BENTLEY SYSTEMS INC

Previous wording

•ARR(2) was $1,319,256 as of March 31, 2025, compared to $1,186,456 as of March 31, 2024, representing a constant currency(1) ARR growth rate(2) of 12%;

Current wording

•ARR(2) was $1,379,161 as of June 30, 2025, compared to $1,215,910 as of June 30, 2024, representing a constant currency(1) ARR growth rate(2) of 11.5%;

Previous wording

•Last twelve-month recurring revenues dollar-based net retention rate(2) was 110% as of March 31, 2025, compared to 108% as of March 31, 2024;

Current wording

•Last twelve-month recurring revenues dollar-based net retention rate(2) was 109% as of June 30, 2025, compared to 108% as of June 30, 2024;

Previous wording

•Cash flows from operations were $219,415 for the three months ended March 31, 2025, compared to $204,969 for the three months ended March 31, 2024.

Current wording

•Cash flows from operations was $280,500 for the six months ended June 30, 2025, compared to $267,555 for the six months ended June 30, 2024.

Previous wording

The increase in total revenues for the three months ended March 31, 2025 was driven by an increase in subscriptions revenues and perpetual licenses, partially offset by a decrease in services revenues.

Current wording

The increase in total revenues for the three and six months ended June 30, 2025 was primarily driven by an increase in subscriptions revenues, partially offset by a decrease in services revenues.

Previous wording

Subscriptions. For the three months ended March 31, 2025, the increase in subscriptions revenues was driven by improvements in our business performance of $35,229 ($38,895 on a constant currency basis). Our business performance includes the impact from programmatic acquisitions, which generally are immaterial, individually and in the aggregate.

Current wording

Subscriptions. For the three and six months ended June 30, 2025, the increase in subscriptions revenues was driven by improvements in our business performance of $36,008 ($33,157 on a constant currency basis) and $71,237 ($72,052 on a constant currency basis), respectively. Our business performance includes the impact from programmatic acquisitions, which generally are immaterial, individually and in the aggregate.

Previous wording

For the three months ended March 31, 2025, the improvements in business performance were primarily driven by expansion from accounts with revenues in the same period in the prior year (“existing accounts”), and growth of 3% attributable to new accounts, most notably small- and medium-sized accounts. Improvements in business performance for the three months ended March 31, 2025 were led by our engineering applications, followed by geoprofessional applications, and our Bentley Infrastructure Cloud.

Current wording

For the three and six months ended June 30, 2025, the improvements in business performance were primarily driven by expansion from accounts with revenues in the same period in the prior year (“existing accounts”), and growth of 3% attributable to new accounts, most notably small- and medium-sized accounts. Improvements in business performance for the three and six months ended June 30, 2025 were led by our engineering applications, followed by geoprofessional applications, and our Bentley Infrastructure Cloud.

Previous wording

Perpetual licenses. For the three months ended March 31, 2025, the increase in perpetual licenses revenues was driven by improvements in business performance of $1,280 ($1,443 on a constant currency basis).

Current wording

Perpetual licenses. For the three months ended June 30, 2025, the decrease in perpetual licenses revenues was driven by a decline in our business performance of $670 ($762 on a constant currency basis). For the six months ended June 30, 2025, the increase in perpetual licenses revenues was driven by improvements in business performance of $610 ($681 on a constant currency basis).

Previous wording

Services. For the three months ended March 31, 2025, the decrease in services revenues was driven by a decline in our business performance of $3,730 ($3,440 on a constant currency basis), driven primarily from weakness within Asset Performance Services.

Current wording

Services. For the three and six months ended June 30, 2025, the decrease in services revenues was driven by a decline in our business performance of $1,569 ($1,894 on a constant currency basis) and $5,299 ($5,334 on a constant currency basis), respectively, driven primarily from weakness within Asset Performance Services.

Previous wording

Americas. For the three months ended March 31, 2025, the increase in revenues from the Americas was primarily driven by improvements in our business performance of $14,782 ($16,664 on a constant currency basis).

Current wording

Americas. For the three and six months ended June 30, 2025, the increase in revenues from the Americas was primarily driven by improvements in our business performance of $17,749 ($18,194 on a constant currency basis) and $32,531 ($34,858 on a constant currency basis), respectively.

Previous wording

The improvements in business performance for the three months ended March 31, 2025 were primarily due to expansion of our subscriptions revenues from existing accounts in the U.S., partially offset by a decline in services revenues.

Current wording

The improvements in business performance for the three and six months ended June 30, 2025 were primarily due to expansion of our subscriptions revenues from existing accounts in the U.S. Partially offsetting these improvements, for the six months ended June 30, 2025, was a decline in services revenues.

Previous wording

EMEA. For the three months ended March 31, 2025, the increase in revenues from EMEA was primarily driven by improvements in our business performance of $12,291 ($13,476 on a constant currency basis).

Current wording

EMEA. For the three and six months ended June 30, 2025, the increase in revenues from EMEA was primarily driven by improvements in our business performance of $9,549 ($5,926 on a constant currency basis) and $21,840 ($19,402 on a constant currency basis), respectively.

Previous wording

The improvements in business performance for the three months ended March 31, 2025 were primarily due to expansion of our subscriptions revenues from existing accounts in the United Kingdom, Africa, and the Middle East, partially offset by a decline in services revenues.

Current wording

The improvements in business performance for the six months ended June 30, 2025 were primarily due to expansion of our subscriptions revenues from existing accounts in the United Kingdom, the Middle East, and Africa, partially offset by a decline in services revenues.

Previous wording

APAC. For the three months ended March 31, 2025, the increase in revenues from APAC was primarily driven by improvements in our business performance of $5,706 ($6,758 on a constant currency basis).

Current wording

APAC. For the three and six months ended June 30, 2025, the increase in revenues from APAC was primarily driven by improvements in our business performance of $6,471 ($6,381 on a constant currency basis) and $12,177 ($13,139 on a constant currency basis), respectively.

Previous wording

The improvements in business performance for the three months ended March 31, 2025 were primarily due to expansion of our subscriptions revenues from existing accounts in Australia and India, as well as an increase in perpetual licenses revenues, partially offset by declines of our subscriptions revenues in China.

Current wording

The improvements in business performance for the three months ended June 30, 2025 were primarily due to expansion of our subscriptions revenues from existing accounts in India, as well as an increase in our subscriptions revenues from new accounts in China, partially offset by declines in our subscriptions revenues from existing accounts in China.

Previous wording

Cost of Revenues and Operating Expense (Income)

Current wording

Cost of Revenues and Operating Expenses

Previous wording

Cost of subscriptions and licenses. For the three months ended March 31, 2025, on a constant currency basis, cost of subscriptions and licenses expenses increased primarily due to an increase in headcount-related costs of $4,245, mainly due to an increase in annual and other compensation costs, and an increase in cloud-related costs of $1,538.

Current wording

Cost of subscriptions and licenses. For the three and six months ended June 30, 2025, on a constant currency basis, cost of subscriptions and licenses expenses increased due to an increase in headcount-related costs of $2,676 and $6,921, respectively, mainly due to an increase in annual and other compensation costs, and higher stock-based compensation expense, partially offset by realignment expenses recognized in the prior year periods related to the 2023 Program, which did not recur in the current year periods. Additionally, for the three and six months ended June 30, 2025, cost of subscriptions and licenses further increased due to an increase in cloud-related costs of $2,917 and $4,455, respectively.

Previous wording

Cost of services. For the three months ended March 31, 2025, on a constant currency basis, cost of services expenses decreased primarily due to a decrease in headcount‑related costs of $1,332, mainly due to a reduction in third‑party personnel costs.

Current wording

For the six months ended June 30, 2025, on a constant currency basis, cost of services expenses decreased primarily due to a decrease in headcount‑related costs, mainly due to a reduction in third‑party personnel costs.

Previous wording

Research and development. For the three months ended March 31, 2025, on a constant currency basis, research and development expenses increased primarily due to an increase in headcount‑related costs of $5,761, mainly due to increases in headcount, and annual and other compensation costs, partially offset by lower acquisition-related retention incentives.

Current wording

Research and development. For the three and six months ended June 30, 2025, on a constant currency basis, research and development expenses increased primarily due to increases in headcount‑related costs of $10,041 and $15,802, respectively, mainly due to increases in headcount, and annual and other compensation costs.

Previous wording

Selling and marketing. For the three months ended March 31, 2025, on a constant currency basis, selling and marketing expenses increased primarily due to an increase in headcount‑related costs of $7,929, mainly due to increases in headcount, and annual and other compensation costs.

Current wording

Selling and marketing. For the three and six months ended June 30, 2025, on a constant currency basis, selling and marketing expenses increased primarily due to an increase in headcount‑related costs $9,145 and $17,074, respectively, mainly due to increases in headcount, and annual and other compensation costs, and an increase in promotional costs of $1,987 and $2,609, respectively.

Previous wording

General and administrative. For the three months ended March 31, 2025, on a constant currency basis, general and administrative expenses increased primarily due to an increase in headcount‑related costs of $1,641, mainly due to increases in headcount, and annual and other compensation costs, and to a lesser extent, higher third-party personnel costs. Partially offsetting these increases was lower incentive compensation expense related to the reduction in Gregory S. Bentley’s fractional interest under the Bonus Plan as part of Mr. Bentley’s transition to the role of Executive Chair effective July 1, 2024.

Current wording

General and administrative. For the three months ended June 30, 2025, on a constant currency basis, general and administrative expenses decreased primarily due to a decrease in headcount‑related costs of $5,185, mainly due to lower incentive compensation expense related to the reduction in Gregory S. Bentley’s fractional interest under the Bonus Plan as part of Mr. Bentley’s transition to the role of Executive Chair effective July 1, 2024. Additionally, during the three months ended June 30, 2024, we recognized approximately $2,200 of other corporate initiatives expenses, which did not recur in the current year period. Partially offsetting these decreases were higher charitable contributions focusing on education and sustainability of $2,037.

Previous wording

Deferred compensation plan. For the three months ended March 31, 2025 and 2024, deferred compensation plan (income) expense was attributable to the marked to market impact on deferred compensation plan liability balances period over period.

Current wording

Deferred compensation plan. For the three and six months ended June 30, 2025 and 2024, deferred compensation plan expense was attributable to the marked to market impact on deferred compensation plan liability balances period over period.

Previous wording

Amortization of purchased intangibles. For the three months ended March 31, 2025, on a constant currency basis, amortization of purchased intangibles decreased primarily due to previously acquired intangible assets that continue to become fully amortized and lower acquisition activity as compared to prior periods.

Current wording

Amortization of purchased intangibles. For the three and six months ended June 30, 2025, on a constant currency basis, amortization of purchased intangibles decreased primarily due to lower acquisition activity as compared to prior periods.

Previous wording

For the three months ended March 31, 2025, interest expense, net decreased primarily due to lower weighted average debt outstanding under the credit facilities as compared to the same period in the prior year.

Current wording

For the three and six months ended June 30, 2025, interest expense, net decreased primarily due to lower weighted average debt outstanding under the credit facilities as compared to the same periods in the prior year.

Previous wording

(1)Foreign exchange gain is primarily attributable to foreign currency translation derived mainly from U.S. dollar denominated cash and cash equivalents, account receivables, customer deposits, and intercompany balances held by foreign subsidiaries.

Current wording

(1)Foreign exchange gain (loss) is primarily attributable to foreign currency translation derived mainly from U.S. dollar denominated cash and cash equivalents, account receivables, customer deposits, and intercompany balances held by foreign subsidiaries.

Previous wording

For the three months ended March 31, 2025, the effective tax rate was lower as compared to the same period in the prior year primarily due to the impact of the increase in discrete tax benefits recognized in the current year period and an increase in the forecasted deductions to U.S. taxable income related to foreign revenues. For the three months ended March 31, 2025 and 2024, we recorded discrete tax benefits of $5,073 and $2,138, respectively, primarily associated with windfall tax benefits from stock‑based compensation, net of the impact from officer compensation limitation provisions.

Current wording

For the three months ended June 30, 2025, the effective tax rate was higher compared to the same period in the prior year primarily due to the impact of a decrease in discrete tax benefits recognized, partially offset by the decrease in forecasted effective tax rate impact of U.S. international tax provisions. For the three months ended June 30, 2025 and 2024, we recorded discrete tax benefits of $8,114 and $18,543, respectively, primarily associated with windfall tax benefits from stock‑based compensation, net of the impact from officer compensation limitation provisions.

Previous wording

ARR resulting from the annualization of recurring contracts with consumption measurement durations of less than one year, as a percentage of total ARR, was 50% and 48% as of March 31, 2025 and 2024, respectively, with our E365 subscription offering representing 45% and 42% of total ARR as of March 31, 2025 and 2024, respectively.

Current wording

ARR resulting from the annualization of recurring contracts with consumption measurement durations of less than one year, as a percentage of total ARR, was 51% and 49% as of June 30, 2025 and 2024, respectively, with our E365 subscription offering representing 45% and 43% of total ARR as of June 30, 2025 and 2024, respectively.

Previous wording

The last twelve‑months recurring revenues for the periods ended March 31, 2025 compared to the last twelve‑months of the comparative twelve‑month period increased by $147,017. This increase was primarily due to growth in ARR, which is primarily the result of growing our recurring revenues within our existing accounts as expressed in our recurring revenues dollar‑based net retention rate, as well as additional recurring revenues resulting from new accounts and acquisitions. For the twelve months ended March 31, 2025 and 2024, 92% and 90%, respectively, of our revenues were recurring revenues.

Current wording

The last twelve‑months recurring revenues for the periods ended June 30, 2025 compared to the last twelve‑months of the comparative twelve‑month period increased by $146,161. This increase was primarily due to growth in ARR, which is primarily the result of growing our recurring revenues within our existing accounts as expressed in our recurring revenues dollar‑based net retention rate, as well as additional recurring revenues resulting from new accounts and acquisitions. For the twelve months ended June 30, 2025 and 2024, 92% and 90%, respectively, of our revenues were recurring revenues.

Previous wording

(4)Realignment expenses. We exclude these charges and subsequent adjustments to our estimates when we evaluate our continuing operational performance because they are not reflective of our ongoing business and results of operations. We believe it is useful for investors to understand the effects of these items on our total operating expenses. For the three months ended March 31, 2024, Realignment expenses were primarily associated with the 2023 Program.

Current wording

(4)Realignment expenses. We exclude these charges and subsequent adjustments to our estimates when we evaluate our continuing operational performance because they are not reflective of our ongoing business and results of operations. We believe it is useful for investors to understand the effects of these items on our total operating expenses. For the three and six months ended June 30, 2024, Realignment expenses were primarily associated with the 2023 Program.

Previous wording

For the three months ended March 31, 2025, compared to the same period in the prior year, net cash provided by operating activities was higher by $14,446 due to an increase in net income of $21,028 and an increase in net cash flows from the change in operating assets and liabilities of $1,954, partially offset by a net decrease in non‑cash adjustments of $8,536. The increase in net cash flows from the change in operating assets and liabilities period over period was primarily due to the overall timing of payments for income taxes and for software maintenance contracts, as well as lower capitalized internal‑use software implementation costs. Offsetting these increases were lower period over period Cloud Services Subscription deposits, and accruals and other liabilities.

Current wording

For the six months ended June 30, 2025, compared to the same period in the prior year, net cash provided by operating activities was higher by $12,945 due to an increase in net income of $19,482, partially offset by a net decrease in non‑cash adjustments of $3,935 and a decrease in net cash flows from the change in operating assets and liabilities of $2,602. The decrease in net cash flows from the change in operating assets and liabilities period over period was primarily due to lower period over period Cloud Services Subscription deposits, and accruals and other liabilities. Offsetting these decreases were increases primarily due to timing of collections on our receivables, the overall timing of payments for income taxes and for software maintenance contracts, as well as lower capitalized internal‑use software implementation costs compared to the same period in the prior year.

Previous wording

Net cash used in investing activities was lower by $805 for the three months ended March 31, 2025, compared to the same period in the prior year, primarily due to lower purchases of property and equipment and investment in capitalized software of $555.

Current wording

Net cash used in investing activities was lower by $3,811 for the six months ended June 30, 2025, compared to the same period in the prior year, primarily due to lower acquisition related payments of $5,000.

Previous wording

Net cash used in financing activities was higher by $74,373 for the three months ended March 31, 2025, compared to the same period in the prior year, primarily due to higher net paydowns of the credit facilities of $40,788 and higher payments for shares acquired of $16,345, including shares repurchased under the Repurchase Program. Additionally, we paid $9,797 in cash to repurchase $10,000 aggregate principal amount of our outstanding 2026 Notes during the first quarter of 2025 and dividend payments were higher by $3,327, primarily due to an increase in our quarterly dividend per share to $0.07 from $0.06.

Current wording

Net cash used in financing activities was lower by $13,490 for the six months ended June 30, 2025, compared to the same period in the prior year, primarily due to lower net paydowns of the credit facilities of $61,713, partially offset by higher payments for shares acquired of $27,661, including shares repurchased under the Repurchase Program, higher dividend payments of $6,642, primarily due to an increase in our quarterly dividend per share to $0.07 in 2025 from $0.06 in 2024, and lower proceeds from the exercise of stock options of $4,007. Additionally, we paid $9,797 in cash to repurchase $10,000 aggregate principal amount of our outstanding 2026 Notes during the first quarter of 2025.

Previous wording

Unless converted, upon maturity in January 2026, we will be required to repay the outstanding principal amount on the 2026 Notes, which, as of March 31, 2025, was $677,830. As of March 31, 2025, the 2026 Notes were classified as long-term debt in the consolidated balance sheets as we currently have the ability and intent to refinance them on a long-term basis through available capacity under the Credit Facility.

Current wording

Unless converted, upon maturity in January 2026, we will be required to repay the outstanding principal amount on the 2026 Notes, which, as of June 30, 2025, was $677,830. As of June 30, 2025, the 2026 Notes were classified as long‑term in the consolidated balance sheets as we currently have the ability and intent to refinance them on a long‑term basis through available capacity under the Credit Facility.

Previous wording

During the three months ended March 31, 2025, we repurchased 673,898 shares for $30,014, and $10,000 aggregate principal amount of our outstanding 2026 Notes for $9,797 under the Repurchase Program. During the three months ended March 31, 2024, we repurchased 302,598 shares for $15,006 under the Repurchase Program.

Current wording

During the six months ended June 30, 2025, we repurchased 1,173,041 shares for $50,023, and $10,000 aggregate principal amount of our outstanding 2026 Notes for $9,797 under the Repurchase Program. During the six months ended June 30, 2024, we repurchased 729,681 shares for $37,515 under the Repurchase Program.

Previous wording

We have the right to require that certain equity awardees receive gross or net quantities of shares of our Class B common stock, including distributions from the DCP and share issuances under our Bonus Plan. In the case of a gross issuance or distribution, an awardee is required to reimburse promptly to us the cash required for his or her tax withholding amounts. Conversely, under a net issuance or distribution, shares are withheld in consideration of remitting withholding taxes on behalf of an equity awardee, thereby requiring us to remit cash for the tax withholdings. During the three months ended March 31, 2025 and 2024, we exercised our right to require that impacted equity awardees receive gross quantities of our Class B common stock. We will continue to evaluate whether share awards will be required to be received by awardees on a gross basis, or if net settlement may be elected by awardees.

Current wording

We have the right to require that certain equity awardees receive gross or net quantities of shares of our Class B common stock, including distributions from the DCP and share issuances under our Bonus Plan. In the case of a gross issuance or distribution, an awardee is required to reimburse promptly to us the cash required for his or her tax withholding amounts. Conversely, under a net issuance or distribution, shares are withheld in consideration of remitting withholding taxes on behalf of an equity awardee, thereby requiring us to remit cash for the tax withholdings. We exercised our right to require that impacted equity awardees receive gross quantities of our Class B common stock during the first quarter of 2025, but we allowed impacted awardees the option to receive net quantities of shares of our Class B common stock during the second quarter of 2025. During the six months ended June 30, 2024, we exercised our right to require that impacted equity awardees receive gross quantities of our Class B common stock. We will continue to evaluate whether share awards will be required to be received by awardees on a gross basis, or if net settlement may be elected by awardees.

Previous wording

The declaration and payment of dividends is within the discretion of our Board of Directors. We paid quarterly dividends of $0.07 per share of common stock during the three months ended March 31, 2025 and $0.06 per share of common stock during the three months ended March 31, 2024. While we intend to continue paying quarterly dividends, any future determination will be subject to the discretion of our Board of Directors and will be dependent on a number of factors, including our results of operations, capital requirements, restrictions under Delaware law, and overall financial condition, as well as any other factors our Board of Directors considers relevant. In addition, the terms of the agreement governing the Credit Facility limit the amount of dividends we can pay.

Current wording

The declaration and payment of dividends is within the discretion of our Board of Directors. We paid quarterly dividends of $0.07 per share of common stock during the six months ended June 30, 2025 and $0.06 per share of common stock during the six months ended June 30, 2024. While we intend to continue paying quarterly dividends, any future determination will be subject to the discretion of our Board of Directors and will be dependent on a number of factors, including our results of operations, capital requirements, restrictions under Delaware law, and overall financial condition, as well as any other factors our Board of Directors considers relevant. In addition, the terms of the agreement governing the Credit Facility limit the amount of dividends we can pay.