Shares of Progress Software (NASDAQ: PRGS) rose on Friday following a fiscal first-quarter report that beat analyst expectations. While revenue and earnings declined from the prior-year period, both the top and bottom lines were better than expected, and the company's guidance was solid as well. The stock was up about 15.3% at 10:45 a.m. EST.
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Progress Software reported first-quarter revenue of $89.5 million, down 6% year over year but nearly $2 million higher than the average analyst estimate. Software license revenue was down 12% to $22.8 million, while maintenance and services revenue was down 4% to $66.7 million. Adjusted for currency, total revenue declined by 4% year over year.
Non-GAAP earnings per share came in at $0.50, down from $0.56 in the prior-year period but $0.03 better than analysts were expecting. The company pointed to better-than-expected license revenue from OpenEdge, its application development platform, as one driver behind its results.
Progress Software expects fiscal 2019 non-GAAP revenue between $422 million and $428 million, well above the average analyst estimate of $382.4 million. Full-year non-GAAP EPS is expected between $2.46 and $2.52, ahead of the $2.37 analysts were expecting.
The company's results will benefit this year from the acquisition of Ipswitch, which is expected to close in late April. Progress Software expects the deal to "meaningfully contribute to non-GAAP revenue, profitability and cash flow in fiscal 2019."
While the headline numbers moved in the wrong direction in the first quarter, analysts were expecting worse. That, along with solid guidance, was enough to push up the stock.
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