Progress Software Corporation raised its full-year FY26 sales guidance and adjusted earnings per share (EPS) outlook following fiscal second-quarter results that exceeded analyst expectations. The company now projects sales in the range of $990.000 million to $1.002 billion, revised from the prior $988.000 million to $1.000 billion. The adjusted EPS outlook was raised to $6.09 to $6.21, up from $5.91 to $6.03, against an analyst estimate of $5.98. Conversely, the GAAP EPS guidance was reduced to a range of $1.60 to $1.74, down from the previous $1.71 to $1.87. Shares of Progress Software Corp jumped 11.7% to $37.52 following the announcement.

For the fiscal second quarter ended May 31, 2026, Progress Software reported adjusted EPS of $1.62. This figure beat the analyst consensus estimate of $1.49 by 8.72 percent and represents a 15.71 percent increase over earnings of $1.40 per share from the same period last year. The company also recorded quarterly sales of $253.465 million, surpassing the analyst consensus estimate of $242.741 million by 4.42 percent. Sales increased by 6.79 percent compared to $237.355 million in the prior year period. Annual Recurring Revenue (ARR) reached $868 million, up 2% year over year in constant currency, with an operating margin of 40%.

Strategic Initiatives and Balance Sheet

The company highlighted strong performance in its data platform products and infrastructure management, driven by customer demand for AI context and control. Strategic initiatives include launching Chef Enterprise Management for Nvidia's DGX Spark. Operationally, the company improved collections, reducing day sales outstanding to 49 days from 53 days in the year-ago quarter. Progress Software paid down $110 million in debt in the first half of the fiscal year and plans to reduce debt by approximately $220 million and repurchase $75 million in shares for the full year.

Q3 and Full-Year Outlook

For the third quarter, Progress Software provided guidance for adjusted EPS in the range of $1.53 to $1.59, compared to the analyst estimate of $1.45. The company projects sales to be between $244.000 million and $250.000 million, versus the analyst estimate of $249.973 million. For the full year, the company expects an operating margin of approximately 39% and adjusted free cash flow between $271 million and $283 million.

Recent Analyst Actions

Ahead of the earnings release, several analysts adjusted their price targets. Citigroup analyst Fatima Boolani maintained a Buy rating but cut the price target from $60 to $46 on April 1, 2026. Jefferies analyst Brent Thill maintained a Hold rating and lowered the price target from $45 to $34 on March 31, 2026. Wedbush analyst Dan Ives maintained an Outperform rating and slashed the price target from $65 to $45 on March 31, 2026. Oppenheimer analyst Ittai Kidron maintained an Outperform rating and cut the price target from $70 to $57 on March 31, 2026. Subsequently, Kidron maintained an Outperform rating and lowered the price target to $50.

Progress Software announced it will release financial results for its fiscal second quarter of 2026 after the market close on June 30, 2026. The company will host a conference call to review and discuss the results at 5:00 p.m. ET the same day. The fiscal second quarter of 2026 ended on May 31, 2026.

Conference Call Details

A live webcast of the conference call will be available on the company's website. Participants can access the call by phone using the dial-in details provided on the investor relations page. Progress encourages participants to dial in 15 minutes ahead of the scheduled start time to avoid delays.

An archived version of the conference call and supporting materials will be available on the Progress Investor Relations webpage after the live event.

Key Dates

Progress Software empowers organizations to develop, deploy, and manage AI-powered applications and digital experiences. The company's products serve millions of developers and technologists across various industries.