Dassault Systèmes SE

Q2 total revenue was EUR 1.556 billion, up 4% year over year on a constant-currency basis. Subscription revenue grew 8%, service revenue grew 6%, operating profit rose 7%, and operating margin was 30%, up 90 basis points ex FX. EPS was EUR 0.31, up 8%. For H1, revenue was EUR 3.065 billion, up 3%, operating profit was up 5%, operating margin improved 40 basis points to 13.1%, and EPS was EUR 0.61, up 6%. ARR reached EUR 4.443 billion, up EUR 73 million versus Q1. Full-year 2026 guidance was reaffirmed at EUR 6.296 billion to EUR 6.416 billion in revenue, 32.2% to 32.6% operating margin, and EPS of EUR 1.30 to EUR 1.34. Q3 guidance calls for EUR 1.497 billion to EUR 1.537 billion in revenue, 31% to 31.1% operating margin, and EPS of EUR 0.30 to EUR 0.31.

Pascal Daloz framed the quarter as evidence of strategy execution rather than just financial performance. He stressed that customers are increasingly standardizing on the 3DEXPERIENCE platform and cloud as the foundation for industrial AI, and said the company is moving from AI architecture to AI-native products and agentic experiences. He also highlighted ArisGlobal as a strategic milestone that closes the loop across discovery, clinical, manufacturing, regulatory, and real-world safety data in life sciences.

Rouven Bergmann emphasized that the company is balancing growth and discipline: revenue, profit, and cash flow all improved while the business shifts toward subscription and cloud. He cited H1 operating cash flow of EUR 1.237 billion, up 8% year over year and 11% ex FX, free cash flow up 13% ex FX, and cash conversion of 134% versus 123% last year. Cash and cash equivalents were EUR 5.660 billion at June 2026, with net cash at EUR 2.3 billion, and he noted the EUR 1 billion senior bond issuance in June will refinance the EUR 900 million maturity due in September 2026. On ArisGlobal, he said 2026 revenue is estimated at $175 million, about 85% recurring, with a $1.8 billion cash purchase price plus up to $200 million tied to AI revenue milestones, and that the deal should be growth- and EPS-accretive in the first year post-close.

Analysts focused on ArisGlobal’s growth profile, customer concentration, and how it fits with Dassault’s existing life sciences assets. Management said the business has about 200 customers, more than 5 million in spend from some customers, roughly 85% recurring revenue, and meaningful upside from cross-selling into Dassault’s much larger mid-market base and from combining ArisGlobal’s safety/regulatory data with MEDIDATA’s clinical data. Questions also covered transport and mobility, where management said the segment grew 6% and remains relevant despite industry weakness, because customers still need digital continuity and faster development cycles. On China and Asia, management said China was down in H1 but the pipeline supports improvement in H2, while Asia overall was strong, led by India, Korea and Japan.