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1. Company Snapshot

1.a. Company Description

Progress Software Corporation develops, deploys, and manages business applications.The company offers OpenEdge, a development software, which builds multi-language applications for secure deployment across various platforms and devices, as well as cloud; developer tools that consists of components for user interface development for Web, mobile, desktop, chat, and AR/VR apps, as well as automated application testing and reporting tools; Sitefinity, a web content management and customer analytics platform; Corticon, a business rules management system that provides applications with decision automation and change process, and decision-related insight capabilities.It also offers DataDirect Connect, which provides data connectivity using industry-standard interfaces to connect applications running on various platforms; MOVEit that offers secure collaboration and automated file transfers of critical business information; Chef, an infrastructure automation platform to build, deploy, manage, and secure applications in multi-cloud and hybrid environments, and on-premises; and WhatsUp Gold, a network monitoring solution.


In addition, the company provides Kemp LoadMaster, a load balancing solutions; and Kemp Flowmon network performance monitoring and diagnostic solutions that collect and analyze network telemetry from various sources.Further, it provides project management, implementation, custom development, programming, and other services, as well as web-enable applications; and training services.The company sells its products to end users, independent software vendors, original equipment manufacturers, and system integrators.


It has operations in the United States, Canada, Latin America, Europe, the Middle East, Africa, and the Asia Pacific.The company was founded in 1981 and is headquartered in Burlington, Massachusetts.

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1.b. Last Insights on PRGS

Progress Software Corporation faced negative drivers, including a significant sale of shares by Paradice, which dumped its entire $15.2 million stake in the company. This substantial sale could indicate a lack of confidence in the company's short-term prospects. Additionally, despite the company's announcement of its Progress Data Platform being deemed an "Awardable" vendor for the U.S. Department of Defense's Tradewinds Solutions Marketplace, and the launch of Automate MFT to streamline file transfer solutions, these positive developments seem to be overshadowed by the large institutional sale.

1.c. Company Highlights

2. Progress Software Delivers Robust Q2 2025 Earnings, Boosted by Strong ARR Growth and Strategic Acquisitions

Progress Software reported impressive financial results for Q2 2025, with total revenue reaching $237 million, a 36% year-over-year increase. Annual Recurring Revenue (ARR) surged 46% to $838 million, underscoring the company's ability to drive sustainable growth. The company also exceeded earnings expectations, with actual EPS of $1.4 compared to the consensus estimate of $1.3. This strong performance was complemented by a significant expansion of the company's product portfolio through the acquisition of Nuclia for $20 million, enhancing its AI capabilities with agentic RAG-as-a-Service. Progress also raised its full-year guidance, now expecting revenue of $962–$974 million and EPS of $5.28–$5.40, reflecting increased confidence in its growth trajectory.

Publication Date: Jul -02

📋 Highlights

Nuclia Acquisition and ShareFile Integration

The acquisition of Nuclia stands out as a strategic move to bolster Progress' AI offerings. Unlike previous acquisitions, Nuclia's technology is expected to be integrated across multiple products, creating cross-selling opportunities and embedding potential, particularly benefiting ShareFile's 86,000 customers. The modest purchase price of $20 million highlights the company's disciplined approach to M&A, focusing on value and strategic fit. Additionally, ShareFile's integration is ahead of schedule, with operational synergies already completed and new AI features launched, further enhancing the platform's competitiveness.

Product Updates and Customer Wins

Progress continued to innovate across its product lines, with OpenEdge and ShareFile driving significant customer wins, including a global pharmaceutical firm adopting Progress' advanced RAG search solution for improved accuracy. The company also released AI-enhanced updates for Telerik and Kendo UI, boosting developer productivity. Infrastructure management products saw success in cybersecurity and IT automation, further diversifying the company's revenue streams. ShareFile achieved strong renewals and was recognized as a Visionary in Gartner's Magic Quadrant for Document Management, reinforcing its market leadership.

Free Cash Flow and Outlook

While free cash flow was below expectations due to collection timing and the transition of ShareFile's $250 million business to the company's billing system, management remains optimistic about future performance. The company repaid $40 million of debt, reducing net leverage, and repurchased $20 million of stock, demonstrating its commitment to shareholder value. With a P/E Ratio of 41.09 and a Free Cash Flow Yield of 8.83%, the stock appears to be pricing in continued growth and execution of its AI-driven strategy. Analysts expect revenue growth to moderate to 1.8% next year, but the company's strong execution and improved guidance suggest it is well-positioned to exceed expectations.

3. NewsRoom

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Edgestream Partners L.P. Has $5.52 Million Stock Holdings in Progress Software Corporation $PRGS

Dec -03

Source: defenseworld.net

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Progress Software Stock Down 36%. Learn Why, If AI Makes $PGRS A Buy

Nov -27

Source: forbes.com

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Progress Software Brings Its RAG-as-a-Service Platform to AWS Marketplace

Nov -19

Source: globenewswire.com

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Progress Software Redefines Digital Experiences with the First Generative Content Management System (CMS) Built on Trusted AI

Nov -13

Source: globenewswire.com

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Teacher Retirement System of Texas Has $1.21 Million Stake in Progress Software Corporation $PRGS

Nov -06

Source: defenseworld.net

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Progress Federal Solutions Deemed “Awardable” Vendor for U.S. Department of Defense Chief Digital and Artificial Intelligence Office's Tradewinds Solutions Marketplace

Oct -29

Source: globenewswire.com

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Paradice Dumped Its Entire $15.2 Million Progressive Software Stake

Oct -26

Source: fool.com

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Envestnet Portfolio Solutions Inc. Purchases New Shares in Progress Software Corporation $PRGS

Oct -23

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.85%)

6. Segments

Maintenance

Expected Growth: 3.5%

Progress Software Corporation's 3.5% growth in Maintenance is driven by increasing demand for digital transformation, adoption of cloud-based solutions, and expansion into new markets. Additionally, the company's strategic acquisitions and partnerships have enhanced its product offerings, leading to higher maintenance revenue.

Software Licenses

Expected Growth: 4.5%

Progress Software Corporation's 4.5% growth in software licenses is driven by increasing demand for digital transformation, adoption of cloud-based solutions, and expansion into new markets. Additionally, the company's strategic acquisitions, innovative product offerings, and strong partnerships contribute to its growth momentum.

Professional Services

Expected Growth: 3.8%

Progress Software Corporation's 3.8% growth in Professional Services is driven by increasing demand for digital transformation, adoption of cloud-based solutions, and growing need for IT consulting services. Additionally, the company's strategic acquisitions and partnerships have expanded its service offerings, contributing to revenue growth.

7. Detailed Products

Progress Telerik

A suite of UI components and tools for building web, mobile and desktop applications

Progress Sitefinity

A web content management system for building and managing websites and mobile applications

Progress OpenEdge

A platform for building and deploying business applications

Progress Corticon

A business rules management system for automating decision-making processes

Progress WhatsUp Gold

A network monitoring and management tool for IT infrastructure

Progress Chef

An automation platform for infrastructure, applications and compliance

Progress Kemp

A load balancer and application delivery controller for high-availability and scalability

8. Progress Software Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Progress Software Corporation is medium because while there are some alternative products available, they are not as comprehensive or widely adopted as Progress Software's offerings.

Bargaining Power Of Customers

The bargaining power of customers for Progress Software Corporation is low because the company's products are often critical to customers' operations, making it difficult for customers to negotiate prices or switch to alternative products.

Bargaining Power Of Suppliers

The bargaining power of suppliers for Progress Software Corporation is medium because while the company relies on some key suppliers for certain components, it also has some flexibility to negotiate prices and switch to alternative suppliers if needed.

Threat Of New Entrants

The threat of new entrants for Progress Software Corporation is low because the company has a strong brand and established customer base, making it difficult for new entrants to gain traction in the market.

Intensity Of Rivalry

The intensity of rivalry for Progress Software Corporation is high because the company operates in a highly competitive market with several established players, and the company must continually innovate and invest in marketing and sales to maintain its market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 61.91%
Debt Cost 4.68%
Equity Weight 38.09%
Equity Cost 8.67%
WACC 6.20%
Leverage 162.52%

11. Quality Control: Progress Software Corporation passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
PTC

A-Score: 5.0/10

Value: 1.5

Growth: 6.9

Quality: 8.3

Yield: 0.0

Momentum: 6.0

Volatility: 7.3

1-Year Total Return ->

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Stock-Card
Aspen Technology

A-Score: 4.5/10

Value: 3.2

Growth: 5.2

Quality: 5.6

Yield: 0.0

Momentum: 7.0

Volatility: 6.0

1-Year Total Return ->

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Stock-Card
Elastic

A-Score: 4.2/10

Value: 2.5

Growth: 8.0

Quality: 4.9

Yield: 0.0

Momentum: 6.0

Volatility: 4.0

1-Year Total Return ->

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Stock-Card
Progress Software

A-Score: 4.2/10

Value: 4.4

Growth: 6.4

Quality: 6.0

Yield: 1.0

Momentum: 1.0

Volatility: 6.3

1-Year Total Return ->

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Stock-Card
Manhattan Associates

A-Score: 4.0/10

Value: 0.6

Growth: 7.9

Quality: 8.6

Yield: 0.0

Momentum: 1.0

Volatility: 5.7

1-Year Total Return ->

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Stock-Card
Agilysys

A-Score: 3.5/10

Value: 0.0

Growth: 7.9

Quality: 7.5

Yield: 0.0

Momentum: 2.5

Volatility: 3.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

43.5$

Current Price

43.5$

Potential

-0.00%

Expected Cash-Flows