Additional Customer Highlights Progress' semantic and graph RAG approach—featuring MarkLogic Server 12—delivers 33% higher LLM accuracy and faster discovery for customers LAS VEGAS, Aug. 12, 2025 (GLOBE NEWSWIRE) -- Progress Software (Nasdaq: PRGS), the trusted provider of AI-powered digital experience and infrastructure software, today announced at Ai4 2025 the general availability of Progress® MarkLogic® Server 12. This latest release introduces advanced semantic search and graph Retrieval-Augmented Gener ...

Core Insights - Progress Software is participating in Ai4 2025, North America's largest AI industry conference, from August 11-13, 2025, at MGM Grand, Las Vegas [1] - Philip Miller, AI Strategist at Progress, will present on "Trusted AI: Unlock Data Value" on August 12, 2025, focusing on connecting generative AI to proprietary data [2][7] - The session targets business and data leaders aiming to implement AI for enhanced decision-making, operational automation, and improved customer experiences [3] Company Offerings - Progress will showcase its Data Platform at Booth 503, which helps unify and govern data across systems, providing real-time insights for intelligent automation and predictive analytics [4] - The company emphasizes its role in empowering organizations to develop and manage responsible AI-powered applications and digital experiences [5]

Group 1 - The stock of Progress Software Corporation (PRGS) is experiencing significant attention due to high implied volatility in the options market, particularly for the Dec 19, 2025 $27.50 Call option [1] - Implied volatility indicates the market's expectation of future price movement, suggesting that investors anticipate a significant change in the stock's price, potentially due to an upcoming event [2] - Progress Software holds a Zacks Rank of 3 (Hold) in the Computer - Software industry, which is in the top 21% of the Zacks Industry Rank, with the Zacks Consensus Estimate for the current quarter increasing from $1.29 to $1.31 per share over the last 30 days [3] Group 2 - The high implied volatility for Progress Software may indicate a developing trading opportunity, as options traders often seek to sell premium on options with high implied volatility to capture decay [4]

Core Insights - Progress Software has announced a new credit facility of $1.5 billion, increasing its revolving credit from $900 million and extending the maturity date to July 31, 2030 [1][2] - The company currently has $660 million in revolving credit loans outstanding, indicating a strong liquidity position to support growth initiatives [1][2] Company Overview - Progress Software provides AI-powered digital experience and infrastructure software, enabling organizations to develop and manage mission-critical applications and IT infrastructure [3] - The company aims to leverage its increased liquidity for additional accretive acquisitions as part of its Total Growth Strategy [2] Financial Arrangement Details - The Fifth Amended and Restated Credit Agreement replaces the existing secured credit facility, enhancing the company's financial flexibility [1][2] - JPMorgan Chase Bank, N.A. acted as the Administrative Agent, with several other banks participating in the syndication and documentation of the credit facility [2]

Core Insights - Progress Software (PRGS) reported total revenue of $237.35 million for the quarter ending May 2025, reflecting a 35.6% increase year-over-year [4] - The company's international revenue performance is crucial for understanding its financial resilience and growth potential [2][10] International Revenue Breakdown - Latin America contributed $5.05 million, accounting for 2.13% of total revenue, showing a slight increase from 2.12% in the previous quarter [5] - Europe, Middle East, and Africa generated $66.94 million, representing 28.20% of total revenue, slightly down from 32.86% year-over-year [6] - Asia Pacific brought in $11.37 million, making up 4.79% of total revenue, consistent with the previous quarter's contribution [7] Future Revenue Forecasts - Analysts project total revenue of $240.35 million for the current fiscal quarter, a 34.5% increase year-over-year, with expected contributions of 2% from Latin America, 30.7% from Europe, Middle East, and Africa, and 5.1% from Asia Pacific [8] - For the full year, total revenue is anticipated to reach $965.22 million, indicating a 28.1% rise from the previous year, with regional contributions expected to be 2.1% from Latin America, 30.1% from Europe, Middle East, and Africa, and 5% from Asia Pacific [9] Market Context - The reliance on international markets presents both opportunities and challenges for Progress Software, necessitating close monitoring of revenue trends to project future performance accurately [10] - The company's stock has seen a decline of 15.2% over the past four weeks, contrasting with a 5.2% increase in the S&P 500, indicating potential market concerns [13]

Group 1 - The core viewpoint of the article is that Progress Software's Q2 results were disappointing, indicating potential challenges in the company's pivot strategy [1] - The analysis suggests that the company is still in the early stages of its strategic transition, which may affect its performance in the near term [1] Group 2 - The article does not provide specific financial metrics or detailed performance data from the Q2 results, focusing instead on the overall sentiment regarding the company's performance [1]

Core Viewpoint - Progress Software (PRGS) reported quarterly earnings of $1.4 per share, exceeding the Zacks Consensus Estimate of $1.3 per share, and showing an increase from $1.09 per share a year ago, representing an earnings surprise of +7.69% [1][2] Financial Performance - The company posted revenues of $237.36 million for the quarter ended May 2025, which was slightly below the Zacks Consensus Estimate by 0.21%, but an increase from $175.08 million year-over-year [2] - Over the last four quarters, Progress Software has surpassed consensus EPS estimates four times and topped consensus revenue estimates three times [2] Stock Performance - Progress Software shares have declined approximately 2.1% since the beginning of the year, while the S&P 500 has gained 5% [3] - The current Zacks Rank for Progress Software is 3 (Hold), indicating expected performance in line with the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $1.31 on revenues of $240.16 million, and for the current fiscal year, it is $5.28 on revenues of $964.97 million [7] - The estimate revisions trend for Progress Software was mixed ahead of the earnings release, which may change following the recent report [6] Industry Context - The Computer - Software industry, to which Progress Software belongs, is currently ranked in the top 11% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8] - Commvault Systems (CVLT), another company in the same industry, is expected to report quarterly earnings of $0.97 per share, reflecting a year-over-year change of +14.1% [9]

Financial Data and Key Metrics Changes - Total revenue for Q2 reached $237 million, representing a 36% increase year over year [7] - Annual Recurring Revenue (ARR) grew by 46% year over year to $838 million, with a net retention rate of 100% [7][21] - Operating margin was reported at 40%, an increase from 38% in the same quarter last year [24] - Earnings per share for Q2 were $1.40, exceeding the high end of guidance by $0.06 [24] Business Line Data and Key Metrics Changes - Strong performance was noted across product lines, particularly from OpenEdge and ShareFile, contributing to major renewals and expansions [8][23] - ShareFile's integration is progressing well, with operational synergies completed ahead of schedule [12] Market Data and Key Metrics Changes - The company reported consistent performance across geographies, with significant strength in data platform products [8] - The integration of ShareFile with Microsoft 365 has enhanced productivity and streamlined workflows for users [13] Company Strategy and Development Direction - The acquisition of Nuclear for $20 million aims to enhance the product portfolio with advanced Gen AI capabilities [5][6] - The company emphasizes disciplined M&A strategies to drive sustained top-line growth, focusing on companies with strong products and customer bases [17][18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the continued strength of the business and raised guidance for the remainder of the year [8][27] - The integration of AI into various business functions is seen as a key driver for maintaining high operating margins and improving efficiency [15] Other Important Information - The company repaid $40 million against its revolving credit line, contributing to a total debt repayment of $70 million in the first half of the fiscal year [26] - ShareFile was recognized as a visionary in the latest Gartner Magic Quadrant for Document Management [13] Q&A Session Summary Question: Insights on the Nuclea acquisition - Management clarified that the acquisition is an investment in the product portfolio, aimed at enhancing customer retention and integrating advanced technology [32][34] Question: Cross-sell opportunities with Nuclea - Management confirmed that Nuclea's technology is expected to be integrated across the product portfolio, providing value to various business lines [40][42] Question: Free cash flow expectations - Management explained that the lower free cash flow in the quarter was due to timing on collections and the transition of ShareFile to Progress' billing system, which is expected to improve moving forward [46][48]

Financial Data and Key Metrics Changes - Total revenue for Q2 2025 was $237 million, representing a 36% increase year-over-year [7] - Annual Recurring Revenue (ARR) grew 46% year-over-year to $838 million, with a net retention rate of 100% [8][23] - Operating margin was 40%, with earnings per share of $1.40, exceeding guidance [8][26] - Total costs and operating expenses were $142 million, a 31% increase driven by the addition of ShareFile [26] - Cash and cash equivalents at the end of the quarter were $102 million, with total debt of $1.47 billion [27] Business Line Data and Key Metrics Changes - Significant strength was noted in OpenEdge and ShareFile, contributing to strong renewals and expansions [9] - ShareFile's integration is ahead of schedule, with operational synergies completed [13] - New AI capabilities were introduced in ShareFile, enhancing document collection speed and insights extraction [14] Market Data and Key Metrics Changes - The company reported consistent performance across all geographies and product areas, with major renewals from various sectors including biotech and pharmaceuticals [9][10] - The integration of AI into products is driving customer retention and satisfaction [11][12] Company Strategy and Development Direction - The acquisition of Nuclear for $20 million aims to enhance the product portfolio with Gen AI capabilities [5][6] - The company emphasizes disciplined M&A strategy to drive sustained top-line growth, focusing on companies with strong products and customer bases [19][20] - Continued investment in R&D is seen as essential for customer retention and product value [6][18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of the business and raised guidance for the remainder of the year [9][29] - The integration of ShareFile is progressing well, with expectations for improved customer experience [27][28] - The outlook for Q3 2025 includes revenue expectations between $237 million and $243 million, with full-year revenue guidance increased to between $962 million and $974 million [29][30] Other Important Information - The company has maintained expense discipline, which is central to its operating philosophy [15][17] - Progress was recognized as one of the Best Places to Work by the Boston Business Journal [20] Q&A Session Summary Question: Can you provide more details about the Nuclea acquisition? - Management indicated that the acquisition is an investment in the product portfolio, aimed at integrating advanced AI technology to enhance customer value [33][36] Question: Will Nuclea be a cross-sell opportunity or embedded in other products? - Management confirmed that Nuclea is expected to integrate across the product portfolio, adding value to various offerings including ShareFile and OpenEdge [41][43] Question: Why was free cash flow below expectations this quarter, yet annual forecasts were raised? - Management explained that timing on collections and the transition of ShareFile to Progress' billing system impacted cash flow, but they remain optimistic about future performance [46][48]

Q2 2025 Financial Highlights - Revenues reached $237 million, a 35% year-over-year increase in constant currency, surpassing prior guidance of $235 million - $241 million[9] - Annual Recurring Revenue (ARR) reached $838 million, up 46% year-over-year in constant currency, or 2% pro-forma[9] - The company achieved a Net Retention Rate (NRR) of 100%[9] - Operating margin was 40%[9] - Earnings per share (EPS) was $1.40, exceeding the high end of prior guidance of $1.28 - $1.34[9] Guidance - Q3 2025 guidance projects revenue between $237 million and $243 million, with EPS between $1.28 and $1.34[9] - Fiscal Year 2025 revenue guidance is updated to $962 million - $974 million, increased from $958 million - $970 million[9] - Fiscal Year 2025 EPS guidance is updated to $5.28 - $5.40, increased from $5.25 - $5.37[9] Growth Strategy - The company's ARR has a Compound Annual Growth Rate (CAGR) of 19% from Q2 2020 to Q2 2025[20] - Revenue has a CAGR of 15% from 2021 to 2025(E), based on the midpoint of FY25 guidance[22] - Operating income has a CAGR of 13% from 2021 to 2025(E), based on the midpoint of FY25 guidance[24] - Unlevered Free Cash Flow (FCF) has a CAGR of 11% from 2021 to 2025(E), based on the midpoint of FY25 guidance[26] Capital Allocation - The company repaid $40 million in debt in Q2 2025, bringing the year-to-date total to $70 million[30] - The company is currently modeling $160 million in debt repayment for FY2025[30] - The company repurchased $20 million of shares in Q2 2025, bringing the year-to-date total to $50 million[30] - ShareFile adds over $250 million of ARR[11]