PTC (PTC) has been insulated from the negative impact of AI and vibe code disruption, with customers relying on its platform for design needs, RBC Capital Markets said in a note Wednesday.

The company posted solid fiscal Q1 results, with annual recurring revenue and free cash flow meeting analyst consensus, while revenue surpassed expectations on large deal volumes and competitive displacements, the report said.

PTC's go-to-market enhancements have driven strong pipeline conversion, which sets up acceleration for annual recurring revenue in fiscal Q4, the report added.

"We like the idiosyncratic drivers and 2H setup driven by their product roadmap, GTM improvements, expanding deal pipeline, FCF growth and share repurchases," the note said.

RBC kept its outperform rating while lowering its price target to $195 from $235.

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