Business Overview / Sources of Revenue

Bentley Systems (BSY) is a global leader in infrastructure engineering software, providing architects, engineers, constructors, and owner-operators with comprehensive solutions for advancing infrastructure projects[1]. The company generates revenue primarily through subscriptions and licenses[5], with a strong focus on recurring revenue streams that provide visibility and consistency[4].

As of Q3 2024 (ended September 30), Bentley reported total revenues of $334.34 million, with a modest year-over-year growth of 9.28%[5]. The company's software portfolio serves multiple infrastructure sectors including roads and bridges, rail and transit, water and waste, industrial, commercial/facilities, municipal, grids, resources, and geoprofessional[4]. These market segments are distributed across various percentages of their annualized recurring revenue (ARR), though the exact breakdown percentages aren't specified in the search results[4]. Bentley maintains a profit margin of 12.66% as of Q3 2024[5].

Revenue Growth Potential and Recurrence

Bentley Systems (BSY) has an exceptionally high share of recurring revenue, with 91% of its total revenue being recurring as of 2024, following 13% growth in subscription revenues[1]. The company's subscription revenues reached $315.6 million in Q4 2024, up 15.8% year-over-year[1].

BSY demonstrates solid growth potential with a last twelve-month recurring revenues dollar-based net retention rate of 110% in Q1 2025, improved from 108% in the same period the previous year[3]. This net retention rate indicates BSY would grow revenue by 9.3% even without acquiring new customers[5].

The company's excellent 81.2% gross margin provides substantial resources to fund investments in new products and sales[5]. While total revenues grew 10.1% for full-year 2024[2] and 10% year-over-year in Q1 2025[4], BSY's three-year annual revenue growth of 10.8% was slower than software industry peers[5], suggesting moderate but stable growth prospects.

Economic Moat Factors

Bentley Systems (BSY) possesses a narrow economic moat primarily driven by switching costs[1][2]. The complex nature of their infrastructure software solutions makes it difficult for customers to transition to competitors once they've implemented Bentley's products[1]. While this provides some protection against competition and ability to sustain profitability[2], the moat isn't considered wide by all analysts. However, GuruFocus assigns BSY a Moat Score of 7, suggesting it might have an "entry-level wide moat" with durable competitive advantages[3]. The company has demonstrated remarkable resilience, maintaining 12% constant currency ARR growth for 12 consecutive quarters, which is increasingly rare in the current economic climate[5]. With an impressive 81.21% gross profit margin and 10.71% revenue growth over the past year, Bentley's financial performance further indicates the effectiveness of its competitive positioning in the infrastructure software market[5].

Leadership

Nicholas Cumins became CEO of Bentley Systems (BSY) on July 1, 2024, succeeding Greg Bentley, the eldest of five founding brothers who served as CEO since 1995[2][3]. Cumins is the first non-family CEO in the company's 40-year history[3]. Prior to becoming CEO, Cumins was COO since January 2022 and joined as Chief Product Officer in September 2020[4]. Greg Bentley transitioned to Executive Chair of the Board[2]. The company remains majority family-owned[4]. Under Cumins' leadership as COO, Bentley Systems achieved its highest ARR growth and operating margins in its history[2].

Financial Health

Bentley Systems’ financial health shows mixed signals. The company holds $64 million in cash against $1.39 billion in debt, with a high debt-to-equity ratio of 133.3%, indicating a modestly leveraged balance sheet[5]. However, its operating cash flow covers debt comfortably (coverage ratio: 31.4%), and interest coverage is strong (24.6x EBIT)[5]. Bentley generates robust free cash flow ($216.4 million in Q1 2025), but the free cash flow margin isn’t specified[2][4]. The company’s share count has increased over the past five years, suggesting net share dilution rather than repurchases[5].

Last updated Jun 3, 2025