prgs-20250228

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended February 28, 2025


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____to _____.

Commission File Number: 0-19417

PROGRESS SOFTWARE CORPORATION

(Exact name of registrant as specified in its charter)


Delaware						04-2746201
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)


15 Wayside Road, Suite 400, Burlington, Massachusetts						01803
(Address of principal executive offices)						(Zip code)

Registrant’s telephone number, including area code: (781) 280-4000

Not applicable

(Former name or former address and formal fiscal year, if changed since last report.)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value per share	PRGS	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of March 27, 2025, there were 43,025,995 shares of the registrant’s common stock, $.01 par value per share, outstanding.

PROGRESS SOFTWARE CORPORATION

FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED FEBRUARY 28, 2025

TABLE OF CONTENTS



PART I	FINANCIAL INFORMATION

Item 1.	Financial Statements (Unaudited)	3
	Condensed Consolidated Balance Sheets as of February 28, 2025 and November 30, 2024	3
	Condensed Consolidated Statements of Operations for the three months ended February 28, 2025 and February 29, 2024	4
	Condensed Consolidated Statements of Comprehensive Income for the three months ended February 28, 2025 and February 29, 2024	5
	Condensed Consolidated Statements of Stockholders' Equity for the three months ended February 28, 2025 and February 29, 2024	6
	Condensed Consolidated Statements of Cash Flows for the three months ended February 28, 2025 and February 29, 2024	7
	Notes to Condensed Consolidated Financial Statements	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	18
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	27
Item 4.	Controls and Procedures	27

PART II	OTHER INFORMATION

Item 1.	Legal Proceedings	28
Item 1A.	Risk Factors	28
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	28
Item 5.	Other Information	29
Item 6.	Exhibits	30

	Signatures	31

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)

Condensed Consolidated Balance Sheets


(in thousands, except share data)	February 28, 2025		November 30, 2024
Assets
Current assets:
Cash and cash equivalents	$	124,161	$	118,077
Accounts receivable, net	126,366		163,575
Unbilled receivables	35,454		34,672
Other current assets	54,694		52,489
Total current assets	340,675		368,813
Long-term unbilled receivables	30,416		28,893
Property and equipment, net	13,233		13,746
Intangible assets, net	686,359		723,571
Goodwill	1,293,822		1,292,177
Right-of-use lease assets	28,308		30,894
Deferred tax assets	57,452		56,179
Other assets	12,153		12,693
Total assets	$	2,462,418	$	2,526,966
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	14,770	$	13,910
Short-term deferred revenue, net	328,798		332,142

Accrued compensation and related payroll taxes	43,154		64,672
Short-term operating lease liabilities	8,975		9,202
Other accrued liabilities	32,844		35,219
Total current liabilities	428,541		455,145
Long-term deferred revenue, net	71,508		72,270
Convertible senior notes, net	797,277		796,267
Long-term debt, net	700,000		730,000
Long-term operating lease liabilities	24,260		26,259
Deferred tax liabilities	2,286		2,279
Other noncurrent liabilities	6,699		5,958
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.01 par value; authorized, 10,000,000 shares; issued, none	—		—
Common stock, $0.01 par value; authorized, 200,000,000 shares; issued and outstanding, 43,021,707 shares in 2025 and 43,360,695 shares in 2024	430		434
Additional paid-in capital	353,039		354,158
Retained earnings	115,999		120,405
Accumulated other comprehensive loss	(37,621)		(36,209)
Total stockholders’ equity	431,847		438,788
Total liabilities and stockholders’ equity	$	2,462,418	$	2,526,966

See notes to unaudited condensed consolidated financial statements.

Condensed Consolidated Statements of Operations


	Three Months Ended
(in thousands, except per share data)	February 28, 2025		February 29, 2024
Revenue:
Software licenses	$	58,445	$	64,100
Maintenance, SaaS, and professional services	179,570		120,585
Total revenue	238,015		184,685
Costs of revenue:
Cost of software licenses	2,925		2,731
Cost of maintenance, SaaS, and professional services	32,884		22,219
Amortization of acquired intangibles	10,422		7,859
Total costs of revenue	46,231		32,809
Gross profit	191,784		151,876
Operating expenses:
Sales and marketing	51,296		39,111
Product development	46,375		34,988
General and administrative	25,623		21,344
Amortization of acquired intangibles	25,808		17,389
Cyber vulnerability response expenses, net	737		987
Restructuring expenses	7,029		2,349
Acquisition-related expenses	2,490		702

Total operating expenses	159,358		116,870
Income from operations	32,426		35,006
Other (expense) income:
Interest expense	(18,429)		(7,344)
Interest income and other, net	487		624
Foreign currency loss, net	(1,182)		(679)
Total other expense, net	(19,124)		(7,399)
Income before income taxes	13,302		27,607
Provision for income taxes	2,356		4,968
Net income	$	10,946	$	22,639
Earnings per share:
Basic	$	0.25	$	0.52
Diluted	$	0.24	$	0.51
Weighted average shares outstanding:
Basic	43,256		43,802
Diluted	44,887		44,826

Cash dividends declared per common share	$	—	$	0.175

See notes to unaudited condensed consolidated financial statements.

Condensed Consolidated Statements of Comprehensive Income


	Three Months Ended
(in thousands)	February 28, 2025		February 29, 2024
Net income	$	10,946	$	22,639
Other comprehensive loss, net of tax:
Foreign currency translation adjustments	(1,412)		(1,546)
Unrealized loss on hedging activity, net of tax benefit of $218 for the three months ended February 29, 2024	—		(690)
Total other comprehensive loss, net of tax	(1,412)		(2,236)
Comprehensive income	$	9,534	$	20,403

See notes to unaudited condensed consolidated financial statements.

Condensed Consolidated Statements of Stockholders’ Equity


	Three Months Ended February 28, 2025
	Common Stock			Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Total Stockholders' Equity
(in thousands)	Number of Shares	Amount
Balance, December 1, 2024	43,361	$	434	$	354,158	$	120,405	$	(36,209)	$	438,788
Issuance of stock under employee stock purchase plan	57	—		2,196		—		—		2,196
Exercise of stock options	37	—		1,470		—		—		1,470
Vesting of restricted stock units	187	2		(2)		—		—		—
Withholding tax payments related to net issuance of RSUs	(81)	(1)		(4,640)		—		—		(4,641)
Stock-based compensation	—	—		14,683		—		—		14,683

Treasury stock repurchases and retirements, including excise tax	(539)	(5)		(14,826)		(15,352)		—		(30,183)
Net income	—	—		—		10,946		—		10,946
Other comprehensive loss	—	—		—		—		(1,412)		(1,412)
Balance, February 28, 2025	43,022	$	430	$	353,039	$	115,999	$	(37,621)	$	431,847


	Three Months Ended February 29, 2024
	Common Stock			Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Total Stockholders' Equity
(in thousands)	Number of Shares	Amount
Balance, December 1, 2023	43,796	$	438	$	370,579	$	120,858	$	(32,160)	$	459,715
Issuance of stock under employee stock purchase plan	66	1		2,530		—		—		2,531
Exercise of stock options	80	1		3,249		—		—		3,250
Vesting of restricted stock units	244	2		(2)		—		—		—
Withholding tax payments related to net issuance of RSUs	(103)	(1)		(5,889)		—		—		(5,890)
Stock-based compensation	—	—		12,464		—		—		12,464
Dividends declared	—	—		—		(8,230)		—		(8,230)
Treasury stock repurchases and retirements	(394)	(4)		(10,658)		(11,838)		—		(22,500)
Net income	—	—		—		22,639		—		22,639
Other comprehensive loss	—	—		—		—		(2,236)		(2,236)
Balance, February 29, 2024	43,689	$	437	$	372,273	$	123,429	$	(34,396)	$	461,743

Condensed Consolidated Statements of Cash Flows


	Three Months Ended
(in thousands)	February 28, 2025		February 29, 2024
Cash flows from operating activities:
Net income	$	10,946	$	22,639
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization of property and equipment	1,619		1,589
Amortization of acquired intangibles and other	36,581		25,408
Amortization of debt discount and issuance costs	1,009		547
Stock-based compensation	14,683		12,464
Non-cash lease expense	3,443		4,259
Deferred income taxes	(1,696)		(3,295)
Credit losses and other sales allowances	1,323		363
Changes in operating assets and liabilities:
Accounts receivable	33,008		30,454
Other assets	(2,168)		1,530

Accounts payable and accrued liabilities	(22,821)		(24,897)
Lease liabilities	(3,080)		(2,949)
Income taxes payable	(260)		(461)
Deferred revenue, net	(3,640)		2,853
Net cash flows from operating activities	68,947		70,504
Net cash flows used in investing activities:


Purchases of property and equipment	(1,290)		(309)
Payments for acquisitions	(1,195)		—
Net cash flows used in investing activities	(2,485)		(309)
Net cash flows used in financing activities:
Proceeds from equity plans	6,238		7,583
Payments for taxes related to net share settlements of equity awards	(4,641)		(5,890)
Repurchases of common stock, including excise tax	(30,108)		(22,500)


Dividend equivalent and dividend payments to stockholders	(359)		(8,171)

Repayment of revolving line of credit	(30,000)		(30,000)
Principal payment on term loan	—		(3,437)

Net cash flows used in financing activities	(58,870)		(62,415)
Effect of exchange rate changes on cash and cash equivalents	(1,508)		(1,516)
Net increase in cash and cash equivalents	6,084		6,264
Cash and cash equivalents, beginning of period	118,077		126,958
Cash and cash equivalents, end of period	$	124,161	$	133,222

Condensed Consolidated Statements of Cash Flows, continued


	Three Months Ended
(in thousands)	February 28, 2025		February 29, 2024
Supplemental disclosure:
Cash paid for income taxes, net of refunds of $778 in 2025 and $856 in 2024	$	3,121	$	3,179
Cash paid for interest	$	12,121	$	5,570
Non-cash investing and financing activities:
Total fair value of restricted stock awards, restricted stock units and deferred stock units on date vested	$	10,677	$	13,947
Dividends declared and unpaid	$	—	$	8,435

See notes to unaudited condensed consolidated financial statements.

Notes to Condensed Consolidated Financial Statements

Note 1: Basis of Presentation

Company Overview - Progress Software Corporation ("Progress," the "Company," "we," "us," or "our") provides software products that enable our customers to develop, deploy and manage responsible AI-powered applications and digital experiences.

Many of our products are sold as perpetual licenses, but certain products use term licensing models and our cloud-based offerings are marketed as software-as-a-service ("SaaS") offerings. More than half of our worldwide license revenue is realized through relationships with indirect channel partners, principally independent software vendors ("ISVs"), original equipment manufacturers ("OEMs"), distributors and value-added resellers. ISVs develop and market applications using our technology and resell our products in conjunction with sales of their own products that incorporate our technology. OEMs are companies that embed our products into their own software products or devices. Value-added resellers are companies that add features or services to our product, then resell it as an integrated product or complete "turn-key" solution. In October 2024, we acquired ShareFile, a SaaS offering.

We operate in North America, Latin America, Europe, the Middle East and Africa ("EMEA"), and Asia and Australia ("Asia Pacific"), through local subsidiaries as well as independent distributors.

Basis of Presentation and Significant Accounting Policies - We prepared the accompanying unaudited condensed consolidated financial statements pursuant to the rules and regulations of the U.S. Securities and Exchange Commission ("SEC") regarding interim financial reporting. Accordingly, the financial statements do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America ("GAAP") for complete financial statements and these unaudited financial statements should be read in conjunction with the audited financial statements included in our Annual Report on Form 10-K for the fiscal year ended November 30, 2024, as filed with the SEC on January 21, 2025 (our "2024 Annual Report").

We made no material changes in the application of our significant accounting policies that were disclosed in our 2024 Annual Report. We have prepared the accompanying unaudited condensed consolidated financial statements on the same basis as the audited financial statements included in our 2024 Annual Report, and these financial statements include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results of the interim periods presented. The operating results for the interim periods presented are not necessarily indicative of the results expected for the full fiscal year.

Use of Estimates

The preparation of condensed consolidated financial statements requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. On an on-going basis, management evaluates its estimates and records changes in estimates in the period in which they become known. These estimates are based on historical data and experience, as well as various other assumptions that management believes to be reasonable under the circumstances. The most significant estimates relate to revenue recognition, loss contingencies and the MOVEit Vulnerability (as defined herein), and business combinations. Actual results could differ from those estimates.

Recent Accounting Pronouncements

Recently Issued Accounting Pronouncements Not Yet Adopted

In November 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures ("ASU 2023-07"). ASU 2023-07 updates reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses and information used to assess segment performance. This update is effective beginning with the Company’s 2025 fiscal year annual reporting period. The Company is currently evaluating the impact that the adoption of this standard and will include the additional disclosures in the financial statements for the fiscal year ended November 30, 2025.

In December 2023, the FASB issued Accounting Standards Update No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures ("ASU 2023-09"). ASU 2023-09 is intended to improve the transparency and decision usefulness of income tax disclosures, primarily related to the rate reconciliation and income taxes paid information. ASU 2023-09 is effective for the Company beginning with the annual period ending November 30, 2026, allowing for adoption on a prospective basis or

a retrospective option. Early adoption is permitted. The adoption of this standard only impacts disclosures and is not expected to have a material impact on the Company's consolidated financial statements.

In November 2024, the FASB issued Accounting Standards Update No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses ("ASU 2024-03"), and in January 2025, the FASB issued Accounting Standards Update No. 2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date ("ASU 2025-01"). ASU 2024-03 requires additional disclosure of the nature of expenses included in the income statement as well as disclosures about specific types of expenses included in the expense captions presented in the income statement. ASU 2024-03, as clarified by ASU 2025-01, is effective for us for our annual reporting for fiscal 2028 and for interim period reporting beginning in fiscal 2029 on a prospective basis. Both early adoption and retrospective application are permitted. The Company is currently evaluating the impact that the adoption of these standards will have on its consolidated financial statements and disclosures.

Note 2: Fair Value Measurements

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The following table details the fair value measurements within the fair value hierarchy of our financial assets and liabilities at February 28, 2025:


			Fair Value Measurements Using
(in thousands)	Total Fair Value		Level 1		Level 2		Level 3
Assets
Money market funds	$	1,962	$	1,962	$	—	$	—
Liabilities
Foreign exchange derivatives	$	(1,752)	$	—	$	(1,752)	$	—

The following table details the fair value measurements within the fair value hierarchy of our financial assets and liabilities at November 30, 2024:


			Fair Value Measurements Using
(in thousands)	Total Fair Value		Level 1		Level 2		Level 3
Assets

Money market funds	$	1,823	$	1,823	$	—	$	—
Liabilities
Foreign exchange derivatives	$	(624)	$	—	$	(624)	$	—

When developing fair value estimates, we maximize the use of observable inputs and minimize the use of unobservable inputs. When available, we use quoted market prices to measure fair value. The valuation technique used to measure fair value for our Level 1 and Level 2 assets is a market approach, using prices and other relevant information generated by market transactions involving identical or comparable assets. If market prices are not available, the fair value measurement is based on models that use primarily market-based parameters including yield curves, volatilities, credit ratings and currency rates.

Assets and Liabilities Not Carried at Fair Value

Fair Value of the Convertible Senior Notes

The following table details the fair value and carrying value of our Convertible Senior Notes due 2026 and 2030 (together referred to as "the Notes"):


	February 28, 2025				November 30, 2024
(in thousands)	Carrying Value		Fair Value		Carrying Value		Fair Value
Convertible senior notes due 2026(1)	$	357,497	$	391,775	$	356,946	$	449,094
Convertible senior notes due 2030(2)	439,780		485,864		439,321		550,827
Total	$	797,277	$	877,639	$	796,267	$	999,921

(1) The carrying value of the convertible senior notes due 2026 (the "2026 Notes"), is reflected net of $2.5 million and $3.1 million of unamortized debt issuance costs as of February 28, 2025 and November 30, 2024, respectively.

(2) The carrying value of the convertible senior notes due 2030 (the "2030 Notes"), is reflected net of $10.2 million and $10.7 million of unamortized debt issuance costs as of February 28, 2025 and November 30, 2024, respectively.

The fair value of the Notes is based on quoted prices in an over-the-counter market on the last trading day of the reporting period and classified within Level 2 in the fair value hierarchy.

Fair Value of Other Financial Assets and Liabilities

The carrying amounts of other financial assets and liabilities including cash and cash equivalents, accounts receivable, unbilled accounts receivable, accounts payable, and accrued liabilities approximate their respective fair values due to their immediate or short-term maturities.

Note 3: Intangible Assets and Goodwill

Intangible Assets

Intangible assets are comprised of the following significant classes:


	February 28, 2025						November 30, 2024
(in thousands)	Gross Carrying Amount		Accumulated Amortization		Net Book Value		Gross Carrying Amount		Accumulated Amortization		Net Book Value
Purchased technology	$	399,000	$	(220,686)	$	178,314	$	399,000	$	(210,264)	$	188,736
Customer-related	776,608		(306,138)		470,470		777,608		(282,384)		495,224
Trademarks and trade names	77,111		(39,536)		37,575		77,111		(37,500)		39,611

Total	$	1,252,719	$	(566,360)	$	686,359	$	1,253,719	$	(530,148)	$	723,571

In the three months ended February 28, 2025 and February 29, 2024, amortization expense related to intangible assets was $36.2 million and $25.2 million, respectively.

Future amortization expense for intangible assets as of February 28, 2025, is as follows:


(in thousands)
Remainder of 2025	$	108,406
2026	135,361
2027	111,026
2028	99,443
2029	99,443
Thereafter	132,680
Total	$	686,359

Goodwill

Changes in the carrying amount of goodwill in the three months ended February 28, 2025 are as follows:


(in thousands)
Balance, December 1, 2024	$	1,292,177
Additions(1)	1,632
Translation adjustments	13
Balance, February 28, 2025	$	1,293,822

(1) The additions to goodwill during fiscal year 2025 represent measurement period adjustments related to the acquisition of ShareFile in October 2024. See Note 4: Business Combinations for additional information.

Note 4: Business Combinations

ShareFile Acquisition

On October 31, 2024, we completed the acquisition of ShareFile from Cloud Software Group, Inc. and its subsidiaries ("Cloud") for an aggregate purchase price of $875.0 million in cash, subject to a $25.0 million working capital credit and certain customary adjustments. We funded the acquisition through $730.0 million in borrowings under our existing $900.0 million revolving credit facility and cash on hand. Refer to Note 5: Debt for further information.

The acquisition consideration for ShareFile has been preliminarily allocated to ShareFile’s assets and assumed liabilities based on estimated fair values. The preliminary fair value estimates of the net assets acquired are based upon preliminary calculations and valuations, and those estimates and assumptions are subject to change as we obtain additional information for those estimates during the measurement period, which is up to one year from the acquisition date. During the three months ended February 28, 2025, the Company identified measurement period adjustments that resulted in increases in goodwill totaling $1.6 million.

The preliminary allocation of the purchase price, including the measurement period adjustments, is as follows:


(in thousands)	Initial Purchase Price Allocation		Measurement Period Adjustments		Adjusted Purchase Price Allocation		Life
Net working capital	$	892	$	940	$	1,832
Property, plant and equipment	54		—		54
Purchased technology	119,000		—		119,000		7 years
Trade name	27,000		—		27,000		7 years
Customer relationships	319,000		(1,000)		318,000		7 years
Deferred taxes	23,456		(377)		23,079
Deferred revenue	(96,159)		—		(96,159)
Goodwill	459,459		1,632		461,091
Net assets acquired	$	852,702	$	1,195	$	853,897

The fair value of the intangible assets was estimated using the income approach in which the after-tax cash flows are discounted to present value. The cash flows are based on estimates used to value the acquisition, and the discount rates applied were benchmarked with reference to the implied rate of return from the transaction model as well as the weighted average cost of capital. The valuation assumptions take into consideration our estimates of customer attrition, technology obsolescence, and revenue growth projections.

We recorded the excess of the purchase price over the identified tangible and intangible assets as goodwill. We believe that the investment value of the future enhancement of our product and solution offerings created as a result of this acquisition has principally contributed to a purchase price that resulted in the recognition of $461.1 million of goodwill, of which a portion is deductible for tax purposes.

Acquisition-related transaction costs (e.g., legal, due diligence, valuation, and other professional fees) and certain acquisition restructuring and related charges are not included as a component of consideration transferred but are required to be expensed as incurred. During the three months ended February 28, 2025, we incurred approximately $2.3 million of acquisition-related costs, which are included in acquisition-related expenses on our condensed consolidated statement of operations.

The amount of revenue of ShareFile included in our condensed consolidated statement of operations during the three months ended February 28, 2025, was $63.6 million. We determined that disclosing the amount of ShareFile related earnings included in the condensed consolidated statement of operations is impracticable, as certain operations of ShareFile were integrated into the operations of the Company from the date of acquisition.

In connection and concurrent with the ShareFile acquisition, we entered into a Transition Services Agreement ("TSA") with Cloud for a period of six months from the date of acquisition, with the option to extend the TSA beyond this period for certain services. Expenses related to the TSA were not significant during the three months ended February 28, 2025 and are not expected to be significant in future periods.

Pro Forma Information

The following pro forma financial information presents the combined results of operations of Progress and ShareFile as if the acquisition had occurred on December 1, 2022, after giving effect to certain pro forma adjustments. The pro forma adjustments reflected herein include only those adjustments that are directly attributable to the ShareFile acquisition and factually supportable. These pro forma adjustments include: (i) a net increase in amortization expense to record amortization expense relating to the $464.0 million of acquired identifiable intangible assets, (ii) an increase in interest expense to record interest for the periods presented as a result of drawing down our revolving line of credit in connection with the acquisition, (iii) an increase in acquisition-related expenses in connection with the acquisition that were not included in the purchase price, (iv) additional expense related to the TSA entered into between Progress and Cloud, and (v) the income tax effect of the adjustments made at the statutory tax rate of the U.S. (approximately 24.0%).

The pro forma financial information does not reflect any adjustments for anticipated expense savings resulting from the acquisition and is not necessarily indicative of the operating results that would have actually occurred had the transaction been consummated on December 1, 2022.


(in thousands, except per share data)	Pro Forma Three Months Ended February 29, 2024
Revenue	$	244,595
Net income	$	12,528
Net income per basic share	$	0.29
Net income per diluted share	$	0.28

Note 5: Debt

As of February 28, 2025 and November 30, 2024, we had the following debt obligations:


(in thousands)	February 28, 2025		November 30, 2024
1.0% convertible senior notes due 2026	$	360,000	$	360,000
3.5% convertible senior notes due 2030	450,000		450,000
Revolving credit facility	700,000		730,000
Total face value of long-term debt	1,510,000		1,540,000
Unamortized discount and issuance costs for the Notes	(12,723)		(13,733)
Long-term debt

SEC Form 10-Q filed by Progress Software Corporation