PTC to Report Q1 Earnings: Here's What Investors Should Expect

PTC Inc. PTC is scheduled to report first-quarter fiscal 2026 results on Feb. 4, after market close.

For the quarter, PTC anticipates revenues between $600 million and $660 million. Non-GAAP EPS is projected in the range of $1.26 to $1.82.

The Zacks Consensus Estimate for revenues is pegged at $638.4 million, up 13% from the year-ago reported number. The consensus estimate for earnings is pinned at $1.59 per share, up 44.6% from a year ago, unchanged in the past 30 days.

The company’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters. It delivered a trailing four-quarter average earnings surprise of 34.6%. 

In the past year, shares of PTC have lost 17.8% compared with the Zacks Computer – Software industry’s decline of 4.2%.

Factors Shaping PTC’s Q1 Results

PTC's core business segments, product lifecycle management (“PLM”) and computer-aided design (“CAD”) solutions, remain its primary revenue contributors and are likely to have positively influenced performance in the to-be-reported quarter. The company has been enhancing its focus on the Intelligent Product Lifecycle vision, centered on CAD, PLM, Application Lifecycle Management (“ALM”), Service Lifecycle Management (“SLM”), with increasing importance on SaaS and AI. The sale (expected to close in the first half of calendar 2026) of its Kepware and ThingWorx businesses to TPG is a part of this strategy.

PTC’s go-to-market realignment is pivotal to its growth strategy. This initiative aims to strengthen the company’s ability to scale and better serve customers.

On the last earnings call, management noted that demand capture remains “healthy” despite a tough macroeconomic backdrop. PTC further added that it entered the fiscal first quarter with a “stronger pipeline” than the start of fiscal 2025. It expects churn in fiscal 2026 to remain low, as customers need subscriptions to continue using PTC’s software to design, manufacture and service their products.

For the fiscal first quarter, PTC projects ARR growth (at constant currency) to be between 8% to 8.5%, including Kepware and ThingWorx and between 8.5% and 9% excluding Kepware and ThingWorx. The fiscal first quarter is typically the “lightest quarter” for net new ARR owing to renewal seasonality and the timing of big enterprise transactions, noted PTC.

PTC Inc. Price and EPS Surprise

PTC Inc. price-eps-surprise | PTC Inc. Quote

Generative-AI initiatives and product portfolio enhancements augur well. The company advanced its product portfolio with generative AI capabilities across PLM, ALM, SLM and CAD. It has plans for a comprehensive and ambitious AI roadmap for fiscal 2026.

Also, the shift toward a subscription-based model and efforts to enhance operational discipline have been driving cash flow. 

For the fiscal first quarter, cash from operations is expected to be in the band of $270-$275 million, and free cash flow is forecasted to be between $265 million and $270 million. For fiscal 2026, the company is on track to generate approximately $1 billion in free cash flow, with 55% to 60% expected in the first half of the year due to the majority of collections in this period. 

Stiff competition in the CAD market and volatile foreign currency movements remain key concerns amid a challenging macro backdrop. Increasing expenses due to higher investments might have proven a drag on the margin performance if revenue performance falters.  

Key Recent Developments

On Jan. 27, 2026, PTC launched Windchill AI Parts Rationalization, an AI-powered capability in its Windchill PLM solution that improves parts management by reducing duplicate parts, speeding up part searches and improving data consistency, aiding manufacturers to cut costs and accelerate development.

On Jan. 20, 2026, PTC announced that Reditus Space, a manufacturing company focused on delivering sustainable and scalable microgravity access as a service, had selected the former cloud-native Onshape CAD and PDM platform to support the development of its reusable spacecraft and associated hardware.

On Jan. 15, 2025, PTC upgraded its ALM portfolio with the rollout of Codebeamer 3.2, Codebeamer AI 1.0 and Pure Variants 7.2. These updates position PTC’s ALM portfolio as the primary choice for organizations in highly regulated industries, such as automotive, medical technology, aerospace, defense and federal systems. The releases focus on three core priorities — stronger traceability, improved change management and governed AI assistance aligned with regulatory and quality standards.

On Jan. 6, 2026, PTC announced new AI-powered capabilities for its FlexPLM retail PLM solution that automate tech pack creation by extracting data from design drawings to populate BOMs, measurements and other specifications.

What Our Model Says About PTC

Our proven model does not predict an earnings beat for PTC this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here.

PTC has an Earnings ESP of 0.00% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks With the Favorable Combination

Here are three stocks you may want to consider, as our model shows that these have the right elements to post an earnings beat in this reporting cycle.

Cirrus Logic, Inc CRUS currently has an Earnings ESP of +5.90% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here. 

CRUS is scheduled to report quarterly earnings on Feb. 3. The Zacks Consensus Estimate for CRUS’ to-be-reported quarter’s earnings and revenues is pegged at $2.42 per share and $536.3 million, respectively. Shares of CRUS have gained 31.3% in the past year.

Advanced Micro Devices, Inc. AMD has an Earnings ESP of +2.01% and a Zacks Rank #2 at present. AMD is scheduled to report quarterly figures on Feb. 3. The Zacks Consensus Estimate for AMD’s to-be-reported quarter’s earnings and revenues is pegged at $1.32 per share and $9.67 billion, respectively. Shares of AMD have skyrocketed 107.1% in the past year.

Microchip Technology MCHP presently has an Earnings ESP of +1.34% and a Zacks Rank #1. MCHP is scheduled to report quarterly numbers on Feb. 5. The Zacks Consensus Estimate for MCHP’s to-be-reported quarter’s earnings and revenues is pegged at 43 cents per share and $1.19 billion, respectively. Shares of MCHP have risen 45.3% in the past year.

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This article originally published on Zacks Investment Research (zacks.com).

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