Dassault Systemes (DSY) AI Stock Analysis

• Market Cap: €24.70B
• Dividend Yield: 1.1%
• Average Volume (3M): 1.64M
• Price to Earnings (P/E): 20.4
• Beta (1Y): 0.85
• Revenue Growth: 3.38%
• EPS Growth: 4.62%
• Country: FR
• Employees: 26,225
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): 0.40
• Shares Outstanding: 1,341,456,000
• 10 Day Avg. Volume: 1,511,633
• 30 Day Avg. Volume: 1,638,826
• PEG Ratio: 0.00
• Price to Book (P/B): 3.57
• Price to Sales (P/S): 5.04
• P/FCF Ratio: 21.37
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: €24.15
• Price Target Upside: 30.75% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 10
• EPS Forecast (FY): 1.33
• Revenue Forecast (FY): €6.36B

• Rating: 62 Neutral
• Price Target: €19.00 ▲(2.87% Upside)
• Action: Reiterated Date: 02/18/26
• Date: Action: Reiterated 02/18/26

The score is supported by strong underlying fundamentals (healthy margins and solid cash generation), but is held back by a sharply bearish technical setup (price well below key moving averages and negative momentum). Valuation is reasonable and dividend yield provides modest support, but recent revenue and free-cash-flow growth weakness limits the upside.

Positive Factors

High Margins & Improving Profitability

Consistently very high gross margins and materially improved net margins indicate durable pricing power and operating leverage in Dassault’s software model. That margin profile supports sustained cash generation, funds R&D, and cushions the business versus cyclical demand shifts over the next 2–6 months and beyond.

Subscription-based Recurring Revenue Model

A subscription and support revenue mix yields predictable, recurring cash flows and higher customer retention. This structural model increases visibility into future revenues, improves lifetime value, and supports steady investment in product and services that underpin multi-industry penetration over the medium term.

Strategic AI Partnership (NVIDIA)

The NVIDIA alliance is a structural enhancement: integrating industry-grade AI and virtual twin tech can expand Dassault’s platform capabilities, deepen customer lock-in, and open AI-driven use cases across aerospace, automotive and life sciences. That partnership can materially strengthen the competitive moat and long-term addressable market.

Negative Factors

Recent Top-line Weakness

A year-over-year revenue decline signals cooling demand or slower new customer adds for a company whose strength depends on recurring subscription growth. If top-line momentum remains weak, it can constrain R&D investment, slow platform adoption, and reduce the pace of expansion into new verticals over the coming months.

Free Cash Flow Volatility and Recent Decline

While absolute FCF is healthy, recent negative growth and historical swings reduce predictability of internal funding. Persistent FCF weakness would limit capital allocation flexibility for M&A, buybacks or heavier R&D spend needed to exploit AI partnerships, making execution of long-term strategy more challenging.

Meaningful Outstanding Debt

Improved leverage reduces risk, but material outstanding debt leaves less financial optionality than a net-cash software peer. In an environment of slower revenue growth, debt servicing and maturities could constrain strategic moves or require more cautious cash deployment over the medium term.

Dassault Systemes Business Overview & Revenue Model

Company Description

Dassault Systèmes SE provides software solutions and services worldwide. It offers SOLIDWORKS design software for 3D design, electrical and printed circuit board design, product data management, simulation, manufacturing, and technical communication; CATIA, an engineering and design software for product 3D computer-aided design; GEOVIA for modeling and simulating the earth; and BIOVIA that provides the scientific community with advanced biological, chemical, and materials experiences. The company also provides SIMULIA that delivers realistic simulation applications; DELMIA, which enables global industrial operations; 3DVIA that provides 3D space planning solutions; and ENOVIA that enables to plan and track the definition of success for customer. In addition, it offers Centric PLM, a product lifecycle management software solution; 3DEXCITE, a real-time 3D visualization software; NETVIBES, which enables organizations to gather, align, and enrich big data; 3DEXPERIENCE platform that provides organizations a holistic and real-time view of their business activities and ecosystem, as well as connecting people, ideas, data, and solutions together in a single environment; and MEDIDATA, a clinical research study software that provides evidences and insights to pharmaceutical, biotech, medical device, and diagnostic companies, as well as academic researchers. Further, the company provides consulting, deployment, outcome based, and training services. It primarily serves companies in the transportation and mobility; industrial equipment; aerospace and defense; high-tech; life sciences and healthcare; energy and materials; home and lifestyle; construction, cities, and territories; consumer packaged goods and retail; marine and offshore; and business services sectors through distributors and resellers. Dassault Systèmes SE was incorporated in 1981 and is headquartered in Vélizy-Villacoublay, France.

How the Company Makes Money

Dassault Systèmes generates revenue primarily through software licenses, subscription services, and support agreements. The company's revenue model is largely subscription-based, allowing clients to access its software products and services over time rather than through one-time purchases. Key revenue streams include licensing fees for its software solutions, recurring subscription fees from the 3DEXPERIENCE platform, and professional services such as consulting and training. Additionally, Dassault Systèmes benefits from strategic partnerships with major companies across various industries, which enhance its product offerings and expand its market reach. The company's focus on innovation and investment in research and development also contribute to its ability to attract new clients and retain existing ones.

Dassault Systemes Financial Statement Overview

Summary

Strong and consistent profitability with high gross margins and improving net margins through 2024, plus solid recurring cash generation. The main risks are the latest period’s slight revenue decline and the recent drop in free cash flow growth, which point to cooling near-term momentum.

Income Statement

Profitability is strong and consistent for a software business, with high gross margins (roughly 77%–84%) and solid operating and net margins (net margin improved from ~11% in 2020 to ~19% in 2024). Revenue expanded steadily from 2020 to 2024 (with mid-to-high single digit growth in 2023–2024 after a strong 2022), but the most recent annual data point shows a slight revenue decline (2025 revenue growth rate: -1.163), which is the key near-term concern. Overall earnings have held up well, with net income rising meaningfully versus 2020 levels, but top-line momentum appears to be cooling.

Balance Sheet

Leverage has improved notably over time: debt-to-equity moved down from ~0.96 (2020) to ~0.34 (2024), reflecting a stronger equity base and reduced balance-sheet risk. Shareholders’ equity has grown to ~€9.1B (2024), supporting financial flexibility. Returns on equity have been steady in the low-teens (~12%–13% in 2021–2024), indicating consistent profitability but not accelerating. Total debt remains meaningful (~€3.1B in 2024; ~€2.6B in 2025), so the balance sheet is solid but not “net-cash-like.”

Cash Flow

Cash generation is healthy and fairly stable: operating cash flow has been consistently around €1.2B–€1.7B (2020–2025), and free cash flow has stayed robust at roughly €1.1B–€1.5B. Free cash flow has generally tracked earnings well (free cash flow to net income around ~0.88–0.94 in 2021–2024), which supports quality of profits. The main weakness is growth volatility: free cash flow growth swung from strong in 2021 to negative in 2022, modestly positive in 2023–2024, and then declined in 2025 (free cash flow growth: -0.251), suggesting some near-term pressure on cash conversion or investment needs.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	6.24B	6.21B	5.95B	5.67B	4.86B
Gross Profit	5.22B	5.20B	4.60B	4.75B	4.07B
EBITDA	1.90B	1.92B	1.81B	1.94B	1.59B
Net Income	1.20B	1.20B	1.05B	931.50M	773.70M
Balance Sheet
Total Assets	15.06B	15.55B	14.62B	14.26B	14.22B
Cash, Cash Equivalents and Short-Term Investments	4.13B	3.95B	3.57B	2.77B	2.98B
Total Debt	2.60B	3.06B	3.60B	3.58B	4.47B
Total Liabilities	6.26B	6.47B	6.78B	6.94B	8.01B
Stockholders Equity	8.79B	9.07B	7.83B	7.31B	6.20B
Cash Flow
Free Cash Flow	1.47B	1.47B	1.42B	1.39B	1.51B
Operating Cash Flow	1.63B	1.66B	1.57B	1.53B	1.61B
Investing Cash Flow	-404.30M	-191.70M	-161.60M	-213.90M	-160.40M
Financing Cash Flow	-789.40M	-1.21B	-536.70M	-1.59B	-711.90M

Dassault Systemes Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 18.47
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FR:DSY, the sentiment is Negative. The current price of 18.47 is below the 20-day moving average (MA) of 19.10, below the 50-day MA of 21.92, and below the 200-day MA of 26.54, indicating a bearish trend. The MACD of -1.25 indicates Negative momentum. The RSI at 39.99 is Neutral, neither overbought nor oversold. The STOCH value of 92.00 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for FR:DSY.

Dassault Systemes Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PLNW	67 Neutral	€1.12B	22.62	―	1.37%	13.17%	22.60%
QDT	67 Neutral	€448.51M	7.30	5.80%	4.90%	0.13%	11.29%
DSY	62 Neutral	€24.70B	20.43	14.37%	1.10%	3.38%	4.62%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
VU	60 Neutral	€1.86B	23.91	-5.53%	0.31%	39.72%	63.70%
LSS	58 Neutral	€729.74M	28.27	8.16%	1.76%	0.40%	-9.67%
74SW	55 Neutral	€943.00M	23.31	9.71%	―	103.99%	17.53%