Progress Software has entered into an agreement to acquire substantially all of the assets and assume certain liabilities of Domo for a cash purchase price of $400 million. The transaction, structured as an asset purchase, includes Domo's AI and data products platform, aiming to strengthen Progress Software's position in the AI infrastructure software market. The acquisition is expected to close within Progress’ fiscal year ending November 30, 2026, subject to regulatory approvals and customary closing conditions.

Transaction Details

The acquisition involves Progress Software taking over substantially all of Domo's assets along with specific liabilities. The deal is valued at $400 million and will be settled entirely in cash. Progress expects to finance the transaction with a combination of cash and its existing revolving credit facility. By integrating Domo's AI and data products platform, Progress Software intends to expand its capabilities in the AI infrastructure sector.

Strategic Implications

This move marks a significant step for Progress Software as it seeks to enhance its offerings through the addition of Domo's technology. Domo will add a customer base of over 2,400 businesses, as well as a global and strategic ecosystem of cloud data warehouse technology partnerships. The asset purchase structure allows Progress Software to selectively acquire the components of Domo that align with its strategic goals while assuming certain associated liabilities.

Financial Guidance

Based on currently available information, Progress anticipates revenue and non-GAAP earnings per share for its fiscal third quarter will be within or above the high end of previously issued guidance provided on June 30, 2026. The company will discuss full financial results of its third quarter on a conference call on September 30, 2026.

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.