Jay Vleeschhouwer

Jay Vleeschhouwer asked if PTC anticipates a fundamental shift towards more frequent eight-figure transactions, drawing parallels to Ansys's past go-to-market evolution. He also inquired about broadening PTC's momentum in the automotive sector beyond ALM and Windchill, leveraging its significant presence at CES.

Answer

CEO Neil Barua and CRO Robert Datta discussed PTC's strong reception at CES, noting executive interest from industrial and automotive sectors in Windchill, Codebeamer, and AI. Neil confirmed Codebeamer as the "tip of the spear" in automotive, with significant displacement opportunities and growing AI functionality. He also highlighted consolidation onto Windchill and ServiceMax deployments in automotive, with Rob adding Codebeamer's expansion into other industries. Neil concluded that enhanced messaging and GSI engagement are fostering larger, cross-product deals, with optimism for future closures.

Jay Vleeschhouwer asked if PTC anticipates a fundamental change in its deal profile, leading to more frequent eight-figure transactions, and if momentum in automotive can broaden beyond ALM and Windchill.

Answer

Neil Barua (CEO, PTC) confirmed that the company is starting to construct larger, cross-product deals due to elevated messaging and engagement with partners and GSIs, which is building into the pipeline. For automotive, he noted Codebeamer (ALM) as the current tip of the spear, with significant displacement opportunities, and growing consolidation onto Windchill (PLM). He also highlighted ServiceMax (SLM) deployments, like with Lamborghini, tied into Windchill instances, indicating a broader impact beyond ALM.

Jay Vleeschhouwer inquired about additional improvements in roadmap execution, how it connects to multi-solution sales, and asked Kristian Talvitie for an update on current RPO sequentially and year-over-year.

Answer

Neil Barua, CEO of PTC, explained that Chief Product Officer Jon Stevenson is instilling discipline for on-time delivery of roadmap items, such as a new UI/UX for Windchill, to ensure customer value and align with sales needs. He also highlighted aggressive efforts to embed AI into core products like Codebeamer, Windchill, Arena, ServiceMax, and Onshape. Kristian Talvitie, CFO of PTC, stated that approximately 55% of the total RPO is expected to be recognized over the next 12 months.

Jay Vleeschhouwer asked Neil Barua to elaborate on improvements in roadmap execution and its connection to multi-solution sales, given PTC's historical performance with Creo and Windchill. He also asked CFO Kristian Talvitie about the current portion of RPO (recognized over the next 12 months) sequentially or year-over-year.

Answer

CEO Neil Barua explained that Chief Product Officer Jon Stevenson is instilling discipline to ensure roadmap items, such as a new UI/UX for Windchill, deliver proactive customer value. He highlighted aggressive execution on the AI roadmap, embedding AI into core products like Codebeamer, Windchill, Arena, ServiceMax, and Onshape, to leverage contextual data for unique customer outcomes. CFO Kristian Talvitie stated that approximately 55% of the total RPO is expected to be recognized over the next 12 months.

Jay Vleeschhouwer asked two questions: first, whether the sales pipeline is showing an improvement in multi-solution deals, and second, about the status of the Ansys OEM relationship following its acquisition by Synopsys.

Answer

President and CEO Neil Barua responded positively to both points. Regarding Ansys/Synopsys, he expressed enthusiasm for the transaction and noted he has already been in discussions with Synopsys's CEO to strengthen and expand the partnership. On multi-product deals, he confirmed they are seeing more of these conversations, particularly at customer events, which validates the strategy of aggregating CAD, PLM, and ALM, especially in the context of AI.

Jay Vleeschhouwer inquired about PTC's organic growth drivers beyond active base growth, touching on pricing power, cross-sell opportunities, and the risk of deal disaggregation.

Answer

CEO Neil Barua emphasized that the go-to-market transformation is designed to capture more wallet share by expanding core Windchill and Creo usage and cross-selling ALM and SLM, citing a recent CAD consolidation win as proof. CRO Robert Dahdah added that compensation plans are now aligned with this strategy, and the vertical focus allows for more credible, problem-solving conversations with customers, which elevates the engagement and strengthens the value proposition.

Jay Vleeschhouwer inquired about PTC's organizational and investment strategy for its AI product initiatives and its potential expansion into manufacturing processes.

Answer

CEO Neil Barua explained that PTC's AI development, which began within individual product teams like ServiceMax, is now being centralized for better alignment. Regarding manufacturing, Barua clarified that PTC's strategy is to extend PLM data to the factory floor to integrate with, rather than compete against, existing MES systems.

Jay Vleeschhouwer of Griffin Securities asked which verticals are most advanced in adopting a 'digital thread' strategy and how PTC's automotive business has fundamentally changed with the industry's shift to software-defined vehicles.

Answer

CEO Neil Barua explained that PTC's automotive focus has shifted significantly to Windchill (PLM) and Codebeamer (ALM) to address the complexities of software-defined vehicles, a major change from its historical focus. Regarding the digital thread, he noted that no single vertical is dramatically ahead, which he views as a significant opportunity to cross-sell the integrated portfolio across all key industries.

Jay Vleeschhouwer asked about the practical strategies Autodesk employs to ensure 'no one gets left behind' in new technology adoption, covering customer migration, packaging, and promotions. He also sought insights into any new trends in usage telemetry across verticals, geographies, or product types that contributed to recent growth.

Answer

CEO Andrew Anagnost detailed a multi-vector approach, including bundling new applications like Forma with existing collections, providing common data environment access, and developing connected clients (e.g., Revit) for seamless desktop-to-cloud workflows. He also emphasized rolling out high-adoption AI features like Fusion's auto-constrain. CFO Janesh Moorjani noted that Q3 usage trends were consistent with Q2, driven by strength in AECO (data centers, infrastructure, industrial), the Autodesk Store, and emerging geographies, without significant new emerging trends.

Jay Vleeschhouwer asked about the practicalities of Autodesk's commitment to 'no one gets left behind' regarding customer migration, packaging, promotions, and the rollout of connected clients like Revit. He also asked about new or incremental trends in usage telemetry across verticals, geographies, or product types that contributed to revenue upside.

Answer

CEO Andrew Anagnost explained that Autodesk addresses this through packaging (e.g., Forma with collections), making the Common Data Environment (CDE) widely available, and tightly connecting desktop products with emerging cloud solutions for seamless workflows. He cited AI-powered Sketch auto constraint in Fusion as an example of a highly adopted, productivity-enhancing feature. CFO Janesh Moorjani stated that Q3 trends were consistent with Q2, with continued strength in AECO (data centers, infrastructure, industrial), the Autodesk Store, and emerging geographies, without highlighting new emerging trends.

Jay Vleeschhouwer of Griffin Securities requested a breakdown of the drivers for the increased billings guidance and asked about the expected customer adoption curve for fundamentally new technologies like APS and granular data models.

Answer

EVP & CFO Janesh Moorjani attributed the guidance raise to broad momentum from product innovation and go-to-market execution, with AECO and Construction as key drivers. President and CEO Andrew Anagnost noted that API usage is continuously increasing and that new AI features like auto-constraint in Fusion are seeing high acceptance rates (60%), indicating a strong customer appetite for productivity-enhancing technology.

Jay Vleeschhouwer asked for details on the accelerated roadmaps for Autodesk's industry clouds, particularly the integration of ACC and Forma, and questioned the benefits and risks of channel partner consolidation.

Answer

CEO Andrew Anagnost highlighted accelerated roadmaps for Fusion's data management and plans to deepen Forma's integration with Revit. He explained that channel consolidation is a deliberate strategy to foster more solution-focused partners, which has already benefited the Autodesk store through better price realization. The risk of partners not focusing on new business is managed through incentive structures.

Jay Vleeschhouwer asked for a breakdown of the components (price, volume) behind the now-retired 10-15% growth framework. He also questioned which critical product and technology initiatives, such as platform services and new data models, are receiving reallocated investment.

Answer

CEO Andrew Anagnost focused his response on two key growth drivers: enhancing channel productivity to boost core subscription sales and accelerating the growth of emerging 'Make' businesses. He specified that investments are being reallocated to accelerate the roadmaps for the Forma, Fusion, and Construction industry clouds, expand platform APIs, and develop more commercial AI features like the 'AutoConstrain' tool in Fusion.

Jay Vleeschhouwer questioned the sustainability of the approximate 12% three-year CAGR for current RPO (CRPO) and asked about the future of the Chief Revenue Officer (CRO) position.

Answer

Interim CFO Betsy Rafael addressed the CRPO question, noting that underlying growth was consistent with Q2 after accounting for headwinds and tailwinds, such as the declining contribution from large EBA cohorts renewing in FY26. CEO Andrew Anagnost confirmed the CRO role will remain separate under the COO, focusing on direct customer engagement and channel transformation.

Jay Vleeschhouwer inquired about the division of labor between Autodesk's direct sales force and the channel under the new transaction model, and how to parse the organic business performance from billings impacts like co-terming.

Answer

CEO Andrew Anagnost explained that the new model will drive efficiencies and productivity in sales and marketing, which is where future margin growth will originate. Regarding co-terming, he noted that while it shifts the timing of some billings, it is a net positive as it creates significant efficiency in the renewal process and provides better opportunities for cross-selling and upselling. Interim CFO Betsy Rafael added that managing fewer, consolidated contracts also drives internal cost efficiencies.

Jay Vleeschhouwer asked about the potential uplift in demand for EDA tools, IP, and hardware resulting from the joint GPU and CPU work announced by Nvidia and Intel, and whether this would necessitate increased investments in application engineers.

Answer

President and CEO Anirudh Devgan noted that the combination of CPU and GPU is a long-standing trend beneficial for EDA workloads, exemplified by Nvidia's platforms. He stated that Cadence is already porting workloads to CPU+GPU combinations (e.g., Millennium) and that the Nvidia-Intel partnership is positive, providing a new x86 plus GPU platform. He expects this activity to generally increase EDA consumption and improve tool performance.

Jay Vleeschhouwer asked about the implications of the joint work between NVIDIA and Intel on combined GPU and CPU architectures, specifically whether it would increase demand for EDA tools, IP, and hardware, and necessitate increased investments in application engineers.

Answer

President and CEO Anirudh Devgan stated that the industry's shift towards CPU plus GPU combinations is a positive trend, as Cadence has been porting its workloads to these architectures for years, exemplified by Millennium. He noted that this partnership is good for Cadence, both in optimizing tools for new platforms and in specific design activities, and generally increases EDA consumption as tools improve and customer activity expands.

Jay Vleeschhouwer of Griffin Securities asked about the broader requirements of Agentic AI, such as workflow orchestration and data management.

Answer

President & CEO Anirudh Devgan agreed that workflow automation is key, highlighting the critical role of the Cadence JEDI platform. He described JEDI as the underlying 'Joint Enterprise Data and AI' platform that provides the necessary data management and storage to enable complex, multi-tool agentic workflows, supporting on-prem, cloud, and hybrid customer environments.

Jay Vleeschhouwer asked about the most important technical deliverables for the year, investments in areas like physical verification and next-gen hardware, and spending on acquired simulation solver products.

Answer

CEO Anirudh Devgan highlighted three critical R&D investment themes: 1) Expanding AI in chip design, with over 50% of designs now using their AI-enabled tools; 2) 3D-IC technology, a long-term driver requiring investment in tools, analysis, and IP; and 3) Hardware-software co-optimization across CPUs, GPUs, and their own Palladium hardware.

Jay Vleeschhouwer from Griffin Securities pointed out the progressive slowdown in year-over-year growth of current RPO (cRPO) and asked for details on its composition and geographic trends excluding China.

Answer

CFO John Wall acknowledged the need to grow the annual value of the backlog (cRPO) and stated it would be a key focus for 2025. He noted that the China headwind negatively impacts this metric. He also explained that total backlog is expected to dip in the first half of 2025 due to the timing of renewals, which are more concentrated in the second half of the year.

Jay Vleeschhouwer asked about the potential for more vertical-specific product packaging for AI/ML applications and the company's AI development roadmap. He also inquired about the strategy for the System Design & Analysis (SD&A) business, including application integration and go-to-market expansion.

Answer

CEO Anirudh Devgan outlined a multi-horizon AI strategy and noted that while most solutions are horizontal, vertical-specific offerings like Millennium will emerge. For SD&A, he stated the portfolio is now largely complete and outgrowing the market, supported by a three-pronged go-to-market strategy of direct sales, a growing indirect channel of over 100 partners, and the Cadence OnCloud e-commerce platform.

Jay Vleeschhouwer from Griffin Securities asked if the planned 10% headcount reduction was an independent strategic decision or influenced by IP challenges, noting recent organic headcount growth. He also inquired about the current integration status of Ansys, specifically regarding named accounts and the large indirect business, and whether Synopsys plans to smooth Ansys's historical seasonality and 606 effects by shifting to a subscription model.

Answer

President and CEO Sassine Ghazi confirmed that the 10% headcount reduction was a pre-planned strategic initiative, independent of recent IP issues, aimed at optimizing resources and leveraging AI efficiencies after an 18-month regulatory process. He explained that integration is proceeding cautiously in areas without impact on the pending divestitures (Optical Solutions Group and PowerArtist), while other areas are being carefully managed. CFO Shelagh Glaser added that aligning Ansys's fiscal calendar with Synopsys's means its strong Q4 seasonality will now fall into Synopsys's Q1. She noted that smoothing seasonality and potentially shifting to a subscription model for Ansys is a longer-term opportunity as new products and offerings are deployed, and emphasized the value and continuity of Ansys's robust channel business.

Jay Vleeschhouwer asked if the targeted 10% headcount reduction was planned irrespective of the current IP challenges, noting significant organic headcount growth. He also inquired about the integration and consolidation efforts for Ansys, specifically regarding named accounts and the large indirect business. For a follow-up, he asked if Synopsys plans to smooth out Ansys's historical seasonality and 606 effects by potentially shifting to a subscription model.

Answer

Sassine Ghazi, President, CEO & Director, Synopsys, confirmed that the 10% headcount adjustment was planned for a while, irrespective of IP issues, as part of a strategic portfolio review, management layer analysis, process optimization, and leveraging AI's impact. He explained that integration speed is cautious due to the ongoing divestiture of Optical Solutions Group and PowerArtist, ensuring no contamination before handover. Shelagh Glaser, CFO, stated that smoothing Ansys's seasonality and 606 effects by aligning with Synopsys's subscription model is a longer-term opportunity as new products and offerings are deployed. She also emphasized that Ansys's robust channel (about 25% of its business) is a valuable asset, and Synopsys is ensuring a smooth, seamless transition with no disruption, also seeing opportunities for Synopsys products to be sold through this channel.

Jay Vleeschhouwer asked if the 10% headcount reduction was planned independently of the IP business challenges and about the organic headcount expansion. He also inquired about the integration of Ansys's named accounts and large indirect business, and the potential to smooth Ansys's seasonality and 606 accounting effects.

Answer

President and CEO Sassine Ghazi confirmed the 10% headcount reduction was a pre-planned strategic initiative, leveraging AI and process optimization, independent of current IP issues. He noted careful integration speed due to pending divestitures. CFO Shelagh Glaser highlighted Ansys's robust channel (25% of business) as a valuable asset, ensuring smooth operations and potential for Synopsys products. She also mentioned exploring opportunities to align Ansys's renewal and product delivery models over time to smooth seasonality and 606 effects.

Jay Vleeschhouwer of Griffin Securities asked for confirmation on the growth of the company's current RPO. He also requested that CEO Sassine Ghazi elaborate on the 'reengineering engineering' theme from the recent SNUG conference, particularly the evolution from AI for optimization to the new 'Agentik.ai' concept.

Answer

CFO Shelagh Glaser confirmed strong backlog growth, up $400 million quarter-over-quarter. CEO Sassine Ghazi detailed that 'reengineering engineering' involves integrating multi-physics with electronics for complex systems. He distinguished the first AI wave (optimization tools like DSO.ai) from the next wave, Agentik.ai, which will use AI agents for specific engineering tasks, ultimately transforming workflows and creating new monetization opportunities.

Jay Vleeschhouwer of Griffin Securities asked for clarification on the growth and sustainability of current RPO. He also requested a deeper explanation of the 'reengineering engineering' theme and the evolution from optimization-focused AI (like DSO.ai) to agent-based AI (AgenTeq.ai).

Answer

CFO Shelagh Glaser confirmed strong backlog growth, up $400 million quarter-over-quarter, reflecting a strong business environment. CEO Sassine Ghazi elaborated that 'reengineering engineering' involves integrating multi-physics with electronics for complex systems. He described the AI evolution as a paradigm shift from optimization to agent-based technology, which will transform workflows and create new monetization opportunities.

Jay Vleeschhouwer asked if the growth in semiconductor R&D is becoming more concentrated among fewer companies. He also questioned whether the infusion of AI into EDA tools could eventually democratize design capabilities, making customers more alike in their productivity.

Answer

CEO Sassine Ghazi stated that R&D investment is increasing in aggregate across the industry, from advanced to mature nodes, and Synopsys is growing along with this trend. On the second point, he explained that while current AI tools have not fundamentally changed the design workflow, he believes upcoming 'Agentic AI' will. This shift in workflow, he argued, represents a significant new monetization opportunity, distinguishing it from past innovations.

Jay Vleeschhouwer asked for specifics on the operational alignments being made to prepare for future growth, independent of the Ansys deal. He also inquired about how the long-term trend of domain-specific design interacts with the newer phenomenon of customer-specific AI use cases.

Answer

CEO Sassine Ghazi explained that operational alignment involves scaling the company's structure and modernizing internal engineering workflows to improve R&D productivity. Regarding AI, he described a three-stage evolution: first, embedding AI into products (e.g., DSO.ai); second, enabling customer-specific AI models for their unique workflows; and third, the future of generative/agentic AI, which he believes will drive entirely new business models and product offerings.

Jay Vleeschhouwer asked how the development process for AI products differs from conventional EDA tools and whether they will eventually be absorbed into core products. He also inquired about the company's ambition for its custom analog design business.

Answer

CEO Sassine Ghazi explained that generative AI development is moving at a faster, more customer-specific pace than traditional EDA. He agreed with the view that AI capabilities will eventually become an expected, integrated part of the core solution. Regarding analog design, he noted the opportunity is to grow in the analog design environment TAM, where Synopsys is smaller, by leveraging new technologies like ASO.ai to address rising complexity and modernization needs.

Jay Vleeschhouwer of Griffin Securities inquired about the rationale behind recent hiring trends, particularly the focus on adding headcount in go-to-market, product management, strategy, and marketing functions.

Answer

Chairman & CEO Shantanu Narayen explained that the hiring aligns with the company's innovation roadmap. Marketing investments are to build awareness for new products like Express, while product management hiring is focused on enhancing product-led growth (PLG) motions. He clarified that overall headcount is not growing dramatically due to internal efficiencies gained from AI, and the recent quarterly increase was largely driven by the influx of summer interns.

Jay Vleeschhouwer asked if current RPO growth would remain near the reported 13% or revert to its lower 3-year average. He also asked if new tiered offerings are based on product functionality or market segmentation.

Answer

Dan Durn, EVP and CFO, expressed confidence in future business momentum, citing large enterprise deals and cross-cloud opportunities, but did not guide specifically on cRPO growth. David Wadhwani, President of Digital Media, clarified that the new tiering strategy will be a combination of access to specific features and associated usage limits, representing an evolution from past models like generative credits.

Jay Vleeschhouwer followed up on previous comments about increasing go-to-market (GTM) spend for Adobe Express, asking if this accelerated investment pace would continue or if it might taper off soon.

Answer

President of Digital Media David Wadhwani and CEO Shantanu Narayen responded. Wadhwani confirmed the strategy, detailing significant GTM ramp-up across direct sales, social media, and partnerships to reach new audiences for Express. He stated unequivocally, 'we're going to pour more gas on it, not less.' Narayen added that the company continues to invest in key long-term growth initiatives like Express while delivering phenomenal margins.

Jay Vleeschhouwer inquired about pipeline trends regarding multi-solution sales versus potential deal disaggregation, and the current mix of Bentley's work between existing infrastructure versus new projects.

Answer

Executive Chair Greg Bentley noted that the year-plus backlog of customers is a buffer, and the trend of multi-year E365 escalations reflects customer confidence. CEO Nicholas Cumins stated that customers are optimistic and leveraging E365 for more software access, the opposite of disaggregation. He added that while traditionally focused on new infrastructure, growing the business tied to existing asset operations is a major future opportunity.

Jay Vleeschhouwer asked for the principal objectives for the new Chief Operating Officer and for an update on the integration of the customer success and account management teams.

Answer

CEO Nicholas Cumins clarified the new COO's role is cross-functional, focusing on planning, execution, industry solutions, and growth initiatives like Asset Analytics. He confirmed the combination of account and success management teams has been highly beneficial. Executive Gregory Bentley added that the new COO brings valuable experience in commercial model innovation.

Jay Vleeschhouwer from Griffin Securities asked how customer selection criteria are evolving, specifically whether purchasing decisions are now being made horizontally based on platform capabilities or vertically based on application-level features.

Answer

Executive Chair Greg Bentley and executive Julien Moutte both confirmed a shift towards horizontal, platform-based decisions. They explained that customers, particularly large engineering firms, are prioritizing intelligent data management and platform openness to ensure their data is accessible for future AI applications, making these key criteria in their evaluation process.