Neil Barua
PTCAbout Neil Barua
Neil Barua, age 47, is PTC’s President and Chief Executive Officer (CEO) and a director, having become CEO on February 14, 2024 after serving as CEO‑Elect from July 2023; he joined PTC’s Board in 2023 . He holds a Bachelor of Science in finance and economics from NYU Stern and previously led ServiceMax and IPC Systems, and served as an Operating Partner at Silver Lake and Francisco Partners, bringing deep enterprise software, operations, and financial acumen . PTC’s FY2024 performance featured ARR of $2.26B, cash from operations of $750M, and free cash flow of $736M, with the annual incentive plan tied to FCF growth paying at 135% due to exceeding target; PTC’s pay‑versus‑performance TSR index value was $218.40 for 2024 versus the peer group’s $222.15 .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| ServiceMax | Chief Executive Officer | Apr 2019–Jan 2023 | Led field service management leader; “proven track record of growing businesses” |
| IPC Systems | Chief Executive Officer | 2014–2018 | Ran specialized technology solutions provider to financial services; operational leadership |
| Silver Lake; Francisco Partners | Operating Partner | Not disclosed | Technology investment expertise; strong financial acumen and growth orientation |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| PTC Inc. | Director | Since 2023 | CEO is not independent; Board Chair is independent (Janice Chaffin) |
| Other public company boards | — | — | None |
- Board governance: Independent Chair; CEO does not serve on any Board committee; Board met 6 times in 2024 and all directors attended at least 80% of their meetings .
- Dual‑role implications: Separation of chair and CEO roles with an independent chair mitigates independence concerns; PTC has a Lead Independent Director charter if the chair were not independent .
Fixed Compensation
| Metric | 2023 | 2024 |
|---|---|---|
| Base Salary ($) | $431,154 | $800,000 |
| Target Annual Bonus ($) | $1,200,000 (set in Jul 2023 for rest of 2023) | $1,200,000 |
| Target Annual LT RSU Grant ($) | Not disclosed | $11,000,000 |
| Non‑Equity Incentive (Actual) ($) | $672,411 | $1,620,000 |
| Stock Awards Recognized ($) | $12,710,200 | $13,968,399 |
| Other Compensation ($) | $392,408 | $11,504 |
| Total Compensation ($) | $14,206,173 | $16,399,903 |
Performance Compensation
| Plan/Metric | Threshold | Target | Upside/Cap | FY2024 Achievement | FY2024 Payout/Vesting |
|---|---|---|---|---|---|
| Annual Corporate Incentive Plan (ACIP): Free Cash Flow ($M) | $670 | $710 | Cap $730; max 135% | $736 (CFO $750 minus $14 CapEx) | 135% of target |
| LT Operating Performance RSUs: ARR growth (YoY) | 6% | 10% | 16% (200% earn) | 12% | 126% of target earned for FY2024 tranche |
| LT rTSR RSUs: 3‑yr relative TSR vs custom S&P Software & Services + peers | 25th percentile | 50th percentile | 90th percentile; capped at 100% if ending stock price lower than beginning | N/A (performance period ends Sept 30, 2026) | No FY2024 vesting; earn at end of 3‑year period |
Design notes:
- Operating performance RSUs have annual performance periods for three years; unearned tranches are forfeited; up to 200% can be earned .
- Service RSUs vest in three equal annual installments .
- rTSR RSUs have a single three‑year performance period; up to 200% earned, but subject to a 100% cap if stock price declines across the measurement window .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Shares Beneficially Owned | 62,574; includes 22,884 shares scheduled to vest by Jan 29, 2025 |
| Ownership as % of Outstanding | Less than 1% of 120,446,852 shares (deemed outstanding includes 22,884 RSUs vesting by Jan 29, 2025) |
| CEO Stock Ownership Guideline | 6× annual salary; all directors/officers meet ownership requirements |
| Hedging/Pledging | Prohibited for directors/officers; pre‑clearance required for trades |
Outstanding awards and vesting schedule (selected):
- Service RSUs: 35,557 (FY24 awards) vest over Nov 15, 2024/2025/2026; plus service RSUs vesting on Jan 12, 2025 and 2026 (15,256 each) and Aug 15, 2025 and 2026 (22,942 total) .
- Performance RSUs (ARR): 17,778 target (one‑third eligible each year on Nov 15, 2024/2025/2026, subject to ARR results) .
- Performance RSUs (rTSR): 17,778 target, eligible at Nov 15, 2026 after three‑year period (Oct 1, 2023–Sept 30, 2026) .
| Award Type | Unvested/Unearned Units | Market/Payout Value ($) | Key Vesting Dates |
|---|---|---|---|
| Service RSUs (FY24) | 35,557 | $6,423,728 (at $180.66) | Nov 15, 2024/2025/2026 |
| ARR Performance RSUs (FY24) | 17,778 | $3,211,773 | Nov 15, 2024/2025/2026 (subject to ARR) |
| rTSR Performance RSUs (FY24) | 17,778 | $3,211,773 | Nov 15, 2026 (subject to 3‑yr rTSR) |
| Service RSUs (Other dated grants) | 15,256; 15,256; 22,942 | $2,756,149; $2,756,149; $4,144,702 | Jan 12, 2025; Jan 12, 2025/2026; Aug 15, 2025/2026 |
Employment Terms
Summary of CEO agreement (severance and change‑in‑control):
- Termination without Cause or for specified “Other Reason”: 2× base salary, 2× target bonus, 1× pro‑rated target bonus, accelerated equity of 1 year, and 18 months of benefits; no tax gross‑ups .
- Change‑in‑control: no single‑trigger equity acceleration; double‑trigger within two years provides 2× base salary, 2× target bonus, 1× pro‑rated target bonus, 100% accelerated equity, and 2 years of benefits; no tax gross‑ups .
- Agreements require non‑compete and release of claims to receive severance .
Estimated payments if event occurred on September 30, 2024:
| Scenario | Base ($) | Target Bonus ($) | Pro‑Rated Bonus ($) | Accelerated Equity ($) | Benefits ($) | Total ($) |
|---|---|---|---|---|---|---|
| Termination without Cause/“Other Reason” | $1,600,000 | $2,400,000 | $1,200,000 | $9,418,528 | $46,231 | $14,664,759 |
| Change in Control | — | — | $1,200,000 | $24,634,751 | $61,987 | $28,696,738 |
| Double‑Trigger (post‑CIC) | $1,600,000 | $2,400,000 | — | $22,504,274 | — | $22,504,274 |
Clawback and other policies:
- Executive Compensation Recoupment Policy compliant with SEC Rule 10D‑1 and Nasdaq Rule 5608; enables recovery of incentive compensation upon restatement or correction of operating measures .
- Equity grant timing safeguards; awards on pre‑set dates, avoidance of blackout period grants except limited special circumstances .
Compensation Committee Analysis
- Committee composition: fully independent directors; responsibilities include setting executive pay, establishing performance goals, overseeing equity plans and recoupment .
- Independent consultant: Pearl Meyer & Partners engaged; independence assessed; fees of $230,047 in 2024 .
- Benchmarking: Peer group of 17 U.S. enterprise software companies (Akamai, ANSYS, Autodesk, Blackbaud, Cadence, Ceridian, CrowdStrike, Dynatrace, F5, Fair Isaac, Guidewire, OpenText, Paycom, ServiceNow, Splunk, Tyler Tech, WEX); target compensation opportunities generally set around the market median .
- Say‑on‑pay: 2024 advisory vote support of 92% .
Director Compensation (for Neil Barua as a director)
- As an employee (CEO), Neil Barua receives no separate compensation for Board service .
Performance & Track Record
- FY2024 outcomes: ARR $2.26B, CFO $750M, FCF $736M; ACIP free cash flow target represented ~21% increase over FY2023 and paid out at 135% .
- PTC’s pay‑versus‑performance disclosure: TSR index value $218.40; peer group TSR index $222.15; Net Income $376.3M and Free Cash Flow $735.6M in 2024 .
- Qualifications highlighted by the Board: extensive leadership in global technology, software industry knowledge, financial acumen, and growth track record .
Risk Indicators & Red Flags
- Hedging/pledging prohibited; trades require pre‑clearance—reduces misalignment and speculative risk .
- No tax gross‑ups in severance—shareholder‑friendly .
- Double‑trigger equity acceleration on change‑in‑control—mitigates windfalls and aids retention through transactions .
- Equity awards rely primarily on RSUs rather than options—reduces risk of aggressive behavior to maintain option moneyness .
Equity Ownership & Insider Selling Pressure
- Beneficial ownership: 62,574 shares; less than 1% ownership; 22,884 shares scheduled to vest by Jan 29, 2025 .
- Upcoming vesting from multiple RSU grants across Jan/Aug/Nov 2025 and 2026 suggests periodic supply from vesting; actual sales subject to pre‑clearance and 10b5‑1 plan policy, with hedging/pledging prohibited .
Employment Terms (Additional)
- Non‑compete and release of claims required for severance eligibility; benefits continuation periods specified above .
Investment Implications
- Strong pay‑for‑performance alignment: ACIP tied to FCF growth and LT RSUs split between ARR and rTSR metrics; FY2024 payouts reflect operational outperformance in cash generation (135% ACIP; 126% ARR RSU tranche) .
- Retention and supply considerations: Significant unvested RSUs with scheduled vesting across 2025–2026 indicate potential periodic share supply; however, hedging/pledging prohibitions and stock ownership requirements (6× salary, met) reinforce long‑term alignment .
- Transaction readiness with guardrails: Double‑trigger CoC terms and lack of gross‑ups reduce windfall optics while ensuring management continuity through strategic events—positive for governance‑focused investors .
- Governance mitigants to dual‑role risk: Independent Board Chair, no committee membership for CEO, and robust committee structures lessen independence concerns tied to CEO + director dual role .
- Shareholder sentiment: 92% say‑on‑pay support and use of an independent compensation consultant and median benchmarking indicate alignment with investor expectations, reducing headline risk .