Progress Software Corporation

What they do

Progress sells software products that organizations use to develop, deploy, and manage AI-powered applications and digital experiences, operating in North America, Latin America, EMEA, and Asia Pacific through subsidiaries and independent distributors. The portfolio includes Progress Agentic RAG, Automate MFT, Chef, Corticon, DataDirect, Developer Tools, Flowmon, Kemp LoadMaster, MarkLogic, MOVEit, OpenEdge, Semaphore, ShareFile, Sitefinity, and WhatsUp Gold. Revenue comes from software licenses plus maintenance, SaaS, and professional services. Management describes its operating philosophy as customer retention and a streamlined cost structure aimed at predictable recurring revenue and high profitability.

Revenue drivers

• Maintenance, SaaS, and professional services — The recurring base, at $184.5M in the quarter ended May 31, 2026 ($364.7M for the six months), or roughly 73% of quarterly total revenue.
• Software licenses — License revenue was $69.0M in the May 31, 2026 quarter and $136.6M for the first half, versus $50.8M and $109.2M in the prior-year periods.
• ShareFile — Acquired October 31, 2024; contributed $261.6 million of fiscal 2025 revenue and is cited as the primary driver of the year-over-year revenue increase.
• Acquired product lines — Ipswitch (2019), Chef (2020), Kemp (2021), MarkLogic (2023), ShareFile (2024), and Nuclia (June 2025); the company states accretive M&A is its core growth engine.

Recent performance

Fiscal 2025 revenue was $977.8 million, up 30% as reported and 29% in constant currency, which the company attributes primarily to the ShareFile acquisition. Fiscal 2025 net income was $73.1 million and diluted EPS was $1.66, versus $68.4 million and $1.54 in fiscal 2024. For the quarter ended May 31, 2026, revenue was $253.5 million with net income of $21.1 million and diluted EPS of $0.50; first-half fiscal 2026 revenue was $501.3 million with net income of $43.9 million. The balance sheet at May 31, 2026 showed total assets of $2.35 billion, goodwill of $1.31 billion, intangibles of $514.6 million, cash and equivalents of $103.0 million, and long-term debt of $850.0 million plus $442.1 million of convertible notes. Deferred revenue totaled roughly $423 million across current and non-current portions.

Strategy

Progress states a total growth strategy built on accretive acquisitions meeting strict strategic, financial, and operating criteria, supplemented by share repurchases intended at minimum to offset equity plan dilution. On July 22, 2026 it announced an agreement to acquire substantially all assets and assume certain liabilities of Domo, including Domo's AI and data products platform, for a $400 million cash purchase price, expected to close within fiscal 2026 subject to regulatory approval. Progress expects to fund that deal with a combination of cash and its existing revolving credit facility. Management describes the Domo business as complementary to its data platform offerings, adding over 2,400 customer businesses and cloud data warehouse partnerships. The company has not paid dividends based on the reported per-share data, which shows zero in 2025 after $0.53 in 2024.

Risks

• Acquisition execution and integration — Growth is largely acquisition-driven, and the pending $400 million Domo asset purchase must close and integrate while the company carries $1.29 billion of long-term debt plus convertible notes.
• AI product competitiveness — The company states that AI initiatives may not succeed and that failure to develop or acquire products incorporating new technologies in a timely manner could materially harm results.
• Customer and partner retention — The operating model depends on retention and renewals across ISVs, distributors/resellers, OEMs, and direct customers, so loss of that base would pressure recurring revenue.
• Foreign currency exposure — International revenue is a substantial portion of the total and results are affected by currency movements, with fiscal 2025 growth reported 30% as reported versus 29% in constant currency.

Outlook

On July 22, 2026, Progress said it anticipates fiscal third-quarter revenue and non-GAAP earnings per share will be within or above the high end of guidance issued June 30, 2026. Full third-quarter results are to be discussed on a conference call on September 30, 2026. The Domo asset acquisition is expected to close within fiscal 2026, subject to regulatory approvals and customary closing conditions, and would add over 2,400 customer businesses. Management states that existing cash, operating cash flow, and its credit facility should cover operations and foreseeable cash needs, including stock repurchases, for at least the next twelve months.