Company: PTC
Filing Date: 2025-02-06
Form Type: 10-Q
Source: 0000950170-25-015530
Chunk: 16

Company: PTC INC.
Filing Date: 2025-02-06
Form: 10-Q
Item: Part I, Item 2
Chunk 16
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, term loan, and our senior notes due 2025 and 2028. Interest expense decreased in Q1'25 compared to Q1'24 due to lower aggregate debt.

Other Income (Expense)

    (Dollar amounts in millions)
     
    Three months ended

    December 31, 2024

    December 31, 2023

    Percent Change

    Interest income
     
    $
    0.9

    $
    1.3

    (27
    )%

    Other income (expense), net

    (1.2
    )

    0.9

    (232
    )%

    Other income (expense), net
     
    $
    (0.3
    )
     
    $
    2.2

    (115
    )%

Other income (expense), net was lower in Q1'25 compared to Q1'24, driven by foreign currency exchange losses.

Income Taxes

    (Dollar amounts in millions)
     
    Three months ended

    December 31, 2024

    December 31, 2023

    Percent Change

    Income before income taxes
     
    $
    93.2

    $
    85.6

    9
    %

    Provision for income taxes
     
    $
    10.9

    $
    19.2

    (43
    )%

    Effective income tax rate

    12
    %

    22
    %

The effective tax rate for Q1'25 was lower than the effective tax rate for the corresponding prior-year period primarily due to changes in the geographic mix of income before taxes. Additionally, for the three months ended December 31, 2024 and December 31, 2023, rates were impacted by a benefit of $5.4 million and an expense of $3.6 million, respectively, associated with the impact of tax reserves related to prior years in foreign jurisdictions.

In FY’24, we requested IRS consent for an accounting method change in the treatment of certain deductions. If we do not receive this consent, our future tax payments could be higher than currently estimated.

Critical Accounting Policies and Estimates

There were no material changes to our critical accounting policies and estimates as set forth under the heading Critical Accounting Policies and Estimates in Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations of our 2024 Annual