Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2023 | Apr. 28, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2023 | |
Document Transition Report | false | |
Entity File Number | 1-12273 | |
Entity Registrant Name | ROPER TECHNOLOGIES, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 51-0263969 | |
Entity Address, Address Line One | 6901 Professional Parkway, Suite 200 | |
Entity Address, City or Town | Sarasota, | |
Entity Address, State or Province | FL | |
Entity Address, Postal Zip Code | 34240 | |
City Area Code | 941 | |
Local Phone Number | 556-2601 | |
Title of 12(b) Security | Common Stock, $0.01 Par Value | |
Trading Symbol | ROP | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 106,592,234 | |
Entity Central Index Key | 0000882835 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Earnings (unaudited) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Income Statement [Abstract] | ||
Net revenues | $ 1,469.7 | $ 1,279.8 |
Cost of sales | 451.1 | 382.6 |
Gross profit | 1,018.6 | 897.2 |
Selling, general and administrative expenses | 617.6 | 541.3 |
Income from operations | 401 | 355.9 |
Interest expense, net | 37.4 | 52.6 |
Equity investment activity, net | (1.2) | 0 |
Other expense, net | (2.3) | (2.1) |
Earnings before income taxes | 360.1 | 301.2 |
Income taxes | 75.8 | 64.8 |
Net earnings from continuing operations | 284.3 | 236.4 |
Earnings (loss) from discontinued operations, net of tax | (1.2) | 66.8 |
Gain on disposition of discontinued operations, net of tax | 0 | 1,717.3 |
Net earnings from discontinued operations | (1.2) | 1,784.1 |
Net earnings | $ 283.1 | $ 2,020.5 |
Net earnings per share from continuing operations: | ||
Basic (in dollars per share) | $ 2.67 | $ 2.24 |
Diluted (in dollars per share) | 2.66 | 2.22 |
Net earnings (loss) per share from discontinued operations: | ||
Basic (in dollars per share) | (0.01) | 16.89 |
Diluted (in dollars per share) | (0.01) | 16.72 |
Net earnings per share: | ||
Basic (in dollars per share) | 2.66 | 19.13 |
Diluted (in dollars per share) | $ 2.65 | $ 18.94 |
Weighted average common shares outstanding: | ||
Basic (in shares) | 106.3 | 105.6 |
Diluted (in shares) | 107 | 106.7 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income (unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Statement of Comprehensive Income [Abstract] | ||
Net earnings | $ 283.1 | $ 2,020.5 |
Other comprehensive income (loss), net of tax: | ||
Foreign currency translation adjustments | 24.1 | (22.9) |
Total other comprehensive income (loss), net of tax | 24.1 | (22.9) |
Comprehensive income | $ 307.2 | $ 1,997.6 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (unaudited) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
ASSETS: | ||
Cash and cash equivalents | $ 1,181.6 | $ 792.8 |
Accounts receivable, net | 629.1 | 724.5 |
Inventories, net | 115 | 111.3 |
Income taxes receivable | 25.5 | 61 |
Unbilled receivables | 100.9 | 91.5 |
Other current assets | 180.1 | 151.3 |
Total current assets | 2,232.2 | 1,932.4 |
Property, plant and equipment, net | 86.3 | 85.3 |
Goodwill | 15,962.8 | 15,946.1 |
Other intangible assets, net | 7,871.7 | 8,030.7 |
Deferred taxes | 59.3 | 55.9 |
Equity investment | 535 | 535 |
Other assets | 387.5 | 395.4 |
Total assets | 27,134.8 | 26,980.8 |
LIABILITIES AND STOCKHOLDERS' EQUITY: | ||
Accounts payable | 134 | 122.6 |
Accrued compensation | 154.2 | 228.8 |
Deferred revenue | 1,303.8 | 1,370.7 |
Other accrued liabilities | 413.4 | 454.6 |
Income taxes payable | 70.5 | 16.6 |
Current portion of long-term debt, net | 699.5 | 699.2 |
Total current liabilities | 2,775.4 | 2,892.5 |
Long-term debt, net of current portion | 5,964.4 | 5,962.5 |
Deferred taxes | 1,652.9 | 1,676.8 |
Other liabilities | 409.4 | 411.2 |
Total liabilities | 10,802.1 | 10,943 |
Commitments and contingencies (Note 9) | ||
Common stock | 1.1 | 1.1 |
Additional paid-in capital | 2,570.4 | 2,510.2 |
Retained earnings | 13,941.2 | 13,730.7 |
Accumulated other comprehensive loss | (162.9) | (187) |
Treasury stock | (17.1) | (17.2) |
Total stockholders' equity | 16,332.7 | 16,037.8 |
Total liabilities and stockholders' equity | $ 27,134.8 | $ 26,980.8 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Cash flows from operating activities: | ||
Net earnings from continuing operations | $ 284.3 | $ 236.4 |
Adjustments to reconcile net earnings from continuing operations to cash flows from operating activities: | ||
Depreciation and amortization of property, plant and equipment | 8.6 | 9.6 |
Amortization of intangible assets | 175.1 | 145.7 |
Amortization of deferred financing costs | 2.6 | 3.1 |
Non-cash stock compensation | 29.6 | 33 |
Income tax provision, excluding tax associated with gain on sale of assets | 75.8 | 64.8 |
Changes in operating assets and liabilities, net of acquired businesses: | ||
Accounts receivable | 98 | 85.6 |
Unbilled receivables | (8.7) | (10.4) |
Inventories | (3.8) | (13) |
Accounts payable | 11.2 | 10.1 |
Other accrued liabilities | (103.7) | (106.6) |
Deferred revenue | (61.4) | 28.4 |
Cash income taxes paid | (16) | (22.3) |
Other, net | (26.7) | (23.1) |
Cash provided by operating activities from continuing operations | 464.9 | 441.3 |
Cash provided by (used in) operating activities from discontinued operations | (1.2) | 34 |
Cash provided by operating activities | 463.7 | 475.3 |
Cash flows from (used in) investing activities: | ||
Acquisitions of businesses, net of cash acquired | (1.1) | (53.2) |
Capital expenditures | (9.8) | (5.4) |
Capitalized software expenditures | (9.9) | (7.5) |
Other, net | (2.8) | 0 |
Cash used in investing activities from continuing operations | (23.6) | (66.1) |
Proceeds from (used in) disposition of discontinued operations | (3.2) | 3,006.2 |
Cash used in investing activities from discontinued operations | 0 | (1.9) |
Cash provided by (used in) investing activities | (26.8) | 2,938.2 |
Cash flows from (used in) financing activities: | ||
Borrowings (payments) under revolving line of credit, net | 0 | (470) |
Cash dividends to stockholders | (72.3) | (65.3) |
Proceeds from stock-based compensation, net | 15.1 | 21 |
Treasury stock sales | 4.7 | 5.5 |
Cash flows used in financing activities from continuing operations | (52.5) | (508.8) |
Cash flows used in financing activities from discontinued operations | 0 | (11.4) |
Cash flows used in financing activities | (52.5) | (520.2) |
Effect of foreign currency exchange rate changes on cash | 4.4 | (7.3) |
Net increase in cash and cash equivalents | 388.8 | 2,886 |
Cash and cash equivalents, beginning of period | 792.8 | 351.5 |
Cash and cash equivalents, end of period | $ 1,181.6 | $ 3,237.5 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Changes in Stockholders' Equity (unaudited) - USD ($) $ in Millions | Total | Common stock | Additional paid-in capital | Retained earnings | Accumulated other comprehensive loss | Treasury stock |
Balance at beginning of period at Dec. 31, 2021 | $ 11,563.8 | $ 1.1 | $ 2,307.8 | $ 9,455.6 | $ (183.1) | $ (17.6) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net earnings | 2,020.5 | 2,020.5 | ||||
Stock option exercises | 38.7 | 38.7 | ||||
Cash settlement of share-based awards in connection with disposition of discontinued operations | (11.1) | (11.1) | ||||
Treasury stock sold | 5.5 | 5.4 | 0.1 | |||
Currency translation adjustments | (22.9) | (22.9) | ||||
Stock-based compensation | 40.8 | 40.8 | ||||
Restricted stock activity | (17.7) | (17.7) | ||||
Dividends declared | (65.7) | (65.7) | ||||
Balance at end of period at Mar. 31, 2022 | 13,551.9 | 1.1 | 2,363.9 | 11,410.4 | (206) | (17.5) |
Balance at beginning of period at Dec. 31, 2022 | 16,037.8 | 1.1 | 2,510.2 | 13,730.7 | (187) | (17.2) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net earnings | 283.1 | 283.1 | ||||
Stock option exercises | 33.7 | 33.7 | ||||
Treasury stock sold | 4.7 | 4.6 | 0.1 | |||
Currency translation adjustments | 24.1 | 24.1 | ||||
Stock-based compensation | 31.4 | 31.4 | ||||
Restricted stock activity | (9.5) | (9.5) | ||||
Dividends declared | (72.6) | (72.6) | ||||
Balance at end of period at Mar. 31, 2023 | $ 16,332.7 | $ 1.1 | $ 2,570.4 | $ 13,941.2 | $ (162.9) | $ (17.1) |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Changes in Stockholders' Equity (unaudited) (Parenthetical) - $ / shares | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Statement of Stockholders' Equity [Abstract] | ||
Dividends declared (in usd per share) | $ 0.6825 | $ 0.62 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying Condensed Consolidated Financial Statements for the three months ended March 31, 2023 and 2022 are unaudited. In the opinion of management, the accompanying unaudited Condensed Consolidated Financial Statements reflect all adjustments, which include only normal recurring adjustments, necessary to state fairly the financial position, results of operations, comprehensive income and cash flows of Roper Technologies, Inc. and its subsidiaries (“Roper,” the “Company,” “we,” “our” or “us”) for all periods presented. The December 31, 2022 financial position data included herein was derived from the audited consolidated financial statements included in the Company’s 2022 Annual Report on Form 10-K (“Annual Report”) filed on February 27, 2023 with the Securities and Exchange Commission (“SEC”) but does not include all disclosures required by U.S. generally accepted accounting principles (“GAAP”). Roper’s management has made estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities to prepare these Condensed Consolidated Financial Statements in conformity with GAAP. Actual results could differ from those estimates. The results of operations for the three months ended March 31, 2023 are not necessarily indicative of the results to be expected for the full year. You should read these unaudited Condensed Consolidated Financial Statements in conjunction with Roper’s audited consolidated financial statements and the notes thereto included in its Annual Report. Certain prior period amounts have been reclassified to conform to current period presentation. Discontinued Operations |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting PronouncementsThe Financial Accounting Standards Board (“FASB”) establishes changes to accounting principles under GAAP in the form of accounting standards updates (“ASUs”) to the Accounting Standards Codification (“ASC”). The Company considers the applicability and impact of all ASUs. Any recent ASUs were assessed and determined to be either not applicable or are expected to have an immaterial impact on the Company’s results of operations, financial position or cash flows. |
Weighted Average Shares Outstan
Weighted Average Shares Outstanding | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Weighted Average Shares Outstanding | Weighted Average Shares OutstandingBasic earnings per share were calculated using net earnings and the weighted average number of shares of common stock outstanding during the respective period. Diluted earnings per share were calculated using net earnings and the weighted average number of shares of common stock and potential common stock outstanding during the respective period. Potentially dilutive common stock consisted of stock options based upon the trading price of Roper’s common stock. The effects of potential common stock were determined using the treasury stock method. Weighted average shares outstanding are shown below: Three months ended March 31, 2023 2022 Basic shares outstanding 106.3 105.6 Effect of potential common stock: Common stock awards 0.7 1.1 Diluted shares outstanding 107.0 106.7 For the three months ended March 31, 2023, there were 1.150 outstanding stock options, respectively, that were not included in the determination of diluted earnings per share because doing so would have been antidilutive, as compared to 0.840 outstanding stock options that would have been antidilutive in the respective 2022 period. |
Discontinued Operations
Discontinued Operations | 3 Months Ended |
Mar. 31, 2023 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | Discontinued Operations The Company concluded that the 2021 Divestitures and the sale of a majority 51% stake in Indicor each represented a strategic shift that had a major effect on the Company’s operations and financial results. Accordingly, the financial results related to these transactions are presented in the Condensed Consolidated Financial Statements as discontinued operations for all periods presented. The following transactions closed in the first quarter of 2022: • On March 17, 2022, Roper closed on the divestiture of our TransCore business to an affiliate of Singapore Technologies Engineering Ltd., for approximately $2,680.0 in cash. The sale resulted in a pretax gain of $2,073.7 and income tax expense of $550.5, which are reported within “Gain on disposition of discontinued operations, net of tax” in the Condensed Consolidated Statements of Earnings. TransCore was previously included in the historical Network Software & Systems reportable segment. • On January 5, 2022, Roper closed on the divestiture of our Zetec business to Eddyfi NDT Inc. for approximately $350.0 in cash. The sale resulted in a pretax gain of $255.3 and income tax expense of $60.9, which are reported within “Gain on disposition of discontinued operations, net of tax” in the Condensed Consolidated Statements of Earnings. Zetec was previously included in the historical Process Technologies reportable segment. The following table summarizes the major classes of revenue and expenses constituting net income from discontinued operations attributable to the TransCore and Zetec businesses: Three Months Ended March 31, 2022 Net revenues $ 100.4 Cost of sales 71.2 Gross profit 29.2 Selling, general and administrative expenses (1) 19.9 Income from operations 9.3 Other income, net 0.1 Earnings before income taxes 9.4 Income taxes (6.2) Earnings from discontinued operations, net of tax 15.6 Gain on disposition of discontinued operations, net of tax (2) 1,717.3 Net earnings from discontinued operations $ 1,732.9 (1) Includes stock-based compensation expense of $0.9. Stock-based compensation for discontinued operations was previously reported as a component of unallocated corporate general and administrative expenses. (2) Includes expense of $4.5 associated with accelerated vesting of share-based awards. Indicor - On November 22, 2022, Roper completed the divestiture of a majority 51% stake in Indicor to Clayton, Dubilier & Rice, LLC (“CD&R”). In connection with the transaction, Roper retained an initial 49% minority equity interest in Indicor (described further in Note 8). The following table summarizes the major classes of revenue and expenses constituting net income from discontinued operations attributable to Indicor: Three Months Ended March 31, 2023 2022 (1) Net revenues $ — $ 246.8 Cost of sales — 113.9 Gross profit — 132.9 Selling, general and administrative expenses 1.2 67.7 Income from operations (1.2) 65.2 Other income, net — 0.2 Earnings (loss) before income taxes (1.2) 65.4 Income taxes — 14.2 Earnings (loss) from discontinued operations, net of tax $ (1.2) $ 51.2 (1) Includes depreciation and amortization expense of $3.9 and stock-based compensation expense of $2.9. Stock-based compensation was previously reported as a component of unallocated corporate general and administrative expenses. |
Stock Based Compensation
Stock Based Compensation | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock Based Compensation | Stock Based Compensation The Roper Technologies, Inc. 2021 Incentive Plan is a stock-based compensation plan used to grant incentive stock options, nonqualified stock options, restricted stock, stock appreciation rights or equivalent instruments to Roper’s employees, officers, directors and consultants. The following table provides information regarding the Company’s stock-based compensation expense: Three Months Ended March 31, 2023 2022 Stock-based compensation $ 30.2 $ 33.0 Tax effect recognized in net earnings from continuing operations 5.2 7.0 Stock Options - In the three months ended March 31, 2023, 0.353 options were granted with a weighted average fair value of $128.89 per option. During the same period in 2022, 0.365 options were granted with a weighted average fair value of $115.83 per option. All options were issued with an exercise price equal to the closing price of Roper’s common stock on the date of grant, as required by the Company’s stock-based compensation plans. Roper records compensation expense for employee stock options based on the estimated fair value of the options on the date of grant using the Black-Scholes option-pricing model. Historical data is used to estimate the expected price volatility, the expected dividend yield, the expected option life and the expected forfeiture rate. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant for the estimated life of the option. The following weighted average assumptions were used to estimate the fair value of options granted during current and prior year periods using the Black-Scholes option-pricing model: Three months ended March 31, 2023 2022 Risk-free interest rate (%) 3.73 2.05 Expected option life (years) 5.65 5.63 Expected volatility (%) 26.02 24.52 Expected dividend yield (%) 0.64 0.54 Cash received from option exercises for the three months ended March 31, 2023 and 2022 was $24.6 and $38.7, respectively. Restricted Stock Grants - During both the three months ended March 31, 2023 and 2022, the Company granted 0.219 shares with a weighted average grant date fair value of $428.20 and $455.84 per restricted share, respectively. All grants were issued at grant date fair value. During the three months ended March 31, 2023, 0.082 restricted shares vested with a weighted average grant date fair value of $376.74 per restricted share and a weighted average vest date fair value of $435.75 per restricted share. Employee Stock Purchase Plan - Roper’s employee stock purchase plan (“ESPP”) allows employees in the U.S. and Canada to designate up to 10% of eligible earnings to purchase Roper’s common stock at a 10% discount on the lower of the closing price of the stock on the first and last day of each quarterly offering period. Common stock sold to employees pursuant to the ESPP may be either treasury stock, stock purchased on the open market, or newly issued shares. During the three months ended March 31, 2023 and 2022, participants in the ESPP purchased 0.012 and 0.013 shares of Roper’s common stock for total consideration of $4.7 and $5.5, respectively. All shares were purchased from Roper’s treasury shares. |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2023 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories The components of inventory were as follows: March 31, December 31, Raw materials and supplies $ 63.0 $ 60.6 Work in process 26.9 24.9 Finished products 32.1 31.3 Inventory reserves (7.0) (5.5) Inventories, net $ 115.0 $ 111.3 |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 3 Months Ended |
Mar. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets The carrying value of goodwill by segment was as follows: Application Software Network Software Technology Enabled Products Total Balances at December 31, 2022 $ 11,417.5 $ 3,598.3 $ 930.3 $ 15,946.1 Other 0.1 — — 0.1 Currency translation adjustments 5.9 10.9 (0.2) 16.6 Balances at March 31, 2023 $ 11,423.5 $ 3,609.2 $ 930.1 $ 15,962.8 Other relates primarily to purchase accounting adjustments for acquisitions completed in 2022. Other intangible assets were comprised of: Cost Accumulated Net book Assets subject to amortization: Customer related intangibles $ 9,300.7 $ (2,437.7) $ 6,863.0 Unpatented technology 954.6 (506.9) 447.7 Software 149.0 (134.0) 15.0 Patents and other protective rights 10.3 (1.2) 9.1 Trade names 9.7 (3.1) 6.6 Assets not subject to amortization: Trade names 689.3 — 689.3 Balances at December 31, 2022 $ 11,113.6 $ (3,082.9) $ 8,030.7 Assets subject to amortization: Customer related intangibles $ 9,310.5 $ (2,576.2) $ 6,734.3 Unpatented technology 959.3 (539.4) 419.9 Software 149.1 (136.8) 12.3 Patents and other protective rights 10.3 (1.2) 9.1 Trade names 9.7 (3.8) 5.9 Assets not subject to amortization: Trade names 690.2 — 690.2 Balances at March 31, 2023 $ 11,129.1 $ (3,257.4) $ 7,871.7 Amortization expense of other intangible assets was $170.4 and $143.3 during the three months ended March 31, 2023 and 2022, respectively. An evaluation of the carrying value of goodwill and indefinite-lived intangibles is required to be performed on an annual basis and on an interim basis if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value. There have been no events or changes in circumstances which indicate an interim impairment review is required in 2023. The Company will perform the annual analysis during the fourth quarter of 2023. |
Fair Value
Fair Value | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Fair ValueFinancial assets and liabilities are valued using market prices on active markets (Level 1), less active markets (Level 2) and little or no market activity (Level 3). Level 1 instrument valuations are obtained from real-time quotes for transactions in active exchange markets involving identical assets. Level 2 instrument valuations are obtained from readily available pricing sources for comparable instruments, identical instruments in less active markets, or models using market observable inputs. Level 3 instrument valuations typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability. Debt - Roper’s debt included $6,700 of fixed-rate senior notes with the following fair values: Fixed-rate senior notes Fair Value Principal Amount Interest rate Year of maturity As of March 31, 2023 $700 3.650% 2023 $ 695 $500 2.350% 2024 $ 482 $300 3.850% 2025 $ 295 $700 1.000% 2025 $ 641 $700 3.800% 2026 $ 679 $700 1.400% 2027 $ 609 $800 4.200% 2028 $ 788 $700 2.950% 2029 $ 629 $600 2.000% 2030 $ 497 $1,000 1.750% 2031 $ 803 The fair values of the senior notes are based on the trading prices of each series of notes, which the Company has determined to be Level 2 in the FASB fair value hierarchy. Indicor Investment - Following the sale of a majority stake in its industrial businesses to CD&R, Roper now holds a minority 48.6% equity interest in Indicor. We elected to apply the fair value option as we believe this is the most reasonable method to value the equity investment. The fair value of Roper’s equity investment in Indicor is updated on a quarterly basis and its impact is reported as "Equity investment activity, net." There was no change in fair value between December 31, 2022 and March 31, 2023. The assessment of fair value for the equity investment requires significant judgments to be made by management. Although our assumptions are considered reasonable and are consistent, there is significant judgment applied. Changes in estimates or the application of alternative assumptions could produce significantly different results. The fair value of the investment reflects management’s estimate of assumptions that market participants would use in pricing the equity interest, which the Company has determined to be Level 3 in the FASB fair value hierarchy. On April 26, 2023, Indicor announced its planned divestiture of its Compressor Controls business unit to Honeywell International Inc. for approximately $670. This transaction will be contemplated in our assessment of the fair value of our equity investment in the second quarter. |
Contingencies
Contingencies | 3 Months Ended |
Mar. 31, 2023 | |
Loss Contingency [Abstract] | |
Contingencies | Contingencies Roper, in the ordinary course of business, is party to various pending or threatened legal actions, including product liability, intellectual property, antitrust, data privacy and employment practices that, in general, are of a nature consistent with those over the past several years. After analyzing the Company’s contingent liabilities on a gross basis and, based upon past experience with resolution of such legal claims and the availability and limits of the primary, excess, and umbrella liability insurance coverages with respect to pending claims, management believes that adequate provision has been made to cover any potential liability not covered by insurance, and that the ultimate liability, if any, arising from these actions should not have a material adverse effect on Roper’s consolidated financial position, results of operations or cash flows. However, no assurances can be given in this regard. Roper’s subsidiary, Vertafore, Inc., had been named in three putative class actions, all of which are now dismissed: two in the U.S. District Court for the Southern District of Texas (Allen, et al. v. Vertafore, Inc., Case 4:20-cv-4139, filed December 4, 2020) and Masciotra, et al. v. Vertafore, Inc. (originally filed on December 8, 2020 as Case 1:20-cv-03603 in the U.S. District Court for the District of Colorado and subsequently transferred)), and one in the U.S. District Court for the Northern District of Texas (Mulvey, et al. v. Vertafore, Inc., Case 3:21-cv-00213-E, filed January 31, 2021). In July 2021, the court granted Vertafore’s motion to dismiss the Allen Case, with the dismissal affirmed by the U.S. Fifth Circuit Court of Appeals, effectively concluding the litigation. In July 2021, the plaintiff in the Masciotra case voluntarily dismissed his action without prejudice. In February 2023, the court granted Vertafore’s motion to dismiss the Mulvey case, and Plaintiff failed to appeal the dismissal effectively concluding the matter. Both the Allen and Mulvey cases purported to represent approximately 27.7 million individuals who held Texas driver’s licenses prior to February 2019. In November 2020, Vertafore announced that as a result of human error, three data files were inadvertently stored in an unsecured external storage service that appears to have been accessed without authorization. The files, which included driver information for licenses issued before February 2019, contained Texas driver license numbers, as well as names, dates of birth, addresses and vehicle registration histories. The files did not contain any Social Security numbers or financial account information. These cases sought recovery under the Driver’s Privacy Protection Act, 18 U.S.C. § 2721. As set forth above, all of these matters have now been dismissed. Roper’s subsidiary, Verathon, Inc. (“Verathon”), was a defendant in a patent infringement action pending in the United States District Court for the Western District of Washington (Berall v. Verathon, Inc., Case No. 2:2021mc00043). The plaintiff claimed that video laryngoscopes and certain accessories sold by Verathon and other manufacturers from approximately 2004 through 2016 infringed U.S. Patent 5,827,178 (the “178 Patent”). Verathon and the plaintiff agreed to settle the matter for $45.0 which was fully concluded and cash settled in the first quarter of 2023. |
Business Segments
Business Segments | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Business Segments | Business Segments The following table presents selected financial information by reportable segment: Three months ended March 31, 2023 2022 Change % Net revenues: Application Software $ 761.4 $ 628.2 21.2 % Network Software 354.5 338.5 4.7 % Technology Enabled Products 353.8 313.1 13.0 % Total $ 1,469.7 $ 1,279.8 14.8 % Gross profit: Application Software $ 520.5 $ 435.4 19.5 % Network Software 299.4 284.9 5.1 % Technology Enabled Products 198.7 176.9 12.3 % Total $ 1,018.6 $ 897.2 13.5 % Operating profit*: Application Software $ 193.2 $ 172.3 12.1 % Network Software 147.5 136.8 7.8 % Technology Enabled Products 115.5 99.7 15.8 % Total $ 456.2 $ 408.8 11.6 % Long-lived assets: Application Software $ 153.3 $ 135.8 12.9 % Network Software 30.7 26.2 17.2 % Technology Enabled Products 29.2 27.0 8.1 % Total $ 213.2 $ 189.0 12.8 % *Segment operating profit is before unallocated corporate general and administrative and enterprise-wide stock-based compensation expenses. These expenses were $55.2 and $52.9 for the three months ended March 31, 2023 and 2022, respectively. |
Revenues from Contracts
Revenues from Contracts | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenues from Contracts | Revenues from Contracts Disaggregated Revenue - We disaggregate our revenues by reportable segment into four categories: (i) recurring revenue comprised of Software-as-a-Service (“SaaS”) licenses and software maintenance; (ii) reoccurring revenue comprised of transactional and volume-based fees related to software licenses; (iii) non-recurring revenue comprised of term and perpetual software licenses, professional services associated with software products and hardware sold with our software licenses; and (iv) product revenue. See details in the table below. Three months ended March 31, 2023 Three months ended March 31, 2022 Application Software Network Software Technology Enabled Products Total Application Software Network Software Technology Enabled Products Total Revenue Stream Software related Recurring $ 580.6 $ 255.9 $ 3.8 $ 840.3 $ 461.5 $ 237.2 $ 2.6 $ 701.3 Reoccurring 35.4 64.2 — 99.6 31.7 60.5 — 92.2 Non-recurring 145.4 34.4 0.4 180.2 135.0 40.8 0.3 176.1 Total Software Revenues 761.4 354.5 4.2 1,120.1 628.2 338.5 2.9 969.6 Product Revenue — — 349.6 349.6 — — 310.2 310.2 Total Revenue $ 761.4 $ 354.5 $ 353.8 $ 1,469.7 $ 628.2 $ 338.5 $ 313.1 $ 1,279.8 Remaining performance obligations - Remaining performance obligations represent the transaction price of firm orders for which work has not been performed and excludes unexercised contract options. As of March 31, 2023, the aggregate amount of the transaction price allocated to remaining performance obligations was $4,203.0. We expect to recognize revenue of $2,872.5, or approximately 68% of our remaining performance obligations over the next 12 months (“Backlog”), with the remainder to be recognized thereafter. Contract balances Balance Sheet Account March 31, 2023 December 31, 2022 Change Unbilled receivables $ 100.9 $ 91.5 $ 9.4 Deferred revenue - current (1,303.8) (1,370.7) 66.9 Deferred revenue - non-current (1) (121.4) (111.5) (9.9) Net contract assets/(liabilities) $ (1,324.3) $ (1,390.7) $ 66.4 (1) The non-current portion of deferred revenue is included in “Other liabilities” in our Condensed Consolidated Balance Sheets. The change in our net contract assets/(liabilities) from December 31, 2022 to March 31, 2023 was due primarily to the timing of payments and invoicing relating to SaaS and post contract support (“PCS”) contracts, driven largely by the renewal cycle of our Frontline business which primarily occurs in the third quarter. The Company records deferred revenue when cash payments are received or due in advance of the Company’s performance relating primarily to SaaS and PCS renewals. Revenue recognized from the deferred revenue balance on December 31, 2022 and 2021 was $589.9 and $489.3 for the three months ended March 31, 2023 and 2022, respectively. In order to determine revenues recognized in the period, we allocate revenue to the individual deferred revenue balance outstanding at the beginning of the year until the revenue exceeds that balance. The current and non-current portions of deferred commissions are included in “Other current assets” and “Other assets,” respectively, in our Condensed Consolidated Balance Sheets. At March 31, 2023 and December 31, 2022, we had $64.5 and $64.8 of total deferred commissions, respectively. |
Recent Accounting Pronounceme_2
Recent Accounting Pronouncements (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting PronouncementsThe Financial Accounting Standards Board (“FASB”) establishes changes to accounting principles under GAAP in the form of accounting standards updates (“ASUs”) to the Accounting Standards Codification (“ASC”). The Company considers the applicability and impact of all ASUs. Any recent ASUs were assessed and determined to be either not applicable or are expected to have an immaterial impact on the Company’s results of operations, financial position or cash flows. |
Weighted Average Shares Outst_2
Weighted Average Shares Outstanding (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Weighted Average Shares Outstanding | Weighted average shares outstanding are shown below: Three months ended March 31, 2023 2022 Basic shares outstanding 106.3 105.6 Effect of potential common stock: Common stock awards 0.7 1.1 Diluted shares outstanding 107.0 106.7 |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Discontinued Operations | The following table summarizes the major classes of revenue and expenses constituting net income from discontinued operations attributable to the TransCore and Zetec businesses: Three Months Ended March 31, 2022 Net revenues $ 100.4 Cost of sales 71.2 Gross profit 29.2 Selling, general and administrative expenses (1) 19.9 Income from operations 9.3 Other income, net 0.1 Earnings before income taxes 9.4 Income taxes (6.2) Earnings from discontinued operations, net of tax 15.6 Gain on disposition of discontinued operations, net of tax (2) 1,717.3 Net earnings from discontinued operations $ 1,732.9 (1) Includes stock-based compensation expense of $0.9. Stock-based compensation for discontinued operations was previously reported as a component of unallocated corporate general and administrative expenses. (2) Includes expense of $4.5 associated with accelerated vesting of share-based awards. The following table summarizes the major classes of revenue and expenses constituting net income from discontinued operations attributable to Indicor: Three Months Ended March 31, 2023 2022 (1) Net revenues $ — $ 246.8 Cost of sales — 113.9 Gross profit — 132.9 Selling, general and administrative expenses 1.2 67.7 Income from operations (1.2) 65.2 Other income, net — 0.2 Earnings (loss) before income taxes (1.2) 65.4 Income taxes — 14.2 Earnings (loss) from discontinued operations, net of tax $ (1.2) $ 51.2 (1) Includes depreciation and amortization expense of $3.9 and stock-based compensation expense of $2.9. Stock-based compensation was previously reported as a component of unallocated corporate general and administrative expenses. |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Stock-Based Compensation Expense | The following table provides information regarding the Company’s stock-based compensation expense: Three Months Ended March 31, 2023 2022 Stock-based compensation $ 30.2 $ 33.0 Tax effect recognized in net earnings from continuing operations 5.2 7.0 |
Schedule of Weighted Average Assumptions Used to Value Option Grants | The following weighted average assumptions were used to estimate the fair value of options granted during current and prior year periods using the Black-Scholes option-pricing model: Three months ended March 31, 2023 2022 Risk-free interest rate (%) 3.73 2.05 Expected option life (years) 5.65 5.63 Expected volatility (%) 26.02 24.52 Expected dividend yield (%) 0.64 0.54 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | The components of inventory were as follows: March 31, December 31, Raw materials and supplies $ 63.0 $ 60.6 Work in process 26.9 24.9 Finished products 32.1 31.3 Inventory reserves (7.0) (5.5) Inventories, net $ 115.0 $ 111.3 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The carrying value of goodwill by segment was as follows: Application Software Network Software Technology Enabled Products Total Balances at December 31, 2022 $ 11,417.5 $ 3,598.3 $ 930.3 $ 15,946.1 Other 0.1 — — 0.1 Currency translation adjustments 5.9 10.9 (0.2) 16.6 Balances at March 31, 2023 $ 11,423.5 $ 3,609.2 $ 930.1 $ 15,962.8 |
Schedule of Other Intangible Assets - Subject to Amortization | Other intangible assets were comprised of: Cost Accumulated Net book Assets subject to amortization: Customer related intangibles $ 9,300.7 $ (2,437.7) $ 6,863.0 Unpatented technology 954.6 (506.9) 447.7 Software 149.0 (134.0) 15.0 Patents and other protective rights 10.3 (1.2) 9.1 Trade names 9.7 (3.1) 6.6 Assets not subject to amortization: Trade names 689.3 — 689.3 Balances at December 31, 2022 $ 11,113.6 $ (3,082.9) $ 8,030.7 Assets subject to amortization: Customer related intangibles $ 9,310.5 $ (2,576.2) $ 6,734.3 Unpatented technology 959.3 (539.4) 419.9 Software 149.1 (136.8) 12.3 Patents and other protective rights 10.3 (1.2) 9.1 Trade names 9.7 (3.8) 5.9 Assets not subject to amortization: Trade names 690.2 — 690.2 Balances at March 31, 2023 $ 11,129.1 $ (3,257.4) $ 7,871.7 |
Schedule of Other Intangible Assets - Not Subject to Amortization | Other intangible assets were comprised of: Cost Accumulated Net book Assets subject to amortization: Customer related intangibles $ 9,300.7 $ (2,437.7) $ 6,863.0 Unpatented technology 954.6 (506.9) 447.7 Software 149.0 (134.0) 15.0 Patents and other protective rights 10.3 (1.2) 9.1 Trade names 9.7 (3.1) 6.6 Assets not subject to amortization: Trade names 689.3 — 689.3 Balances at December 31, 2022 $ 11,113.6 $ (3,082.9) $ 8,030.7 Assets subject to amortization: Customer related intangibles $ 9,310.5 $ (2,576.2) $ 6,734.3 Unpatented technology 959.3 (539.4) 419.9 Software 149.1 (136.8) 12.3 Patents and other protective rights 10.3 (1.2) 9.1 Trade names 9.7 (3.8) 5.9 Assets not subject to amortization: Trade names 690.2 — 690.2 Balances at March 31, 2023 $ 11,129.1 $ (3,257.4) $ 7,871.7 |
Fair Value (Tables)
Fair Value (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fixed-Rate Senior Notes, Fair Value | Fixed-rate senior notes Fair Value Principal Amount Interest rate Year of maturity As of March 31, 2023 $700 3.650% 2023 $ 695 $500 2.350% 2024 $ 482 $300 3.850% 2025 $ 295 $700 1.000% 2025 $ 641 $700 3.800% 2026 $ 679 $700 1.400% 2027 $ 609 $800 4.200% 2028 $ 788 $700 2.950% 2029 $ 629 $600 2.000% 2030 $ 497 $1,000 1.750% 2031 $ 803 |
Business Segments (Tables)
Business Segments (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information | The following table presents selected financial information by reportable segment: Three months ended March 31, 2023 2022 Change % Net revenues: Application Software $ 761.4 $ 628.2 21.2 % Network Software 354.5 338.5 4.7 % Technology Enabled Products 353.8 313.1 13.0 % Total $ 1,469.7 $ 1,279.8 14.8 % Gross profit: Application Software $ 520.5 $ 435.4 19.5 % Network Software 299.4 284.9 5.1 % Technology Enabled Products 198.7 176.9 12.3 % Total $ 1,018.6 $ 897.2 13.5 % Operating profit*: Application Software $ 193.2 $ 172.3 12.1 % Network Software 147.5 136.8 7.8 % Technology Enabled Products 115.5 99.7 15.8 % Total $ 456.2 $ 408.8 11.6 % Long-lived assets: Application Software $ 153.3 $ 135.8 12.9 % Network Software 30.7 26.2 17.2 % Technology Enabled Products 29.2 27.0 8.1 % Total $ 213.2 $ 189.0 12.8 % *Segment operating profit is before unallocated corporate general and administrative and enterprise-wide stock-based compensation expenses. These expenses were $55.2 and $52.9 for the three months ended March 31, 2023 and 2022, respectively. |
Revenues from Contracts (Tables
Revenues from Contracts (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | See details in the table below. Three months ended March 31, 2023 Three months ended March 31, 2022 Application Software Network Software Technology Enabled Products Total Application Software Network Software Technology Enabled Products Total Revenue Stream Software related Recurring $ 580.6 $ 255.9 $ 3.8 $ 840.3 $ 461.5 $ 237.2 $ 2.6 $ 701.3 Reoccurring 35.4 64.2 — 99.6 31.7 60.5 — 92.2 Non-recurring 145.4 34.4 0.4 180.2 135.0 40.8 0.3 176.1 Total Software Revenues 761.4 354.5 4.2 1,120.1 628.2 338.5 2.9 969.6 Product Revenue — — 349.6 349.6 — — 310.2 310.2 Total Revenue $ 761.4 $ 354.5 $ 353.8 $ 1,469.7 $ 628.2 $ 338.5 $ 313.1 $ 1,279.8 |
Schedule of Contract Balances | Contract balances Balance Sheet Account March 31, 2023 December 31, 2022 Change Unbilled receivables $ 100.9 $ 91.5 $ 9.4 Deferred revenue - current (1,303.8) (1,370.7) 66.9 Deferred revenue - non-current (1) (121.4) (111.5) (9.9) Net contract assets/(liabilities) $ (1,324.3) $ (1,390.7) $ 66.4 (1) The non-current portion of deferred revenue is included in “Other liabilities” in our Condensed Consolidated Balance Sheets. |
Weighted Average Shares Outst_3
Weighted Average Shares Outstanding - Schedule of Weighted Average Shares Outstanding (Details) - shares shares in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Earnings Per Share [Abstract] | ||
Basic shares outstanding (in shares) | 106.3 | 105.6 |
Effect of potential common stock: | ||
Common stock awards (in shares) | 0.7 | 1.1 |
Diluted shares outstanding (in shares) | 107 | 106.7 |
Weighted Average Shares Outst_4
Weighted Average Shares Outstanding - Narrative (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Earnings Per Share [Abstract] | ||
Antidilutive stock options (in shares) | 1,150 | 840 |
Discontinued Operations - Narra
Discontinued Operations - Narrative (Details) - USD ($) $ in Millions | Mar. 17, 2022 | Jan. 05, 2022 | Dec. 31, 2022 | Nov. 22, 2022 |
Indicor | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Equity method investment, ownership percentage | 49% | |||
Held-for-sale or Disposed of by Sale | Indicor | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Ownership interest divested, percent | 51% | |||
Disposed of by Sale | TransCore | Singapore Technologies Engineering Ltd Affiliate | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Consideration received from disposal | $ 2,680 | |||
Pretax gain on disposition of business | 2,073.7 | |||
Income tax expense | $ 550.5 | |||
Disposed of by Sale | Zetec | Eddyfi NDT Inc | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Consideration received from disposal | $ 350 | |||
Pretax gain on disposition of business | 255.3 | |||
Income tax expense | $ 60.9 |
Discontinued Operations - Sched
Discontinued Operations - Schedule of Amounts Included in Discontinued Operations (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Earnings from discontinued operations, net of tax | $ (1.2) | $ 66.8 |
Gain on disposition of discontinued operations, net of tax | 0 | 1,717.3 |
Net earnings from discontinued operations | (1.2) | 1,784.1 |
Held-for-sale or Disposed of by Sale | TransCore and Zetec | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Net revenues | 100.4 | |
Cost of sales | 71.2 | |
Gross profit | 29.2 | |
Selling, general and administrative expenses | 19.9 | |
Income from operations | 9.3 | |
Other income, net | 0.1 | |
Earnings before income taxes | 9.4 | |
Income taxes | (6.2) | |
Earnings from discontinued operations, net of tax | 15.6 | |
Gain on disposition of discontinued operations, net of tax | 1,717.3 | |
Net earnings from discontinued operations | 1,732.9 | |
Stock-based compensation expense | 4.5 | |
Held-for-sale or Disposed of by Sale | TransCore and Zetec | Selling, General and Administrative Expenses | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Stock-based compensation expense | 0.9 | |
Held-for-sale or Disposed of by Sale | Industrial Businesses | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Net revenues | 0 | 246.8 |
Cost of sales | 0 | 113.9 |
Gross profit | 0 | 132.9 |
Selling, general and administrative expenses | 1.2 | 67.7 |
Income from operations | (1.2) | 65.2 |
Other income, net | 0 | 0.2 |
Earnings before income taxes | (1.2) | 65.4 |
Income taxes | 0 | 14.2 |
Earnings from discontinued operations, net of tax | $ (1.2) | 51.2 |
Stock-based compensation expense | 2.9 | |
Depreciation and amortization | $ 3.9 |
Stock Based Compensation - Stoc
Stock Based Compensation - Stock Based Compensation Expense (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | ||
Stock-based compensation | $ 30.2 | $ 33 |
Tax effect recognized in net earnings from continuing operations | $ 5.2 | $ 7 |
Stock Based Compensation - Narr
Stock Based Compensation - Narrative (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 3 Months Ended | ||
Jul. 01, 2020 | Mar. 31, 2023 | Mar. 31, 2022 | |
Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Employee stock options granted during the period (in shares) | 353 | 365 | |
Fair value per share (in dollars per share) | $ 128.89 | $ 115.83 | |
Cash received from exercise of options | $ 24.6 | $ 38.7 | |
Restricted Stock Awards | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Restricted stock awards granted during period (in shares) | 219 | ||
Weighted average fair value per share of restricted stock awards granted during the period (in dollars per share) | $ 428.20 | $ 455.84 | |
Restricted stock awards vested during period (in shares) | 82 | ||
Weighted average grant date fair value per share (in dollars per share) | $ 376.74 | ||
Weighted average vest date fair value per share (in dollars per share) | $ 435.75 | ||
Employee Stock Purchase Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percentage of eligible earnings to purchase common stock through the employee stock purchase plan | 10% | ||
Discount on the average closing price for the employee stock purchase plan | 10% | ||
Shares of stock purchased during the period by participants in the employee stock purchase plan (in shares) | 12 | 13 | |
Amount paid for stock purchased during the period by participants in the employee stock purchase plan | $ 4.7 | $ 5.5 |
Stock Based Compensation - Weig
Stock Based Compensation - Weighted Average Assumptions Used to Value Option Grants (Details) | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | ||
Risk-free interest rate (%) | 3.73% | 2.05% |
Expected option life (years) | 5 years 7 months 24 days | 5 years 7 months 17 days |
Expected volatility (%) | 26.02% | 24.52% |
Expected dividend yield (%) | 0.64% | 0.54% |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Raw materials and supplies | $ 63 | $ 60.6 |
Work in process | 26.9 | 24.9 |
Finished products | 32.1 | 31.3 |
Inventory reserves | (7) | (5.5) |
Inventories, net | $ 115 | $ 111.3 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Goodwill (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Goodwill [Roll Forward] | |
Balance at beginning of period | $ 15,946.1 |
Other | 0.1 |
Currency translation adjustments | 16.6 |
Balance at end of period | 15,962.8 |
Application Software | |
Goodwill [Roll Forward] | |
Balance at beginning of period | 11,417.5 |
Other | 0.1 |
Currency translation adjustments | 5.9 |
Balance at end of period | 11,423.5 |
Network Software | |
Goodwill [Roll Forward] | |
Balance at beginning of period | 3,598.3 |
Other | 0 |
Currency translation adjustments | 10.9 |
Balance at end of period | 3,609.2 |
Technology Enabled Products | |
Goodwill [Roll Forward] | |
Balance at beginning of period | 930.3 |
Other | 0 |
Currency translation adjustments | (0.2) |
Balance at end of period | $ 930.1 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Other Intangible Assets (Details) - USD ($) $ in Millions | Mar. 31, 2023 | Dec. 31, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Accumulated amortization | $ (3,257.4) | $ (3,082.9) |
Intangible assets, gross (excluding goodwill) | 11,129.1 | 11,113.6 |
Intangible assets, net (excluding goodwill) | 7,871.7 | 8,030.7 |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets (excluding goodwill) | 690.2 | 689.3 |
Customer related intangibles | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross | 9,310.5 | 9,300.7 |
Accumulated amortization | (2,576.2) | (2,437.7) |
Finite-lived intangible assets, net | 6,734.3 | 6,863 |
Unpatented technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross | 959.3 | 954.6 |
Accumulated amortization | (539.4) | (506.9) |
Finite-lived intangible assets, net | 419.9 | 447.7 |
Software | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross | 149.1 | 149 |
Accumulated amortization | (136.8) | (134) |
Finite-lived intangible assets, net | 12.3 | 15 |
Patents and other protective rights | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross | 10.3 | 10.3 |
Accumulated amortization | (1.2) | (1.2) |
Finite-lived intangible assets, net | 9.1 | 9.1 |
Trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Finite-lived intangible assets, gross | 9.7 | 9.7 |
Accumulated amortization | (3.8) | (3.1) |
Finite-lived intangible assets, net | $ 5.9 | $ 6.6 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Finite-Lived Intangible Assets [Line Items] | ||
Amortization of intangible assets | $ 175.1 | $ 145.7 |
Other Intangible Assets | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization of intangible assets | $ 170.4 | $ 143.3 |
Fair Value - Schedule of Fixed-
Fair Value - Schedule of Fixed-Rate Senior Notes, Fair Value (Details) - Fair Value, Inputs, Level 2 - Senior Notes | Mar. 31, 2023 USD ($) |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Fixed rate senior notes carrying amount | $ 6,700,000,000 |
Senior Notes Due 2023 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Principal Amount | $ 700,000,000 |
Interest rate (as a percent) | 3.65% |
Fair value | $ 695,000,000 |
Senior Notes Due in 2024 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Principal Amount | $ 500,000,000 |
Interest rate (as a percent) | 2.35% |
Fair value | $ 482,000,000 |
Senior Notes Due 2025 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Principal Amount | $ 300,000,000 |
Interest rate (as a percent) | 3.85% |
Fair value | $ 295,000,000 |
Senior Unsecured Notes Due September 15, 2025 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Principal Amount | $ 700,000,000 |
Interest rate (as a percent) | 1% |
Fair value | $ 641,000,000 |
Senior Notes Due 2026 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Principal Amount | $ 700,000,000 |
Interest rate (as a percent) | 3.80% |
Fair value | $ 679,000,000 |
Senior Unsecured Notes Due September 15, 2027 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Principal Amount | $ 700,000,000 |
Interest rate (as a percent) | 1.40% |
Fair value | $ 609,000,000 |
Senior Notes Due 2028 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Principal Amount | $ 800,000,000 |
Interest rate (as a percent) | 4.20% |
Fair value | $ 788,000,000 |
Senior Notes Due in 2029 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Principal Amount | $ 700,000,000 |
Interest rate (as a percent) | 2.95% |
Fair value | $ 629,000,000 |
Senior Notes Due June 2030 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Principal Amount | $ 600,000,000 |
Interest rate (as a percent) | 2% |
Fair value | $ 497,000,000 |
Senior Unsecured Notes Due February 15, 2031 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Principal Amount | $ 1,000,000,000 |
Interest rate (as a percent) | 1.75% |
Fair value | $ 803,000,000 |
Fair Value - Narrative (Details
Fair Value - Narrative (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2023 | Apr. 26, 2023 | |
Indicor | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Retaining minority interest | 48.60% | |
Honeywell International, Inc. | Disposed of by Sale | Subsequent Event | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Consideration received from disposal | $ 670 |
Contingencies (Details)
Contingencies (Details) individual in Millions, $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) claim individual | |
Vertafore Litigation | |
Loss Contingencies [Line Items] | |
Number of pending putative class actions | 3 |
Number of individuals represented by class actions | individual | 27.7 |
Vertafore Litigation | Other Nonoperating Income (Expense) | |
Loss Contingencies [Line Items] | |
Litigation settlement, one time charge | $ | $ 45 |
Allen, et al. v. Vertafore, Inc. | |
Loss Contingencies [Line Items] | |
Number of pending putative class actions | 2 |
Mulvey, et al. v. Vertafore, Inc. | |
Loss Contingencies [Line Items] | |
Number of pending putative class actions | 1 |
Business Segments (Details)
Business Segments (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Segment Reporting Information [Line Items] | ||
Net revenues: | $ 1,469.7 | $ 1,279.8 |
Percent change in net revenues | 14.80% | |
Gross profit: | $ 1,018.6 | 897.2 |
Percent change in gross profit | 13.50% | |
Operating profit | $ 456.2 | 408.8 |
Percent change in operating profit | 11.60% | |
Long-lived assets: | $ 213.2 | 189 |
Percent change in long-lived assets | 12.80% | |
Corporate | ||
Segment Reporting Information [Line Items] | ||
Unallocated corporate general and administrative expenses | $ 55.2 | 52.9 |
Application Software | ||
Segment Reporting Information [Line Items] | ||
Net revenues: | $ 761.4 | 628.2 |
Percent change in net revenues | 21.20% | |
Gross profit: | $ 520.5 | 435.4 |
Percent change in gross profit | 19.50% | |
Operating profit | $ 193.2 | 172.3 |
Percent change in operating profit | 12.10% | |
Long-lived assets: | $ 153.3 | 135.8 |
Percent change in long-lived assets | 12.90% | |
Network Software | ||
Segment Reporting Information [Line Items] | ||
Net revenues: | $ 354.5 | 338.5 |
Percent change in net revenues | 4.70% | |
Gross profit: | $ 299.4 | 284.9 |
Percent change in gross profit | 5.10% | |
Operating profit | $ 147.5 | 136.8 |
Percent change in operating profit | 7.80% | |
Long-lived assets: | $ 30.7 | 26.2 |
Percent change in long-lived assets | 17.20% | |
Technology Enabled Products | ||
Segment Reporting Information [Line Items] | ||
Net revenues: | $ 353.8 | 313.1 |
Percent change in net revenues | 13% | |
Gross profit: | $ 198.7 | 176.9 |
Percent change in gross profit | 12.30% | |
Operating profit | $ 115.5 | 99.7 |
Percent change in operating profit | 15.80% | |
Long-lived assets: | $ 29.2 | $ 27 |
Percent change in long-lived assets | 8.10% |
Revenues from Contracts - Disag
Revenues from Contracts - Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Disaggregation of Revenue [Line Items] | ||
Total Revenue | $ 1,469.7 | $ 1,279.8 |
Application Software | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | 761.4 | 628.2 |
Network Software | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | 354.5 | 338.5 |
Technology Enabled Products | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | 353.8 | 313.1 |
Total Software Revenues | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | 1,120.1 | 969.6 |
Total Software Revenues | Application Software | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | 761.4 | 628.2 |
Total Software Revenues | Network Software | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | 354.5 | 338.5 |
Total Software Revenues | Technology Enabled Products | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | 4.2 | 2.9 |
Recurring | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | 840.3 | 701.3 |
Recurring | Application Software | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | 580.6 | 461.5 |
Recurring | Network Software | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | 255.9 | 237.2 |
Recurring | Technology Enabled Products | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | 3.8 | 2.6 |
Reoccurring | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | 99.6 | 92.2 |
Reoccurring | Application Software | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | 35.4 | 31.7 |
Reoccurring | Network Software | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | 64.2 | 60.5 |
Reoccurring | Technology Enabled Products | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | 0 | 0 |
Non-recurring | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | 180.2 | 176.1 |
Non-recurring | Application Software | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | 145.4 | 135 |
Non-recurring | Network Software | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | 34.4 | 40.8 |
Non-recurring | Technology Enabled Products | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | 0.4 | 0.3 |
Product Revenue | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | 349.6 | 310.2 |
Product Revenue | Application Software | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | 0 | 0 |
Product Revenue | Network Software | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | 0 | 0 |
Product Revenue | Technology Enabled Products | ||
Disaggregation of Revenue [Line Items] | ||
Total Revenue | $ 349.6 | $ 310.2 |
Revenues from Contracts - Remai
Revenues from Contracts - Remaining Performance Obligations Narrative (Details) $ in Millions | Mar. 31, 2023 USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | $ 4,203 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-04-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligations | $ 2,872.5 |
Remaining performance obligations, percentage | 68% |
Remaining performance obligations, expected timing of satisfaction | 12 months |
Revenues from Contracts - Contr
Revenues from Contracts - Contract Balances (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | ||
Unbilled receivables | $ 100.9 | $ 91.5 |
Change in unbilled receivables | 9.4 | |
Deferred revenue - current | (1,303.8) | (1,370.7) |
Change in deferred revenue - current | 66.9 | |
Deferred revenue - non-current | (121.4) | (111.5) |
Change in deferred revenue - non-current | (9.9) | |
Net contract assets/(liabilities) | (1,324.3) | $ (1,390.7) |
Change in net contract assets/(liabilities) | $ 66.4 |
Revenues from Contracts - Narra
Revenues from Contracts - Narratives (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |||
Revenue recognized from contract liability balance | $ 589.9 | $ 489.3 | |
Deferred commissions | $ 64.5 | $ 64.8 |