Segment Information

12 Months Ended

Sep. 30, 2013

Segment Reporting [Abstract]

Segment Information

Segment Information

We operate within a single industry segment—computer software and related services. Operating segments as defined under GAAP are components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. Our chief operating decision maker is our President and Chief Executive Officer. We have two operating and reportable segments: (1) Software Products, which includes license and related support revenue (including updates and technical support) for all our products except computer-based training products; and (2) Services, which includes consulting, implementation, training, cloud services, and license and support revenue for computer-based training products. We do not allocate sales and marketing or administrative expenses to our operating segments as these activities are managed on a consolidated basis.

The revenue and operating income attributable to these operating segments are summarized as follows:
	Year ended September 30,
	2014			2013			2012
	(in thousands)
Software Products segment revenue	$	1,032,230		$	977,523		$	935,472
Services segment revenue	324,737			316,018			320,207
Total revenue	$	1,356,967		$	1,293,541		$	1,255,679
Operating income: (1) (2)
Software Products segment	$	663,593		$	605,963		$	598,344
Services segment	48,378			37,131			41,793
Sales and marketing expenses	(371,392		)	(378,771		)	(392,956		)
General and administrative expenses	(144,003		)	(136,999		)	(119,085		)
Total operating income	$	196,576		$	127,324		$	128,096
Other (expense) income, net	(10,464		)	(1,090		)	(7,360		)
Income before income taxes	$	186,112		$	126,234		$	120,736

(1) We recorded restructuring charges of $28.4 million in 2014. Software Products included $2.8 million; Services included $9.8 million; sales and marketing expenses included $13.9 million; and general and administrative expenses included $1.8 million of the total restructuring charges recorded in 2014.We recorded restructuring charges of $52.2 million in 2013. Software Products included $17.7 million; Services included $11.3 million; sales and marketing expenses included $18.1 million; and general and administrative expenses included $5.1 million of the total restructuring charges recorded in 2013. We recorded restructuring charges of $24.9 million in 2012. Software Products included $4.1 million; Services included $4.0 million; sales and marketing expenses included $15.2 million; and general and administrative expenses included $1.6 million of the total restructuring charges recorded in 2012.

(2) The Software Products segment operating income includes depreciation and amortization of $30.0 million, $32.0 million, and $30.8 million in 2014, 2013, and 2012, respectively. The Services segment operating income includes depreciation and amortization of $7.4 million, $6.1 million, and $4.8 million in 2014, 2013, and 2012, respectively.

We report revenue by the following three product areas:

• CAD: PTC Creo^® and PTC Mathcad^®.

• EPLM: PLM solutions (primarily PTC Windchill^® and PTC Creo^® View^TM ) and ALM solutions (primarily PTC Integrity^™).

• SLM & IoT: PTC Arbortext^® , PTC Servigistics^®, ThingWorx^® and Axeda^®.

	Year ended September 30,
	2014		2013		2012
	(in thousands)
CAD	$	581,508	$	552,442	$	573,457
EPLM	599,312		571,058		604,339
SLM & IoT	176,147		170,041		77,883
Total revenue	$	1,356,967	$	1,293,541	$	1,255,679

Data for the geographic regions in which we operate is presented below.
	Year ended September 30,
	2014		2013		2012
	(in thousands)
Revenue:
Americas (1)	$	558,671	$	522,788	$	479,932
Europe (2)	528,090		479,877		480,287
Pacific Rim	148,151		161,587		160,834
Japan	122,055		129,289		134,626
Total revenue	$	1,356,967	$	1,293,541	$	1,255,679

	September 30,
	2014		2013		2012
	(in thousands)
Long-lived tangible assets:
Americas (3)	$	51,027	$	49,788	$	46,083
Europe	7,020		5,557		6,649
Asia-Pacific	9,736		9,307		10,734
Total long-lived tangible assets	$	67,783	$	64,652	$	63,466

(1) Includes revenue in the United States totaling $518.7 million, $485.2 million and $453.2 million for 2014, 2013 and 2012, respectively.

(2) Includes revenue in Germany totaling $200.3 million, $167.2 million and $188.3 million for 2014, 2013 and 2012, respectively.

(3) Substantially all of the Americas long-lived tangible assets are located in the United States.

Our international revenue is presented based on the location of our customer. We license products to customers worldwide. Our sales and marketing operations outside the United States are conducted principally through our international sales subsidiaries throughout Europe and the Asia-Pacific regions. Intercompany sales and transfers between geographic areas are accounted for at prices that are designed to be representative of unaffiliated party transactions.