Progress Software (PGR) Q3 2026 Earnings Report
DE:PGR Q3 2026 EPS Results
- Actual EPS
- EUR 1.50
- Consensus EPS
- EUR 1.35
- Beat/Miss
- Beat by +EUR 0.16
- One Year Ago EPS
- EUR 1.33
DE:PGR Q3 2026 Revenue Results
- Actual Revenue
- EUR 218.49M
- Expected Revenue
- EUR 219.66M
- Beat/Miss
- Missed by -EUR 1.17M
- YoY Revenue Growth
- -1.52%
Earnings Announcement Details
- Quarter
- Q3 2026
- Date
- 09/30/2026
- Time
- After Close
- Conference Call
- Wednesday, September 30, 2026
Progress Software's next earnings date is estimated for January 19, 2027, based on past reporting schedules.
Q3 2026 Earnings Call Audio
Q3 2026 Earnings Slide Deck
Q3 2026 Earnings Call Summary
The call was predominantly positive, featuring Q3 revenue in line with guidance, strong 43% operating margins, 13% EPS growth, substantial free cash flow improvement, debt paydown, customer expansion, and raised fiscal 2026 guidance. The principal challenges were expected Domo seat-based churn and services declines, temporary fiscal 2027 margin compression, acquisition-related interest expense, and potential slight pressure from a greater SaaS mix.
For the fourth quarter of 2026, Domo will contribute approximately 2 months of activity, with revenue expected to be between $297 million and $305 million and earnings per share between $1.24 and $1.33; for the full year 2026, revenue is expected to be between $1.044 billion and $1.052 billion, operating margin 38%, adjusted free cash flow between $275 million and $283 million, unlevered free cash flow between $330 million and $338 million, and earnings per share between $6.15 and $6.23, assuming a tax rate of 20% and approximately 42 million weighted shares outstanding. Domo’s steady-state revenue is expected to stabilize in the range of $280 million to $290 million, and once fully integrated by the end of FY '27, Domo is expected to annually add well over $100 million of EBITDA; for fiscal 2027, Domo will likely run slightly below 30% operating margin as the synergies ramp, Progress’ overall operating margin could be compressed 100 to 200 basis points, with a Progress margin in the range of 38% to 39% potentially looking more like 36% to 37%, and incremental interest expense is expected to be approximately $21 million.
- Solid Q3 ARR and RetentionARR increased by more than 1% year over year on a constant-currency basis to approximately $873 million. Net retention was 99%, within the expected range of 99% to 100% and consistent with recent quarters.
- Revenue Met Guidance with Product StrengthQ3 revenue was $246 million, around the midpoint of the most recent guidance range. Strength was noted across OpenEdge, DataDirect, MOVEit, LoadMaster, WhatsUp Gold, DevTools, and other products. Year-to-date constant-currency revenue growth was 2%, in line with ARR growth.
- Strong Margins and Earnings OutperformanceOperating income was $105 million, up 6% year over year, and operating margin was 43%, an increase of 300 basis points from the prior-year quarter. Earnings per share was $1.69, exceeding the high end of guidance and increasing approximately 13% year over year.
- Disciplined Cost ManagementTotal cost and operating expenses were approximately $141 million, down approximately $10 million, or 6%, from the year-ago quarter. Management said disciplined cost management contributed significantly to the quarter's earnings outperformance.
- Improved Cash Flow and CollectionsAdjusted free cash flow was $87 million, up 17% year over year, while unlevered free cash flow was $101 million, up 14%. Year-to-date adjusted free cash flow was $265 million, an increase of 44%, reflecting materially improved collections and continued operating performance. DSO improved to 42 days from 55 days a year ago and 73 days at the end of fiscal 2025.
- Balance Sheet Progress and Capital ReturnsProgress ended Q3 with $114 million of cash and cash equivalents, approximately $1.24 billion of total debt, approximately $1.1 billion of net debt, and a net leverage ratio of approximately 2.7x. The company repaid $60 million on its revolving credit facility during the quarter and $170 million year to date, while repurchasing approximately $17 million of stock in Q3 and approximately $72 million year to date.
- Customer Expansion and Mission-Critical DemandSeveral major customers across financial services, health organizations, energy, technology, government agencies, and European law enforcement recommitted to and expanded their relationships with Progress. Customers cited reliability, security, compliance, and operational efficiency as key reasons for deepening those relationships.
- Growing AI OpportunityManagement reported growing customer interest in Progress's AI-enabled capabilities and described demand for trusted data, security, governance, and infrastructure management to support AI projects. The company said AI workloads are increasing data volumes, infrastructure complexity, compute capacity, and related demand for capacity-based, observability, and security products.
- Domo Acquisition Closed and Integration UnderwayProgress completed its acquisition of Domo's AI and data platform business the prior week, for a headline cash purchase price of $400 million. The integration process is already underway, and the company has begun engaging Domo customers, meeting with its customer advisory board, and conducting a global customer meeting tour covering a dozen cities.
- Strategic Combination of Data and AI PlatformsManagement said Domo adds real-time data integration and transformation, analytics and visualization, automation, and agentic orchestration to Progress's existing capabilities in ontology management, unstructured data management, semantic analysis, agentic RAG, intelligent decisioning, and AI-powered workflows. Together, the companies expect to provide a more complete AI-ready data layer.
- Domo Earnings and Cash Flow OpportunityOnce fully integrated, which Progress plans to complete by the end of fiscal 2027, management expects Domo to annually add well over $100 million of EBITDA. Based on the steady-state revenue range, Progress paid roughly 1.4x revenue and roughly 3.5x pro forma EBITDA. Management also cited meaningful tax benefits and other favorable adjustments associated with the asset purchase.
- Consumption-Based Domo Business Shows Stronger RetentionDomo's consumption-based platform represents more than 85% of Domo's ARR and carries significantly higher net retention rates than the seat-based business. Management said customers starting on the consumption business have historically shown net retention above 100%, and it is evaluating how consumption-based pricing could apply across other Progress products.
- Raised Fiscal 2026 OutlookProgress raised full-year fiscal 2026 revenue guidance to $1.044 billion to $1.052 billion, more than $50 million above prior guidance, driven by approximately two months of Domo activity and solid underlying performance in the base business. Adjusted free cash flow guidance is $275 million to $283 million, unlevered free cash flow guidance is $330 million to $338 million, and EPS guidance is $6.15 to $6.23.
- Positive Fourth-Quarter OutlookFor Q4 fiscal 2026, management expects revenue of $297 million to $305 million and earnings per share of $1.24 to $1.33.
- Continued Product InvestmentManagement said Progress invests in the upper teens, close to 20%, of revenue in R&D and will continue investing in Domo and across the product portfolio, including AI capabilities. Management expects Domo's steady-state margins to be similar to the rest of Progress while continuing to invest in product competitiveness and customer attractiveness.
DE:PGR Earnings History
| Report Date | Fiscal Quarter | Forecast / EPS | Last Year's EPS | EPS YoY Change | Press Release |
|---|---|---|---|---|---|
| Jan 19, 2027 | 2026 (Q4) | 1.14- | 1.34 | ― | ― |
| Sep 30, 2026 | 2026 (Q3) | 1.351.50 | 1.33 | 12.67% (+0.17) | |
| Jun 30, 2026 | 2026 (Q2) | 1.321.44 | 1.24 | 15.71% (+0.20) | |
| Mar 30, 2026 | 2026 (Q1) | 1.391.42 | 1.16 | 22.14% (+0.26) | |
| Jan 20, 2026 | 2025 (Q4) | 1.171.34 | 1.18 | 13.53% (+0.16) | |
| Sep 29, 2025 | 2025 (Q3) | 1.151.33 | 1.12 | 19.05% (+0.21) | |
| Jun 30, 2025 | 2025 (Q2) | 1.151.24 | 0.97 | 28.44% (+0.28) | |
| Mar 31, 2025 | 2025 (Q1) | 0.941.16 | 1.11 | 4.80% (+0.05) | |
| Jan 21, 2025 | 2024 (Q4) | 1.081.18 | 0.91 | 30.39% (+0.28) | |
| Sep 24, 2024 | 2024 (Q3) | 1.011.12 | 0.96 | 16.67% (+0.16) |
The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.
