Bentley Systems (BSY) Q4 2025: Asset Analytics Revenue Hits $50M Run Rate, AI Monetization Path Accelerates
Bentley Systems closed 2025 with robust recurring revenue growth, margin expansion, and a clear AI-driven asset analytics monetization strategy emerging as a new lever. The company’s disciplined capital allocation and product repackaging signal operational strength, while management’s outlook points to durable growth and increasing AI integration across its portfolio. Investors should watch for how quickly asset analytics and API consumption translate to recurring revenue and broader AI adoption in infrastructure engineering.
Summary
- AI-Driven Asset Analytics Monetization: Asset analytics reached a $50M run rate, providing early proof of scalable AI revenue streams.
- Subscription Revenue Mix Strengthens: Recurring revenue now comprises 92% of total, with E365 hitting 45% of subscriptions.
- Strategic Capital Flexibility: Deleveraging enables up to $400M in annual acquisitions, expanding inorganic growth opportunities.
Performance Analysis
Bentley Systems delivered double-digit constant currency revenue growth in Q4 and for the full year, led by strong performance in its core subscription model. Subscription revenues now account for 92% of total sales, up from 90% last year, reflecting the company’s successful transition away from perpetual licenses and services. The E365 program, enterprise subscriptions with usage-based pricing, expanded to 45% of subscription revenue, reinforcing the shift to consumption-centric models.
Asset analytics, the company’s AI-enabled offering for infrastructure operations and maintenance, reached a $50 million annualized run rate, marking a significant milestone for Bentley’s AI monetization thesis. Net revenue retention remained high at 109%, and the addition of over 600 new SMB logos for the 16th consecutive quarter sustained new business momentum. Meanwhile, free cash flow margins hit 35%, though management notes true free cash flow is closer to 30% after accounting for stock-based compensation dilution.
- Asset Analytics Outpaces Core Growth: The asset analytics business, bolstered by targeted acquisitions, is growing faster than the overall company and is positioned as the near-term AI monetization engine.
- ARR Growth Consistency: Annual recurring revenue (ARR) grew 11.5% YoY in constant currency, with new logo additions and resilient retention underpinning momentum.
- Margin Expansion: Adjusted operating income less SBC margin improved by 110 basis points YoY, reflecting operating leverage and disciplined cost management.
Geographically, the Americas and EMEA led growth, with Middle East investments and U.S. infrastructure funding providing sustained tailwinds. China remains a small and challenged market at 2% of ARR, with macro and geopolitical headwinds expected to persist.
Executive Commentary
"AI is not a risk to be countered, but an unprecedented opportunity. Distinctive fundamentals of infrastructure engineering serve substantially in our favor. As the industry's established and trusted digital quartermaster, we are best positioned to catalyze with infrastructure engineering organizations the value to be realized by taking full advantage of AI's potential to transform the substance of their work."
Greg Bentley, Executive Chair
"We are not only embedding our own AI capabilities into our products, but also instrumenting our platforms so our users and partners can build their own AI-driven workflows. Our immediate priority is to lead the exploration for the highest value AI-powered workflows, while at the same time building the market and driving their adoption rather than focusing on direct monetization."
Nicholas Cummins, Chief Executive Officer
Strategic Positioning
1. AI Integration as Core Differentiator
Bentley is embedding AI across its Open Applications and Asset Analytics platforms, automating design, enhancing engineering workflows, and enabling API-driven optimization. The company’s “co-pilot” AI and natural language scripting are designed to increase software consumption and lock in engineering users.
2. Asset Analytics as Immediate Monetization Path
Asset analytics, leveraging AI and digital twins, is the first area showing tangible monetization, with offerings like OpenTower IQ and Blink-See gaining traction in telecom and transportation. Acquisitions of Talon Analytics and Pointivo expand AI-based inspection and simulation, opening recurring revenue opportunities in asset monitoring and grid resilience.
3. Subscription Model and Consumption-Based Growth
The company’s strategic pivot to subscriptions and usage-based pricing (E365) has driven recurring revenue to 92% of total, increasing predictability and customer lifetime value. Simplified packaging, such as the ProjectWise Connect rollout, is lowering adoption barriers and expanding the user base.
4. Capital Allocation Flexibility
Deleveraging post-acquisitions has restored balance sheet capacity, enabling up to $400 million annually in programmatic M&A without increasing leverage. Management signaled openness to expanding beyond asset analytics, broadening the scope for inorganic growth.
5. Data Stewardship and Ecosystem Trust
Bentley’s commitment to data ownership and stewardship is a strategic moat, with explicit user control over AI training data and a registry for consent management. This stance is resonating with engineering firms and owner-operators, differentiating Bentley from generic AI vendors and reinforcing its ecosystem position.
Key Considerations
Bentley’s 2025 results and 2026 outlook demonstrate a business model built on recurring revenue, operational leverage, and a disciplined approach to AI monetization. The company is methodically layering AI into its portfolio while maintaining high retention and expanding its acquisition pipeline.
Key Considerations:
- Asset Analytics Scale-Up: The $50M run rate validates the asset analytics monetization thesis, but recurring classification depends on regulatory inspection cycles accelerating.
- API Consumption Opportunity: API-driven workflows are poised to multiply software usage, but widespread adoption and monetization hinge on customer readiness and process changes.
- Subscription Mix Drives Predictability: The shift to 92% recurring revenue, with E365 at 45% of subscriptions, enhances visibility and resilience.
- Capital Allocation Optionality: With leverage at multi-year lows, Bentley can pursue larger or more frequent acquisitions to supplement organic growth.
- Product Repackaging Momentum: ProjectWise Connect’s rapid adoption and simplified tiers are expanding access to advanced features, supporting future growth.
Risks
AI monetization in design workflows remains a long-term play, with adoption gated by the cautious, regulated nature of infrastructure engineering and owner-operator procurement cycles. Asset analytics revenue, though growing, may not fully convert to recurring ARR until inspection norms shift. Currency exposure has increased due to global expansion, potentially impacting reported margins. Macro uncertainty in China and the commercial facilities sector could weigh on growth, while competitive pressure from new AI entrants and evolving customer expectations present ongoing strategic risks.
Forward Outlook
For Q1 2026, Bentley guided to:
- Constant currency revenue growth of 11-13%, mirroring 2025’s trajectory
- ARR growth of 10.5-12.5%, with asset analytics upside not fully annualized
For full-year 2026, management maintained guidance:
- Revenue of $1.685B to $1.715B
- Adjusted operating income less SBC of $495M to $510M
- Free cash flow of $500M to $570M, with 45-50% expected in H1
Management highlighted:
- Continued investment in AI and earlier weighting of operating expenses in 2026
- Stable end-market demand, except for ongoing China softness and commercial facilities headwinds
Takeaways
Bentley’s model is built for durable growth, with AI-enabled asset analytics and API consumption emerging as new growth levers. The company’s conservative approach to AI in design, focus on trust and data stewardship, and disciplined capital allocation position it to capture upside as infrastructure digitization accelerates.
- Asset Analytics Validation: Early monetization success in asset analytics sets the stage for broader AI-driven recurring revenue, but regulatory and adoption cycles will dictate the pace.
- Subscription Model Strength: The continued mix shift to recurring revenue and usage-based pricing increases predictability and operational leverage.
- AI Monetization Timeline: Investors should watch for the conversion of API consumption and asset analytics into ARR, as well as signs of accelerating AI adoption in design workflows across the portfolio.
Conclusion
Bentley Systems enters 2026 with strong financials, a growing asset analytics business, and a methodical approach to AI integration that prioritizes trust and long-term value creation. The company’s capital flexibility and product innovation underpin a compelling, durable growth narrative, though full AI monetization in design remains a multi-year journey.
Industry Read-Through
Bentley’s results underscore a broader infrastructure software trend toward recurring revenue models, AI-driven operations, and data-centric value capture. The company’s asset analytics momentum and focus on API-driven workflows highlight a shift from traditional engineering software to consumption-based, AI-enabled platforms. Competitors in infrastructure, engineering, and asset management software will need to address the trust, data stewardship, and ecosystem integration demands of owner-operators and engineering firms. The slow but steady adoption of AI in mission-critical, regulated industries signals a long runway for digital transformation, with monetization favoring those with established customer relationships and proprietary data platforms.