Question · Q2 2025
Anna Kruszenski of Barclays, on for Luke Surgut, inquired about the distinct demand drivers for software versus services bookings and requested more detail on the behavioral differences between Tier 1 and Tier 2/3 customers, particularly regarding the software slowdown in Tier 1.
Answer
CEO William Feehery explained that software demand is driven by its role as essential R&D infrastructure and new product innovation, while services demand has rebounded due to high interest in QSP. CFO John Gallagher added that the Tier 1 software softness was due to the timing of renewals, which are expected to normalize in the second half, and highlighted strong performance in Tier 3.