On Friday, PRGS stock slumped 12% after Progress Software Corp (NASDAQ:PRGS) reported lower-than-expected sales in the third quarter. Moreover, the company lowered its revenue estimate for the current quarter to $116–119 million from $122.1 million.
Q3 Results and Guidance
The company reported revenue of $13.6 million or $0.30 per share relative to the $14.4 million or $0.32 per share in revenue reported in Q3 last year. The company reported earnings of $0.75 per share and beat Zacks’ consensus estimate of $0.70. The software company grew its revenue in the quarter by 15% from $92.6 million in Q3 2018 to $106.7 million.
For the current quarter, which will end in November, the company has predicted its earnings-per-share to be between $0.73 and $0.75. Progress Software indicates that it expects its revenue to range between $116 million and 119 million in the fourth quarter. The company has projected its full-year earnings to be between $2.63 and $2.65 per share with revenue of around $428 million.
At the time of writing, PRGS stock is down 12% at $36.97.
Acquisition of Ipswitch Contributed to Exceptional Q3
Progress Software CEO, Yogesh Gupta, maintains that the company performed exceptionally in the third quarter, despite what others may think. Gupta said that the company exceeded both its EPS guidance and revenue with an exceptional contribution from its recent acquisition of Ipswitch. The CEO said that the company’s core business has continued to do well, and they expect to create great value for the shareholders.
Company CFO, Paul Jalbert, said they were delighted that they managed to increase the company’s full-year guidance for both EPS and operating margin. He said that it reflects the company’s business efficiency, and their integration efforts for their latest acquisition are on track. Progress Software expects to have all the $15 million concerted effort in place by the end of this year.
The company Board of Directors approved a quarterly dividend of $0.165 per share to be paid on December 16, 2019. This is a 6% increase in Progress Software’s quarterly dividend.
Since the beginning of the year, PRGS shares have gained around 7%.
Featured image: DepositPhotos © fazon1