Q3 Revenue and EPS Significantly Ahead of Guidance
Full Year 2021 Guidance Raised Again

BEDFORD, Mass., Sept. 23, 2021 (GLOBE NEWSWIRE) -- Progress (NASDAQ: PRGS), the leading provider of products to develop, deploy and manage high-impact business applications, today announced financial results for its fiscal third quarter ended August�31, 2021.

Third Quarter 2021 Highlights:

• Revenue of $147.4 million increased 34% year-over-year on an actual currency basis, and 33% on a constant currency basis.
• Non-GAAP revenue of $152.6 million increased 38% on an actual currency basis, and 36% on a constant currency basis.
• Annualized Recurring Revenue (ARR) of $444 million increased 25% year-over-year on a constant currency basis.
• Operating margin was 31% and Non-GAAP operating margin was 47%.
• Diluted earnings per share was $0.70 compared to $0.53 in the same quarter last year, an increase of 32%.�
• Non-GAAP diluted earnings per share was $1.18 compared to $0.78 in the same quarter last year, an increase of 51%.

�We�re very pleased to announce Q3 results that significantly beat our previous guidance for revenue and earnings, and we�re raising 2021 guidance for the third time this year,� said Yogesh Gupta, CEO at Progress. �We also announced the signing of a definitive agreement to acquire Kemp, a leader in the Application Experience (�AX�) space. Kemp meets all our acquisition criteria, fits perfectly with our total growth strategy, and brings a very talented team to Progress.�

Additional financial highlights included⁽¹⁾:

⁽¹⁾See Legal Notice Regarding Non-GAAP Financial Information

Other fiscal third quarter 2021 metrics and recent results included:

• Cash, cash equivalents and short-term investments were $383.7 million at the end of the quarter.
• DSO was 54 days compared to 49 days in the fiscal third quarter of 2020 and 44 days in the fiscal second quarter of 2021.
• On September 21, 2021, our Board of Directors declared a quarterly dividend of $0.175 per share of common stock that will be paid on December 15, 2021 to shareholders of record as of the close of business on December 1, 2021.
• On September 23, 2021, we announced a definitive agreement to acquire Kemp Technologies, a leader in the Application Experience space, for $258 million in cash.

Anthony Folger, CFO, said: �Q3 results were outstanding across every metric and our confidence in our business is reflected in the increased outlook for 2021. In addition to our strong financial results and outlook, we continued to execute our total growth strategy while remaining disciplined with the acquisition of Kemp, a deal that positions us exceptionally well for 2022 and beyond.�

2021 Business Outlook

Progress provides the following guidance for the fiscal year ending November 30, 2021 and the fiscal fourth quarter ending November 30, 2021:

Based on current exchange rates, the expected positive currency translation impact on Progress� fiscal year 2021 business outlook compared to 2020 exchange rates is approximately $6.8 million on GAAP and non-GAAP revenue, and approximately $0.04 on GAAP and non-GAAP diluted earnings per share. The expected positive currency translation impact on Progress� fiscal Q4 2021 business outlook compared to 2020 exchange rates on GAAP and non-GAAP revenue is approximately $0.6 million. The expected positive impact on GAAP and non-GAAP diluted Q4 2021 earnings per share is $0.01. To the extent that there are changes in exchange rates versus the current environment, this may have an impact on Progress� business outlook.

Conference Call

Progress will hold a conference call to review its financial results for the fiscal third quarter of 2021 at 5:00 p.m. ET on Thursday, September�23, 2021. The call can be accessed on the investor relations section of the company�s website, located at www.progress.com. Additionally, you can listen to the call by telephone by dialing 800-773-2954 or +1 847-413-3731, passcode 50220857. The conference call will include comments followed by questions and answers. An archived version of the conference call and supporting materials will be available on the Progress website within the investor relations section after the live conference call.

Legal Notice Regarding Non-GAAP Financial Information

Progress provides non-GAAP financial information as additional information for investors. These non-GAAP measures are not in accordance with, or an alternative to, generally accepted accounting principles in the United States (�GAAP�). Progress believes that the non-GAAP results described in this release are useful for an understanding of its ongoing operations and provide additional detail and an alternative method of assessing its operating results. �A reconciliation of non-GAAP adjustments to the company�s GAAP financial results is included in the tables below and is available on the Progress website at www.progress.com�within the investor relations section. Additional information regarding the company�s non-GAAP financial information is contained in the company's Current Report on Form 8-K furnished to the Securities and Exchange Commission in connection with this press release, which is also available on the Progress website within the investor relations section.

Note Regarding Forward-Looking Statements

This press release contains statements that are �forward-looking statements� within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Progress has identified some of these forward-looking statements with words like �believe,� �may,� �could,� �would,� �might,� �should,� �expect,� �intend,� �plan,� �target,� �anticipate� and �continue,� the negative of these words, other terms of similar meaning or the use of future dates.

Forward-looking statements in this press release include, but are not limited to, statements regarding Progress� business outlook and financial guidance. There are a number of factors that could cause actual results or future events to differ materially from those anticipated by the forward-looking statements, including, without limitation:

(1) Economic, geopolitical and market conditions can adversely affect our business, results of operations and financial condition, including our revenue growth and profitability, which in turn could adversely affect our stock price. (2) We may fail to achieve our financial forecasts due to such factors as delays or size reductions in transactions, fewer large transactions in a particular quarter, fluctuations in currency exchange rates, or a decline in our renewal rates for contracts. (3) Our ability to successfully manage transitions to new business models and markets, including an increased emphasis on a cloud and subscription strategy, may not be successful. (4) If we are unable to develop new or sufficiently differentiated products and services, or to enhance and improve our existing products and services in a timely manner to meet market demand, partners and customers may not purchase new software licenses or subscriptions or purchase or renew support contracts. (5) We depend upon our extensive partner channel and we may not be successful in retaining or expanding our relationships with channel partners. (6) Our international sales and operations subject us to additional risks that can adversely affect our operating results, including risks relating to foreign currency gains and losses. (7) If the security measures for our software, services, other offerings or our internal information technology infrastructure are compromised or subject to a successful cyber-attack, or if our software offerings contain significant coding or configuration errors, we may experience reputational harm, legal claims and financial exposure. (8) We have made acquisitions, and may make acquisitions in the future, and those acquisitions may not be successful, may involve unanticipated costs or other integration issues or may disrupt our existing operations. (9) Delay or failure to realize the expected synergies and benefits of the Kemp acquisition could negatively impact our future results of operations and financial condition; (10) The continuing impact of the coronavirus disease (COVID-19) outbreak on our employees, customers, partners, and the global financial markets could adversely affect our business, results of operations and financial condition. For further information regarding risks and uncertainties associated with Progress� business, please refer to Progress� filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the fiscal year ended November 30, 2020. Progress undertakes no obligation to update any forward-looking statements, which speak only as of the date of this press release.

About Progress

Progress�(NASDAQ: PRGS) provides the best products to develop, deploy and manage high-impact business applications. Our comprehensive product stack is designed to make technology teams more productive and we have a deep commitment to the developer community, both open source and commercial alike. With Progress, organizations can accelerate the creation and delivery of strategic business applications, automate the process by which apps are configured, deployed and scaled, and make critical data and content more accessible and secure�leading to competitive differentiation and business success. Over 1,700 independent software vendors, 100,000 enterprise customers, and three million developers rely on�Progress�to power their applications. Learn about�Progress�at�www.progress.com�or +1-800-477-6473.

Progress and�Progress Software�are trademarks or registered trademarks of�Progress Software Corporation�and/or its subsidiaries or affiliates in the�U.S.�and other countries.�Any other names contained herein may be trademarks of their respective owners.

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