PROS(US:PRO)2025-10-27 20:21Revenue Growth - Subscription revenue increased by 13% and 12% for the three and nine months ended September 30, 2025, respectively, compared to the same periods in 2024[84]. - Total revenue rose by 11% and 9% for the three and nine months ended September 30, 2025, respectively, compared to the same periods in 2024[84]. - Recurring revenue accounted for 85% of total revenue for the three and nine months ended September 30, 2025[85]. Profitability Metrics - Subscription gross margin improved to 80% and 79% for the three and nine months ended September 30, 2025, respectively, compared to 78% for the same periods in 2024[86]. - Total gross margin increased to 69% and 68% for the three and nine months ended September 30, 2025, respectively, compared to 66% and 65% for the same periods in 2024[86]. Operating Performance - Cash provided by operating activities was $15.8 million for the nine months ended September 30, 2025, up from $3.4 million for the same period in 2024[87]. - Total operating expenses for the three months ended September 30, 2025, were $66.0 million, an increase of 21% compared to $54.4 million in 2024[102]. - Selling and marketing expenses increased by $2.4 million (12%) to $22.5 million for the three months ended September 30, 2025, primarily due to higher employee-related costs[102]. - Research and development expenses rose by $2.0 million (9%) to $23.0 million for the three months ended September 30, 2025, driven by increased employee-related costs[104]. - General and administrative expenses increased by $7.3 million (55%) to $20.5 million for the three months ended September 30, 2025, mainly due to higher noncash share-based compensation[106]. Cash Flow and Financial Position - Net cash provided by operating activities for the nine months ended September 30, 2025, was $15.8 million, a significant improvement from $3.4 million in 2024[115]. - Net cash provided by financing activities for the nine months ended September 30, 2025, was $13.0 million, primarily due to $50.0 million from the issuance of 2030 Notes[118]. - As of September 30, 2025, the company had $188.4 million in cash and cash equivalents, an increase from $162.0 million at December 31, 2024[112]. - The company reported a net change in cash, cash equivalents, and restricted cash of $26.4 million for the nine months ended September 30, 2025, compared to a decrease of $28.2 million in 2024[115]. Other Significant Events - On September 22, 2025, the company entered into a Merger Agreement to be acquired by Thoma Bravo, L.P., with a per share price of $23.25[88]. - The Merger is expected to close in the fourth quarter of 2025, pending shareholder and regulatory approvals[89]. - Maintenance and support revenue decreased by 37% for the three months ended September 30, 2025, primarily due to customer maintenance churn[94]. - Services revenue increased by 11% for the three months ended September 30, 2025, driven by higher billable utilization of the professional services organization[95]. - Other income, net increased by $7.0 million (213%) to $10.4 million for the nine months ended September 30, 2025, mainly due to a $4.2 million gain on debt extinguishment[108]. Taxation - The effective tax rate for the three months ended September 30, 2025, was (13)%, compared to 47% in 2024[110].