average duration of contracts starting in the year decreased compared to FY'22 primarily due to a few high-value renewal contracts in FY'22 that had longer than typical durations.

Because longer duration contracts typically have a higher total contract value, which drives the amount of upfront license revenue recognized for on-premises contracts, this year-over-year duration decrease represented a headwind to license revenue growth in FY'23.

Professional services revenue decreased in FY'23 as we continue to execute on our strategy of leveraging partners to deliver services rather than contracting to deliver services ourselves, including the Q3'22 sale of a portion of our PLM services business to ITC Infotech (which branded the business DxP Services).

Changes in foreign currency exchange rates also contributed to the year-over-year revenue decline.

These decreases were partially offset by ServiceMax professional services revenue.

| | | 2023 | | | | 2022 | | | | Actual | | | | Constant Currency | | |

PLM software revenue growth in FY'23 benefited from contributions from ServiceMax and Codebeamer.

Changes in foreign currency exchange rates were a headwind to year-over-year revenue growth.

Excluding contributions from ServiceMax and Codebeamer, constant currency revenue growth was driven by Windchill and IIoT in the Americas.

PLM ARR grew 36% (34% constant currency) from Q4’22 to Q4'23, driven by ServiceMax, which contributed $171 million of ARR; Windchill; IIoT; and Codebeamer.

CAD software revenue was negatively impacted by changes in foreign currency exchange rates.

Constant currency revenue growth was flat due to decreases in Creo revenue in Europe due to shorter durations of on-premises subscription contracts, offset by Creo revenue growth in the Americas and Asia Pacific.

CAD ARR grew 12% (10% constant currency) in FY'23 compared to FY'22, driven by Creo.

License gross margin decreased in FY’23 compared to FY’22 due to lower license revenue and higher royalty expense.

Professional services gross margin decreased in FY’23 compared to FY’22 due to lower professional services revenue, offset by lower professional services costs.

The decrease in professional services revenue is mainly due to the sale of a portion of our PLM services business in FY'22 and continued execution on our strategy of leveraging partners to deliver services rather than contracting to deliver services ourselves.

| | | 2023 | | | | 2022 | | | | Percent Change | | |

| Restructuring and other charges (credits), net | | | (0.5 | ) | | | 36.2 | | | | (101 | )% |

Total headcount increased by 11% between FY'22 and FY'23, primarily driven by our acquisition of ServiceMax.

a $90 million increase in compensation expense (including stock-based compensation and benefit costs), primarily due to our acquisition of ServiceMax;

a $12 million increase in marketing expense, primarily due to our Q3'23 LiveWorx event;

| | | 2023 | | | | 2022 | | | | Percent Change | | |

Interest expense includes interest on our revolving credit facility and term loan, our Senior Notes due 2025 and 2028, and imputed interest on the deferred payment of a portion of the ServiceMax purchase price.

Forward-Looking Statements

*Statements in this Annual Report about anticipated financial results, capital developments and growth, as well as about the development of our products, markets and workforce, are forward-looking statements that are based on our current plans and assumptions.

Important information about the bases for these plans and assumptions and factors that may cause our actual results to differ materially from these statements is contained below and in Item 1A.

“Risk Factors” of this Annual Report.*

*Unless otherwise indicated, all references to a year reflect our fiscal year that ends on September 30.*

ARR increased 7% (16% constant currency) to $1,572 million in FY’22 compared to the end of FY’21.

Excluding the impact of Codebeamer, which we acquired in the third quarter of FY’22, organic ARR growth was 6% (15% constant currency) in FY’22 compared to FY’21.

FY’22 revenue of $1.93 billion increased 7% over FY’21 (11% in constant currency).

FY’22 operating margin of 23% increased approximately 200 basis points over FY’21 and non-GAAP operating margin of 38% increased approximately 300 basis points.

Operating margin improvements are due to higher revenue and continued operating expense discipline.

FY’22 diluted EPS was $2.65 compared to $4.03 in FY'21.

Diluted EPS in FY'22 included a $35 million non-operating charge associated with the decrease in value of an equity investment in a publicly-traded company, offset by a non-operating $30 million credit associated with the sale of a portion of our PLM services business.

Diluted EPS in FY'21 benefited from gains associated with an equity investment in a publicly-traded company, and income tax credits related to a release of a previously held valuation allowance.

FY'22 non-GAAP diluted EPS was $4.58, representing a 15% increase over non-GAAP diluted EPS of $3.97 in FY'21.

FY’22 operating cash flow of $435 million grew 18% over FY’21; FY’22 free cash flow of $416 million grew 21% over FY’21.

FY'22 operating cash flow and free cash flow included an $11.8 million outflow related to acquisition and transaction-related costs and $40.8 million of restructuring payments.

| | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

(1)

For the September 30, 2021 period, to facilitate comparability, we removed $6.2 million of ARR associated with a Vuforia AR product that we ceased selling as of September 30, 2021 from our ARR operating measure.

(4)

Cash from operations for FY'21 includes $17.9 million in un-forecasted payments related to the prior period tax exposure from a non-U.S. tax dispute.

| *(Dollar amounts in millions)* | | Year ended September 30, | | | | | | | | Percent Change | | | | | | |

The strengthening of the U.S. dollar compared to foreign currencies had a substantial impact on our revenue growth in FY'22.

On an actual currency basis, FY'22 revenue increased $126 million (7%), compared to an increase of $202 million (11%) on a constant currency basis.

Software revenue increased in FY’22 compared to FY’21 due to growth of Windchill and Arena revenue in the Americas and contribution from the recently acquired Codebeamer business in Europe, offset by a decline in Creo revenue primarily driven by foreign currency fluctuations in Europe and changes in contract durations.

In FY'22, our average durations for on-premises subscriptions starting in the year decreased slightly, resulting in a reduced revenue benefit compared to FY'21, which benefited from significant increases in average contractual durations due to business rule changes.

Professional services revenue in FY’22 compared to FY'21 reflects an increase in revenue associated with large PLM consulting engagements, particularly with automotive, aerospace and defense and consumer electronics customers.

Professional services revenue in the first half of FY’21 was negatively impacted by services delivery challenges associated with the COVID-19 pandemic.

As described in Part I, Item 1.

Business above, in the second half of FY'22, we accelerated this strategy through the sale of a portion of our PLM services business to ITC Infotech.

| Software Revenue by Product Group(1) | | | | | | | | | | | | | | | | |

| Digital Thread - Core | | $ | 1,212.1 | | | $ | 1,161.7 | | | | 4 | % | | | 9 | % |

| Digital Thread - Growth | | | 249.6 | | | | 236.7 | | | | 5 | % | | | 9 | % |

| Digital Thread - FSG | | | 227.0 | | | | 210.2 | | | | 8 | % | | | 12 | % |

| Digital Thread (Total) | | | 1,688.7 | | | | 1,608.6 | | | | 5 | % | | | 9 | % |

| Velocity | | | 81.6 | | | | 40.7 | | | | 101 | % | | | 101 | % |

We describe our Product Groups for FY'22 and FY'21 and the change for FY'23, including the products in each group, in Part I, Item 1.

Business above.

Windchill software revenue increased by 12% (16% constant currency), driven by a significant increase in on-premises subscription license revenue and an increase in cloud services revenue.

Our most significant foreign currency exposures relate to [removed: Western European] [added: Eurozone] countries, Japan, [removed: Israel,] [added: Sweden, Switzerland,] China and [removed: Canada.][added: India.]

We enter into foreign currency forward contracts [added: and options] to manage our exposure to fluctuations in foreign exchange rates that arise from receivables and payables denominated in foreign currencies.

We do not enter into or hold foreign currency derivative financial instruments for trading or speculative [removed: purposes, nor do we enter into derivative financial instruments to hedge future cash flows or forecast transactions.][added: purposes.]

Approximately [removed: 55%] [added: 50%] of our revenue and [removed: 40%] [added: 35%] of our expenses were transacted in currencies other than the U.S. [removed: dollar.][added: Dollar.]

Based on current revenue and expense levels (excluding restructuring charges and stock-based compensation), a $0.10 change in the USD to EUR exchange rate and a 10 Yen change in the Yen to USD exchange rate would impact operating income by approximately [removed: $32] [added: $30] million and [removed: $12] [added: $6] million, respectively.

Our foreign currency hedging program uses forward contracts [added: and options] to manage the foreign currency exposures that exist as part of our ongoing business operations.

The contracts are primarily denominated in [removed: Japanese Yen] [added: the Euro, Swedish Krona,] and [removed: European] [added: Swiss Franc] currencies, and have maturities of less than four months.

The majority of our foreign currency forward contracts [added: and options] are not designated as hedges for accounting purposes, and changes in the fair value of these instruments are recognized immediately in earnings.

Because we enter into [removed: forward] [added: these derivative] contracts only as an economic hedge, any gain or loss on the underlying foreign-denominated balance would be offset by the loss or gain on the [removed: forward] [added: derivative] contract.

Gains and losses on [removed: forward contracts] [added: these derivatives] and foreign currency denominated receivables and payables are included in [removed: foreign currency net losses.][added: Other income, net.]

As of September 30, [removed: 2022] [added: 2023] and [removed: 2021,] [added: 2022,] we had outstanding forward contracts for derivatives not designated as hedging instruments with notional amounts equivalent to the following:

| Currency Hedged *(in thousands)* | | [removed: 2022] [added: 2023] | | | | [removed: 2021] [added: 2022] | | |

| Canadian [added: Dollar] / U.S. Dollar | | $ | [removed: 2,731] [added: 5,135] | | | $ | [removed: 4,894] [added: 2,731] | |

| Euro / U.S. Dollar | | | [removed: 316,869] [added: 383,227] | | | | [removed: 387,466] [added: 316,869] | |

| British Pound / U.S. Dollar | | | [removed: 7,368] [added: 6,058] | | | | [removed: 23,141] [added: 7,368] | |

| Israeli Shekel / U.S. Dollar | | | [removed: 12,052] [added: 11,852] | | | | [removed: 10,475] [added: 12,052] | |

| Japanese Yen / U.S. Dollar | | | [removed: 25,566] [added: 4,770] | | | | [removed: 46,450] [added: 25,566] | |

| Swiss Franc / U.S. Dollar | | | [removed: 25,559] [added: 32,766] | | | | [removed: 18,039] [added: 25,559] | |

| Swedish Krona / U.S. Dollar | | | [removed: 35,713] [added: 35,085] | | | | [removed: 34,196] [added: 35,713] | |

| Singapore Dollar / U.S. Dollar | | | [removed: 3,637] [added: —] | | | | [removed: 3,498] [added: 3,637] | |

| Chinese Renminbi / U.S. Dollar | | | [removed: 23,965] [added: 16,660] | | | | [removed: 23,297] [added: 23,965] | |

| New Taiwan Dollar / U.S. Dollar | | | [removed: 13,906] [added: 11,855] | | | | [removed: 3,369] [added: 13,906] | |

| Korean [removed: Won/] [added: Won /] U.S. Dollar | | | [removed: 4,919] [added: 6,157] | | | | [removed: —] [added: 4,919] | |

| Danish [removed: Krone/] [added: Krone /] U.S. Dollar | | | [removed: 3,192] [added: 6,731] | | | | [removed: 2,380] [added: 3,192] | |

| Australian [removed: Dollar/] [added: Dollar /] U.S. Dollar | | | [removed: 3,269] [added: 452] | | | | [removed: 2,086] [added: 3,269] | |

| All other | | | [removed: 4,432] [added: 2,888] | | | | [removed: 2,016] [added: 4,432] | |

| Total | | $ | [removed: 483,178] [added: 523,636] | | | $ | [removed: 563,921] [added: 483,178] | |

In addition to the $1 billion due under our 2025 and 2028 Senior Notes, as of September 30, [removed: 2022,] [added: 2023,] we had [removed: $359] [added: $702] million outstanding under our credit facility.

As of September 30, [removed: 2022,] [added: 2023,] the annual rate on the credit facility loans was [removed: 4.14%.][added: 7.18%.]

If there were a 100 basis point change in interest rates, the annual net impact to earnings and cash flows would be [removed: $3.6] [added: $7] million.

This change in cash flows and earnings has been calculated based on the borrowings outstanding at September 30, [removed: 2022] [added: 2023] and a 100 basis point per annum change in interest rate applied over a one-year period.

As of September 30, [removed: 2022,] [added: 2023,] cash equivalents were invested in highly liquid investments with maturities of three months or less when purchased.

At September 30, [removed: 2022,] [added: 2023,] we had cash and cash equivalents of [removed: $11] [added: $35] million in the United States, [removed: $105] [added: $111] million in Europe, [removed: $128] [added: $121] million in Asia Pacific (including India), and [removed: $28] [added: $21] million in other non-U.S. countries.

Given the short maturities and investment grade quality of the portfolio holdings at September 30, [removed: 2022,] [added: 2023,] a hypothetical 10% change in interest rates would not materially affect the fair value of our cash and cash equivalents.

Changes in foreign currencies relative to the U.S. [removed: dollar] [added: Dollar] had [added: a favorable impact of $2.9 million and] an unfavorable impact of $24.2 million [removed: and $0.1 million] on our consolidated cash balances in [removed: 2022 and 2021, respectively, in particular due to changes in the Euro] [added: FY'23] and [removed: the Japanese Yen.][added: FY'22, respectively.]

We also had a $620 million deferred acquisition payment liability related to the fair value of the $650 million installment for the ServiceMax acquisition, which we paid in October 2023 leveraging financing from our credit facility.

The impact in FY'23 was due in particular to changes in the Euro and the Korean Won.

| Russian Ruble/ U.S. Dollar | | | — | | | | 2,614 | |

Our software portfolio includes award-winning offerings [removed: in the] [added: that enable companies to author product data (our] computer-aided design (CAD) [added: portfolio solutions)] and [added: to manage] product [added: data and orchestrate processes (our product] lifecycle management (PLM) [removed: markets.][added: portfolio solutions).]

[removed: CAD is utilized for product data authoring and PLM is for product data management] [added: | PLM Software Products For Product Data Management] and [removed: process orchestration.][added: Process Orchestration | | CAD Software Products For Product Data Authoring |]

Our [removed: customer base includes] [added: customers include] some of the world's most innovative [removed: manufacturers] [added: companies] in the aerospace and defense, automotive, electronics and high tech, industrial machinery and equipment, life sciences, retail and consumer products industries.

We generate revenue through the sale of [removed: software] subscriptions, which include [removed: license access] [added: term-based on-premises software licenses] and [removed: support (technical support] [added: related support, Software-as-a-Service (SaaS),] and [removed: software updates); support for] [added: hosting services;] perpetual licenses; [removed: cloud services (hosting] [added: support] for [removed: our software and software-as-a-service (SaaS));] perpetual licenses; and professional services (consulting, implementation, and training).

[removed: With our solutions, we enable] [added: Our solutions portfolio encompasses the entire product life cycle, from design to manufacture to service, enabling] companies to adopt a “digital thread” strategy to drive innovation and productivity.

Acquisitions and Disposition of [removed: Business*] [added: Businesses*] of Notes to Consolidated Financial Statements in this Annual Report for additional discussion [removed: regarding these transactions.][added: about the ServiceMax transaction.]

[removed: ][added: ]

[removed: These service offerings will provide an alternative to our traditional on-premises software] [added: We believe that SaaS] products [removed: and provide] [added: represent a strong value proposition for] our [removed: customers with the benefits of SaaS including accelerated time to value,] [added: customers, offering] reduced [removed: complexity,] [added: complexity;] lower costs to implement, upgrade and [removed: administer, improved] [added: administer; better] user collaboration and [removed: mobility,] [added: mobility;] and scalability.

[removed: We] [added: Across all our solutions, we] see opportunity for further market growth [removed: for all our solutions] with a new generation of SaaS solutions we are developing to bring to market over the next few years.

Approximately 25% [removed: to 30%] of our sales of products and services are through third-party resellers.

Additional financial information about our [removed: segments and] international and domestic operations may be found in *Note [removed: 18.][added: 3.]

[removed: Segment and Geographic Information*] [added: Revenue from Contracts with Customers*] of Notes to Consolidated Financial Statements in this Annual Report, which information is incorporated herein by reference.

For enterprise [removed: Creo] [added: CAD] and [removed: Windchill] [added: PLM] solutions, we compete with large established companies including Autodesk, Dassault Systèmes SA, and Siemens AG.

For our AR products, our primary competitors include Microsoft, [removed: TeamViewer,] [added: TeamViewer SE,] and [removed: ScopeAR.][added: Scope Technologies US Inc. For our ALM products, we compete with IBM, Jama Software, Inc. and Siemens AG.]

For our SLM products, we compete with [added: enterprise software] companies [added: such as Oracle, SAP and IFS AB, and with companies] that offer point [removed: solutions and with customers’ homegrown] solutions.

[removed: “Risk Factors”] [added: *Risk Factors*] below, which is incorporated into this section by reference.

Our approach is focused on [removed: sustainable talent practices and core values that promote] [added: promoting] an agile culture, an increased sense of belonging, engaged work environments, and high-performing teams.

[removed: ][added: ]

As of September 30, [removed: 2022,] [added: 2023,] PTC had [removed: 6,503] [added: 7,231] full-time employees.

[removed: Worldwide] [added: *Worldwide] Employee [removed: Representation][added: Representation*]

[removed: ][added: ]

[removed: United] [added: *United] States Employee [removed: Representation][added: Representation*]

PTC provides a comprehensive and competitive compensation and benefits package designed to attract, retain, motivate, and engage talent around the [removed: world that will drive success and innovation in meeting the goals of our business.][added: world.]

We provide employees with competitive [added: compensation packages, including] base salaries, [removed: incentive compensation] and, [removed: in many cases,] [added: for eligible roles, incentive and] equity compensation.

Our benefits offerings are designed to meet the [removed: unique] needs of our [removed: employees.][added: employees and their families around the world.]

[removed: Employee Development][added: Talent Development & Employee Engagement]

[removed: We] [added: As we focus on enhancing the employee experience, we are increasing our efforts to] invest in our [removed: employees, creating] [added: people and create] meaningful opportunities to learn, grow, [removed: develop] [added: develop,] and advance their careers.

[removed: Commitment to Diversity,] [added: Diversity,] Equity, and Inclusion (DEI)

Recent Developments

We acquired the ServiceMax® cloud-native field service management business in Q2’23, broadening our PLM solution set to encompass the service phase of the product lifecycle.

We paid the first purchase payment installment of $835 million, as adjusted for working capital, indebtedness, cash, and transaction expenses, in January 2023, and the second and final installment of $650 million in October 2023.

We pursue multiple strategic initiatives designed to create value for our customers, increase our Annual Run Rate (ARR) and free cash flow, and deliver long-term value for stockholders.

Subscription Business Model

Our transition from a perpetual and maintenance model to a subscription business model continues to be key to driving growth.

Our subscription model offers greater benefits of scale and growth potential, drives higher customer engagement and retention, and provides better business predictability, with over 90% of our annual revenues being recurring in nature.

This, in turn, enables us to make steady and sustained investments to pursue mid-to-long-term growth opportunities.

Customer Expansion

The digital thread is particularly valuable for customers with complex products that tend to have longer life cycles.

We seek to drive value for our customers by offering new and enhanced features and products that enable our customers to pursue and expand their digital thread strategies.

Our acquisition strategy targets companies with products that complement ours and that we believe will appeal to our existing customer base, allowing us to pursue cross-selling opportunities.

The addition of ServiceMax in 2023 for the SLM part of our PLM portfolio further extends what was already a unique portfolio of interconnected digital thread capabilities across the full product life cycle.

The addition of Codebeamer in 2022 for the ALM part of our PLM portfolio strengthened our offerings in the ALM space as software becomes integral to more and more products, especially in regulated industries where traceability is safety-critical.

PLM Expansion

PLM is at the heart of digital transformation and has become essential technology at industrial companies.

No longer confined to the Engineering department, PLM data is driving decision-making across organizations, enabling them to improve how products are designed, manufactured, and serviced.

Our goal is to be the category leader in PLM and to provide our customers with best-in-class solutions to drive innovation and productivity.

SaaS Transition

We continue to invest in the transformation of our technology portfolio to include more SaaS offerings.

Our acquisitions of Onshape, Arena, and ServiceMax brought cloud-native solutions to our portfolio, and we continue to work towards creating and expanding SaaS offerings for our existing products.

This is a longer-term strategy as we expect that SaaS adoption in the CAD and PLM markets will be gradual at first, then accelerate significantly, given constraints such as the length and cost of conversion projects and budgeting timelines of our customers.

Our Principal Product Groups

PLM

Our Windchill® PLM application suite manages all aspects of the product development lifecycle—from concept through service and retirement—by enabling a digital thread of product parts, materials, and configuration information.

Windchill provides real-time information sharing, dynamic data visualization, and the ability to collaborate across geographically-distributed teams, enabling manufacturers to elevate their product development, manufacturing, and field service processes.

With its open architecture that integrates with other enterprise systems, Windchill provides a solid foundation for a product-driven digital thread.

Our ThingWorx® platform is flexible and purpose-built for Industrial Internet of Things (IIoT).

It offers a rich set of capabilities that enable enterprises to digitally transform every aspect of their business with innovative solutions that are simple to create, easy to implement, scalable to meet future needs, and designed to enable customers to accelerate time to value.

Primary use cases include remote asset monitoring, remote maintenance and service, predictive maintenance and asset management, and optimized equipment effectiveness.

Our ThingWorx Digital Performance Management solution enables manufacturers to identify, prioritize, and overcome their most significant production bottlenecks.

Our ServiceMax® field service management (FSM) solutions enable companies to improve asset uptime with optimized in-person and remote service, boost technician productivity with the latest mobile tools, and deliver metrics for confident decision making.

Our Arena® SaaS PLM solution enables product teams to collaborate virtually anytime and anywhere, making it easier to share the latest product and quality information with internal teams and supply chain partners and deliver innovative products to customers faster.

Our Arena quality management system software connects quality and product designs into a single system to simplify regulatory compliance.

Our Codebeamer® application lifecycle management (ALM) and model-based systems engineering capabilities enable companies to accelerate the development of software-intensive products through system modeling, software configuration, and requirements, risk, and test management.

Our Servigistics® service parts management solution enables companies to effectively manage their service parts inventory, enabling them to optimize equipment availability and uptime, and increase customer satisfaction.

Our FlexPLM® solution provides retailers with a single platform for merchandising and line planning, materials management, sampling, and more.

Our Kepware® portfolio of industrial connectivity solutions helps companies connect diverse automation devices and software applications.

CAD

Our Creo® 3D CAD technology enables the digital design, testing, and modification of product models.

There are three key elements to our strategy to deliver long-term shareholder value.

Accelerate Digital Thread Solutions

This is particularly relevant for larger businesses pursuing a vertically integrated manufacturing strategy in which the reuse and repurposing of earlier innovations drives next generation product offerings.

Accelerate Product Innovation

We enable companies to upend the product development process with solutions that apply agile concepts, originally focused on software development, to the entire product innovation process, from software to hardware and electronics.

By applying agile product development processes across all three disciplines, companies can increase innovation velocity and bring new products to market faster to meet rapidly changing market demand.

This is particularly relevant for start-up and upstart businesses focused on technology-centered innovations that commonly leverage contract manufacturers for production of their designs.

Accelerate SaaS Transformation

Manufacturers today face a myriad of business challenges.

Macroeconomic forces, such as an ever-evolving workforce, supply chain disruptions, the rise of smart, connected products, and the need to prove sustainability, are all driving the need for change.

We enable companies to respond to these challenges with technology that leverages the cloud to transform how, where, and when work gets done.

Software-as-a-service (SaaS), which has already reshaped nearly all aspects of business, is poised to transform management of the entire product lifecycle.

Anticipating this need, PTC acquired the Onshape and Arena cloud-native product development solutions.

In parallel, we are heavily investing to transform our technology portfolio to SaaS.

Strategic Transactions

During FY'22, we completed two strategic transactions.

In Q3'22, we acquired the CodebeamerTM application lifecycle management business to broaden and deepen our ALM footprint across safety-critical and regulated industries.

In Q3'22, we also sold a portion of our PLM services business to ITC Infotech.

The transaction is designed to accelerate customer digital transformation initiatives and adoption of our Windchill+ SaaS solution.

In 2022, we reported our business in two product groups: Digital Thread and Velocity.

Digital Thread included products focused on customers that are embracing enterprise-wide digital transformation and Velocity included products focused on customers that prioritize agile product development.

Beginning in fiscal year 2023, we are reporting our businesses in two new product groups: CAD (Computer-Aided Design) and PLM (Product Lifecycle Management).

Products designated as CAD refer to software used for product data authoring.

Products designated as PLM refer to software used for product data management and process orchestration.

The new reporting structure aligns better to our strategy, product offerings and industry segments.

| Our Windchill® PLM application suite manages all aspects of the product development lifecycle - from concept through service and retirement - by enabling a digital thread of product parts, materials, and configuration information. Windchill provides real-time information sharing, dynamic data visualization, and the ability to collaborate across geographically-distributed teams, enabling manufacturers to elevate their product development process. With its open architecture that integrates with other enterprise systems, Windchill provides a solid foundation for a product-driven digital thread. Our Arena® SaaS PLM solution enables product teams to collaborate virtually anytime and anywhere, making it easier to share the latest product and quality information with internal teams and supply chain partners and help deliver innovative products to customers faster. Our Arena quality management system software connects quality and product designs into a single system to simplify regulatory compliance. Our ThingWorx® platform is flexible and purpose-built for Industrial Internet of Things (IIoT). It offers a rich set of capabilities that enable enterprises to digitally transform every aspect of their business with innovative solutions that are simple to create, easy to implement, scalable to meet future needs, and designed to enable customers to accelerate time to value. Our ThingWorx Digital Performance Management solution enables manufacturers to identify, prioritize, and overcome their most significant production bottlenecks. Our CodebeamerTM and IntegrityTM application lifecycle management (ALM) and model-based systems engineering capabilities enable users to accelerate the development of software-intensive products through system modeling, software configuration, and requirements, risk, and test management. Our Servigistics® service parts management solution enables customers to effectively manage their service parts inventory, enabling them to optimize equipment availability and uptime, and increase customer satisfaction. Our FlexPLM® solution provides retailers with a single platform for merchandising and line planning, materials management, sampling, and more. | | Our Creo® 3D CAD technology enables the digital design, testing, and modification of product models. With its design simulation, additive manufacturing, and generative design innovations, we enable our customers to be first to market with differentiated products. From initial concept to design, simulation, and analysis, Creo provides designers with innovative tools to efficiently create better products, faster. Our Onshape® SaaS product development platform unites computer-aided design with data management, collaboration tools, and real-time analytics. A cloud-native multi-tenant solution that can be instantly deployed on virtually any computer or mobile device, Onshape enables teams to work together from just about anywhere. Real-time design reviews, commenting, and simultaneous editing enable a collaborative workflow where multiple design iterations can be completed in parallel and merged into the final design. Our Vuforia® augmented reality (AR) technology enables the visualization of digital information in a physical context and the creation of AR and mixed reality experiences to deliver workforce productivity and business results in manufacturing, service, engineering, and operations. Vuforia solutions equip frontline workers with focused and effective step-by-step instructions, procedural guidance, skill development and remote assistance that enable enterprises to reduce errors, increase asset utilization and drive higher profitability. Our Arbortext® dynamic publishing solution streamlines how organizations create, manage, and publish technical documentation. |

To meet the increasing demand for SaaS delivered solutions, we expect to introduce a number of new SaaS offerings over time.

We are giving this new generation of offerings a “plus” brand.

We launched Windchill+ in the second quarter of 2022.

For our ALM products, we compete with IBM and Siemens AG.

PTC’s commitment to building a diverse, equitable, and inclusive culture is fundamental to our purpose – the Power to Create – and critical to every aspect of our talent strategy.


We believe we provide competitive benefits in each local market we operate in to help our employees care for themselves and their families.

Common offerings are health benefits, retirement benefits, life insurance and disability protection, employee assistance, vacation time, holidays and leave benefits.

To ensure our employees and families have the support they need as the COVID-19 pandemic begins to ease, PTC has continued its global emergency leave policy, which provides for ten days of paid time off over and above regular sick or other time off to recuperate from or care for a family member recovering from COVID-19.

We have specific development programs, including our Rotational Leadership Development, Managing at PTC, Leading at PTC, and 360-degree development programs.

We are improving our systems and processes to enable us to better track, manage and develop our employees.

With these improvements, we are gaining a better understanding of our current demographic population and developing demographic goals, as we strive to create a more demographically diverse, inclusive, and equitable organization.

Starting in FY’22, our Self-Identification program invited U.S. employees to volunteer their personal information across categories such as race/ethnicity, sexual orientation, gender identity, pronouns, disability, veteran and military status, and more.

By analyzing this information in aggregate, we can determine what we should adjust in terms of DEI programming, policies, and hiring practices.

None.

Information on legal proceedings can be found in *Note 10.

Commitments and Contingencies* *\-- Legal Proceedings* of Notes to Consolidated Financial Statements in this Annual Report, which information is incorporated herein by reference.

For the Fiscal Year Ended: September 30, [removed: 2022][added: 2023]

The aggregate market value of our voting stock held by non-affiliates was approximately [removed: $11,336,087,091] [added: $14,078,377,983] on March 31, [removed: 2022] [added: 2023] based on the last reported sale price of our common stock on the Nasdaq Global Select Market on that date.

There were [removed: 116,975,644] [added: 118,333,823] shares of our common stock outstanding on that day and [removed: 117,471,969] [added: 119,244,754] shares of our common stock outstanding on November [removed: 14, 2022.][added: 16, 2023.]

Portions of the definitive Proxy Statement in connection with the [removed: 2023] [added: 2024] Annual Meeting of Stockholders [removed: (2023] [added: (2024] Proxy Statement) are incorporated by reference into Part III.

ANNUAL REPORT ON FORM 10-K FOR FISCAL YEAR [removed: 2022][added: 2023]

| Item 1A. | [Risk Factors](#item_1a_risk_factors) | [removed: [10](#item_1a_risk_factors)] [added: [9](#item_1a_risk_factors)] |

| Item 1B. | [Unresolved Staff Comments](#unresolved_staff_comments) | [removed: [19](#unresolved_staff_comments)] [added: [17](#unresolved_staff_comments)] |

| Item 2. | [Properties](#properties) | [removed: [19](#properties)] [added: [17](#properties)] |

| Item 3. | [Legal Proceedings](#legal_proceedings) | [removed: [19](#legal_proceedings)] [added: [17](#legal_proceedings)] |

| Item 4. | [Mine Safety Disclosures](#mine_safety_disclosures) | [removed: [19](#mine_safety_disclosures)] [added: [17](#mine_safety_disclosures)] |

| Item 5. | [Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](#market_for_registrants_common_equity_rel) | [removed: [19](#market_for_registrants_common_equity_rel)] [added: [17](#market_for_registrants_common_equity_rel)] |

| Item 6. | [Reserved](#reserved) | [removed: [19](#reserved)] [added: [17](#reserved)] |

| Item 7. | [Management’s Discussion and Analysis of Financial Condition and Results of Operations](#managements_discussion_analysis_financia) | [removed: [20](#managements_discussion_analysis_financia)] [added: [18](#managements_discussion_analysis_financia)] |

| Item 7A. | [Quantitative and Qualitative Disclosures about Market Risk](#item_7a__quantitative_and_qualitative_di) | [removed: [37](#item_7a__quantitative_and_qualitative_di)] [added: [33](#item_7a__quantitative_and_qualitative_di)] |

| Item 8. | [Financial Statements and Supplementary Data](#item_8__financial_statements_and_supplem) | [removed: [39](#item_8__financial_statements_and_supplem)] [added: [35](#item_8__financial_statements_and_supplem)] |

| Item 9. | [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](#item_9__changes_in_and_disagreements_wit) | [removed: [39](#item_9__changes_in_and_disagreements_wit)] [added: [35](#item_9__changes_in_and_disagreements_wit)] |

| Item 9A. | [Controls and Procedures](#item_9a__controls_and_procedures) | [removed: [39](#item_9a__controls_and_procedures)] [added: [35](#item_9a__controls_and_procedures)] |

| Item 9B. | [Other Information](#item_9b__other_information) | [removed: [40](#item_9b__other_information)] [added: [36](#item_9b__other_information)] |

| Item 9C. | [Disclosure Regarding Foreign Jurisdictions that Prevent Inspection](#item_9c__disclosue_regarding_foreign_jur) | [removed: [40](#item_9c__disclosue_regarding_foreign_jur)] [added: [37](#item_9c__disclosue_regarding_foreign_jur)] |

| Item 10. | [Directors, Executive Officers and Corporate Governance](#item_10__directors__executive_officers_a) | [removed: [41](#item_10__directors__executive_officers_a)] [added: [38](#item_10__directors__executive_officers_a)] |

| Item 11. | [Executive Compensation](#item_11__executive_compensation) | [removed: [41](#item_11__executive_compensation)] [added: [38](#item_11__executive_compensation)] |

| Item 12. | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](#item_12_security_ownership_certain) | [removed: [41](#item_12_security_ownership_certain)] [added: [38](#item_12_security_ownership_certain)] |

| Item 13. | [Certain Relationships and Related Transactions, and Director Independence](#item_13__certain_relationships_and_relat) | [removed: [41](#item_13__certain_relationships_and_relat)] [added: [38](#item_13__certain_relationships_and_relat)] |

| Item 14. | [Principal Accounting Fees and Services](#item_14__principal_accountant_fees_and_s) | [removed: [41](#item_14__principal_accountant_fees_and_s)] [added: [38](#item_14__principal_accountant_fees_and_s)] |

| [removed: [PART IV.](#part_iv)] [added: [PART IV.](#part_iv)] | | |

| Item 15. | [Exhibits and Financial Statement Schedules](#exhibits_financial_statement_schedules) | [removed: [42](#exhibits_financial_statement_schedules)] [added: [39](#exhibits_financial_statement_schedules)] |

| Item 16. | [Form 10-K Summary](#form_10k_summary) | [removed: [42](#form_10k_summary)] [added: [39](#form_10k_summary)] |

| [Exhibit Index](#exhibit_index) | | [removed: [43](#exhibit_index)] [added: [40](#exhibit_index)] |

| [Signatures](#signatures) | | [removed: [45](#signatures)] [added: [42](#signatures)] |

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b).

Website References

References to our PTC.com website in this Annual Report and to our 2023 Impact Report are provided for convenience.

The content on PTC.com and in our 2023 Impact Report is not incorporated by reference into this Annual Report unless expressly stated.

We currently have [removed: 98] [added: 83] office locations used in operations in the United States and internationally, predominately as sales and/or support offices and for research and development work.

Of our total of approximately [removed: 1,209,000] [added: 1,076,000] square feet of leased facilities used in operations, approximately [removed: 484,000] [added: 421,000] square feet are located in the U.S., including [added: approximately] 250,000 square feet at our headquarters facility located in Boston, Massachusetts, and approximately [removed: 250,000] [added: 267,000] square feet are located in India, where a significant amount of our research and development is conducted.

On September 30, [removed: 2022,] [added: 2023,] the close of our fiscal year, and on November [removed: 14, 2022,] [added: 13, 2023,] our common stock was held by [removed: 1,003] [added: 952] and [removed: 1,000] [added: 950] shareholders of record, respectively.

Based on this evaluation, we concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of September 30, [removed: 2022.][added: 2023.]

Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may [removed: deteriorate][added: deteriorate.]

Our management assessed the effectiveness of our internal control over financial reporting as of September 30, [removed: 2022] [added: 2023] using the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in *Internal Control-Integrated Framework (2013)*.

Based on this assessment and those criteria, our management concluded that, as of September 30, [removed: 2022,] [added: 2023,] our internal control over financial reporting was effective.

The effectiveness of our internal control over financial reporting as of September 30, [removed: 2022] [added: 2023] has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report, which appears under Item 8.

[removed: Change] [added: Changes] in Internal Control over Financial Reporting

There was no change in our internal control over financial reporting that occurred during the quarter ended September 30, [removed: 2022] [added: 2023] that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Management excluded ServiceMax from its assessment of internal control over financial reporting as of September 30, 2023 because it was acquired in a business combination in the current fiscal year.

ServiceMax's total assets and total revenues represent approximately 1% (excluding the impact of goodwill and intangibles from the acquisition) and 7%, respectively, of our total assets and total revenues, as of and for the year ended September 30, 2023.

*Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.*

On November 16, 2023, Michael DiTullio, President and Chief Operating Officer of the Company, Kristian Talvitie, Executive Vice President, Chief Financial Officer, Catherine Kniker, Executive Vice President, Chief Strategy and Marketing Officer, and Aaron von Staats, Executive Vice President, General Counsel entered into new Executive Agreements with PTC Inc. (the “Company”).

The new Executive Agreements replace the executives’ existing Executive Agreements with the Company.

The Executive Agreements provide certain compensation and employment protections to the executives.

Each Executive Agreement provides that, upon a change in control of the Company, (i) all performance measures under any outstanding equity award held by the executive will be deemed to have been met at the target level, and (ii) the executive will receive a payment in an amount equal to the pro-rata portion of the executive’s target incentive bonus for the current year.

Upon any termination of the executive’s employment after a change in control of the Company, (i) all equity awards held by the executive will accelerate and vest in full, (ii) the executive will receive a payment in an amount equal to: (a) 100% of the executive’s highest base salary in the six months preceding the termination date, plus (b) 100% of the executive’s highest applicable target bonus, and (iii) the executive will be entitled to continued participation in the Company’s medical, dental and vision benefit plans (the “Benefit Plans”) for one year, or payment of an amount sufficient to purchase substantially equivalent benefits if continued participation is not permitted under the applicable Benefit Plan or if the Benefit Plan is terminated.

The Executive Agreement also provides that, upon termination of the executive’s employment by the Company without cause (i) the executive will receive a payment in an amount equal to 100% of the executive’s highest base salary in the six months preceding the termination date plus 100% of the executive’s target bonus for the year in which the termination occurs, (ii) all equity awards held by the executive that would have vested in the twelve months following the termination date will vest, and (iii) the executive will be entitled to continued participation in the Benefit Plans or payment in lieu thereof as described above.

The Executive Agreement also provides that upon termination of the executive’s employment by the Company due to the executive’s death or disability, all equity held by the executive will vest in full.

Mr. DiTullio’s Executive Agreement also provides that if he voluntarily terminates his employment after September 30, 2025, or if he is terminated without cause, all outstanding equity held by him will continue to vest after such termination in accordance with its terms, which continued equity vesting after termination without cause replaces the equity acceleration described above in the event of termination without cause.

To receive the payments and benefits under the Executive Agreement, the

executive must execute a release of claims in favor of the Company and continue to comply with the terms of the executive’s Proprietary Information Agreement with the Company.

The preceding description of the Executive Agreements is qualified by reference to the full text of such agreements, copies of which are filed as Exhibits 10.5 and 10.6 of this Form 10-K.

*Insider Trading Arrangements*

Our Section 16 officers and directors may enter into plans or arrangements for the purchase or sale of our securities that are intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) of the Exchange Act.

Such plans and arrangements must comply in all respects with our insider trading policies, including our policy governing entry into and operation of 10b5-1 plans and arrangements.

During the quarter ended September 30, 2023, the following Section 16 officers and directors adopted Rule 10b5-1 trading arrangements (as defined in Item 408 of Regulation S-K of the Exchange Act).

All plans adopted covered only sales of PTC common stock.

No plans were modified or terminated.

| | | | | | | |

| --- | --- | --- | --- | --- | --- | --- |

| Name and Title of Director or Section 16 Officer | | Date of Adoption, Modification, or Termination | | Duration of the Plan | | Aggregate Number of Shares of Common Stock that may be Sold under the Plan |

| James Heppelmann, Chairman and Chief Executive Officer | | Adopted August 7, 2023 | | Ends February 12, 2024 | | 35,000 |

| Kristian Talvitie, Executive Vice President, Chief Financial Officer | | Adopted August 31, 2023 | | Ends February 29, 2024 | | 22,240 |

| Catherine Kniker, Executive Vice President, Chief Strategy and Marketing Officer | | Adopted August 15, 2023 | | Ends August 8, 2024 | | 4,857, plus all net vested shares issued for the FY2023 Corporate Incentive Plan, plus all shares purchased under the 2016 Employee Stock Purchase Plan for the offering periods ending on January 31, 2024 and July 31, 2024(1)(2) |

| Aaron von Staats,Executive Vice President, General Counsel | | Adopted August 24, 2023 | | Ends May 31, 2024 | | 3,835, plus all net vested shares issued for the FY2023 Corporate Incentive Plan, plus 40.5% of total shares that vest on November 15, 2023 under the performance-based RSU awards granted on November 17, 2020, November 17, 2021, and November 16, 2022(1)(3) |

(1)

The total number of shares that would be issued for the FY2023 Corporate Incentive Plan could not be known when the plan was adopted as the FY2023 performance period had not yet ended and attainment of the performance measure was not known.

(2)

The total number of shares that will be purchased under the 2016 Employee Stock Purchase Plan for the offering periods ending January 31, 2024 and July 31, 2024 could not be known when the plan was adopted.

(3)

The total number of shares that would be earned and vested under the performance-based RSU awards for the FY2023 performance period could not be known when the plan was adopted as the FY2023 performance period had not yet ended and attainment of the performance measures was not known.

None.

The information required by this item with respect to our directors and executive officers may be found under the headings “Proposal 1: Election of Directors,” “Corporate Governance,” "Information About Our Executive Officers," and “Transactions with Related Persons” appearing in our [removed: 2023] [added: 2024] Proxy Statement.

Information with respect to director and executive compensation may be found under the headings “Director Compensation,” “Compensation Discussion and Analysis,” [removed: “Executive Compensation,” and] “Compensation Committee [removed: Report”] [added: Report,” “Compensation Tables,” and “Pay Ratio Disclosure”] appearing in our [removed: 2023] [added: 2024] Proxy Statement.

[removed: The information required by this item] [added: Information about our common stock ownership] may be found under the [removed: headings “Proposal 2: Approve an Increase in the Number of Shares Available under the 2000 Equity Incentive Plan,” ”Equity Compensation Plan Information,” and] [added: heading] “Information about PTC Common Stock Ownership” appearing in our [removed: 2023] [added: 2024] Proxy Statement.

EQUITY COMPENSATION PLAN INFORMATION

as of September 30, 2023

| | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Plan Category | | Number of securities to be issued upon exercise of outstanding options, warrants and rights | | | | Weighted-average exercise price of outstanding options, warrants and rights | | | | Number of securities remaining available for future issuance under equity compensation plans | | | |

| Equity compensation plans approved by security holders: | | | | | | | | | | | | | |

| 2000 Equity Incentive Plan(1) | | | 2,580,222 | | | | — | | | | 7,257,075 | | |

| 2016 Employee Stock Purchase Plan(2) | | | — | | | | — | | | | 2,223,947 | | |

| Total | | | 2,580,222 | | | | — | | | | 9,481,022 | | |

(1)

All of the shares issuable upon vesting are restricted stock units, which have no exercise price.

(2)

This amount represents the total number of shares remaining available under the 2016 Employee Stock Purchase Plan, of which 105,794 shares are subject to purchase during the current offering period.

Information with respect to this item may be found under the headings “Independence of Our Directors,” “Review of Transactions with Related Persons” and “Transactions with Related Persons” appearing in our [removed: 2023] [added: 2024] Proxy Statement.

Information with respect to this item may be found under the headings “Engagement of Independent Auditor and Approval of Professional Services and Fees” and “PricewaterhouseCoopers LLP Professional Services and Fees” in our [removed: 2023] [added: 2024] Proxy Statement.

ITEM15.

Exhibits and Financial Statement Schedules

*(a) Documents Filed as Part of Form 10-K*

| | | |

| --- | --- | --- |

| 1. | Financial Statements | |

| | [Report of Independent Registered Public Accounting Firm](#report_of_independent_registered) (PricewaterhouseCoopers LLP, Boston, MA, PCAOB ID: 238) | [F-1](#report_of_independent_registered) |

| | [Consolidated Balance Sheets as of September 30, 2022 and 2021](#consolidated_balance_sheets) | [F-4](#consolidated_balance_sheets) |

| | [Consolidated Statements of Operations for the years ended September 30, 2022, 2021 and 2020](#consolidated_statements_operations) | [F-5](#consolidated_statements_operations) |

| | [Consolidated Statements of Comprehensive Income for the years ended September 30, 2022, 2021 and 2020](#consolidated_statements_comprehensive_in) | [F-6](#consolidated_statements_of_comprehensive) |

| | [Consolidated Statements of Cash Flows for the years ended September 30, 2022, 2021 and 2020](#consolidated_statements_cash_flows) | [F-7](#consolidated_statements_cash_flows) |

| | [Consolidated Statements of Stockholders’ Equity for the years ended September 30, 2022, 2021 and 2020](#consolidated_statements_stockholders_equ) | [F-8](#consolidated_statements_stockholders_equ) |

| | [Notes to Consolidated Financial Statements](#notes_to_consolidated_financial_statemen) | [F-9](#notes_to_consolidated_financial_statemen) |

| 2. | Financial Statement Schedules | |

| | Schedules have been omitted since they are either not required, not applicable, or the information is otherwise included in the Financial Statements per Item 15(a)1 above. | |

| 3. | Exhibits | |

| | The list of exhibits in the Exhibit Index is incorporated herein by reference. | |

*(b) Exhibits*

We hereby file the exhibits listed in the attached Exhibit Index.

*(c) Financial Statement Schedules*

None.

ITEM16.

Form 10-K Summary

EXHIBIT INDEX

| Exhibit Number | | Exhibit |

| 2.1 | — | [Share Sale and Purchase Agreement dated as of April 19, 2022, by and among PTC (SSI), Intland Software GmbH, Eger Invest GmbH, Janos Rezso Koppány, Zsolt Koppány, Szabolcs Koppány and Eger Software Holding UG (haftungsbeschränkt) & Co. KG. (filed as Exhibit 1.1 to our Current Report on Form 8-K filed on April 20, 2022 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000156459022014784/ptc-8k_20220419.htm) |

| 3.1 | — | [Restated Articles of Organization of PTC Inc. adopted August 4, 2015 (filed as Exhibit 3.1 to our Annual Report on Form 10-K for the fiscal year ended September 30, 2015 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000085700515000042/ptc9302015ex31.htm) |

| 3.2 | — | [Amended and Restated By-Laws of PTC Inc., as amended through June 24, 2021.](https://www.sec.gov/Archives/edgar/data/857005/000095017022025211/ptc-ex3_2.htm) |

| 4.1 | — | [Indenture, dated as of February 13, 2020, between PTC Inc. and Wells Fargo Bank, National Association, as trustee (filed as Exhibit 4.1 to our Current Report on Form 8-K filed on February 13, 2020 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/0000857005/000119312520035604/d882560dex41.htm) |

| 4.2 | — | [Form of 3.625% senior unsecured notes due 2025 (filed as Exhibit 4.2 to our Current Report on Form 8-K filed on February 13, 2020 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/0000857005/000119312520035604/d882560dex41.htm) |

| 4.3 | — | [Form of 4.000% senior unsecured notes due 2028 (filed as Exhibit 4.3 to our Current Report on Form 8-K filed on February 13, 2020 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/0000857005/000119312520035604/d882560dex41.htm) |

| 4.4 | — | [Description of Securities Registered under Section 12 of the Securities Exchange Act of 1934 (filed as Exhibit 4.4 to our Annual Report on Form 10-K for the year ended September 30, 2019 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000085700519000040/ptc93019ex44.htm) |

| 10.1.1* | — | [2000 Equity Incentive Plan (filed as Exhibit 10 to our Current Report on Form 8-K filed on March 8, 2019 (File No. 0-18059) and incorporated herein by reference.](https://www.sec.gov/Archives/edgar/data/857005/000165495419002484/exhibit10-2000eipplanamen.htm) |

| 10.1.2 | — | [Form of Restricted Stock Unit Certificate (Non-U.S.) (filed as Exhibit 10.4 to our Quarterly Report on Form 10-Q for the fiscal quarter ended July 2, 2005 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000119312505165325/dex104.htm) |

| 10.1.3* | — | [Form of Restricted Stock Unit Certificate (Non-Employee Director) (filed as Exhibit 10.1.1 to our Quarterly Report on Form 10-Q for the fiscal quarter ended March 30, 2013 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000085700513000018/exhibit1011formofrsucertif.htm) |

| 10.1.4 | — | [Form of Restricted Stock Unit Certificate (U.S.) (filed as Exhibit 10.1.9 to our Annual Report on Form 10-K for the fiscal year ended September 30, 2016 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000085700516000071/ptc93016ex1019.htm) |

| 10.1.5 | — | [Form of Restricted Stock Unit Certificate (U.S.) (filed as Exhibit 10.1.10 to our Annual Report on Form 10-K for the fiscal year ended September 30, 2016 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000085700516000071/ptc93016ex10110.htm) |

| 10.1.6 | — | [Form of Restricted Stock Unit Certificate (U.S.) (filed as Exhibit 10.1.11 to our Annual Report on Form 10-K for the fiscal year ended September 30, 2016 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000085700516000071/ptc93016ex10111.htm) |

| 10.1.7 | — | [Form of Restricted Stock Unit Certificate (U.S. EVP) (filed as Exhibit 10.1.12 to our Annual Report on Form 10-K for the fiscal year ended September 30, 2016 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000085700516000071/ptc93016ex10112.htm) |

| 10.1.8* | — | [Form of Restricted Stock Unit Certificate (U.S. Section 16) (filed as Exhibit 10.1.13 to our Annual Report on Form 10-K for the fiscal year ended September 30, 2016 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000085700516000071/ptc93016ex10113.htm) |

*(a) Documents Filed as Part of Form 10-K*

| | | |

| --- | --- | --- |

| 1. | Financial Statements | |

| | [Report of Independent Registered Public Accounting Firm](#report_of_independent_registered) (PricewaterhouseCoopers LLP, Boston, MA, PCAOB ID: 238) | [F-1](#report_of_independent_registered) |

| | [Consolidated Balance Sheets as of September 30, 2023 and 2022](#consolidated_balance_sheets) | [F-4](#consolidated_balance_sheets) |

| | [Consolidated Statements of Operations for the years ended September 30, 2023, 2022 and 2021](#consolidated_statements_operations) | [F-5](#consolidated_statements_operations) |

| | [Consolidated Statements of Comprehensive Income for the years ended September 30, 2023, 2022 and 2021](#consolidated_statements_comprehensive_in) | [F-6](#consolidated_statements_of_comprehensive) |

| | [Consolidated Statements of Cash Flows for the years ended September 30, 2023, 2022 and 2021](#consolidated_statements_cash_flows) | [F-7](#consolidated_statements_cash_flows) |

| | [Consolidated Statements of Stockholders’ Equity for the years ended September 30, 2023, 2022 and 2021](#consolidated_statements_stockholders_equ) | [F-8](#consolidated_statements_stockholders_equ) |

| | [Notes to Consolidated Financial Statements](#notes_to_consolidated_financial_statemen) | [F-9](#notes_to_consolidated_financial_statemen) |

| 2. | Financial Statement Schedules | |

| | Schedules have been omitted since they are either not required, not applicable, or the information is otherwise included in the Financial Statements per Item 15(a)1 above. | |

| | | |

| 3. | Exhibits | |

| | The list of exhibits in the Exhibit Index is incorporated herein by reference. | |

*(b) Exhibits*

We hereby file the exhibits listed in the attached Exhibit Index.

*(c) Financial Statement Schedules*

None.

None.

EXHIBIT INDEX

| | | |

| --- | --- | --- |

| Exhibit Number | | Exhibit |

| | | |

| 1.1 | — | [Share Purchase Agreement dated as of November 17, 2022, by and among PTC Inc., ServiceMax JV, LP, and ServiceMax, Inc. (filed as Exhibit 1.1 to our Current Report on Form 8-K filed on November 17, 2022 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000119312522287299/d396117dex11.htm) |

| | | |

| 3.1 | — | [Restated Articles of Organization of PTC Inc. adopted August 4, 2015 (filed as Exhibit 3.1 to our Annual Report on Form 10-K for the year ended September 30, 2015 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000085700515000042/ptc9302015ex31.htm) |

| | | |

| 3.2 | — | [Amended and Restated By-Laws of PTC Inc., as amended through June 24, 2021(filed as Exhibit 3.2 to our Annual Report on Form 10-K for the year ended September 30, 2022 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000095017022025211/ptc-ex3_2.htm) |

| | | |

| 4.1 | — | [Indenture, dated as of February 13, 2020, between PTC Inc. and Wells Fargo Bank, National Association, as trustee (filed as Exhibit 4.1 to our Current Report on Form 8-K filed on February 13, 2020 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/0000857005/000119312520035604/d882560dex41.htm) |

| | | |

| 4.2 | — | [Form of 3.625% senior unsecured notes due 2025 (filed as Exhibit 4.2 to our Current Report on Form 8-K filed on February 13, 2020 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/0000857005/000119312520035604/d882560dex41.htm) |

| | | |

| 4.3 | — | [Form of 4.000% senior unsecured notes due 2028 (filed as Exhibit 4.3 to our Current Report on Form 8-K filed on February 13, 2020 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/0000857005/000119312520035604/d882560dex41.htm) |

| | | |

| 4.4 | — | [Description of Securities Registered under Section 12 of the Securities Exchange Act of 1934 (filed as Exhibit 4.4 to our Annual Report on Form 10-K for the year ended September 30, 2019 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000085700519000040/ptc93019ex44.htm) |

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| 10.1* | — | [2000 Equity Incentive Plan (filed as Exhibit 10.1 to our Current Report on Form 8-K filed on February 21, 2023 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000095017023003309/ptc-ex10_1.htm) |

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| 10.1.1 | — | [Form of Restricted Stock Unit Certificate (Non-U.S.) (filed as Exhibit 10.4 to our Quarterly Report on Form 10-Q for the fiscal quarter ended July 2, 2005 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000119312505165325/dex104.htm) |

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| 10.1.2* | — | [Form of Restricted Stock Unit Certificate (Non-Employee Director) (filed as Exhibit 10.1.1 to our Quarterly Report on Form 10-Q for the fiscal quarter ended March 30, 2013 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000085700513000018/exhibit1011formofrsucertif.htm) |

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| 10.1.3 | — | [Form of Restricted Stock Unit Certificate (U.S.) (filed as Exhibit 10.1.9 to our Annual Report on Form 10-K for the fiscal year ended September 30, 2016 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000085700516000071/ptc93016ex1019.htm) |

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| 10.1.4 | — | [Form of Restricted Stock Unit Certificate (U.S.) (filed as Exhibit 10.1.10 to our Annual Report on Form 10-K for the fiscal year ended September 30, 2016 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000085700516000071/ptc93016ex10110.htm) |

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| 10.1.5 | — | [Form of Restricted Stock Unit Certificate (U.S.) (filed as Exhibit 10.1.11 to our Annual Report on Form 10-K for the fiscal year ended September 30, 2016 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000085700516000071/ptc93016ex10111.htm) |

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| 10.1.6 | — | [Form of Restricted Stock Unit Certificate (U.S. EVP) (filed as Exhibit 10.1.12 to our Annual Report on Form 10-K for the fiscal year ended September 30, 2016 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000085700516000071/ptc93016ex10112.htm) |

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| 10.1.7* | — | [Form of Restricted Stock Unit Certificate (U.S. Section 16) (filed as Exhibit 10.1.13 to our Annual Report on Form 10-K for the fiscal year ended September 30, 2016 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000085700516000071/ptc93016ex10113.htm) |

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| 10.1.8 | — | [Form of Restricted Stock Unit Certificate (U.S. EVP) (filed as Exhibit 10.1.14 to our Annual Report on Form 10-K for the fiscal year ended September 30, 2016 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000085700516000071/ptc93016ex10114.htm) |

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| 10.1.9 | — | [Form of Restricted Stock Unit Certificate (U.S.) (filed as Exhibit 10.1.15 to our Annual Report on Form 10-K for the fiscal year ended September 30, 2016 (File No. 0-18059) and incorporated herein by reference).](https://www.sec.gov/Archives/edgar/data/857005/000085700516000071/ptc93016ex10115.htm) |

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