Progress Software Stock Slumps To 4-Month Lows Despite Robust Q4 Results: Retail Smells ‘Good’ Buying Opportunity
Annualized recurring revenue, a key operational metric for software companies, jumped 46% YoY to $842 million in the fourth quarter.
FollowProgress Software Corp. (PRGS) stock plunged Wednesday despite the Burlington, Massachusetts-based application development platform provider’s fiscal year 2024 fourth-quarter beat.
The stock fell over 10% to $56.88 by mid-session, and the down move was accompanied by nearly three times the average volume. This marked the lowest level since Sept. 24, 2024.
Progress Software reported fourth-quarter non-GAAP earnings per share (EPS) of $1.33, up 30% from the third quarter’s $1.02. The bottom-line result exceeded the consensus estimate of $1.21, compiled by Koyfin, and also the company’s guidance of $1.15-$1.25.
Revenue rose 21% year-over-year (YoY) to $215 million, topping the $211.26 million consensus but below the high end of the guidance range of $207 million to $217 million.
Annualized recurring revenue (ARR) jumped 46% YoY to $842 million versus $582 million in the third quarter.
Non-GAAP operating margin was 37%.
Yogesh Gupta, CEO of Progress Software, said, “Mission-critical business applications at more than a hundred thousand businesses are powered by Progress products.”
“We are particularly excited about our recent acquisition of ShareFile, which adds an AI-powered SaaS content-centric collaboration platform to our portfolio and will contribute meaningfully to our top- and bottom-line."
The company guided first-quarter non-GAAP EPS to $0.51-$1.25 and revenue to $232 million to $238 million. It expects full-year non-GAAP EPS of $5.00 to $5.12 and revenue of $958 million to $970 million. Stocktwits data shows the consensus at $5.18 and $945.22 million.
PRGS sentiment and message volume January 22, 2025, as of 12:14 pm ET | Source: Stocktwits
On Stocktwits, retail sentiment toward Progress Software stock improved to ‘extremely bullish’ (95/100) from ‘bullish’ a day ago. Message volume stayed ‘extremely high.’
Some retailers on the platform saw the pullback as a good opportunity to accumulate shares.
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