PTC Inc.

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS (UNAUDITED)

(in thousands, except per share data)

Three Months Ended

Twelve Months Ended

September 30,

September 30,

September 30,

September 30,

2020

2019

2020

2019

GAAP revenue

$                390,981

$                335,004

$              1,458,415

$              1,255,631

Fair value adjustment of acquired deferred revenue

-

192

-

787

Non-GAAP revenue

$                390,981

$                335,196

$              1,458,415

$              1,256,418

GAAP gross margin

$                306,366

$                249,587

$              1,124,144

$                930,253

Fair value adjustment of acquired deferred revenue

-

192

-

787

Fair value adjustment to deferred services cost

-

(88)

-

(308)

Stock-based compensation

4,761

3,152

13,969

11,939

Amortization of acquired intangible assets included in cost of revenue

6,856

6,874

27,391

27,306

Non-GAAP gross margin

$                317,983

$                259,717

$              1,165,504

$                969,977

GAAP operating income

$                  67,012

$                  46,551

$                210,863

$                  63,042

Fair value adjustment of acquired deferred revenue

-

192

-

787

Fair value adjustment to deferred services cost

-

(88)

-

(308)

Stock-based compensation

41,544

14,792

115,149

86,400

Amortization of acquired intangible assets included in cost of revenue

6,856

6,874

27,391

27,306

Amortization of acquired intangible assets

7,346

6,055

28,713

23,841

Acquisition-related and other transactional charges included in general and administrative costs

552

1,895

8,616

3,110

Restructuring and other charges, net

378

5,650

32,716

51,114

Non-GAAP operating income ⁽¹⁾

$                123,688

$                  81,921

$                423,448

$                255,292

GAAP net income (loss)

$                  53,406

$                    9,826

$                130,695

$                 (27,460)

Fair value adjustment of acquired deferred revenue

-

192

-

787

Fair value adjustment to deferred services cost

-

(88)

-

(308)

Stock-based compensation

41,544

14,792

115,149

86,400

Amortization of acquired intangible assets included in cost of revenue

6,856

6,874

27,391

27,306

Amortization of acquired intangible assets

7,346

6,055

28,713

23,841

Acquisition-related and other transactional charges included in general and administrative costs

552

1,895

8,616

3,110

Restructuring and other charges, net

378

5,650

32,716

51,114

Non-operating charges ⁽²⁾

-

-

18,451

-

Income tax adjustments ⁽³⁾

(18,295)

29,317

(63,283)

29,719

Non-GAAP net income

$                  91,787

$                  74,513

$                298,448

$                194,509

GAAP diluted earnings (loss) per share

$                      0.46

$                      0.08

$                      1.12

$                    (0.23)

Fair value adjustment of acquired deferred revenue

-

-

-

0.01

Stock-based compensation

0.35

0.13

0.99

0.73

Amortization of acquired intangibles

0.12

0.11

0.48

0.43

Acquisition-related and other transactional charges

-

0.02

0.07

0.03

Restructuring and other charges, net

-

0.05

0.28

0.43

Non-operating charges

-

-

0.16

-

Income tax adjustments

(0.16)

0.25

(0.54)

0.25

Non-GAAP diluted earnings per share

$                      0.78

$                      0.64

$                      2.57

$                      1.64

GAAP diluted weighted average shares outstanding

117,097

115,897

116,267

117,724

Dilutive effect of stock-based compensation plans

-

-

-

990

Non-GAAP diluted weighted average shares outstanding

117,097

115,897

116,267

118,714