Slide 1: Progress Financial Results Q2 2024 Supplemental Data
Progress Financial Results Q2 2024 Supplemental Data June 25, 2024
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains statements that are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Progress has identified some of these forward-lookin
Slide 3: Conference Call Details
Conference Call Details What: Progress Fiscal Q2 Financial Results When: Tuesday, June 25, 2024 Time: 5:00 p.m. ET To register for the Live Call: Please go to this link to retrieve dial-in details. Live / Recorded Webcast: https://edge.media-server.com/mmc/p/78g7r495 Please note: Webcast is listen-o
Slide 4: Summary Highlights Q2 2024
Summary Highlights Q2 2024 Revenue and EPS ahead of estimates; ARR up 1%; Strong Balance Sheet • Q2 Revenues of $175M above high end of prior guidance of $166M - $170M. • ARR: $579M, up 1% year-over-year in constant currency; NRR 99%. • Operating margins strong at 38%. • EPS: $1.09, above high end o
Slide 5: Annualized Recurring Revenue Trend
Annualized Recurring Revenue Trend ARR growth = 0.9% year-over-year + Net Retention Rate between 99%-102% = Predictable and durable top line performance © 2024 Progress Software Corporation and/or its subsidiaries or affiliates. All rights reserved. 5 All periods reported in constant currency, using
Slide 6: Driving Total Growth
Driving Total Growth Revenue CAGR of 11% 2019 – 2024(F)* * Represents the mid-point of our FY’24 guidance range © 2024 Progress Software Corporation and/or its subsidiaries or affiliates. All rights reserved. 6
Slide 7: Growing Profitability
Growing Profitability Operating Income CAGR of 12% 2019 – 2024(F)* Best-in-class non-GAAP operating margins consistently above 35% * Represents the mid-point of our FY’24 guidance range © 2024 Progress Software Corporation and/or its subsidiaries or affiliates. All rights reserved. 7
Slide 8: Unlevered Free Cash Flow
Unlevered Free Cash Flow Unlevered AFCF CAGR of 11% 2019 – 2024(F)* * Adjusted free cash flow represents the mid-point of our FY’24 guidance range © 2024 Progress Software Corporation and/or its subsidiaries or affiliates. All rights reserved. 8
Slide 9: Capital Allocation Strategy
Capital Allocation Strategy PRIMARY FOCUS Continue to prioritize accretive M&A opportunities that meet our disciplined criteria to create the strongest returns. Repurchase shares to offset dilution from our equity programs. • Management has flexibility to increase, reduce, or suspend repurchases dep
Slide 10: Well Defined M&A Framework
Well Defined M&A Framework ▪ Cast a wide net across infrastructure software End Market and all aspects of the development lifecycle Alignment ▪ Tight alignment increases synergy potential Appropriate ▪ ~10-25% of current Progress revenues Sizing ▪ Can be financed and integrated efficiently Financial
Slide 11: Summary Q2 2024 Financial Results
Summary Q2 2024 Financial Results Q2 2024 Results Prior Q2 2024 Outlook (provided on March 26, 2024) Revenue $175M $166M - $170M GAAP earnings per share (Diluted) $0.37 $0.22 - $0.26 Non-GAAP earnings per share (Diluted) $1.09 $0.93- $0.97 GAAP Operating Margin 16% Not guided Non-GAAP Operating Marg
Slide 12: Business Outlook (as of June 25, 2024)
Business Outlook (as of June 25, 2024) Q3 2024 FY 2024 FY 2024 Current Outlook Prior Outlook Updated Outlook (provided on March 26, 2024) Revenue $174M - $178M $722M - $732M $725M - $735M GAAP EPS $0.48 - $0.52 $1.94 - $2.06 $1.98 - $2.10 Non-GAAP EPS $1.11 - $1.15 $4.65 - $4.75 $4.70 - $4.80 GAAP O
Slide 13: Supplemental Financial Information
Supplemental Financial Information
Slide 14: Supplemental Revenue Information (Unaudited)
Supplemental Revenue Information (Unaudited) Quarterly Revenue by Region and by Type (GAAP) (in thousands) Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024 Revenue by Type License 57,568 56,407 50,544 56,270 64,100 53,979 Maintenance 92,513 102,240 105,164 101,584 102,025 102,503 Services 14,145 19,6
Slide 15: Important Information Regarding Non-GAAP Financial Information
Important Information Regarding Non-GAAP Financial Information Progress furnishes certain non-GAAP supplemental information to our financial results. We use such non-GAAP financial measures to evaluate our period-over-period operating performance because our management team believes that by excludin
Slide 16: Important Information Regarding Non-GAAP Financial Information
Important Information Regarding Non-GAAP Financial Information • Cyber incident and vulnerability response expenses, net • Cyber incident - We exclude certain expenses resulting from the detection of irregular activity on certain portions of our corporate network, as more thoroughly described in the
Slide 17: Important Information Regarding Non-GAAP Financial Information
Important Information Regarding Non-GAAP Financial Information • ARR continued - The calculation is done at constant currency using the current year budgeted exchange rates for all periods presented. ARR is not defined in GAAP and is not derived from a GAAP measure. Rather, ARR generally aligns to b
Slide 18: Progress
D Progress