Progress Software announced strong financial results for its fiscal first quarter ended February 28, 2025. The company reported revenue of $238.0 million, a 29% increase year-over-year, and Annualized Recurring Revenue (ARR) of $836 million, growing 48% year-over-year. Non-GAAP diluted earnings per share reached $1.31, surpassing analyst estimates of $1.25.
The company's operating margin for Q1 2025 was 39%, and its Net Retention Rate (NRR) again exceeded 100%, demonstrating the resilience of its business and strong customer relationships. Progress also generated $88 million in unlevered free cash flow, reflecting robust operational performance and collections.
Progress raised its full-year 2025 guidance, projecting non-GAAP diluted EPS between $5.25 and $5.37, an increase from prior guidance. The operating margin is now expected to be approximately 38%, and adjusted free cash flow is projected between $226 million and $238 million, both representing slight increases.
The company repurchased $30 million of its shares and accelerated the repayment of $30 million on its revolving credit facility during Q1, ahead of schedule. The ShareFile integration is tracking well, with management confident in completing it by year-end and achieving synergy targets. Total debt repayment for FY25 is now targeted at $160 million, an increase from the initial $150 million goal.
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