The earnings conference call with Bernard Charlès, Vice Chairman and Chief Executive Officer, Pascal Daloz, Chief Operating Officer, and Rouven Bergmann, Chief Financial Officer. Dassault Systèmes results are prepared in accordance with IFRS. Most of the financial figures discussed on this conference call are on a non-IFRS basis, with revenue growth rates in constant currencies, unless otherwise noted. Some of our comments on this call contain forward-looking statements that could differ materially from actual results. Please refer to today's press release and the risk factors section of our 2021 universal registration document. All earnings materials are available on our website, and these prepared remarks will be available shortly after this call. I would like now to introduce Bernard Charlès.
Thank you, Béatrix. Good morning and good afternoon to all of you. Thank you for joining us. It's always a pleasure to be with you today. We delivered solid results, as you may have seen in the press release, for the third quarter of Dassault Systèmes 2022, demonstrating the resilience of our model and broad diversification of our business. Total revenue increased 8%, driven by accelerating recurring revenue growth of 10%. We continue to show strong profitability with earnings per share up 17%, while also investing for the future. Our strategic growth drivers performed well, with 3DEXPERIENCE revenue increasing 15% and cloud revenue rising 21%. Looking to the remainder of 2022, we have reaffirmed our revenue objectives of 9%-10% growth and increased our EPS target to 18%-19%.
We are well positioned and on track to achieve our 2024 EPS objective of EUR 1.2. I will give Pascal and Rouven the floor to discuss our operational and financial performance in more detail in a moment. Now, I would like to share some perspectives on our strategic positioning. The first one is about virtualization, which indeed opens possibilities well beyond digitalization. For us, it's the next frontier. For 40 years, we have been a trusted partner, leveraging science to help clients overcome their most significant challenges, prepare for the future, and realize their greatest ambition. We have this track record, and we have recently been attending the 3DEXPERIENCE Forums around the world, seeing incredible showcases. It's very clear from our conversation with customers and partners that we are, for them, game changers. We have supported clients first with Digital Mockup.
You remember that, it's still going on. Adding product life cycle management. It's coming back, product life cycle management. Now with the platformization of everything, the 3DEXPERIENCE platform, to power our industry solutions. In 2020, we announced our ambition to extend virtualization from things to life. Believe me, there is much more to come. We look forward to sharing some updates with you during the full year 2022 earnings announcement in February. The second remark is about the science. Virtualization is about applying science at scale, using the virtual world to extend and improve the real world. This subject is really a center of preoccupation. Our foundation in science is truly a differentiator. Our virtual twin experiences, powered by cloud-based 3DEXPERIENCE, are not simple renderings.
They are fully integrated with specific laws and principles, and all of our technologies integrate this multiphysics, multiscale, multidiscipline that we combine with modeling, simulation, and data science for truly a holistic approach to innovation. I will say even creation of new businesses and solutions. We empower clients to create virtual, indeed, their virtual universes to operate their life cycle of their products and services, and also their production system. This establishes a valuable foundation to fully leverage the future of data science. As data collection and analysis accelerate, virtualization of society and the economy requires the highest level of security, trust, and services, operated services. For this reason, we are announcing our strategic objective to elevate 3DS OUTSCALE to a master brand, like all the twelve brands we have already. Our unified cyber governance offers three levels of trusted experience cloud, dedicated, private, and international cloud.
For obvious reasons, we provide a holistic collaborative universe to create and operate virtual twin experiences, process modeling, data science, and business experiences. Today, we announced a new alliance as part of this new OUTSCALE positioning with Numspot to offer sovereign cloud on cloud services to European citizens aligned with the new Data Act. Each quarter, I want to return to our purpose and make sure that we always illustrate it. Sustainability has always been at the core of our mission to harmonize product, nature and life. Virtualization is an unparalleled catalyst and enabler of sustainable innovation. It allows innovators to create the right decision the first time, using only what's necessary, lean, and incorporate, reuse, and recycle into the design and manufacturing. In fact, design out waste and design for experience is our motto.
To expand the impact we can have on society, on the planet, we have made the power of our 3DEXPERIENCE sustainability portfolio accessible to a broader audience. With 3DEXPERIENCE Lab, we are supporting disruptive startups, accelerating sustainable innovation, and there are many of them. We are preparing the workforce of the future with 3DEXPERIENCE Edu, a significant program. We are driving the adoption of sustainability measurements and standards through partnerships and coalitions, and many of them have already been communicated. Our ambition is to become the world's number one trusted partner for reinventing a sustainable economy. I think this is clear. We walk the talk and many illustrations will be seen today. I hand over to Pascal for his presentation to discuss, and Rouven, to discuss the third quarter results. Pascal, you have the floor.
Thank you, Bernard. Hello to everyone, and again, thank you for being connected. It's a real pleasure to be with you. We are back in London, and it's, again, a pleasure to do it physically, also, even if for this call it's remote. Let's start with a few comments related to the customer. I think if you look at what's happened during this quarter, more than ever, across all three sectors of the global economy we serve, the relevancy and the criticality of what we do has been extremely visible from our customer standpoint. I think we have significant opportunity to help our clients accelerate innovations creation, as Bernard was saying, increase resiliency, and to scale it.
This is clearly demonstrated in our customer adoption this quarter, which incorporates numerous domains and use cases such as precision medicines to new modular nuclear reactors, just to name a few. Now, let's zoom on a few examples, and I will start with transportation and mobility. As you know, it's a core sector for Dassault Systèmes, and I think many of you had questions related to the resiliency of this sector. I think we did a strong performance this quarter, growing double digits almost since the beginning of the year, and we have built on this momentum with a good Q3. We continue to advance growth opportunity across several vectors, you know, 3DEXPERIENCE being one of them, with the combination of the industry solutions. It's critical for electrification, battery design, and manufacturing.
I think we are working with nearly all the new players, the new entrants, but also with the large incumbent transforming themselves. We have many proof points in Q3, right? Including Tesla, Volkswagen, Jaguar Land Rover. Jaguar Land Rover, you know, it's an interesting case because you know that they was an early adopter of the 3DEXPERIENCE platform and our industry solutions. Today they are deploying the 3DEXPERIENCE platform to 500 suppliers to build their value network. This is obviously key to drive the quality and the time to market by standardizing the critical processes, but also enabling simultaneous engineering and improving traceability. It's extremely crucial for the new programs, the electric vehicles, on both sides, you know, the design of the systems and the architecture.
Also all the downstream which is related to the experience, we call it driving experience of the vehicles. JLR expansions, again, for us is a strong reveal of the strong potential of the network effect when our large enterprise clients connect their supply chain to fully scale our technologies. Now let's zoom to life sciences. I think we continue to build on a strong momentum, delivering another excellent quarter. Looking to the past few years, you know, COVID has been an accelerator of the growth. This is true. However, it has proven to be a step change. The pandemic revealed what is possible with the innovations, and it also exposed the importance of connecting the dots across research, discovery, manufacturing, and commercialization.
I think we continue to see biopharma, med device, and CRO clients investing heavily to support programs across a number of therapeutic areas such as oncology, central nervous, and infectious disease. Customers have not only adopting the core Medidata Rave, but they are also expanding to Medidata Patient Cloud for decentralized clinical trial and Medidata AI to get more insight from the data. We are really changing the game, I think, and we are differentiating by building long-term competitive advantage. Many of the biopharma company, you know, we support with COVID vaccine development, started as a small customer, right? Now some of them are becoming the largest customers for us, advancing broad therapeutic candidates. I think we have good proof point this quarter.
All of you know BioNTech, you know, and as you may know, BioNTech, they leverage our Medidata platform to support the development of this COVID-19 vaccine. This quarter, the company has selected Medidata AI to improve the trial design for cell and gene therapeutics in tumors, broadening the scope of our relationship for sure. I think we are pleased to support BioNTech as it advanced precision medicine strategy and strives to deliver better outcomes for the patient. Now, moving to infrastructure and cities. Supply chain are becoming really the hot topic because they are facing an unprecedented challenges, including delivery dislocations, material costing, assessing the viability of substitutes, and how to increase resiliency if there are no more alternative materials or parts. To address these issues, this is requiring managing tremendous complexity with a multi-scale sourcing planning approach. I think that's what we do.
As an example, this quarter, we put the light on one of our customer called Mammoet, a leader in engineering, heavy lifting, and heavy transportation. They are deploying ENOVIA Quintiq, powered by 3DEXPERIENCE platform, to maximize the resource utilization, reduce the cost, and retain its workforce at the same time. Every part of the supply chain is dealing with volatility and disruption, and we do expect this to drive and continue the demand for the transformation. As you can see, you know, we continue to deepen and expand our relationship across sectors to help advance the strategy for our customers. Now let's turn to our third quarter 2022 results, and let's see, the revenue and the performance per geo.
I think we deliver a solid Q3 performance against a challenging macroeconomic and geopolitical backdrop, and once again, demonstrating the resilience of our model and the diversification we have achieved in our addressable market. If we zoom from a geo standpoint, Americas grew 7%, driven by a strong performance in life sciences and also in high-tech, with a number of deals specifically in the semiconductor space, such as NXP and KLA. Europe demonstrating a strong resilience, increasing 9% with a good performance in France, North and South of Europe, specifically in transportation and mobility from an industry perspective. Asia Pacific rose 6%, with India and Korea were up double digits this quarter and year to date, and China growing mid-single digits as extended shutdowns continue to weigh on the activity.
We saw some softness in Japan in Q3, but year to date, Japan has increased by double digits, so clearly, it's very strong. Zooming in on our product line performance for the third quarter, industrial innovation software revenue rose 6% with clearly CATIA, ENOVIA, and DELMIA growing double digits. If we zoom on CATIA, I think, not only CATIA is growing double digit Q3, but year to date. The growth is driven by the CATIA Cyber Systems and 3DEXPERIENCE, which is widely used by the auto sector and the defense and high-tech sectors, specifically for the electrifications and also the connected objects. This is where really the growth is coming from. ENOVIA deliver the high double-digit growth in tandem with 3DEXPERIENCE platform and the large enterprise deployment.
DELMIA also show a very good growth during this quarter, driven by engineering and operation on the manufacturing side, and also with DELMIA Quintiq showing excellent growth on a year-to-date basis, driven by the supply chain issues I was mentioning before. Now, zooming in Life Sciences, revenue grew 13%, with Medidata delivering again an excellent performance, increasing 17% against a high comparison base, if you remember this, last year. It's probably the time, you know, to step back a little bit and, for those who remember, you know, we just celebrate the 3-year anniversary of Medidata merging with Dassault Systèmes, and it was in October 2019. I think it has been an incredible journey, exceeding all the expectations.
If you remember, we committed to deliver 13%-15% top-line growth and 200 basis points per year improvement on the margin side. We have delivered well above our targets. You know, this quarter again is a proof, growing 17% after three years. There is nothing to add, I think. More importantly, I think since the acquisition, we have consistently taken market share and expanding our addressable markets. From multiple axes. The first one is from a solution standpoint, you know, we are not only focusing on Medidata Rave, but Medidata Patient Cloud and Medidata AI are strong drivers, and it's now representing more than 1/3 of the total revenue of Medidata. It was almost nothing at the time of the merger. We continue also to expand the market coverage. We are also growing across multiple markets, including biopharma, med tech, CROs.
In fact, if we look at the CROs, we have doubled the revenue since 2019. We continue also to invest strategically, doubling the size of Medidata, and I think we can claim that Medidata today operates at a level of scale whereby we bring the largest team of experts of the industry, having the deepest and the most relevant domain expertise and a scalable platform to advance better treatment for the patient. I think the conclusion, you know, Medidata is really core to Dassault Systèmes. We are expanding virtualization from things to life, but also we are keeping with our purpose to harmonize product, nature, and life. It's a deep commitment to life sciences, as we have significant ambitions to solve the industry's greatest challenge and ultimately have a meaningful impact on healthcare and for the benefit of the society.
While it has been a terrific three years, it's only the beginning of the journey, and more than ever, we are excited about the future. Now, let's move to the mainstream innovation. Software revenue increased 5%. As you may know, the mainstream market is really the one being impacted by the macroeconomic conditions right now, and it's in conjunction with some specific situation in China, where COVID-related shutdowns continue to have a significant headwind, affecting SOLIDWORKS results this quarter, and specifically on the license growth. I think on behalf of those in China, we hope the situation will improve soon, and we expect, again, the mainstream market to return to trend growth when the macroeconomic conditions will normalize. In the mainstream, we continue also to invest, and we are pleased to announce an acquisition for Centric PLM this quarter.
Just to give you some understanding about the these acquisitions, you need to remember that again we are expanding Centric PLM along many axes. The first one is touching new industries or new subsegment of industries. PLM, Centric PLM was really addressing the fashion industry and more and more we're expanding in food and beverage, personal beauty, even consumer electronics. We are starting to touch new geography also, specifically opening the market in Asia. We are diversifying from brands to retailers, and we see more and more tractions coming from this side. Finally, we are also expanding the scope of solutions. You know, Centric has basically built a standard for the collection management for this industry, and we are more expanding to business planning and analytics, as well as e-commerce.
This quarter, you know, we again complement an acquisition called StyleSage, a cloud-based market intelligence platform offering retailers AI-powered tools for competitive benchmarking, price optimization, and forecasting. This is extremely critical for the success of the e-commerce, because you need to have a different pace, how you monitor your price and how you optimize your pricing. This is what the company is bringing by having developed several technologies, the ability to crawl all the websites, to extract the attributes, to match with images, do the consolidation, build the analytics, and basically provide insight to the decision-maker to make it happen. Again, welcome to these teams. I think it's a game changer, and it's also a sign that we are expanding the scope and being much more related to the e-commerce topic.
Because the PLM backbone is becoming the product referential for e-commerce in many, many consumer-oriented industries. I think now it's time for me to hand over the presentation to Rouven to discuss revenue, profitability, 2022 objectives. Rouven, glad to see you.
Thank you, Pascal. Welcome, and thanks for joining our call today. As you heard from Bernard and Pascal, this quarter was exceptional in highlighting the resiliency of our model, of our business model. Total revenue grew 18% as reported and 8% as constant currency, with recurring revenue up by 10%, representing 82% of software revenue, which was driven by strong subscription growth of 16%, ex FX, and also with cloud revenue up 21%. Our service revenue increased 16% at constant currency during the period. We delivered this good performance on top of a strong first half year. What was different this quarter compared to the first six months is that there was a shift in our expected revenue mix with a higher contribution from subscription and lower CapEx-based purchases. As such, revenue from licenses was down by 2% at constant currency.
This was driven by a preference for subscription as well as the absence of a recovery in China, and I will discuss this in greater detail in a moment. Despite these shifts, as you can see in the numbers, we delivered on our profitability target as promised. This reflects strong returns on the investments we've been making over the last few years in product, infrastructure, and our go-to-market. The operating margin was 31.6% and earnings per share rose 17% to EUR 0.26 as reported. Our growth drivers of 3DEXPERIENCE and cloud are very resilient and continue to propel us forward. Clients from large established enterprises to new players and disruptors. They all adopt 3DEXPERIENCE platform and cloud. They are looking for platforms to accelerate innovation, scale their operations, and to drive growth.
Again, this quarter, 3DEXPERIENCE was a key driver of large transformational client deals, as highlighted by Pascal. 3DEXPERIENCE revenue grew 15% and accounts now for 32% of software revenue, which represents an increase of two points relative to last year. Our cloud revenue rose 21% at constant currency, driven by continued strong momentum of Medidata, up 17%, as well as a very healthy growth in 3DEXPERIENCE Cloud. Cloud now accounts for 24% of our software revenue, which is up three points versus last year. Now, let me turn to the financial results and how we performed relative to the objectives we've set. Total revenue of EUR 1.37 billion was EUR 65 million higher than the midpoint of our target range. We benefited from an FX impact of EUR 74 million during the period.
Excluding this currency impact, we landed between the low and the midpoint of our range. We reported recurring and service revenue above the midpoint by EUR 10 million and EUR 4 million, respectively. This was partially offset by the lower license revenue, which was EUR 23 million below the midpoint. This was driven by two factors. First, as mentioned, clients displayed a stronger preference for subscription with an impact of approximately 4 points of growth on the licenses. This means that we had a few deals that shifted to subscription at the end of the quarter, which were forecasted as license revenue before. Second, we experienced continued softness in China due to the extended shutdowns and restrictions. This also affected SOLIDWORKS sales in China.
As you know, China is a key market and traditionally one of our largest markets of perpetual licenses as over 50% of the total software revenue in the country come from licenses. While we had factored some weakness into the Q3 objectives, the impact was higher than expected. Now this, along with some softness in the SMB market, had an additional impact of approximately 4%-5% on the license growth. The bottom line is this. The shift to accelerated growth and subscription revenue is well underway. We are well prepared, as you can see. We are progressively increasing the share of recurring revenue while continuing to deliver on the top-line revenue and our profitability objective, despite the lower growth contribution from license revenue.
Again, as I said before, this highlights the excellent resiliency of our model, and we will continue, of course, to support our clients with the optionality that meets their needs. We reported operating margin, an operating margin of 31.6%, as mentioned, in line with the objective, while hiring nearly 800 net new team members during the quarter. We grew headcount by 10% year- over- year. As you can see, we remain committed to our plan to make the critical investment in support of our long-term growth objectives. Also important to highlight is that more than 50% of the hires in our R&D function are based in India, of which a good portion fuels the continued growth of Medidata.
Compared to our objectives for the quarter, operating margin benefited 10 points from a positive FX impact and 50 basis points from a lower expense, offsetting the negative impact from the slightly lower revenue. Now turning to the third quarter earnings per share. We delivered strong growth of 17% to EUR 0.26, above the objective range of 6%-11% growth. The growth in EPS benefited this quarter from a more favorable FX conversion, driven by the strengthening of the U.S. dollar with an impact of EUR 0.013, as well as a lower tax rate and a higher financial income contributing EUR 0.007.
Finally, the non-IFRS tax rate for the quarter of 20.7% versus our objective or guidance of 21.6%, was driven by a lower tax rate in France and continued benefit from higher R&D tax deductions in the U.S. Now let me turn to our cash flow and balance sheet items. Cash and cash equivalents totaled EUR 2,787 million, compared to EUR 2,979 million at the end of last year, a decrease of EUR 192 million. Our net financial debt on September 30th, 2022, decreased by EUR 681 million to EUR 208 million, compared to EUR 889 million by the end of last year. This keeps us well ahead of schedule on our deleveraging objective. Now let's look at what's driving our cash position this quarter.
First, cash from operations totaled EUR 1,281 million for the first nine months, which is an increase of 2% relative to last year. Please remember, this was on the back of a strong comparison base. Last year was up 24.5%. By far, the largest impact on the operating cash flow performance year to date comes from the change in non-operating working capital. There are two distinct effects related to an increase in income tax payable. Adjusting for these two effects, cash flow from operations would've been up 10% year to date. As you said before, we are committed to returning value to our shareholders through technical innovation, strategic acquisitions, stock repurchases, and prudent use of debt and our dividend policy.
Consequently, in the first nine months of this year, we used operating cash for share buybacks, net of proceeds from stock options exercises at a total of EUR 359 million. We paid our dividends of EUR 224 million, and we repaid the debt at the level of EUR 885 million. Net of proceeds from EUR 250 million commercial paper, which we issued this quarter. Lastly, of note, we had a benefit of EUR 218 million from FX, with EUR 103 million coming just from Q3. Now let's turn to our 2022 objectives. As we look to the fourth quarter, we feel very confident about the business momentum as we continue to refine our model towards resiliency and predictability, with increasing recurring revenue as a percent of total software revenue.
First, we are reaffirming our 2022 total revenue growth objective of 9%-10% to a higher absolute range of EUR 5,610 million-EUR 5,650 million, versus EUR 5,485 million-EUR 5,535 million previously. This incorporates an update to the US dollar rate for the remainder of 2022. This adjustment to our currency assumption, along with the third quarter FX benefit, has a positive impact of EUR 114 million on our total revenue objective. Reflecting the resilient growth in subscription and support revenue throughout this year, we're confidently adjusting our recurring revenue growth target to a range of 9%-10% from 9% previously.
At the same time, we are reflecting the increase in volatility of the license sales to a range of 5%-7% growth, which was 9%-11% previously. This reflects the lower performance of Q3, returning to low to mid-single digits growth in Q4. Now second, let's come to the operating margin. We are reaffirming our full year objective of 33.4%-33.7%, reflecting continued investment in our future growth initiatives. Finally, we are raising our EPS for 2022, the diluted EPS objectives to 18%-19% growth, reaching now EUR 1.12-EUR 1.14, from EUR 1.08-EUR 1.10, or 14%-16% growth previously. To complete the picture, we are also projecting service revenue growth to be in the range of 11%-12%.
Now before closing, let me briefly share our objectives for the fourth quarter. Total revenue growth of 8%-10% ex FX, with software revenue growing 8%-10%. We're targeting recurring revenue growth of 10%-11%, license revenue in the range of 2%-7%, and service revenue up 6%-11%. The operating margin of 34.9%-35.9%, and the diluted EPS growth of 12%-18% to the range of EUR 0.32-EUR 0.34. Of course, for additional information, I refer you to our earnings presentation from earlier today. Let me conclude. This was an excellent quarter highlighting the resiliency of our business model in terms of accelerating subscription revenue and delivering on the operating margin objectives with EPS growth up 17%.
What I want you to take away from this quarter is that we are well prepared for a progressive acceleration in subscription growth by continuing to support our clients with the optionality that meets their needs. Our key growth drivers of 3DEXPERIENCE and Cloud continue to build the momentum. As you see in our updated guidance, we adjusted our revenue mix with lower contribution from license revenue to address the continued volatility in China and the SMB customer segment. At the same time, we are increasing the share of the recurring revenue, offsetting the lower license contribution. In conclusion, we are reconfirming our 2022 total revenue growth of 9%-10% ex FX to a higher absolute range, incorporating the full benefit of EUR 114 million from currency.
We are raising our EPS growth objectives to 18%-19% year-over-year growth for the full year. Now with this, Pascal, I'd like to hand the call back to you.
Thanks, Rouven. What are the takeaways? I think there are a few. First of all, I think our technology have never been more relevant and critical for our clients. You know, we are uniquely well-positioned to help them overcome today and many of the challenges and realize their ambitions. More than ever, our science-based platform approach afford a long-term competitive advantages. I think we have demonstrated in Q3 and since the beginning of the year that we have a strong and resilient business model with a high recurring revenue. We are walking the talk, you know, fostering a progressive acceleration in subscriptions growth, while at the same time we are delivering revenue and profitability. As such, we, I think, reported a solid third quarter and raised our full year EPS targets.
We have a solid pipeline putting us on a trajectory to achieve our near and long-term objectives, and I think that's basically the level of confidence we have. Finally, I think we will be pleased in the coming months because we are back on the road to participate in several investor events in the U.S. and probably in Europe, and I think we look forward to seeing you. I think it's time now for Bernard, Rouven and myself to take your questions. Operator, back to you.
Thank you. Dear participants, as a reminder, to ask a question, you will need to press star one one on your telephone and wait for a name to be announced. Please stand by. We will compile the Q&A roster. This will take a few moments. Thank you. Now, we're going to take our first question. Please stand by. The first question comes from the line of Jay Vleeschhouwer from Griffin Securities. Your line is open. Please ask your question.
Yeah. Thank you. That must be me. Hello, everyone. Let me start with a question regarding your cloud revenue ambition of EUR 2 billion for 2025 and relatedly, your vertical cloud infrastructure strategy in light of the OUTSCALE news earlier today. Could you speak about how you envision building your hosting capacity, your competitors such as Microsoft and AWS speak in detail about their expansion of data centers and regions and the like. What kind of capacity do you envision having to ramp to to support your cloud revenue targets by 2025? Then a couple follow-up questions.
Bernard, you want to take this one, or you want me to answer?
We can share it, Pascal. I just want to maybe explain a few words on OUTSCALE, and then you can relate to the numbers on the plan. It's okay?
Okay.
Today, we announced that OUTSCALE is... Hello, Jay. We announced today that OUTSCALE is becoming our common operating infrastructure for everything we do. What it means is that we have a level of virtualization to be able to support multiple cloud. That's one thing. It's already in place, as you know, because today we can transparently run our services platforms on other industry solutions, both on Amazon as well as our own physical instance. That's the first thing. We do plan to support new multi-cloud in the years to come, other operators. That's one dimension of it. The second dimension of it is the cyber governance that our customers are asking us to support. They are asking us to provide the services we provide with three levels of cybersecurity.
One for international, what I call international, collaborative platform that goes across frontiers. Second one, which is regional. It's a trusted environment where there is an alignment in laws on fiscal conditions. That's the level above in terms of cybersecurity. Then a level above is dedicated cloud, which means that it's physically located, operated by us, and it's used for a very special, highly sensitive program. In some way, you could have this as being analogous to or similar to Edge cloud. Those three levels of cyber governance are fully integrated in the OUTSCALE operate, service operation framework. That's the context in which we are providing solutions to clients, depending upon what they do.
We could see clients, we will have a lot of clients using at least two levels of what I described at the same time, and having very specific protocols to synchronize them in such a way that the cyber governance, cyber security is tightly respected. That's the strategy, the implementation on the framework. With that, Pascal, maybe you.
Yeah.
You want to step in, huh?
I would add two things. The question, Jay, you ask is basically how we are building the capacity to fulfill the EUR 2 billion we are envisioning in 2025. Just to echo what Bernard is saying, again, we have developed a system whereby we can put different hyperscaler underneath. Right now, we are balanced between our own infrastructure, OUTSCALE, and AWS. Why I'm saying this, because from a CapEx standpoint, there is no need to invest up front before you have the revenue in front of. That's point number one. Point number two, we are using our own infrastructure for the dedicated and the private, where basically we want to size and to delimit, if you want, the frontier in a very specific way.
For everything which is international, I think we will rely massively on the offer on the market. That's really how we are building the capacity without having to basically put pressure on the business model we have, without having to spend more on the CapEx, without having the revenue in front of. I think that's the benefit of the new architecture we have developed 10 years ago, if not 12 years, to make it happen.
Okay, thank you. I'll ask my final questions all at once for you, Pascal, and for Rouven. Pascal, on the call a quarter ago, you gave a very interesting and useful answer with regard to the question about 3DEXPERIENCE Works adoption by brand. As I'm sure you recall, you spoke about the dynamics you were seeing for DELMIAWorks, SIMULIA Works, and so forth. Perhaps you could update us on how that's all progressing and whether you're seeing a more meaningful 3DEXPERIENCE Works penetration of the SOLIDWORKS base of what is almost certainly now over 620,000 licenses. You have to grow that penetration rate.
For Rouven, with regard to what you call the progressive adoption or movement to subscription, how are you thinking about proactively encouraging customers to do so through pricing and perhaps featuring or de-featuring the products versus a more organic progression or adoption by the customers?
I will start briefly. I think this quarter we were extremely pleased with the dynamics of the Works family. Starting with DELMIAWorks. DELMIAWorks is growing a high double digit. Why so? Because now we start to see the traction coming from the reseller network. Remember, for a long time, we were selling direct this line of products, the time to build the references, and now we see again the partners adopting the solutions and promoting extensively on market. It's coming really from the US, from Europe, and to a certain extent, from Asia. The SIMULIA Works family also is growing well. As you may know, it was one of the top priority to expand with having SIMULIA capabilities within the SOLIDWORKS install base for advanced simulation feature. That's what we are seeing.
The ENOVIA Works family is also developing nicely, more in the large customers of SOLIDWORKS, right? Because they are the one having the need for extensive collaborations, for also lifecycle management and program management capability. We see also the platform capability for basic collaborations, like the community ones, being more and more used. I think we see the traction. For the next generation of SOLIDWORKS, again, I would say, most of the new customers of SOLIDWORKS are starting directly with this new capability. This is obviously true for the startup program. As you may know, it's an extensive program, and we are equipping many startups. It's also true for the incubator and the 3DEXPERIENCE Lab.
We see more and more new companies such as, you know, the company in the medical devices, for example, using this set of features. Clearly, I think we are pleased. It's gonna be a long run, you know, to substitute and progressively migrate the large SOLIDWORKS installed base to the Works family, but this is happening. This is really happening.
Okay, Jay, I'll take the second part of your question. Thank you. I think it's important to differentiate here the two ways we go to market. We have our direct model, where we are much more in control with the customer direct relationship, and we better can navigate and understand the preferences of our clients, as much as this is possible. That's one element. Of course, we have our partners that are more and more transitioning from the more traditional licensing model to the subscription world. For this, we have the pricing in place. We have the differentiated models that, you know, allow, for example, our partners to either continue to offer the license.
More and more progressively, we see the shift to subscription that can either be on-premises or in the cloud. So the models are in place. The pricing is established. I would, on the other side, be also clear that the partners, you know, they are on a journey. It takes them some time to adopt, you know, this progression as well. So that's why why I think, you know, this is not something that happens like flipping a switch overnight. This is a progressive move. That's why we call it progressive transition. We do not want to create a scenario where you are forcing someone, you know, to change because, you know, then, you know, there are a lot of unintended consequences to this, and we don't believe in this.
The pricing models are in place to enable the partners. For the direct model, it's really also there's different sentiments across the geos. In North America, we already operate the subscription model at scale. It's more and more the norm to build the engagement and the contracting structure over time. It also allows the more progressive value add models. It gives the customers more flexibility to drive the value up through 3DEXPERIENCE, through the subscription model. They have the flexibility to adjust as they are consuming their program and so that they can really gain the value over the life cycle, which is an important element of the subscription contracting which we do.
In Europe, we see strong growth for subscription, of course, not at the scale like in North America, but clearly it happens in the European markets too. In Asia, for subscription, it's still lagging behind. China clearly is a light market for us so far, and we also believe it will stay like that for the next time.
Okay. Great. Thank you for your comments.
You're welcome.
Thank you. Next question. Nadia?
Now we're going to take our next question.
Yes, please.
The next question comes from the line of Johannes Schaller from Deutsche Bank. Your line is open. Please ask your question.
Yeah, good afternoon. Thanks for taking my question. You mentioned some design wins in the semiconductor space. I think you called out NXP and then KLA. Just wondering if you could shed a bit more light on that particular market, what you see there at the moment in terms of spending trends, also the competitive situation you're facing there, and generally, your strategy addressing that market, and if we should expect more new wins here, maybe over the coming quarters. Thank you.
Okay. I will take this one. Bernard, feel free to add whatever you want.
Yeah. You can go.
You know, it's the market where what we are covering is specifically the IP management. Right? We do not have design automation capabilities such as Cadence or Synopsys. We are partnering with them, right? Does not mean we cannot bring value on top of, because we are managing the life cycle, and more than ever, we are managing what we call the IP. This is really where the core of what we do is today on the design side. We do a lot also on the manufacturing side because you know, you need to produce at scale. There is a time to market, and you need to do a lot of modeling and simulation in order to have a quick ramp-up.
Clearly, we see demand increasing more on the manufacturing side because for obvious reasons. You know, you are aware that many countries want to reinforce the production of the semiconductor locally, and we see a large project going on to build huge facility for production. Clearly, this is where we see a lot of traction coming. On this front, I will not say the competition is rude. The largest competitor we have is much more acting on the design side, and it's probably more a competitor of Cadence and Synopsys than us. I will add that there is something, Johannes, which needs to be understood with the high-tech.
First of all, our team is very, very knowledgeable, and they have a lot of cooperation with a lot of clients around the world. It's really an area I've been participating to lead in the past years. There is another event happening. It's the end product delivered to clients, to the society, those OEMs, if I may call them OEMs, are now redefining the rules about how they use high-tech components. There are good obvious reasons for that I don't need to come back to. Because in most of the case till now, the high-tech components were very often used with a tier one or tier two supplier, creating a black box, and that black box would then be integrated in the final product.
With the new imperative of integration, mastering certification on traceability, more and more tier one and tier two will be forced to do white boxes, open architecture, in such a way that the end product architect can fully integrate at the component level. On this trend, I think is unstoppable. Which means that the nature of the collaboration that's going to happen between the chip providers and the different supplier value chain members up to the final integration is going to evolve at speed. It's obvious and visible today in the auto industry, in the drones, robots, medical equipment. That phenomenon is positioning our 3DEXPERIENCE platform on the IP management, on the collaborative environment, as well as what we call the cyber system architecture.
The cyber governance architecture, the cyber system architecture, as the future of what was at its time, the Digital Mockup, which is really the virtual twin of the system behavior for certification on traceability. There is a lot more to be discussed there. We will discuss it on that topic next at the full year result in February, because it's part of the next evolution of our core development, which we call cyber system. It has a direct impact on how chip manufacturers are going to be integrated in the end product offered to the market.
Maybe just a quick follow-up related to that. I mean, you're obviously active in some very specific parts here and have some important partnerships as you just laid out. I mean, how do you look at this segment from an M&A perspective? Do you feel your portfolio could use some more components here, probably not in EDA, but maybe in other areas, or is that not really a focus area for you?
Well, cyber system, multi-scale cyber system is number one priority for Dassault Systèmes across everything we do. I think it provides a clear answer. Many people have been limiting that to EDA. It's not limited to EDA, as you well said, Johannes.
Understood. Thank you.
Yeah.
Thank you.
And I-
We don't have any further questions.
I think it's time to conclude. Bernard, you want to say a few words?
Well, thank you very much. I know there was a great participation in London. I was traveling and visiting so many customers in the past week, so I know Pascal and Rouven did a great job in London. Many of you were participating. Thank you for connecting today. Of course, we stay in contact, and we continue to provide you with the necessary visibility. We appreciate your openness and quality and integrity of our relationship. Enjoy your afternoon and see you soon.
That does conclude our conference for today. Thank you for participating. You may now all disconnect. Have a nice day.