Progress Software to Post Q4 Earnings: What's in Store for the Stock?

Core Insights - Progress Software (PRGS) is expected to release its fourth-quarter 2025 results on January 20, 2026, with anticipated non-GAAP revenues between $250 million and $256 million and non-GAAP earnings projected between $1.29 and $1.35 per share, reflecting a 1.5% year-over-year decline in earnings [1][2] Revenue and Earnings Expectations - The consensus estimate for revenues stands at $252.68 million, indicating a year-over-year growth of 17.55% [2] - Progress Software has consistently beaten the Zacks Consensus Estimate in the past four quarters, achieving an average earnings surprise of 14.74% [2] Performance Drivers - The company's performance in Q4 2025 is expected to benefit from a diversified product portfolio, including ShareFile, OpenEdge, DevTools, MarkLogic, WhatsUp Gold, Sitefinity, and Corticon, supported by solid customer retention rates [3] - Progress Software reported a net retention rate of 100% in Q3 2025, indicating strong customer loyalty and expansion, which is anticipated to continue into the upcoming quarter [3] AI Integration and Growth - The integration of AI capabilities across its product suite, such as retrieval augmented generation (RAG)-enabled MarkLogic and AI coding assistants for developer tools, is expected to enhance customer retention and acquisition [4] - The acquisition of ShareFile has significantly contributed to the company's Annual Recurring Revenue (ARR), which grew 47% year-over-year to $849 million in Q3 2025, with AI features driving customer adoption and retention [5] Cost Management and Economic Environment - Stringent cost management practices are expected to support bottom-line growth despite challenges posed by persistent inflation, higher interest rates, and a difficult macroeconomic environment [6] Earnings Prediction Model - According to the Zacks model, Progress Software currently has an Earnings ESP of 0.00% and a Zacks Rank of 3 (Hold), indicating that the odds of an earnings beat are not favorable at this time [7]