Pega Cloud ACV Grows 65% in the First Half of 2019 – iCrowdNewswire
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Aug 8, 2019 6:00 AM ET

Pega Cloud ACV Grows 65% in the First Half of 2019


Pega Cloud ACV Grows 65% in the First Half of 2019

iCrowd Newswire - Aug 8, 2019

CAMBRIDGE, Mass., – Pegasystems Inc. (NASDAQ: PEGA), the software company empowering digital transformation at the world’s leading enterprises, released its financial results for the second quarter of 2019.

“At mid-year, I’m excited with the strong progress we’re making in our business and in our transition to cloud,” said Alan Trefler, founder and CEO, Pegasystems. “I’m pleased with how our strategy is working, and we continue to gain traction in seizing the huge opportunity in front of us.”

 

“Pega Cloud ACV increased 65% year over year, reaching $136 million,” said Ken Stillwell, CFO, Pegasystems. “This strong ACV growth reflects solid demand worldwide for digital transformation solutions.”

Financial metrics (1)

(Dollars in thousands, except per share amounts)

Three Months Ended
June 30,

 

Six Months Ended
June 30,

2019

 

2018

 

Change

 

2019

 

2018

 

Change

Total revenue

$

205,592

   

$

196,779

   

4

%

 

$

418,138

   

$

431,961

   

(3)

%

Subscription revenue (2)

$

125,982

   

$

117,416

   

7

%

 

$

269,760

   

$

262,218

   

3

%

Net (loss) income – GAAP

$

(32,296)

   

$

(10,409)

   

(210)

%

 

$

(61,013)

   

$

1,791

   

*

 

Net (loss) income – Non-GAAP

$

(23,427)

   

$

(2,732)

   

(758)

%

 

$

(32,803)

   

$

17,525

   

*

 

Diluted (loss) earnings per share – GAAP

$

(0.41)

   

$

(0.13)

   

(215)

%

 

$

(0.77)

   

$

0.02

   

*

 

Diluted (loss) earnings per share – Non-GAAP

$

(0.30)

   

$

(0.03)

   

(900)

%

 

$

(0.42)

   

$

0.21

   

*

 
   

*

not meaningful

   

(1)

A reconciliation of the GAAP measures to our Non-GAAP measures is contained in the financial schedules at the end of this release.

   

(2)

Reflects client arrangements (term license, cloud, and maintenance) that are subject to renewal.

(Dollars in thousands)

Three Months Ended
June 30,

 

Six Months Ended
June 30,

2019

 

2018

 

Change

 

2019

 

2018

 

Change

Cloud

$

31,699

 

15

%

 

$

20,201

 

10

%

 

$

11,498

 

57

%

 

$

59,457

 

14

%

 

$

35,783

 

8

%

 

$

23,674

 

66

%

Term license

24,954

 

12

%

 

31,309

 

16

%

 

(6,355)

 

(20)

%

 

73,268

 

18

%

 

96,004

 

22

%

 

(22,736)

 

(24)

%

Maintenance

69,329

 

34

%

 

65,906

 

34

%

 

3,423

 

5

%

 

137,035

 

33

%

 

130,431

 

31

%

 

6,604

 

5

%

Subscription

125,982

 

61

%

 

117,416

 

60

%

 

8,566

 

7

%

 

269,760

 

65

%

 

262,218

 

61

%

 

7,542

 

3

%

Perpetual license

19,320

 

9

%

 

13,475

 

7

%

 

5,845

 

43

%

 

34,270

 

8

%

 

36,553

 

8

%

 

(2,283)

 

(6)

%

Consulting

60,290

 

30

%

 

65,888

 

33

%

 

(5,598)

 

(8)

%

 

114,108

 

27

%

 

133,190

 

31

%

 

(19,082)

 

(14)

%

Total revenue

$

205,592

 

100

%

 

$

196,779

 

100

%

 

$

8,813

 

4

%

 

$

418,138

 

100

%

 

$

431,961

 

100

%

 

$

(13,823)

 

(3)

%

Annual contract value (“ACV”) (1) (2)

The change in ACV measures the growth and predictability of future cash flows from Pega Cloud and Client Cloud committed arrangements as of the end of the particular reporting period.

 

June 30,

 

Change

 

Constant Currency
Change

(Dollars in thousands)

2019

 

2018

   

Maintenance ACV

$

277,316

   

$

263,624

   

$

13,692

 

5

%

 

7

%

Term ACV

199,299

   

168,528

   

30,771

 

18

%

 

19

%

Client Cloud ACV

476,615

   

432,152

   

44,463

 

10

%

 

12

%

Pega Cloud ACV

136,074

   

82,376

   

53,698

 

65

%

 

67

%

Total ACV

$

612,689

   

$

514,528

   

$

98,161

 

19

%

 

21

%

   

(1)

Total ACV, as of a given date, is the sum of the following two components:

   
 
  • Client Cloud: the sum of (1) the annual value of each term license contract in effect on such date, which is equal to its total license value divided by the total number of years and (2) maintenance revenue reported for the quarter ended on such date, multiplied by four. We do not provide hosting for Client Cloud arrangements.
 
  • Pega Cloud: the total of the annual value of each cloud contract in effect on such date, which is equal to its total value divided by the total number of years.
   

(2)

As foreign currency exchange rates are an important factor in understanding period to period comparisons, we believe the presentation of ACV growth rates on a constant currency basis enhances the understanding of our results and evaluation of our performance in comparison to prior periods. The percent change in constant currency is calculated by applying the applicable current period exchange rates to prior period ACV.

Remaining performance obligations (“RPO”)

Expected future revenue on existing contracts:

 

June 30, 2019

(Dollars in thousands)

Perpetual license

 

Term license

 

Maintenance

 

Cloud

 

Consulting

 

Total

1 year or less

$

8,429

   

$

38,080

   

$

173,421

   

$

124,134

   

$

16,259

   

$

360,323

 

57

%

1-2 years

915

   

4,678

   

12,530

   

98,842

   

942

   

117,907

 

19

%

2-3 years

1,306

   

641

   

5,801

   

75,828

   

227

   

83,803

 

13

%

Greater than 3 years

   

185

   

2,812

   

63,259

   

   

66,256

 

11

%

 

$

10,650

   

$

43,584

   

$

194,564

   

$

362,063

   

$

17,428

   

$

628,289

 

100

%

Change in RPO Since June 30, 2018

                     
 

$

(36,623)

   

$

6,640

   

$

32,273

   

$

148,253

   

$

1,086

   

$

151,629

   
 

(77)

%

 

18

%

 

20

%

 

69

%

 

7

%

 

32

%

 
   
 

June 30, 2018

(Dollars in thousands)

Perpetual license

 

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Contact Information:

Pegasystems Inc








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