CAMBRIDGE, Mass. - Pegasystems Inc . (NASDAQ:PEGA) reported third-quarter earnings that beat analyst expectations, sending its stock up nearly 4% in after-hours trading on Wednesday.
The enterprise software company posted adjusted earnings per share of $0.39, surpassing the analyst consensus estimate of $0.33. Revenue came in slightly below expectations at $325.05 million, compared to estimates of $326.16 million.
"Pega GenAI Blueprint is creating enormous excitement and fundamentally changing how we engage with our clients," said Alan Trefler, founder and CEO of Pegasystems, in a statement.
The company reported Annual Contract Value (ACV) growth of 16% year-over-year to $1.36 billion. Pega Cloud ACV, a key growth metric, increased 30% compared to the prior year.
While total revenue declined 3% YoY, subscription services revenue grew 12% to $224.8 million. This was offset by a 39% drop in subscription license revenue to $45.4 million.
Ken Stillwell, COO and CFO, highlighted the company's strong free cash flow, which reached $246 million in the first nine months of 2024. He noted that "The steep acceleration in Pega Cloud growth demonstrates our clients' commitment to digitally transform."
For the third quarter, Pegasystems reported a GAAP net loss of $14.4 million, or $0.17 per share, compared to a loss of $7.3 million, or $0.09 per share, in the same period last year.
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