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⁾:

	Three Months Ended
	GAAP								Non-GAAP
(In thousands, except percentages and per share amounts)	August 31, 2021			August 31, 2020			% Change		August 31, 2021			August 31, 2020			% Change
Revenue	$	147,417		$	109,699		34	%	$	152,597		$	110,882		38	%
Income from operations	$	46,046		$	33,193		39	%	$	71,163		$	47,117		51	%
Operating margin	31		%	30		%	100 bps		47		%	42		%	500 bps
Net income	$	30,976		$	23,977		29	%	$	52,577		$	35,605		48	%
Diluted earnings per share	$	0.70		$	0.53		32	%	$	1.18		$	0.78		51	%
Cash from operations (GAAP) /Adjusted free cash flow (Non-GAAP)	$	35,224		$	31,112		13	%	$	35,022		$	30,101		16	%

⁽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:

	Updated FY 2021 Guidance (September 23, 2021)		Prior FY 2021 Guidance (June 24, 2021)
(In millions, except percentages and per share amounts)	GAAP	Non-GAAP	GAAP	Non-GAAP
Revenue	$520 - $524	$548 - $552	$503 - $509	$529 - $535
Diluted earnings per share	$1.56 - $1.58	$3.68 - $3.70	$1.51 - $1.55	$3.46 - $3.50
Operating margin	21%	40%	21%	39%
Cash from operations (GAAP) / Adjusted free cash flow (Non-GAAP)	$168 - $172	$168 - $172	$160 - $164	$158 - $162
Effective tax rate	20% - 21%	20% - 21%	20% - 21%	20% - 21%

	Q4 2021 Guidance
(In millions, except per share amounts)	GAAP	Non-GAAP
Revenue	$129 - $133	$134 - $138
Diluted earnings per share	$0.13 - $0.15	$0.73 - $0.75

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.

Investor Contact:		Press Contact:
Michael Micciche		Erica McShane
Progress Software		Progress Software
+1 781 850 8450		+1 781 280 4000
Investor-Relations@progress.com		PR@progress.com

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	Three Months Ended								Nine Months Ended
(In thousands, except per share data)	August 31, 2021			August 31, 2020			% Change		August 31, 2021			August 31, 2020			% Change
Revenue:
Software licenses	$	51,930		$	27,514		89	%	$	115,354		$	77,806		48	%
Maintenance and services	95,487			82,185			16	%	275,831			241,959			14	%
Total revenue	147,417			109,699			34	%	391,185			319,765			22	%
Costs of revenue:
Cost of software licenses	1,574			1,103			43	%	3,763			3,302			14	%
Cost of maintenance and services	14,895			11,971			24	%	42,887			35,607			20	%
Amortization of acquired intangibles	3,599			1,664			116	%	10,719			4,974			116	%
Total costs of revenue	20,068			14,738			36	%	57,369			43,883			31	%
Gross profit	127,349			94,961			34	%	333,816			275,882			21	%
Operating expenses:
Sales and marketing	29,737			22,186			34	%	88,468			68,100			30	%
Product development	25,616			20,676			24	%	76,579			64,117			19	%
General and administrative	16,451			13,514			22	%	46,335			38,702			20	%
Amortization of acquired intangibles	7,978			4,176			91	%	22,836			12,484			83	%
Restructuring expenses	40			91			(56	)%	1,133			1,826			(38	)%
Acquisition-related expenses	1,481			1,125			32	%	2,721			1,439			89	%
Total operating expenses	81,303			61,768			32	%	238,072			186,668			28	%
Income from operations	46,046			33,193			39	%	95,744			89,214			7	%
Other expense, net	(6,539		)	(2,962		)	(121	)%	(14,409		)	(9,206		)	(57	)%
Income before income taxes	39,507			30,231			31	%	81,335			80,008			2	%
Provision for income taxes	8,531			6,254			36	%	17,841			17,947			(1	)%
Net income	$	30,976		$	23,977		29	%	$	63,494		$	62,061		2	%

Earnings per share:
Basic	$	0.71		$	0.53		34	%	$	1.45		$	1.38		5	%
Diluted	$	0.70		$	0.53		32	%	$	1.43		$	1.37		4	%
Weighted average shares outstanding:
Basic	43,762			45,036			(3	)%	43,896			44,941			(2	)%
Diluted	44,502			45,364			(2	)%	44,542			45,382			(2	)%

Cash dividends declared per common share	$	0.175		$	0.165		6	%	$	0.525		$	0.495		6	%

Stock-based compensation is included in the condensed consolidated statements of operations, as follows:
Cost of revenue	$	374	$	322	16	%	$	1,234	$	979	26	%
Sales and marketing	1,424		1,035		38	%	4,679		3,195		46	%
Product development	1,848		1,693		9	%	6,179		5,518		12	%
General and administrative	3,193		2,635		21	%	9,893		7,667		29	%
Total	$	6,839	$	5,685	20	%	$	21,985	$	17,359	27	%

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands)	August 31, 2021		November 30, 2020
Assets
Current assets:
Cash, cash equivalents and short-term investments	$	383,677	$	105,995
Accounts receivable, net	77,031		84,040
Unbilled receivables and contract assets	28,479		24,917
Other current assets	19,710		23,983
Total current assets	508,897		238,935
Property and equipment, net	28,724		29,817
Goodwill and intangible assets, net	670,602		704,473
Right-of-use lease assets	28,286		30,635
Long-term unbilled receivables and contract assets	22,225		17,133
Other assets	16,753		20,789
Total assets	$	1,275,487	$	1,041,782
Liabilities and shareholders' equity
Current liabilities:
Accounts payable and other current liabilities	$	70,713	$	70,899
Current portion of long-term debt, net	23,886		18,242
Short-term operating lease liabilities	7,269		7,015
Short-term deferred revenue	169,740		166,387
Total current liabilities	271,608		262,543
Long-term debt, net	247,375		364,260
Convertible senior notes, net	291,283		—
Long-term operating lease liabilities	24,010		26,966
Long-term deferred revenue	33,280		26,908
Other long-term liabilities	11,158		15,092
Shareholders' equity:
Common stock and additional paid-in capital	343,677		306,244
Retained earnings	53,096		39,769
Total shareholders' equity	396,773		346,013
Total liabilities and shareholders' equity	$	1,275,487	$	1,041,782

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Three Months Ended						Nine Months Ended
(In thousands)	August 31, 2021			August 31, 2020			August 31, 2021			August 31, 2020
Cash flows from operating activities:
Net income	$	30,976		$	23,977		$	63,494		$	62,061
Depreciation and amortization	16,383			7,480			43,074			22,721
Stock-based compensation	6,839			5,685			21,985			17,359
Other non-cash adjustments	1,009			655			4,132			8,311
Changes in operating assets and liabilities	(19,983		)	(6,685		)	1,917			(8,367		)
Net cash flows from operating activities	35,224			31,112			134,602			102,085
Capital expenditures	(625		)	(1,662		)	(2,741		)	(3,419		)
Issuances of common stock, net of repurchases	2,947			1,719			(25,753		)	(10,973		)
Dividend payments to shareholders	(7,755		)	(7,452		)	(23,372		)	(22,358		)
Payments of principal on long-term debt	(5,644		)	(3,763		)	(111,669		)	(7,525		)
Proceeds from issuance of Notes, net of issuance costs	—			—			349,196			—
Purchase of capped calls	—			—			(43,056		)	—
Other	(3,130		)	6,520			475			(1,376		)
Net change in cash, cash equivalents and short-term investments	21,017			26,474			277,682			56,434
Cash, cash equivalents and short-term investments, beginning of period	362,660			203,645			105,995			173,685
Cash, cash equivalents and short-term investments, end of period	$	383,677		$	230,119		$	383,677		$	230,119

RECONCILIATIONS OF GAAP TO NON-GAAP SELECTED FINANCIAL MEASURES - THIRD QUARTER

(Unaudited)

	Three Months Ended										% Change
(In thousands, except per share data)	August 31, 2021					August 31, 2020					Non-GAAP
Adjusted revenue:
GAAP revenue	$	147,417				$	109,699
Acquisition-related revenue⁽¹⁾	5,180					1,183
Non-GAAP revenue	$	152,597		100	%	$	110,882		100	%	38	%

Adjusted income from operations:
GAAP income from operations	$	46,046		31	%	$	33,193		30	%
Amortization of acquired intangibles	11,577			8	%	5,840			5	%
Restructuring expenses and other	40			—	%	91			—	%
Stock-based compensation	6,839			4	%	5,685			5	%
Acquisition-related revenue⁽¹⁾ and expenses	6,661			4	%	2,308			2	%
Non-GAAP income from operations	$	71,163		47	%	$	47,117		42	%	51	%

Adjusted net income:
GAAP net income	$	30,976		21	%	$	23,977		22	%
Amortization of acquired intangibles	11,577			8	%	5,840			5	%
Restructuring expenses and other	40			—	%	91			—	%
Stock-based compensation	6,839			3	%	5,685			5	%
Acquisition-related revenue⁽¹⁾ and expenses	6,661			4	%	2,308			2	%
Amortization of discount on notes	2,868			2	%	—			—	%
Provision for income taxes	(6,384		)	(4	)%	(2,296		)	(2	)%
Non-GAAP net income	$	52,577		34		$	35,605		32	%	48	%

Adjusted diluted earnings per share:
GAAP diluted earnings per share	$	0.70				$	0.53
Amortization of acquired intangibles	0.26					0.12
Stock-based compensation	0.15					0.13
Acquisition-related revenue⁽¹⁾ and expenses	0.15					0.05
Amortization of discount on notes	0.06					—
Provision for income taxes	(0.14		)			(0.05		)
Non-GAAP diluted earnings per share	$	1.18				$	0.78				51	%

Non-GAAP weighted avg shares outstanding - diluted	44,502					45,364					(2	)%

⁽¹⁾Acquisition-related revenue constitutes revenue reflected as pre-acquisition deferred revenue that would otherwise have been recognized but for the purchase accounting treatment of acquisitions. Since GAAP accounting requires the elimination of this revenue, GAAP results alone do not fully capture all of our economic activities.

RECONCILIATIONS OF GAAP TO NON-GAAP SELECTED FINANCIAL MEASURES - YEAR TO DATE

(Unaudited)

	Nine Months Ended										% Change
(In thousands, except per share data)	August 31, 2021					August 31, 2020					Non-GAAP
Adjusted revenue:
GAAP revenue	$	391,185				$	319,765
Acquisition-related revenue⁽¹⁾	22,394					7,384
Non-GAAP revenue	$	413,579		100	%	$	327,149		100	%	26	%

Adjusted income from operations:
GAAP income from operations	$	95,744		24	%	$	89,214		28	%
Amortization of acquired intangibles	33,555			8	%	17,458			5	%
Restructuring expenses and other	1,133			—	%	1,826			—	%
Stock-based compensation	21,985			5	%	17,359			5	%
Acquisition-related revenue⁽¹⁾ and expenses	25,115			6	%	8,823			3	%
Non-GAAP income from operations	$	177,532		43	%	$	134,680		41	%	32	%

Adjusted net income:
GAAP net income	$	63,494		16	%	$	62,061		19	%
Amortization of acquired intangibles	33,555			8	%	17,458			5	%
Restructuring expenses and other	1,133			—	%	1,826			—	%
Stock-based compensation	21,985			5	%	17,359			5	%
Acquisition-related revenue⁽¹⁾ and expenses	25,115			6	%	8,823			3	%
Amortization of discount on notes	4,348			1	%	—			—	%
Provision for income taxes	(18,036		)	(4	)%	(8,563		)	(2	)%
Non-GAAP net income	$	131,594		32	%	$	98,964		30	%	33	%

Adjusted diluted earnings per share:
GAAP diluted earnings per share	$	1.43				$	1.37
Amortization of acquired intangibles	0.75					0.38
Restructuring expenses and other	0.03					0.04
Stock-based compensation	0.48					0.39
Acquisition-related revenue⁽¹⁾ and expenses	0.56					0.19
Amortization of discount on notes	0.10					—
Provision for income taxes	(0.40		)			(0.19		)
Non-GAAP diluted earnings per share	$	2.95				$	2.18				35	%

Non-GAAP weighted avg shares outstanding - diluted	44,542					45,382					(2	)%

⁽¹⁾Acquisition-related revenue constitutes revenue reflected as pre-acquisition deferred revenue that would otherwise have been recognized but for the purchase accounting treatment of acquisitions. Since GAAP accounting requires the elimination of this revenue, GAAP results alone do not fully capture all of our economic activities.

OTHER NON-GAAP FINANCIAL MEASURES

(Unaudited)

Quarter to Date Adjusted Free Cash Flow

(In thousands)	Q3 2021			Q3 2020			% Change
Cash flows from operations	$	35,224		$	31,112		13	%
Purchases of property and equipment	(625		)	(1,662		)	(62	)%
Free cash flow	34,599			29,450			17	%
Add back: restructuring payments	423			651			(35	)%
Adjusted free cash flow	$	35,022		$	30,101		16	%

Year to Date Adjusted Free Cash Flow

(In thousands)	Q3 2021			Q3 2020			% Change
Cash flows from operations	$	134,602		$	102,085		32	%
Purchases of property and equipment	(2,741		)	(3,419		)	(20	)%
Free cash flow	131,861			98,666			34	%
Add back: restructuring payments	5,087			3,131			62	%
Adjusted free cash flow	$	136,948		$	101,797		35	%

RECONCILIATIONS OF GAAP TO NON-GAAP FINANCIAL MEASURES FOR FISCAL YEAR 2021 GUIDANCE

(Unaudited)

Fiscal Year 2021 Updated Revenue Guidance
	Fiscal Year Ended		Fiscal Year Ending
	November 30, 2020		November 30, 2021
(In millions)			Low		% Change		High		% Change
GAAP revenue	$	442.1	$	520.4	18	%	$	524.4	19	%
Acquisition-related adjustments - revenue⁽¹⁾	14.1		27.6		96	%	27.6		96	%
Non-GAAP revenue	$	456.2	$	548.0	20	%	$	552.0	21	%
⁽¹⁾Acquisition-related revenue constitutes revenue reflected as pre-acquisition deferred revenue that would otherwise have been recognized but for the purchase accounting treatment of acquisitions. Since GAAP accounting requires the elimination of this revenue, GAAP results alone do not fully capture all of our economic activities. Acquisition-related revenue adjustments relate to Ipswitch, Chef, and Kemp.

Fiscal Year 2021 Updated Non-GAAP Operating Margin Guidance
	Fiscal Year Ending November 30, 2021
(In millions)	Low			High
GAAP income from operations	$	108.9		$	110.0
GAAP operating margins	21		%	21		%
Acquisition-related revenue	27.6			27.6
Acquisition-related expense	3.4			3.4
Restructuring expense	4.8			4.8
Stock-based compensation	28.9			28.9
Amortization of acquired intangibles	46.9			46.9
Total adjustments⁽²⁾	111.6			111.6
Non-GAAP income from operations	$	220.5		$	221.6
Non-GAAP operating margin	40		%	40		%
⁽²⁾Total adjustments include preliminary estimates relating to the valuation of intangible assets acquired from Chef and Kemp and restructuring expenses. The final amounts will not be available until the Company's internal procedures and reviews are completed.

Fiscal Year 2021 Updated Non-GAAP Earnings per Share and Effective Tax Rate Guidance
	Fiscal Year Ending November 30, 2021
(In millions, except per share data)	Low			High
GAAP net income	$	69.7		$	70.6
Adjustments (from previous table)	111.6			111.6
Amortization of discount on notes	7.2			7.2
Income tax adjustment⁽³⁾	(24.4		)	(24.3		)
Non-GAAP net income	$	164.1		$	165.1

GAAP diluted earnings per share	$	1.56		$	1.58
Non-GAAP diluted earnings per share	$	3.68		$	3.70

Diluted weighted average shares outstanding	44.6			44.6

⁽³⁾Tax adjustment is based on a non-GAAP effective tax rate of approximately 21% for Low and 20% for High, calculated as follows:
Non-GAAP income from operations	$	220.5		$	221.6
Other (expense) income	(14.0		)	(14.0		)
Non-GAAP income from continuing operations before income taxes	206.5			207.6
Non-GAAP net income	164.1			165.1
Tax provision	$	42.4		$	42.5
Non-GAAP tax rate	21		%	20		%

RECONCILIATIONS OF GAAP TO NON-GAAP FINANCIAL MEASURES FOR FISCAL YEAR 2021 GUIDANCE

(Unaudited)

Fiscal Year 2021 Adjusted Free Cash Flow Guidance
	Fiscal Year Ending November 30, 2021
(In millions)	Low			High
Cash flows from operations (GAAP)	$	168		$	172
Purchases of property and equipment	(5		)	(5		)
Add back: restructuring payments	5			5
Adjusted free cash flow (non-GAAP)	$	168		$	172

RECONCILIATIONS OF GAAP TO NON-GAAP FINANCIAL MEASURES FOR Q4 2021 GUIDANCE

(Unaudited)

Q4 2021 Revenue Guidance
	Three Months Ended		Three Months Ending
	November 30, 2020		November 30, 2021
(In millions)			Low		% Change		High		% Change
GAAP revenue	$	122.4	$	129.2	6	%	$	133.2	9	%
Acquisition-related adjustments - revenue⁽¹⁾	6.7		5.2		(22	)%	5.2		(22	)%
Non-GAAP revenue	$	129.1	$	134.4	4	%	$	138.4	7	%
⁽¹⁾Acquisition-related revenue constitutes revenue reflected as pre-acquisition deferred revenue that would otherwise have been recognized but for the purchase accounting treatment of acquisitions. Since GAAP accounting requires the elimination of this revenue, GAAP results alone do not fully capture all of our economic activities. Acquisition-related revenue adjustments relate to Ipswitch, Chef, and Kemp.

Q4 2021 Non-GAAP Earnings per Share Guidance
	Three Months Ending November 30, 2021
	Low			High
GAAP diluted earnings per share	$	0.13		$	0.15
Acquisition-related revenue	0.12			0.12
Acquisition-related expense	0.02			0.02
Restructuring expense	0.08			0.08
Stock-based compensation	0.15			0.15
Amortization of acquired intangibles	0.30			0.30
Total adjustments⁽²⁾	0.67			0.67
Amortization of discount on notes	0.06			0.06
Income tax adjustment	(0.13		)	(0.13		)
Non-GAAP diluted earnings per share	$	0.73		$	0.75
⁽²⁾Total adjustments include preliminary estimates relating to the valuation of intangible assets acquired from Chef and Kemp. The final amounts will not be available until the Company's internal procedures and reviews are completed.

Progress Announces Third Quarter 2021 Financial Results