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MCLEAN, Va. - Appian (NASDAQ: APPN), a software company with a market capitalization of $2.32 billion and impressive gross profit margins of nearly 76%, has secured a hearing with the Supreme Court of Virginia in an attempt to reinstate a multi-billion dollar judgment against competitor Pegasystems Inc. According to InvestingPro data, the company has shown solid revenue growth of ~13% over the last twelve months. The state’s highest court agreed to hear Appian’s petition which claims four errors in the Court of Appeals’ decision, potentially restoring a jury verdict for willful and malicious trade secret misappropriation.
The dispute centers on allegations that Pegasystems used a "spy" to gain insights into Appian’s software, ultimately using this information to enhance its own products and generate substantial revenue. The jury’s original unanimous verdict came after seven weeks of testimony and extensive evidence review. This legal battle comes at a crucial time for Appian, which InvestingPro analysis shows is currently operating with moderate debt levels while maintaining a stable current ratio of 1.23.
Christopher Winters, General Counsel of Appian, expressed optimism about the Supreme Court’s decision to review the case, stating, "We look forward to being heard by the highest court in Virginia and remain hopeful the Court will reinstate the jury’s verdict and corresponding damages."
In addition to Appian’s petition, the Supreme Court will also consider Pegasystems’ cross-appeal issues, which challenge the sufficiency of evidence for trade secret misappropriation. These arguments have previously been dismissed by both the trial court and the Court of Appeals. It is important to note that a violation of the Virginia Computer Crimes Act by Pegasystems has been confirmed and is not under appeal.
The upcoming briefing and argument before the Supreme Court of Virginia do not have a set timeline, and Appian has indicated that it cannot predict the outcome or duration of the appeals process.
This legal battle is part of Appian’s broader efforts to protect its intellectual property. The company, known for its process-focused software platform, serves various large organizations across multiple industries.
The information for this article is based on a press release statement by Appian. While the company is not currently profitable, InvestingPro analysts predict a return to profitability this year, with six analysts recently revising their earnings estimates upward. For deeper insights into Appian’s financial health and detailed analysis, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.
In other recent news, Appian Corporation reported robust fourth-quarter earnings, with earnings per share (EPS) of $0.00, surpassing analyst expectations by $0.01. The company’s revenue for the quarter reached $166.7 million, exceeding the consensus estimate of $164.36 million and marking a 15% increase from the previous year. Looking ahead, Appian provided guidance for the first quarter of 2025, forecasting EPS between $0.02 and $0.05, significantly higher than the consensus estimate of a $0.39 loss. For the full fiscal year 2025, the company anticipates EPS to be between $0.17 and $0.22, compared to the consensus estimate of $0.12. Morgan Stanley recently raised Appian’s stock price target to $35 from $32, maintaining an Equal-weight rating, citing the company’s strong financial performance despite slowing growth trends in the cloud segment. Additionally, KeyBanc initiated coverage on Appian with a Sector Weight rating, noting positive developments in pricing and packaging but expressing concerns about long-term growth and recent leadership changes. Appian also announced the release of Appian 25.1, an enhanced version of its platform, which significantly increases document processing capabilities and integrates artificial intelligence to improve enterprise application performance. These developments highlight Appian’s ongoing efforts to enhance its platform and financial standing in the competitive tech market.
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