NASDAQ$PEGA

Pegasystems Inc · Q4 2022 earnings

Q4 2022 earnings · · Investor relations

Briefing

Pegasystems' Q4 2022 financial results were released, highlighting improved profitability and surpassing $1 billion in subscription revenue.

Pegasystems reported a strong finish to 2022, with total revenue of $396.47 million, a 25% increase year-over-year. The company's net income (GAAP) was $34.61 million, a significant improvement compared to the $(37.246) million loss in the same period last year. Non-GAAP net income was $68.341 million, a substantial increase from $3.051 million in the prior year. The company's annual contract value (ACV) grew 16% year over year (constant currency) and Pega Cloud gross margin reached 70%.

  • Total revenue increased by 25% year-over-year, reaching $396.47 million.
  • Net income (GAAP) improved to $34.61 million, compared to a loss of $(37.246) million in the same period last year.
  • Non-GAAP net income saw a significant increase to $68.341 million.
  • Annual contract value (ACV) grew 16% year over year (constant currency).

Headline financials

Total Revenue

$396M

Previous: $316M+25.4%
EPS (adj)

$0.82

Previous: $0.04+1950.0%
Annual Contract Value

$1.13B

Previous: $1B+12.6%
Capital Expenditures

$13.1M

Previous: $3.37M+288.9%
Free Cash Flow

$22.7M

Previous: $41.1M-44.8%
Net Income

$34.6M

Previous: -$37.2M+192.9%
Operating Income

$34.2M

Previous: -$32.2M+206.4%
Gross Profit

$304M

Previous: $231M+31.7%
Cash & Equivalents

$145M

Previous: $160M-9.3%
Total Assets

$1.36B

Previous: $1.59B-14.8%
Stock-Based Comp

$28.9M

Previous: $26.5M+9.2%

Revenue & EPS history

Pegasystems · Revenue · Quarterly

$396M

Q4 2022+25.4%vs Q4 2021
Beat estimate in 9 of 15 quarters(60%)
ActualEstimate

Revenue by segment

Pegasystems · $396M total across 4 segments · Q4 2022

  • Subscription license
    $156M+83.3%
  • Pega Cloud
    $103M+26.6%
  • Maintenance
    $82M-0.9%
  • Consulting
    $55.2M-1.0%

Forward guidance

Pegasystems provided guidance for the year ended December 31, 2023, with revenue expected to be $1.4 billion and free cash flow expected to be $150 million.

Tailwinds

  • Annual contract value growth of 11% - 13%
  • Revenue of $1.4 billion
  • Diluted earnings per share of $0.02
  • Cash provided by operating activities of $139 million
  • Free cash flow of $150 million

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q4 2022

Historical avgQ4 2022

+3.5%

Avg return

Earnings day

+3.3%

Avg return

5 days after

+2.8%

Avg return

30 days after

59%

39 / 66 earnings

Positive

+42.2%

Q4 2023

Best reaction

-28.0%

Q3 2010

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-0.5%-6.4%-12.6%
Q4 2025-11.9%+1.9%-1.3%
Q3 2025+15.0%+16.8%-4.6%
Q2 2025+1.4%-0.2%+11.8%
Q1 2025+28.8%+32.5%+39.7%
Q4 2024-19.6%-18.9%-32.1%
Q3 2024+13.4%+13.9%+29.8%
Q2 2024+9.7%+4.9%+11.7%
Q1 2024-0.4%+2.6%+1.1%
Q4 2023+42.2%+34.1%+28.3%
Q3 2023+4.7%+7.3%+34.0%
Q2 2023-9.7%-3.3%-12.0%
Q1 2023+3.7%+6.2%+7.9%
Q4 2022+27.3%+21.7%+18.3%
Q3 2022+9.5%+11.7%+12.3%
Q2 2022-13.2%-12.8%-21.8%
Q1 2022+11.5%+6.1%-26.5%
Q4 2021-18.5%-18.4%-21.2%
Q3 2021-7.5%-6.4%-10.2%
Q2 2021-5.0%-5.2%+3.0%
Q1 2021-1.8%-4.1%-8.6%
Q4 2020-2.0%+0.4%-20.2%
Q3 2020-4.2%-8.5%+6.7%
Q2 2020+9.7%+11.9%+22.5%
Q1 2020+7.7%+4.9%+22.5%
Q4 2019+9.7%+11.1%-15.8%
Q3 2019-4.9%-3.5%+1.8%
Q2 2019+4.9%+2.0%+3.3%
Q1 2019-6.0%-5.8%-5.3%
Q4 2018+9.5%+11.4%+9.3%
Q3 2018+4.4%-3.9%-6.2%
Q2 2018+1.5%+2.3%+9.2%
Q1 2018+2.2%-3.1%-1.9%
Q4 2017+11.6%+6.7%+9.7%
Q3 2017-7.7%-7.3%-11.7%
Q2 2017-10.2%-3.0%-3.9%
Q1 2017+13.9%+24.1%+32.9%
Q4 2016+4.7%+4.1%+1.3%
Q3 2016+10.1%+8.8%+15.2%
Q2 2016-4.7%-5.1%-3.6%
Q1 2016-2.1%
Q4 2015+8.4%
Q3 2015+7.9%
Q2 2015+13.4%
Q1 2015+2.1%
Q4 2014-14.0%
Q3 2014-11.0%
Q2 2014+9.7%
Q1 2014+10.9%
Q4 2013-11.7%
Q3 2013+26.6%
Q2 2013+4.8%
Q1 2013+5.3%
Q4 2012+7.9%
Q3 2012-0.2%
Q2 2012+0.4%
Q1 2011-12.1%
Q1 2012-3.3%
Q4 2011+29.7%
Q4 2009+29.7%
Q3 2011-28.0%
Q3 2010-28.0%
Q4 2010+22.2%
Q2 2010+22.2%
Q2 2011+22.2%
Q1 2010-10.8%

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