In terms of actual performance, we've been able to exceed the EPS growth goals in 2010 when we had 25% EPS growth, and again in 2011 when we had 26% EPS growth. If you look at how we've accomplished that, you'll see that we've been achieving the 12% revenue growth goal on average, but we've been adding more like 2 percentage points of margin expansion per year.This year, in FY '12, we are again expecting to meet or exceed our revenue growth goal of 12%, and we feel confident that we will expand margins by another 2 percentage points to take our margins to around 20% for the year. And with Q1 coming in at 18.4%, this seems likely to be achievable. Note that if we do achieve our 20% margin target here in 2012, that puts us already at the finish line of the original FY '14 margin expansion plan, which essentially causes our FY '14 goals to be no longer meaningful. So with a couple of years under my belt, and with Jeff having been with us for more than a year, we have a lot of time to analyze the business. We feel comfortable we can maintain that same level of revenue growth going forward and also think there are some changes we can make that would allow us to commit to the 2 percentage points per year margin expansion until such time as we drive our margins into the upper 20s where they arguably should be.
Parametric Technology's CEO Discusses Q1 2012 Results - Earnings Call Transcript
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