Progress Software Corp (NASDAQ:PRGS) stock fell 8.41% (As on January 22, 11:22:45 AM UTC-4, Source: Google Finance) after the company reported fourth quarter earnings that beat analyst expectations, but shares fell sharply in after-hours trading as the company’s guidance came in below Wall Street estimates. Progress Software reported annualized recurring revenue of $842 million in Q4, up 46% YoY on a constant currency basis. The company completed its acquisition of ShareFile from Cloud Software Group during the quarter. For fiscal 2024, Progress Software generated cash flow from operations of $211.5 million, up 22% from $173.9 million the prior year. Cash and cash equivalents were $118 million at the end of the quarter. Days sales outstanding was 67 days compared to 62 days in the fiscal fourth quarter of 2023, and 45 days in the fiscal third quarter of 2024. During the fiscal fourth quarter of 2024, the company suspended the quarterly dividend in connection with the ShareFile acquisition and plans to redirect such capital toward the repayment of debt to increase liquidity for future M&A and for share repurchases, both of which are prioritized in the capital allocation policy.
PRGS in the fourth quarter of FY 24 has reported the adjusted earnings per share of $1.33, beating the analysts’ estimates for the adjusted earnings per share of $1.21. The company had reported the adjusted revenue growth of 21 percent to $215 million in the fourth quarter of FY 24, beating the analysts’ estimates for revenue of $211.7 million. The company delivered non-GAAP operating margin of 37%. The net revenue retention closed above 100% for the year.
However, Progress Software’s outlook for the upcoming fiscal year disappointed investors. The company forecast full-year 2025 adjusted EPS of $5.00-$5.12, well below the $5.62 analysts were projecting. First quarter EPS guidance of $1.02-$1.08 also fell short of the $1.44 consensus estimate.
Meanwhile, during the quarter, the company announced the latest release of Progress Flowmon, the network observability platform with AI-powered detection for cyberthreats, anomalies and fast access to actionable insights for greater network and application performance across hybrid cloud ecosystems. With today’s release, the Flowmon platform enhances IP search efficiency up to tenfold with innovative IP address indexing that empowers network administrators to swiftly track network activities tied to specific IP addresses. The result is a significant reduction in the time needed for data analysis and troubleshooting, providing robust protection for optimal network performance.