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Revenue Growth: 5% year-over-year increase in Q3 2025.

Operating Margin: Improved by 100 basis points year-over-year.

EPS Growth: 10% year-over-year increase.

Subscription Revenue Growth: 16% increase in Q3 2025.

Recurring Revenue: Up 9% in Q3 2025.

3DEXPERIENCE Revenue: Increased by 16% in Q3 2025.

Upfront License Revenue: Declined by 13% as clients shift to subscription models.

Recurring Revenue Share: Accounts for 84% of software revenue year-to-date.

Expense Growth: Increased by 3.1% in Q3 2025.

MEDIDATA Growth: Decreased by 3% in Q3 2025.

Life Sciences Growth: Decreased by 3% in Q3 2025.

Full-Year Revenue Outlook: Adjusted to 4% to 6% growth ex-FX.

Full-Year EPS Growth Target: Maintained at 7% to 10% ex-FX.

Q4 Revenue Range: Expected to be between 1% to 8% growth.

Q4 Operating Margin: Expected to be between 37.2% to 38%.

Q4 EPS Range: Expected to be EUR0.41 to EUR0.45.

Release Date: October 23, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Dassault Systemes SE (DASTF) reported a solid financial performance with a 5% revenue growth and a 10% EPS growth year-over-year.

The 3DEXPERIENCE platform is driving a shift to subscription and recurring revenue growth, with subscription revenue growing by 16% this quarter.

The company is winning significant contracts with top industrial companies, laying a foundation for long-term value creation.

Operating margins improved by 100 basis points year-over-year, driven by productivity gains and cost discipline.

Recurring revenue was strong, up 9% in the quarter, highlighting a solid acceleration compared to 7% year-to-date.

Negative Points

MEDIDATA and Centric performed softer than expected, with MEDIDATA experiencing a 3% decline in growth.

The company adjusted its full-year revenue outlook to 4% to 6% growth, down from the previous 6% to 8% growth target.

There is increasing macro volatility, which could impact the timing of closing large transactions.

Upfront license revenue declined by 13% as clients continue to adopt the subscription model.

The transition to a SaaS model for Centric is ongoing, and the company is facing challenges in balancing the effects of clinical trial activity declines.

Q & A Highlights

Q: Could you elaborate on the productivity initiatives mentioned, and are there any operational adjustments being made? A: Rouven Bergmann, CFO, explained that the productivity initiatives focus on placing the right people in the right roles to support growth, particularly in AI and 3D UNIV+RSES. Adjustments include recalibrating go-to-market strategies and offerings, especially in life sciences, and transitioning Centric to a SaaS model. The aim is to capitalize on past investments and ensure revenue growth outpaces expenses, leading to EBIT expansion.

Q: Are the large signings in industrial innovation based on traditional programmatic adoption or something more transformational? A: Pascal Daloz, COO, noted that while traditional programmatic adoption remains, there’s a shift towards transformational adoption leveraging AI across the entire supply chain. This is evident in contracts like the one with Ford, which includes deploying the platform across all programs and the supply chain, accelerating adoption trends.

Q: What is the rationale behind the renaming within the SOLIDWORKS business? A: Pascal Daloz explained that SOLIDWORKS serves as an umbrella for the mainstream market, with a focus on being industry-aware rather than industry-oriented. The aim is to maintain ease of use while integrating relevant features for specific industries. The rebranding aligns with SOLIDWORKS’ 30th anniversary and its strong community.

Q: What metrics will be provided to track progress towards the 3D UNIV+RSES goals set for 2029? A: Pascal Daloz stated that while specific revenue milestones may not be provided quarterly, annual updates will be given. The focus will be on attach rates and the introduction of new categories of solutions, with a roadmap for 2026 and 2027 to track progress.

Q: What triggered the decision to move Centric to a SaaS model, and how does this affect subscription control? A: Pascal Daloz mentioned that acquiring the remaining shares of Centric allowed for this transition. The move is driven by customer demand for SaaS due to mergers and acquisitions and the need for a unified SaaS architecture. While upfront licenses will still be offered, especially in CapEx-based industries, the focus is on expanding subscriptions, particularly for large contracts with cloud components.

Q: Are you seeing longer sales cycles in industrial innovation, and how does this affect Q4 guidance? A: Rouven Bergmann confirmed longer sales cycles, particularly for large contracts, impacting Q4 guidance. However, these deals are not lost to competition but are being closed at the right time and economics. The focus is on recurring contracts for long-term value creation.

Q: What gives confidence that MEDIDATA’s clinical trial volumes won’t decline further in Q4? A: Rouven Bergmann noted that while the trend is declining, the Q4 outlook assumes stability similar to Q3. The enterprise-wide PLM activities are offsetting declines in clinical trial volumes, though not reported in the same line.

Q: What is the M&A pipeline like, and are buybacks considered given the weak share price? A: Pascal Daloz stated that M&A remains on the agenda, focusing on acquisitions that align with the 3D UNIV+RSES strategy, including cloud and AI components. Buybacks were not specifically addressed, but the focus is on strategic acquisitions.

Q: What are the ambitions for cloud, particularly regarding sovereign cloud and hyperscalers? A: Pascal Daloz explained that 3D OUTSCALE addresses sovereign cloud needs while also leveraging hyperscalers like AWS for markets without critical mass. The strategy involves using hyperscalers to establish a base before opening data centers to maintain margins.

Q: How does the revised guidance for upfront license revenue affect long-term expectations? A: Rouven Bergmann clarified that upfront license revenue is expected to decline over time, approaching EUR 0.5 billion, with growth reflected in subscription revenue. The focus is on transitioning to a recurring revenue model, particularly with Centric’s SaaS transition.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.