NASDAQ$PRGS

Progress Software Corporation · Q4 2022 earnings

Q4 2022 earnings · · Investor relations

Briefing

Progress Software's Q4 2022 earnings exceeded guidance, driven by strong business performance and the announcement of the MarkLogic acquisition.

Progress reported a strong fourth quarter in fiscal year 2022, with revenue increasing by 12% year-over-year to $157.1 million. Diluted earnings per share increased by 64% to $0.54, while non-GAAP diluted earnings per share increased by 22% to $1.12. The company also announced a definitive agreement to acquire MarkLogic, which is expected to drive significant growth.

  • Revenue increased 12% year-over-year to $157.1 million.
  • Diluted earnings per share increased 64% year-over-year to $0.54.
  • Non-GAAP diluted earnings per share increased 22% year-over-year to $1.12.
  • A definitive agreement was signed to acquire MarkLogic, expecting to scale Progress to well above $700M in annualized sales.

Headline financials

Total Revenue

$159M

Previous: $144M+10.7%
EPS (adj)

$1.12

Previous: $0.92+21.7%
Annualized Recurring Revenue

$497M

Previous: $486M+2.3%
Capital Expenditures

$3M

Previous: $1.91M+57.0%
Free Cash Flow

$37.1M

Previous: $42M-11.6%
Net Income

$23.7M

Previous: $14.9M+58.8%
Operating Income

$30.4M

Previous: $20.4M+49.5%
Gross Profit

$134M

Previous: $119M+12.2%
Cash & Equivalents

$252M

Previous: $157M+60.0%
Total Assets

$1.41B

Previous: $1.36B+3.5%
Stock-Based Comp

$11M

Previous: $7.74M+41.9%

Revenue & EPS history

Progress Software · Revenue · Quarterly

$159M

Q4 2022+10.7%vs Q4 2021
Beat estimate in 12 of 16 quarters(75%)
ActualEstimate

Revenue by segment

Progress Software · $157M total across 2 segments · Q4 2022

  • Maintenance
    $104M+5.1%
  • Software Licenses
    $53.2M+28.9%

Forward guidance

Progress provides guidance for the fiscal year ending November 30, 2023 and the fiscal first quarter ending February 28, 2023.

Tailwinds

  • FY 2023 GAAP Revenue: $671 million - $681 million
  • FY 2023 Non-GAAP Revenue: $675 million - $685 million
  • FY 2023 GAAP Diluted earnings per share: $1.38 - $1.46
  • FY 2023 Non-GAAP Diluted earnings per share: $4.09 - $4.17
  • FY 2023 Adjusted free cash flow (non-GAAP): $175 million - $185 million

Headwinds

  • Expected negative currency translation impact on Progress' fiscal year 2023 business outlook compared to 2022 exchange rates is approximately $1.2 million on GAAP and non-GAAP revenue.
  • Expected positive currency translation impact on GAAP and non-GAAP diluted earnings per share for fiscal year 2023 is approximately $0.01.
  • Expected negative currency translation impact on Progress' fiscal Q1 2023 business outlook compared to 2022 exchange rates on GAAP and non-GAAP revenue is approximately $2.5 million.
  • The expected currency translation impact on GAAP and non-GAAP diluted earnings per share for fiscal Q1 2023 is not expected to be material from an accounting perspective.
  • Economic, geopolitical and market conditions can adversely affect our business, results of operations and financial condition, including our revenue growth and profitability, which in turn could adversely affect our stock price

Historical earnings impact

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

Avg. return before/after earnings

Based on 18 quarterly earnings reports · overlaid with Q4 2022

Historical avgQ4 2022

+1.8%

Avg return

Earnings day

+1.8%

Avg return

5 days after

+3.1%

Avg return

30 days after

59%

40 / 68 earnings

Positive

+19.8%

Q1 2019

Best reaction

-15.5%

Q3 2018

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q2 2026
Q1 2026-9.3%-4.0%
Q4 2025+10.7%+11.1%+4.5%
Q3 2025+3.2%+8.4%-1.8%
Q2 2025+1.8%+0.3%-4.0%
Q1 2025+12.1%+9.0%+16.7%
Q4 2024-9.0%-15.8%-10.1%
Q3 2024+12.4%+16.6%+14.5%
Q2 2024+12.2%+10.8%+17.3%
Q1 2024-0.2%+1.0%-3.9%
Q4 2023+4.7%+7.2%+4.4%
Q3 2023-6.2%-6.4%-9.9%
Q2 2023+8.4%+10.0%+9.0%
Q1 2023-5.2%-2.4%-6.6%
Q4 2022-3.7%-3.4%+8.0%
Q3 2022+2.5%+3.0%+20.1%
Q2 2022-9.2%-11.4%-8.2%
Q1 2022+3.3%+5.3%+8.3%
Q4 2021-6.2%-3.1%-2.0%
Q3 2021+17.5%+8.3%+13.1%
Q2 2021+2.2%+2.7%+1.6%
Q1 2021+5.9%+4.5%+11.5%
Q4 2020-7.0%-10.2%-8.6%
Q3 2020-1.6%+1.3%-3.0%
Q2 2020+2.5%+5.6%-5.8%
Q1 2020-0.7%-3.7%+13.4%
Q4 2019+8.4%+4.2%-0.5%
Q3 2019-3.8%-6.2%-2.2%
Q2 2019+9.4%+1.7%+9.5%
Q1 2019+19.8%+20.6%+22.8%
Q4 2018-4.7%-4.1%+3.0%
Q3 2018-15.5%-17.5%-25.4%
Q2 2018+14.4%+8.3%+6.8%
Q1 2018-0.4%-3.6%-4.1%
Q4 2017+15.6%+15.9%+6.2%
Q3 2017+0.5%+3.4%+13.4%
Q2 2017+1.9%+2.7%+6.8%
Q1 2017+3.7%+3.0%+5.0%
Q4 2016-14.3%-12.6%-10.5%
Q3 2016-2.6%-1.5%-4.5%
Q2 2016+10.9%+12.2%+17.4%
Q1 2016-4.7%
Q4 2015-0.7%
Q3 2015-11.0%
Q2 2015+8.7%
Q1 2015-5.6%
Q4 2014-4.3%
Q3 2014+4.3%
Q2 2014+8.4%
Q1 2014-3.2%
Q4 2013-5.2%
Q3 2013+4.4%
Q2 2013+7.3%
Q1 2013+1.4%
Q4 2012+2.2%
Q3 2012+7.9%
Q2 2012-0.9%
Q1 2012+1.1%
Q4 2008+4.3%
Q4 2011+4.3%
Q3 2011+2.6%
Q2 2011-1.4%
Q1 2010-2.3%
Q1 2011-4.7%
Q4 2010+5.8%
Q2 2010+5.8%
Q4 2009+5.4%
Q3 2009+5.4%
Q3 2010+5.4%

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