Progress Software Raises Full-Year Revenue Outlook to $1.01B After Q1 Beat
Progress Software reported Q1 revenue of $248 million, a 4% year-over-year increase, and adjusted EPS of $1.60, up 22%, with ARR reaching $863 million and a 99% net retention rate. The company raised its 2026 revenue outlook to $988 million–$1.01 billion and adjusted EPS guidance to $5.91–$6.03.
1. Strong Q1 Financial Results
Progress Software posted $248 million in Q1 revenue, a 4% increase year-over-year, and reported adjusted earnings per share of $1.60, up 22% from the prior year. GAAP diluted EPS rose to $0.53 from $0.24 a year earlier.
2. Recurring Revenue and Retention Metrics
Annual recurring revenue hit $863 million, marking 2% pro forma growth, while the net retention rate remained at 99%. Non-GAAP operating margin reached approximately 41% and adjusted free cash flow was $99 million, up 35% year-over-year.
3. Raised 2026 Outlook
The company raised its full-year 2026 revenue guidance to a range of $988 million–$1.01 billion and boosted adjusted EPS guidance to $5.91–$6.03. For Q2, revenue is expected between $240 million and $246 million with adjusted EPS of $1.47–$1.53.
4. Capital Allocation and Analyst Commentary
During the quarter, Progress Software repaid about $60 million of debt and repurchased $20 million of shares. Analysts maintained an Outperform rating but lowered the price target to $45 from $65, citing cautious SaaS sector conditions.