- Price
- $36.04
- Fair value
- $43.00
- Discount
- 16.2%
- Uncertainty
- Medium
- LSEG rating
- 1.94
- Moat
- Wide
- Next earnings
- 2026-11-05
- Next earnings is estimate
- No
- Company name
- Bentley Systems
- Sector
- Engineering software
- About
- Bentley Systems makes software that engineers use to design, build and operate infrastructure, such as roads, bridges, rail, water networks, power grids, mines and plants. Its products include MicroStation, OpenRoads, STAAD and the power line design software PLS. Customers are engineering firms and the owners and operators of infrastructure. About 92% of revenue comes from subscriptions, under user licenses or the E365 consumption model, and annualized recurring revenue (ARR) was $1.54 billion at June 30, 2026. Its account retention was 99% in Q2 2026. The Bentley family controls a majority of the voting power, and Greg Bentley is the Executive Chair. Nicholas Cumins is the CEO.
- Thesis
- The market prices Bentley Systems with a discount because investors fear that AI will lower the value of engineering software. Their main worry is seat compression: AI agents can do work that engineers now do in licensed software, so customers can need fewer users. The stock fell with other software stocks on these fears several times in 2026, for example in April 2026 after a downgrade of ServiceNow. Bentley also said that it will not charge for its new AI features before 2027, so the evidence that AI adds revenue comes late. A second worry is US road funding, because the new surface transportation bill passed the House but is on hold. For the gap to close, three things must be true. Constant-currency ARR growth must stay at or above about 11%, with net retention at or above 109%, as in Q2 2026. Bentley must show a price model for AI use in its 2027 outlook, and customers must start to pay for it. Free cash flow must reach the 2026 outlook of $500 million to $570 million. The first evidence comes with the Q3 2026 report on November 5, 2026, and the 2027 outlook is expected in late February 2027. If ARR growth holds while AI revenue starts, the gap can close over the next four to six quarters. If AI tools cut the number of paid users, the discount can stay.
- Risks
- AI tools can let engineers do more work with fewer software licenses, and new AI companies can compete for design work. Bentley will charge for its own AI features only from 2027, and management said that user-based and E365 prices do not fit machine-speed AI use. The new price model is not yet known.
Demand depends on public infrastructure budgets. The US surface transportation bill passed the House but is on hold, and Germany's infrastructure fund is slow to reach projects, management said in August 2026.
Bentley had $1.22 billion of debt at June 30, 2026, and $575 million of convertible notes mature in July 2027. Debt rose in 2026 because it repaid the 2026 convertible notes with its credit line and bought back stock.
About 2% of ARR comes from China, where state-owned owners face geopolitical limits. A stronger US dollar also lowers reported revenue; management expected an $8 to $10 million cut to second-half 2026 revenue at late-July exchange rates.
The Bentley family controls the company through its shares. Outside shareholders have little influence on strategy, buybacks and acquisitions.
- Balance sheet
- Cash: $147M
Debt: $1.2B
Net debt: $1.1B
Net debt / EBITDA: 1.9× (low)
Interest cover: 12×
Undrawn credit line: $1.2B, to October 2029
Debt due within 12 months: $7.0M
Last debt due: 2029
At June 30, 2026, debt was $95.9 million drawn on the revolving credit line, a $550 million secured term loan and $575 million of convertible notes due July 2027. The revolving credit line and the term loan mature in October 2029. The term loan has a springing maturity 91 days before the convertible notes mature, unless Bentley meets liquidity tests. The 2026 convertible notes matured on January 15, 2026, and Bentley repaid $678.3 million with the credit line and cash. The weighted average rate on credit line borrowings was 5.00% in Q2 2026. Most cash, $142.6 million, is held by foreign subsidiaries. Interest cover uses operating income and net interest expense for the first half of 2026. The net debt to EBITDA ratio is the company's own figure for June 30, 2026. Bentley has no public credit rating in its filings.
As of 2026-06-30.
- Checkpoints
- Nov 5, 2026: Q3 2026 results: ARR growth and retention. Pending. Watch: A pass is constant-currency ARR growth of 11% or more with net retention of 109% or more; a fail is ARR growth below 10.5%, the bottom of the 2026 outlook.
Feb 2027 (estimate): 2027 outlook: AI price model. Pending. Watch: A pass is a clear AI price model and 2027 ARR growth guidance near 2026 levels; a fail is slower ARR guidance or no AI revenue plan.
Jul 2027 (estimate): 2027 convertible notes repaid. Pending. Watch: A pass is repayment of the $575 million notes with cash and credit while net debt stays near 2 times EBITDA; a fail is costly new financing.
- Recent events
- 2026-10-07: Bentley Systems said that it will report Q3 2026 results on November 5, 2026, before the market opens.
2026-08-06: Bentley Systems reported Q2 2026 results. Revenue was $410.7 million, up 12.8%. ARR was $1.54 billion, up 12% in constant currency, and net retention was 109%. Free cash flow was $63.8 million. Management kept its 2026 free cash flow outlook of $500 to $570 million, and said that it will charge for AI features from 2027. Net debt was 1.9 times adjusted EBITDA.
2026-06-30: In the first half of 2026, Bentley Systems bought back 3.75 million shares for $125.1 million under its $500 million buyback program, which runs to December 31, 2028.
2026-05-07: Bentley Systems reported Q1 2026 results. Revenue was $424.2 million, up 14.5%, and ARR grew 11.5% in constant currency. Free cash flow was $187.9 million, down from $216.4 million a year earlier.
2026-04-23: Bentley Systems added a $550 million senior secured term loan to its credit facility. The loan matures on October 18, 2029, and Bentley used it to repay borrowings under its revolving credit line.