Everyone. I'm François-José Bordonado, Dassault Systèmes investor relations. From the company, we have Bernard Charlès, our Vice Chairman and Chief Executive Officer, and Pascal Daloz, Chief Financial and Strategy Officer. I would like to welcome you to Dassault Systèmes' first quarter 2019 earnings presentation meeting, which is also being webcasted. At the end of the presentation, we'll take questions from the audience and from participants on the webcasted call. Later today, we'll also hold a conference call. Dassault Systèmes' results are prepared in accordance with IFRS. We adopted IFRS 15 in 2018, so all comparative information is presented under IFRS 15. In addition, we adopted the new IFRS 16 lease standard as of January 1st, 2019. Most of the financial figures on this conference call are presented on a non-IFRS basis, with revenue growth rates in constant currency, unless otherwise noted.
For an understanding of the differences between the IFRS and non-IFRS figures, please see the reconciliation tables included in our press release. Some of the comments we'll make during today's presentation will contain forward-looking statements, which could differ materially from actual results. Please refer to our risk factors in our 2018 document, "Reference." Let me now introduce Bernard Charlès.
We are on a good start for 2019 with a strong Q1. Total revenue is up 13%. The license revenue is also up 15%. All of this is really driven by 3DEXPERIENCE software revenue, which is up 26%, excluding exchange rates. We are delivering on the high end of the guidance. Seven out of the 11 industries enjoyed double-digit growth. Transportation, mobility, aerospace and defense, industrial equipment, home, and lifestyle, for example, as well as high-tech, life science, marine offshore. We'll show a few examples of customer news flow from that standpoint. Basically, what can be said about the Q1 is that we are implementing our purpose with positive impact. Also, on the collaborative social innovation, we have very interesting news with the cloud adoption.
Industry, I talked about it, especially industrial equipment and fashion, as well as mining, with the BHP selection of the Dassault Systèmes 3DEXPERIENCE platform, and of course, also on the life science standpoint. We are confirming on upgrading our 2019 guidance, upgrading it for our currencies effect. If we look at the strategy at work briefly, the purpose has been very well established for the company. Dassault Systèmes provides business and people with 3DEXPERIENCE universe to imagine sustainable innovation, capable of harmonizing product nature and life. There are three spheres of digitization that we are contemplating to serve. Products, the [inaudible] , the BIOVIA, and the move on BIOVIA was a very significant one on that standpoint for the life science sector, and the energy and resources, natural resources with the GEOVIA brand on the 3DEXPERIENCE platform.
I will have a few examples today about those three worlds, if you wish, of how the digital world is transforming the real one. The first is in life science, with really the digitalization of the life science sector on the healthcare system at large, which is having a huge impact on how there is a new setup being done for the ecosystem in life science. Here is an interesting connection, a showcase that we are doing between the BIOVIA and the physical equipment with these wearables used for biomolecules, biologics. It's well known that Dassault Systèmes is very well-positioned in the personalized equipment for personalized health, especially with SOLIDWORKS and CATIA for the design and simulation, like stents, valves, and many other equipment. Here is another illustration where the connection between the equipment and the biologics create a fully innovative protocol for injectables.
This device market is a huge market. We estimate it to be $8 billion by 2025. Of course, the biologic drugs represent today more than 50% of the pharmaceutical R&D pipeline. Let's look at the video.
This industry is undergoing a paradigm shift towards large molecule biologics and the required high-volume injectors to deliver them, with the global market for biologics growing to $375 billion by 2022. The market opportunity for large volume injectable devices alone is estimated to be $8 billion by 2025. Biological drugs now account for more than 40% of pharmaceutical R&D pipelines. These novel biologic solutions, dosed with connected, wearable, and reusable delivery devices, are transforming the patient experience by shifting the point of care from the clinic to the patient's home. Named for the Greek goddess of recovery, IASO is a showcase for the life cycle of a combination product in oncology. From upstream thinking through commercialization, IASO demonstrates the value that Dassault Systèmes and the 3DEXPERIENCE can deliver to stakeholders challenged with bringing innovation to market in the form of combination products and transforming the patient experience.
The IASO showcase features collaborative design, delivering market and competitive intelligence to prototyping and validation, therapeutics design and development, accelerating drug design with unified predictive science, device design and development, leveraging 3D design, collaborative engineering and simulation, manufacturing excellence, reimagining engineering operations and commercialization, and enterprise operational excellence, featuring the 3DEXPERIENCE as a platform to expedite product innovation and manage regulatory and quality activities, providing a true 360-degree view of the product.
The cost of healthcare is also related to transforming the entire ecosystem. This illustration shows the importance of connecting the dots between the biologics and the equipment. We believe we have a unique position to serve this market in a different way. As many observers notice, the level of compliance when it comes to the certification of the equipment and the certification of the protocol are significant in the sector, which calls for traceability, which basically is the value of the 3DEXPERIENCE platform demonstrated in other sectors like aerospace. Talking more widely about the industry renaissance, we believe that it's far more than digitalization of the past. It's about game changer in many sectors. Production are focusing now of produce of one as opposed to volume only, with personalized, highly personalized capacity in the production line. The digital production is key.
Product as a service with key operation. That's why we see today, visible the growth of the DELMIA portfolio in digital manufacturing. Of course, the industrial experience to provide really a further integration between design, production, and product in operation, including the support of machine in operation. You will see in a moment also the importance of this 3DEXPERIENCE platform for digital analytics. An example of that is in the pharma biotech. One of the biggest challenge is the process. The molecule is the process in large molecules in the pharma sector, which means that the process will decide if you can have a successful molecule or not, or if you can produce it in volume, which means that intelligent, connected system for production are essential. Good traction on this quarter. Confirmation of what is happening on the cloud.
As we announced last year, Schindler has been adopting the cloud for escalators, which was, in large scale, an impressive showcase for illustrating the maturity completeness of our solution, creating the 3DEXPERIENCE twin of the escalators. This quarter, Schindler adopted the same approach for all its elevators activities. It's a breakthrough because it does change the full life cycle about how you define with the contractor or the developer of the building, the product specification, and how those product specifications are feeding R&D on production to deliver the right configured solutions. Also noticeable was the push from the marketers and the salespeople from the Schindler company saying, "This is what we need to ensure that our contracts with developers are clear and well understood." A great showcase on a confirmation that it can scale in a large way. Another Mittelstand company in Germany, Claas.
Schindler is, of course, Switzerland. Claas, in Germany, they are doing agricultural equipment. They are investing also in China, having both companies in China. The way they are integrating those activities in China is using the 3D language as a way to remove ambiguity between China and Germany. It was quite intriguing for us to discover the extreme collaborative environment that has been established globally for such kind of equipment, and the incredible results in terms of quality of communication for the design and production, integrating companies in China and Germany to provide new product portfolio for the Chinese market. They are also using the digital experience twin, incorporating IoT data, intelligent machine connection, to really improve the overall delivery. Those equipments are highly customized for each market of the world, and that's why the agility and flexibility of production systems are so key. Another very strong illustration.
The ABB Dassault Systèmes partnership was announced. We simply said we are demonstrating that horizontal integration can bring more value to clients as opposed to vertical integration. Customers want to have the choice with the equipment. ABB is a great company, highly diversified. They want to use our platform for their own businesses, and we want to use the ABB relationship so they can become an integrator, an industrial integrator of the solutions to our clients. It is well known that in the highly flexible manufacturing environment at Boeing, for example, ABB equipment are being used. There are many other clients that we have in common, where the value has been well appreciated by clients to see this announcement, this partnership going to a new level of integration. Horizontal integration is, I think, a higher value to clients as opposed to vertical integration.
We have seen it in hardware and software in the past. I think this will continue. Great partnership. We are satisfying our clients. One quick word on the trends on manufacturing. There is a big difference between digitalization of a manufacturing process and creating a platform-based manufacturing environment. The analogy would be the analogy of Amazon. What Amazon did with the platform for retail, a similar thing is happening in production. The digitalization of each of the stages in production does not provide the results which are expected by clients. Creating a common platform-based manufacturing environment is a game changer, and basically this is what Dassault Systèmes is doing with the 3DEXPERIENCE platform. It is a differentiator from that standpoint, and that also explains the double-digit growth in this area and the adoption by extremely large manufacturers.
A quick comeback on the move that we did with Centric PLM, Centric Software. As you know, we own about 66% of Centric PLM. We will buy the remaining shares in the next two to three years. The dynamic of our successes in the home and lifestyle sector is really very impressive. We are now reaching over 800 brands worldwide. You see them here. Of course, those are very well-known logos. The reason why the adoption is so successful is because the product is simple, configurable, extremely easy to deploy, and basically, users love it. It is used to do the PLM process, the product life cycle process, to manage collection-based sets of offers. It is also being used more and more to create the trading between the brand manufacturer and its point of sales around the world.
When point of sales are establishing the categories they want to sell and the pricing they want to do for a given market, they use this trading environment, the Centric PLM platform, to do so. A very good dynamic. We are very pleased to have done this acquisition. The results from a financial standpoint for those companies are significant in terms of impact on sales, reduction of inventories, on significant reduction of inventories, you see between 20%-40%, on reduction on logistics cost. Basically, this is a small team that could reach the world because the value clarity and the simplicity on adaptation of the product to the specific market is extremely strong. You see many new clients here like Adeo, a leading international home improvement retailer based in France, and you have the list on this presentation.
Milan Design Week 2019 was two weeks ago, was very successful. Our objective there is to show that we are connecting the B2B to C, on showing the impact of the design world. 25,000 visitors came and saw what we were presenting here with clients like Honda and many others who were present. The Milan Design Week is like the fashion week of design, and there are so many creative things going on. We had high visibility in the media, the world's best designer came and spoke on the round tables to show how both SOLIDWORKS, CATIA, and 3DEXPERIENCE platform can change the world, moving from design thinking to experience thinking. This morning we announced a milestone cooperation that was started two years ago, or for three years ago, with BHP Group, the largest mining company in the world.
We have announced that we have reached an agreement for a strategic partnership for long term. This is, I believe, as important as the partnership we announced with Boeing when we did the 777 and changed the future of aerospace with digitalization of aircraft creation, production, and operation. This is a holistic approach from basically pit to port. It's really the digitalization and the optimization of all process to improve profitability, to really increase the capacity to pre-plan based on market conditions. To really elevate the workforce and allocate at best the workforce and also, of course, fundamentally to increase safety and comply with very strict environmental regulation. The BHP-Dassault Systèmes cooperation is based on significant pilots that we have been doing for, and showcases we have been doing for the past years, which have provided significant results, leading to this agreement, which is a multi-year agreement.
For the sector, we believe that the sector is behind in terms of digitalization, the 3DEXPERIENCE platform will be, and is becoming game changer to connect the dots in this highly complex CapEx, OpEx intensive sector. Here is a quick illustration.
Driven by volatile commodity prices, declining resource quality, deeper deposits, and increased social pressures, mining companies are seeking transformative change to sustain profitability and their social license to operate. Some companies have started to deploy tactical innovations such as automation, virtual reality, drones, and the Internet of Things. There have been improvements realized in verticals such as resource modeling, short-term scheduling, and fleet management. There is more the industry needs to do to truly transform itself. The 3DEXPERIENCE platform makes it possible to connect the dots, break down the silos between departments, and also disjointed hardware, software systems, enabling superior visibility and enhanced collaboration between upstream and downstream functions, which use the same data. With this comes improved productivity.
This is game changer for the sector because many things have been done as point solutions on creating a platform-based operation where all the data are connected together is, number one, possible. Is changing the capacity to adapt the mining operation to the market conditions, basically, which is for them very, very differentiating. We are very pleased to announce this partnership, I think it will probably resonate in the entire sector and create a new will for the sector to move from highly intensive consulting on highly customized software solutions to a more set of generic industry solution approach. While we transition to Pascal, we're going to comment to you on both the top line, the growth, 17%, as well as software growth and new license growth, the improvement on margin. As you noticed, we did several acquisition last year.
The two main one being Centric PLM, Centric Software, and the second one being IQMS, now DELMIAWorks. Remember, we want to do mainstream ERP for the SOLIDWORKS clients, which by the way, is on a good start. Despite that, we are improving the operating margin, which shows that I think we have a business in good health. Back to you, Pascal.
Thank you, Bernard. You can notice it's a good start for the year. I mean, the growth drivers are winning place, and the contribution of the 3DEXPERIENCE platform, which is really the core of the engine to a certain extent, is growing at 26% and represent 40% of the new license, which is almost in the same trend that what we have seen in Q4 last year. If we zoom and we go a little bit more in detail, let's start the business review, and let's start with by the geo view. Americas growing very well, 18% for the software revenue for this quarter. Remember that Q4 was a little bit disappointed for this region. We had some catch up. We had some large deal shifting. We have been able to close the deal in Q1.
The second point is the growth is driven for CATIA, sorry, for Americas by also the good subscriptions. You have the impact of Boeing, This is not the only one. Last but not least, you also have some contributions of the acquisition, especially Centric PLM and IQMS software. Europe is growing at 10%. Again, in Europe, it's mixed. You have a good growth in south part of Europe, central, and the north. You have a moderate growth, I should say, in the rest, and especially in what we call Europe West, growing at around 5%-6%. Asia, 8%. The good point is, notice here, we have a very good performance in China and AP South, with a growth being close to 20%. I think it's really steady. Interesting. On the consequence, the growth is a little bit more modest for the rest.
We had, again, a good quarter in Q4 in Japan, we have some catch-up coming for the rest of the year. If you look at by product line, CATIA is growing at 6%, it's some improvement compared to Q4 last year. The improvement is coming again from North America with a good subscription revenue. Also, the vast majority of the growth for CATIA is coming from 3DEXPERIENCE platform, which is again, a good sign because it means that this new product line is gaining traction in the core industry as well in the diversification industry. ENOVIA is a star for this quarter, 19% growth. From an organic standpoint, as I wrote here, it's a high double-digit license revenue growth.
This is a proof that when we have a good traction with 3DEXPERIENCE platform, also we are signing large transactions, automatically, the ENOVIA performance is here. That's really the correlations you can extract and conclude from this analysis. SOLIDWORKS is growing at 5%. Keep in mind a few things. One, we had a strong base of comparisons with revenue up 13% last year. Also, if you remember, I committed to you that we will achieve the 10% growth for the full year last year, I think I put some pressure on the channel and I probably drive a little bit the pipeline early this year. For the full year, I'm still expecting to have SOLIDWORKS growth between 5%-10%, which is in line with the guidance I gave to you early this year. There is also an important point for SOLIDWORKS.
We are introducing the 3DEXPERIENCE Works family, with not only the introduction of IQMS, the recent acquisition we did, but also all the other product line we have available on 3DEXPERIENCE platform. This is also a key point because it's a way we will continue to fulfill the growth for SOLIDWORKS over the time. The other software line is growing nicely at 22%. This is also the proof that all the decision we took few years ago to a larger scope, the domain we were serving is starting to pay off because it's a nice growth. Specifically, this growth has been driven by the manufacturing space, we do a zoom just afterwards, but also the simulation space. Those are two product line growing very well and having a strong demand on the market right now.
If I zoom on the manufacturing space, the DELMIA performance is up 25%. Total software revenue, it's a pure organic software revenue because IQMS, so-called DELMIAWorks is not yet integrated into this number. The DELMIA Quintiq, which is a subset of the brand right now dedicated to logistics, the inbound logistics and the outbound logistics, as well as the supply chain, is growing at 78%, which is quite impressive. The growth is really coming from the car industry. That's also a proof point that this strategy is paying off because we have been able to leverage large install base we have in aerospace and defense, transportation, and mobility to expand in this space.
The combinations of DELMIA, which is unique, it's the only product suite having the ability to do the engineering of the production processes, to run the manufacturing facilities, at the same time, to manage and optimize your supply chain with one single platform. This is unique on the market. This is highly competitive against the competition, and here you have the proof. If I zoom on the Quintiq, we have this win, Eurostar, but it's one amongst many we have in this space. In fact, we have a good market share in the highway. The reason is because we have been able to improve the frequency of the trip by doing something which is key, by optimizing the planning of trains with the drivers, but also all the maintenance of the trains.
It's a mix between the workforce management and the maintenance activities you have to do, this is the way we improve the trip frequency, this has a direct impact on the bottom line. We had a significant win in the Swiss highway, for the London Tube as well, in the Italian as well. Clearly, we have a significant market share in this space. From an industry standpoint, Bernard already mentioned it, seven of them are growing double-digits. It's all the core industries, the auto sector, the offset defense and industrial equipment, also Some of the diversification industries, the home and lifestyle. Bernard made a few comments on this. The high-tech is growing well for us, and it's not only in the semiconductor but also in the consumer electronics as well as in the telecommunications.
Clearly in all the different segments, we are seeing double-digit growth. In life science, specifically in the biotech and pharma, and in marine and offshore. A few points for you guys. You remember we used to have 12 industries, we have decided to fine-tune a little bit the industry segmentation. Now we have only 11. It's not because we are disinvesting, it's because we are more precise. The changes are the following. We used to have consumer goods retail, and now it's so-called home and lifestyle because this is really where we focus and it's coming from the acquisition of Centric, but also with the rest of what we do. We have also renamed, what we used to call energy process and utility. It's so-called now energy and materials, because the materials part, it's all the upstream and downstream activities impact.
Also, which is probably key for you guys, we have decided to rename AEC by construction cities and territories, because we are convinced this is the way we're going to display this sector by combining the three things together. Okay. If we zoom a little bit more on the financial highlights. On the total revenue, you remember up 13% including the currency effect. The organic growth is 8%, an improvement compared to last year for sure. On the software revenue, 12% growth excluding the currency effect, also 8% organic growth. If we split the software revenue between the license and the subscriptions, here are the results. 15% growth for the license, which is in the range I gave to you. More important, the organic license is up 9%. Clearly we are getting close to the 10% you expect, guys.
The recurrent revenue is up 8%, it's a significant improvement compared to last year because it's +2 points. You remember, one of the key points for this year is, in fact, we don't know what will be the macro impact on the second half of the year. When we gave the guidance to you, I was pretty confident on our ability to improve and accelerate the recurrent organic growth. Here you have the proof, 2 points compared to last year for Q1. On the services, again, 20% growth excluding the currency effect, 9% organic growth. I think it's relatively aligned with software performance. We see a very good traction on those services related to 3DEXPERIENCE platform, as usual. We also see a good recovery on the services coming from Quintiq and Apriso, then the Apriso and then the Quintiq.
You have seen we have a higher growth in software, we also have to fulfill the related services activities. 3DEXCITE is growing a little bit better. We are not yet fully recovered, compared to last quarter, I think we did some improvements. The mixed point on the services is the gross margin. It's half a point below, it's mainly coming from the fact that not only we are giving more and more to the third party. You remember we decided a few years ago to reinforce the partnership with companies like Capgemini, Accenture, Deloitte, TCS, this is what is happening. Also we are a little bit slow in the hiring process, we had to subcontract a little bit more than expected for the first quarter. Nothing structural. We will recover the gross margin on the services side.
If we look at the operating margin, here you have the detail. The activity improved by more than 2 points, it's really a good performance. The main reason is you have more contribution of the recurrent part of the software, automatically this has a direct impact on the EBIT margin. Also we are a little bit slow in the hiring, as I was telling you, I'm expecting to catch up in Q2 and Q3. The currency effect is also having a positive impact, half a point. The acquisitions continue to have some dilution with -1.2. This is for the operating margin. On the EPS side, EUR 0.87, in the high end of the guidance. Just 21%, just 13% if you include the currency effect. It's a direct consequences of the top-line growth and the operating margin improvements.
Point I would like to notice is the tax rate for Q1 is 29.7%, it's almost a point higher compared to last year. It's coming from the fact that in the U.S. you have the newer tax reforms, there is a specific topic related to what we call BEAT, B-E-A-T. It's the minimum tax payment for all the foreign related parties, this has an impact on the intercompany royalty taxation. Again, it's not new for us. It's well integrated into the guidance for the full year, I just want you to be aware and understand the reason why you have this change. On the cash flow side, very good performance. A EUR 489 million cash flow for Q1. We are getting close to half a billion. +20% compared to last year.
We are lending with a net financial position of EUR 1.897 billion, which is a nice position to have. Nothing to say specifically on the operating cash flow. The vast majority of the improvement is coming from the activities, and it's in line with the growth on both sides on the liability and the receivable. For the financial objectives, a few things. As Bernard stated, we have decided to upgrade the revenue, adding EUR 19 million coming from the currency effect in Q1. Also we have adjusted the Q2 currencies for the dollar. If you remember, we used to have EUR 1 for $1.20, and we have adjusted to $1.15. These are the direct impacts of increasing the revenue by EUR 16 million. On the EPS side, we are adding $0.05, and the same mechanisms on $0.03 coming from Q1 and $0.02 expecting coming from Q2 from the currency effect.
That's it for the full year. The rest is unchanged. You will see. We are still expecting a license growth between 10%-12%, a recurrent organic improvement by 1-2 points, and an organic improvement of the EBIT margin by 80 basis points. For Q2, the guidance we are giving for the revenue is EUR 920 million-EUR 940 million for the revenue. A growth, excluding the currency effects, between 10%-13%. The split between software license and the recurring is the following: 10%-12% for the software, 11%-14% for the license, and the recurrent part between 9%-11%. Again, if you compare to last year on the recurrent side, it's 2 points higher than what we did. The EBIT margin is pretty stable at 29.5%, and the EPS range is between $0.74-$0.77, and a growth between 7%-12%.
That's it for the objectives. I think it's a good start for the year. You will be in agreement with me. At this stage, the visibility is good to confirm the objective for the full year. I think we have been able to demonstrate that we are still having a good momentum to capture a new domain, like the manufacturing space, and also to win new customers, significant ones like BHP. The cloud is also something starting to be visible from you guys. We have been able to display the competition thanks to the cloud solutions, and this is what happened at Schindler. I think the foundations to continue to fulfill the growth are well in place. Bernard and I are ready to take your questions. Thank you very much.
We'll take first question from the room and then from the webcast. Mo?
Great. Thank you. Maybe my first question was really around sort of your visibility into the rest of the year. It's encouraging to see a lot of larger or strategic wins, and more importantly, both in core and diversification industries. What's the sort of conversation you're having with the customers now based on the references, how's the pipeline building, and how do you think about sort of the second half of the year, and the kind of puts and takes in terms of sort of how you get there? Secondly, my question was really around, there's been some speculation in the press around M&A. Maybe you can remind us on M&A, where the priorities are, either by vertical or by product area. I don't know, to the extent that you're in a position to comment on any sort of speculation that's out there.
Thank you.
Thank you, Mo. Pascal, you just made a comment on the visibility, but maybe additional information. Like last year, we are relatively back-loaded. Mo, you are mentioning the potentially the large additional contract we could have in the pipe. We have some. It's probably too early to give some indication about where we are. I think the visibility is still good. It's not only in the core industry, it's also, as you mentioned, in the new industry. Mining is a good example, but energy, process, and utilities, high-tech also is growing very well. I think that's it, what we can say. On the channel side, the visibility is also a little bit better in the second half of the year. I just want you to take this into account.
The pipeline is well in line with what we could expect at this stage of the year. By the way, if I may add, it's quite well spread around the globe, across geographies. Asia, of course, is
We think also Europe can sustain its past growth. Related to the second question, of course, it's a good practice to not comment so much on rumors. I think your question is related to the strategy. If you look at back at what the moves we have done in the last years, I think they were aligned with the strategy on innovative. From a strategic standpoint, many reactions where it makes sense. If you think about Centric PLM, it's a significant acquisition overall, but it's about making mainstream PLM now accessible to new sectors. Same for IQMS, as Pascal said, DELMIAWorks. I think this was extremely welcome. Aligned with the strategy on innovative because people did not necessarily predict that those would be the target. The second part of your question is related to the priorities on the arbitration between sectors.
I think the arbitration is relatively easy for us to do. It's related to the maturity of the market or the readiness of the market to adopt the platform, what I call the platform phenomenon for design, simulation, production, and operation. All industries are not the same level. From that standpoint, we know that many that we serve have been showing the way. Clearly, the announcement today with BHP is a significant move for the natural resources. The success we are seeing on the R&D with BIOVIA on 3DEXPERIENCE gives us some very interesting perspective about their life science market at large. For two reasons, biologics are complex, and for us, connecting R&D with manufacturing is a differentiator, and there is not many players in town on that.
Connecting the biologics with the equipment, as illustrated today, is very unique because Dassault Systèmes is almost a de facto standard in med care equipment. It's a sector which is big, and we have to find out what's the best way to extend the solutions in the future on that side, as we did for other sectors. Let's see.
Another question from the room. Michael.
Thank you. Just sort of carrying on the theme, Bernard, there. You had a EUR 1 per share acquired earnings target for 2023. Clearly, that's not a trivial number. Larger deals should be in your M&A pipeline. Would the business be willing to go into a net debt position for the right acquisition? I've got a couple more.
I think with the dynamic of organic growth on the perspective that we have with the huge sector that we serve, 11 industries on 61 segments. We are not prisoners of having to do acquisitions to reach our objectives. When we did the analyst meeting, we provide a framework about where those factors could be coming from. That should not be the spec of what we do. The specs of what we do is roughly to make it simpler, double EPS every five years. That's the specs. Where it's coming from is more driven by the industry dynamic. Don't take the split between M&A contribution to EPS or growth in the existing sector as a static split. Don't want to be prisoner of doing moves that maybe we look at every year, so many possible options. I think we are financially in good health.
While we have been kind of conservative, but very focused on technology, on talents more than new space acquisition. Not the case of BIOVIA, because for BIOVIA, we're going in life science, and we are seriously entering in life science. I think we have a lot of flexibility and we have easy decision process in the company. We are a family-controlled company, and we can make decisions quickly. If good opportunities occur, we will do the right moves because we are long-term oriented. It has always been the case in the last 30 years. I think we have proved it. We are long-term on, I think the track record of a good managed company is there. We have wide scope of possibilities on scale too.
Thank you. Just a couple of follow-ups. On Boeing, there's obviously been some operational issues with the Max jet. Can you say if that's had any impact on the timing or rollout as they work with you? Pascal, just on DSOs. The cash flows seem to show a good sort of reduction in DSOs or debtors, so a working capital positive, but the actual back of the notes shows an increase in DSOs from 82 to 86. I'm just a bit puzzled. Maybe IFRS 15 or something, but can you walk through that? Thanks.
Thank you for asking the question on Boeing. When a customer is facing challenges, we are always all concerned. zero impact on both visibility contracts, on the type of scope of activities we are doing together. It's really zero impact. Why so? Because it's a multi-year contract. It's already established. Any companies of that size are facing difficulties for one piece of their portfolio. Boeing is not the first. It happened to many others. You remember the Toyota challenges back years ago or the Volkswagen challenges not long ago. Those are extremely professional, high-quality groups. Their focus is, of course, to fix their tactical problems and also the capacity to continue to do their product plans. The product plans as well as production of the backlogs when those problems are resolved, are their priority. zero impact for Dassault Systèmes.
We feel even closer to companies when they face challenges to see if we can find new ways to help, especially on those type of highly integrated systems.
Coming to the DSO. The DSO increased by three day and a half. one day is coming from the acquisitions, because you know when you acquire companies, usually they do not have the disciplines we have to do it. This will be fixed. Then you have a two and half day coming from the fact that when we sign those big contracts, usually 90 days is the standard, more than 45 days. This is basically the flip side of those large contracts. This has this impact. We will be able to resolve and to absorb some of them, but not all of them.
We'll take now questions from the call. Alice?
Thank you. If you wish to ask a question over the phone, please press star and one. Your first question comes from the line of John King from Bank of America. Please go ahead and ask your question.
Yeah, good morning. Two questions, please. The first one was on the dynamics within SOLIDWORKS. Clearly, the growth is a bit slower this year at the moment than in prior years. Maybe just talk about the situation competitively, any changes there. We tend to think of SOLIDWORKS as a lead indicator, so just your commentary on that would be interesting. Then more widely for the group, we continue to see good deal flow momentum, so I guess following up on Mo's question, how's the outlook? How's the pipeline looking for you as you head even into 2020? Are you still confident of accelerating towards the guided range? I think you were more talking about 9% organic growth in the medium term. Maybe any thoughts around how plausible that looks in the next 12 months? Thank you.
John, Pascal, you allow me to make a comment.
Yes, please
SOLIDWORKS? The SOLIDWORKS World event this year was very successful. The user base is highly satisfied. They continue to grow. You are right, John, the organic growth is lower at this point in time. I do not think it is related to any special competitive situation, by the way. I believe that it is more related to our transition to expand the SOLIDWORKS offer, our transition with our resellers. To expand our SOLIDWORKS offer with cloud, analytics, manufacturing, what I call added value to the current SOLIDWORKS world, which is design-centric values. That is a bit perturbing for our resellers. I think it is normal. They have been running for 22 years, selling only one thing, SOLIDWORKS, successfully. I believe that the time they invest to expand their knowledge on ENOVIA, on sales force to sell the platform, the cloud, is having an impact on the productivity of the sales force.
We have to go through it, and I think it is a healthy, good discipline to do it. Our products are like xDesign. This is designed through a browser from any device, is extremely welcome by the SOLIDWORKS community. Design anytime, any device, anywhere through a browser. That is unique. Collaborative platform on the cloud. We are replacing Dropbox, which is unsecure for our clients, with a secure on-the-cloud environment. We are replacing basically Dropbox and WhatsApp for our clients to do secured collaboration. That is what we are doing with the 3DEXPERIENCE platform on what we call 3DSwym. It takes a bit of time for our resellers to understand that and to know how to engage with them. The last factor, which we should not underestimate is, and I want to take the opportunity also because I know resellers are listening to the investor calls.
They are questioning, all our competitors are bypassing the reseller network. Get rid of it. I do not need you. I try to reach the customer myself. That is not our policy. We will continue to use our resellers to provide service consulting on high value to our clients because they need it. The fact that we go cloud, we get the connection of the users with Dassault Systèmes. We have to build the trust to demonstrate that there is no risk for them. I think big progress has been done in the last 12 months. We still need to make them comfortable with it. The last point that we discussed before is related to business model. When you sell desktop, you get an initial revenue, therefore royalties on your license, and then you get the revenue, the annual subscription fee. When you sell cloud, it is native subscription.
There is a little bit of cash flow challenge for them. We find new solutions to help them solve that cash flow that is an issue probably for two years. When you have built a snowball of subscription, then it is a sustainable business. Before moving from desktop selling to cloud with the proper business model requires a little bit of tuning. Those are basically the three or four things which are impacting that transition. I am very comfortable with the fact that it is going to happen in a proper way this year to build up this growth that we want to build up with expanded portfolio. Long story, four parameters, training, new offer, cloud, and adaptation of the new business model.
John, the second question was related to the visibility of the pipeline for 2020. I think we signed a decent number of large deals, multi-years. Airbus, Boeing, EDF, BHP now, ExxonMobil, to name only a few. Definitively, this give us some additional visibility on a multiple-year basis. It's point number 1. Point number 2, the recurrent part of the revenue is also improving. I think we are gaining in term of visibility over the time. Coming back to the questions related to the organic growth. If you look at Q1, we are at 8% on the recurrent part. This represents 75% of the software revenue. It's plus two point compared to last year. We are growing at 9% on the license side, organically speaking. We are pretty close to the target, isn't it?
That's helpful. Thank you.
John, are you there?
His line has been released. Your next question comes from the line of Adam Wood from Morgan Stanley. Please go ahead and ask your question.
Hi. Good morning, Bernard. Good morning, Pascal. Thanks for taking the question. I wanted to dig in on a few things, if I could. Maybe just first of all, on the mining space for the deal with BHP. You mentioned, Bernard, that different industries are at different stages of adoption. Could you talk a little bit about where you see the mining industry? The fact this is one of the later deals you signed, does that suggest this industry is lagging a little bit? When it comes to contracts with other companies in this space, could you talk a little bit about the competition and what those other mining companies are using today? Is it a mix of solutions, homegrown solutions? Is this going to be more displacement of competitors versus greenfield? Just a bit more background on the mining industry would be very helpful.
Maybe just on the life sciences space. If I think about it between data management and process management versus the design and simulation or rather the modeling and simulation of molecules and therefore the drugs, could you talk a little bit about where your business is today and where you see the biggest opportunity over the next three to five years? Again, the competitive landscape, is there anyone very big in those areas that would be a hindrance to you getting to those ambitions? If you could give us a few thoughts on those two, that would be great. Thank you.
Thank you, Adam. On the mining side, natural resources at large, this market is very large. If you look at the current situation of the big players, it's a lot of homegrown legacy systems. In fact, in some way, it's astonishing from that standpoint. That's been fed by a lot of consulting services. Incredible numbers in terms of spending. We want to change that basically with the platform approach, and that's what we're doing with BHP. The BHP announcement, I think it's a tipping point. I think it's showing that the 3DEXPERIENCE platform can connect things which have never been connected before. Which means planning, responsiveness to commodity market situations, and the management on allocation of resources, which are gigantic, frankly speaking. As you know, we started with the geology and geophysics aspect with the acquisition of Gemcom, now called GEOVIA.
We wanted to show to the sector that we could address their core topics from understanding their business. I think the sector, through that conversation, has discovered that we can do the full pipeline with the Experience platform on the collaborative aspect. This is what is happening. I believe that this is eye-opener for also players, and we have been interacting with them, and I see this sector as midterm, as a big sector, as strategic as many of the other heavy industries that we serve. I'm very confident. The competitive landscape is a collection of niche software. It's more consulting, customized software on niche software. No one provides the kind of solutions. As a matter of fact, in the case of what we have announced, there was no really competitors. It was about showing, can we do the job or not from pit to port?
That's exactly a sweet spot for Dassault Systèmes when it comes to serving CapEx, OpEx-intensive industries, where there is a lot of spending, but that could be redirected for the right solutions. We are very positive on that. I think with that, I have addressed quick question one and two on the competitive landscape, Adam. On the question three, which is related to life science, we start on the R. On this side with BIOVIA and 3DEXPERIENCE, we have an outstanding showcase we've announced already with Amgen, for example, for the biologics on many also clients, because biologic is very complex, and it's connected to the way you manufacture things. You cannot get the large molecules without the process, and being able to manage the process. Manufacturing process is so key. We see successes in manufacturing in life science.
BIOVIA Discoverant, for example, it's big data analytics on data from production. We do reverse engineering of data in production to improve the production process of biologics. This is under deployment. I cannot refer yet to new wins there. It's too early. We will come back to you with wins there related to the deployment in manufacturing process for biologic, which is very strategic for them because you have no molecule without the process. Now, of course, between R&D, you have a lot of phases, and specifically 3 phases, which are called phase I, phase II, phase III of clinical trial, where there is a lot going on there, both in modeling, simulation, and data acquisition, to really observe the way those tests are being done. The platform for us is always a platform with one target, connect things which have never been connected.
We will have to decide with our customers how we connect those dots. There are multiple ways to do it, integration, open data format. Still things need to be defined, the dialogue with our clients are going extremely well, and they are open to share with us the comparison between the different approach on that sector.
Perfect. Thank you very much.
We'll take one last question from the webcast. Alice?
Thank you. This final question comes from the line of Stacy Pollard from JPMorgan. Please go ahead and ask your question.
Hi. Thank you very much. Just at the very beginning, you mentioned cloud adoption. Can you say what % of revenues that is today, and where do you see that going? Maybe a little dig in on SOLIDWORKS. I know you've discussed this, but specifically around the cloud, what investor interest are you seeing there? Is it possible to quantify, I mean, just big picture, the approximate % of customers that are now looking to take SOLIDWORKS in the cloud, just to see if there's a bit of a shift there, since you've really, I think, launched it quite strongly in February at your SOLIDWORKS event. Last question on ENOVIA was particularly strong again. Is some of that Boeing? If you look across the board, do you think that you're really gaining market share here now?
Thank you, Stacy. I will let Pascal comment on the revenue. I would like to address two things with cloud. First of all, how do we measure our cloud dynamic? Number of customers, number of users on data volume. Number of customers, number of users on data volume. On number of users on data volume, it's really growing extremely fast. We also look at real project versus trial. Most of what we see on the cloud for Dassault Systèmes is our real industrial project. Airplanes, eAirplanes, eVehicle, medical equipment, escalators, elevators. You have seen that with Schindler, with Kärcher is another example on the cloud. The footprint we have with the cloud showcase is extremely strong from real industrial implementation in large scale. The revenue yet is not big because it's a subscription.
It takes a little bit of time, and Pascal might give you a little bit more on that. The last point is related to the nature of our clients for cloud. We target public, private cloud, on-premise cloud. The customers you mentioned, the biggest one we have, are seriously looking at on-premise cloud, which is basically what we did for Jaipur, India, for Citi, where basically it's an on-premise cloud administrated by Dassault Systèmes with Dassault Systèmes norms. We see that cloud as exactly a public cloud that we provide service to someone else. It's a single point of administration. That's the way we are doing it also for Singapore. That's the way we will be doing for very large clients who are going to delegate to us the seamless operations of the cloud so they can, every X weeks, enjoy the full update seamless.
Today we think we master totally DevOps from the cloud standpoint. We had, in the last year, about eight major online updates that took just a few hours on all users. The hundreds of thousands of users around the world were up and running in the next hours with the fully updated version. The system is now fully industrialized. As you remember, I think last time I showed you the map around the world, the map of our cloud continued to expand for Dassault Systèmes, what we call OUTSCALE, 3DS OUTSCALE cloud. We continue to put them in place, and we use the elasticity of Amazon for it. Yes, Stacy, very large clients are working with us to build the roadmap to private cloud for them.
Related to the revenue coming from the cloud, we are not communicating on this. There is a good reason for that, and Bernard said. The point for us is not to transform the model from a pure upgrade model to a subscriptions-based model, because we have already 75% of the software, which is recurrent. I think we are in a completely different position compared to the competition. The cloud is, for us, a way to reach new users to develop new usages, and this is where we are focusing on. I think this is probably more important for you to listen carefully the story we are giving to you, telling to you related to how we could expand the scope of what we do, how could we reach users who we are not able to reach with the traditional model.
I think this is where the growth is really coming from. Coming back to the question related to SOLIDWORKS, I think there is one thing you should keep in mind, Stacy. We are offering the 3DEXPERIENCE platform to the SOLIDWORKS install base only on the cloud. This is, I think, a good indicator about the penetration rate we are expecting, which is almost 100% at some point of time. This market is really suitable for the cloud. Again, the value is not to substitute the desktop solutions with an equivalent on the cloud. You are not bringing too much value if you do this. It's by providing a platform proposal, which is different, because it's a way to connect the dots. It's a way to collaborate easily with the rest of the world, and this is what this market is looking for.
On the ENOVIA side, I think your summary, Stacy, about ENOVIA is unstoppable on the 3DEXPERIENCE platform. All the wins, which are coming are really 3DEXPERIENCE on ENOVIA. Frankly speaking, I don't see how a Dassault Systèmes client will select something else.
Would you say you're replacing
Our install base. Why? Because the value is platform.
Fair to say you think you're
The game changer is platform. That's why we believe that ENOVIA, from that standpoint, it's a logical, easy decision for clients.
Okay, no, that's good. Thanks.
With that, thank you very much for participating, connected to this call this quarter. We're in good shape for the full year 2019. Stay tuned. Don't push too much the rumors. Thank you very much.