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WALTHAM, Mass. - Pegasystems Inc . (NASDAQ:PEGA) reported fourth-quarter results that topped analyst expectations, but shares fell 4.8% in after-hours trading as the company’s 2025 earnings guidance came in below estimates.
The enterprise software company posted adjusted earnings per share of $1.61 for Q4, beating the consensus estimate of $1.47. Revenue rose 3% year-over-year to $490.83 million, surpassing analyst projections of $468.36 million.
"2024 was a transformative year for Pega, the industry, and our clients," said Alan Trefler, Pega founder and CEO. "Our team’s impressive performance drove the introduction of the most innovative solutions in our history."
For the full year 2024, Pega reported total revenue of $1.5 billion, up 5% from 2023. Annual contract value (ACV) grew 9% YoY to $1.37 billion.
However, the company’s 2025 outlook disappointed investors. Pega forecast adjusted EPS of approximately $3.10 for 2025, below the $3.24 consensus estimate. The company expects 2025 revenue of about $1.6 billion, slightly above the $1.58 billion analyst projection.
Pega also guided for 12% ACV growth in 2025 and free cash flow of $440 million.
Despite the weak guidance, CFO Ken Stillwell noted, "We met or exceeded our financial objectives for 2024 including becoming a Rule of 40 company. We’re committed to accelerating growth and free cash flow in 2025 and beyond."
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