Roper Technologies, Inc. Common Stock Goldman Sachs Communacopia + Technology Conference 2026

Yeah, thanks for having us.

Yeah. Just real briefly, think of us as a durable, steady, low range of outcomes, cash flow per share compounder. That's the mindset of the organization. In terms of the profile of the assets and the business, about $8.5 billion of revenue, 40% EBITDA margins, low 30% free cash flow margins. Perhaps interesting for investors is the portfolio of businesses are hard for investors to own individually because they're small. They're tiny businesses that are leaders in small markets. So we're the leader in a small TAM. So we have the scale advantage locally, but we compete on intimacy with customers. We have strong product-market fit, strong gross retention, and collectively, the cash flow generative capacity of the enterprise is quite compelling. Standalone, each business would not be particularly uniquely productive in how to deploy the cash flow they generate to their own individual purpose.

Therefore, we take all the cash flow up to the center, the free cash flow, excess free cash flow, and deploy it to what is, we think, the next best opportunity, whether it's a new platform, a tuck-in acquisition, a buyback at the enterprise. When you put that together, the cash flow compounding per share capacity is in the mid-teens, and we go to work every day trying to find a way to get that to the high teens, so the rate of double goes from every four years. Excuse me, every five years to every four years. So low range of outcome, durable cash flow per share compounder, one of the largest, if not the largest, vertical market software businesses that's publicly traded, that's a collection of 29 businesses underneath the hood. But I'll stop there. We can take where you want to go, too.

Yeah, I think there's several defensive aspects to it. The first, and this is proving to be the case even in the AI era, is the size of the prize is quite small. When I say our TAMs are small, our largest singular TAM for one of our business. Our biggest TAM is about $4 billion a year. This is pre-AI. Most of our TAMs are $1 billion or less. So the size of the prize is just quite small. It's already very well-vended, particularly by us, and a very small number of competitors we have in each one of our verticals. So that is the case. I think 18 of our 21 software businesses work in a regulated end market. Oftentimes, the regulatory regime is why you need very specialized software in a vertical, whether it's education or insurance or government contracting or whatever it may be.

Healthcare. Healthcare, for sure. In that specialized end market, there's something unique about the way that end market operates that isn't suited particularly well for horizontal software.

Every one of our businesses were created sort of in the nooks and crannies of the horizontal. From the day that they were born, the businesses were born, they had to create differential value from the generic application of horizontal software. Those are some of the reasons why it's historically durable. Going forward on an AI front, if you think about, in our opinion, what are the attributes for an AI winner? First you have to be able to take this probabilistic outcome to deterministic. That's largely done with the context and data knowledge graphs that we have across all of our businesses.

Then you have to apply that in a workflow with potentially no latency, and you have to have the customer trust to be able to do the first one of those. It's the aggregation of those that is, I believe, an incumbent advantage in AI, which I'm sure we'll get into as we get further into the questions today.

Yeah. Just to step back and a little bit of context. When the AI gun went off a couple of years ago, our decision at the enterprise level was we want to take all of this goodness of these tools and drive into the product stacks to drive customer value, to drive growth, and play offense. From the very beginning, that's been the mantra and the mindset. Not how can we do what we do substantially more cost effectively and take it to margin. We're playing sort of a growth game knowing that over time we'll get the productivity and maybe there's some marginal benefits, but we want to take all the productivity gains and go play offense.

What that manifested is all of last year into this year, it has been how do we develop these agentic SKUs that are doing these task replacement sort of things across a large swath of our portfolio, not domiciled in one or two of our businesses, but essentially all 21 of our software businesses. That has been largely successful in the first wave, and now we are in the commercialization sort of learning phase of that, broadly across the portfolio. When you have a portfolio of our size, you definitely have companies that lead the pack and ones that lag. Your question, like on the early adopters and where we have had real success in autism therapy, legal, increasing success in some of our other healthcare IT franchises, early success in insurance, early success in pharmacy automation, just to name a few. I call it early. We have got to scale this.