GlobeNewswire Inc | Jan 14, 2021 04:15PM EST

January 14, 2021

Solid Execution Drove Growth and Operating LeverageAcquisition of Chef Bolsters Position in DevOps Market and Drives Fiscal 2021 Revenue Growth

BEDFORD, Mass., Jan. 14, 2021 (GLOBE NEWSWIRE) -- Progress (NASDAQ: PRGS), the leading provider of products to develop, deploy and manage high-impact business applications, today announced results for its fiscal fourth quarter and fiscal year ended November30, 2020.

Fourth Quarter 2020 Highlights:

-- Revenue of $122.4 million increased 5% year-over-year on an actual currency basis, and 4% on a constant currency basis. -- Non-GAAP revenue of $129.1 million increased 5% on an actual currency basis, and 4% constant currency basis. -- Operating margin was 15% and Non-GAAP operating margin was 37%. -- Diluted earnings per share was $0.39 compared to diluted loss per share of $0.11 in the same quarter last year. -- Non-GAAP diluted earnings per share was $0.91 compared to $0.79 in the same quarter last year, an increase of 15%. -- On October 5, 2020, the company completed the acquisition of Chef Software, a global leader in the growing DevOps and DevSecOps markets.

I am thrilled with our results both for the fourth quarter and the full year 2020 and believe they reflect the durability of our business and our success in executing our total growth strategy, said Yogesh Gupta, CEO at Progress. Chef extends our long-standing leadership position in the developer ecosystem, we are very pleased with the customer response and the rapid pace of the integration. The investments weve made to bolster our M&A capabilities, combined with the large, fragmented and growing DevOps market opportunity, position us well to execute on our total growth strategy for years to come, enabling us to deliver sustained shareholder value.

Additional financial highlights included:

Three Months Ended GAAP Non-GAAP(Inthousands,except November 30, November 30, November 30, November 30,percentages 2020 2019 Change 2020 2019 Changeand pershareamounts)Revenue $ 122,385 $ 117,038 5% $ 129,063 $ 123,416 5%Income(loss) from $ 18,514 $ (6,026 ) * $ 48,081 $ 47,285 2%operationsOperating 15 % (5 )% * 37 % 38 % (100)margin bpsNet income $ 17,661 $ (4,740 ) * $ 41,118 $ 35,720 15%(loss)Dilutedearnings $ 0.39 $ (0.11 ) * $ 0.91 $ 0.79 15%(loss) pershareCash fromoperations(GAAP) /Adjusted $ 42,762 $ 36,601 17% $ 40,656 $ 36,705 11%free cashflow(Non-GAAP) *Not meaningful

Other fiscal fourth quarter 2020 metrics and recent results included:

-- Cash, cash equivalents and short-term investments were $106.0 million at the end of the quarter. -- DSO was 54 days, compared to 56 days in the fiscal fourth quarter of 2019 and 49 days in the fiscal third quarter of 2020. -- Pursuant to the $250 million share authorization by the Board of Directors, Progress repurchased 1.0 million shares for $40 million during the fiscal fourth quarter of 2020. As of November 30, 2020, there was $190 million remaining under this authorization. -- On January 12, 2020, Progress' Board of Directors declared a quarterly dividend of $0.175 per share of common stock that will be paid on March 15, 2021 to shareholders of record as of the close of business on March 1, 2021.

Were excited to deliver results that reflect a strong and durable top line, expanded operating margin and meaningful growth in earnings per share, said Anthony Folger, CFO at Progress. As we begin to realize synergies from the acquisition of Chef, we are very well positioned to deliver strong fiscal 2021 results.

Full Year Results

Fiscal Year Ended GAAP Non-GAAP(Inthousands,except November 30, November 30, November 30, November 30,percentages 2020 2019 Change 2020 2019 Changeand pershareamounts)Revenue $ 442,150 $ 413,298 7% $ 456,212 $ 431,961 6%Income from $ 107,728 $ 40,084 169% $ 182,761 $ 162,258 13%operationsOperating 24 % 10 % 1400 40 % 38 % 200margin bps bpsNet income $ 79,722 $ 26,400 202% $ 140,082 $ 121,745 15%Dilutedearnings $ 1.76 $ 0.58 203% $ 3.09 $ 2.69 15%per shareCash fromoperations(GAAP) /Adjusted $ 144,847 $ 128,484 13% $ 142,453 $ 128,893 11%free cashflow(Non-GAAP)

2021 Business Outlook

Progress provides the following guidance for the fiscal year ending November30, 2021 and for the fiscal first quarter ending February28, 2021, together with actual results for the same periods in the fiscal year ending November30, 2020:

FY 2021 Guidance FY 2020 Actual(In millions, except percentages FY 2021 FY 2021 FY 2020 FY 2020and per share amounts) GAAP Non-GAAP GAAP Non-GAAPRevenue $487 - $513 - $ 442 $ 456 $495 $521Diluted earnings per share $1.40 - $3.22 - $ 1.76 $ 3.09 $1.46 $3.28Operating margin 19% 37% 24% 40%Cash from operations (GAAP) / $151 - $150 - $ 145 $ 142Adjusted free cash flow (Non-GAAP) $156 $155Effective tax rate 21% 20% 18% 18%

Q1 2021 Guidance Q1 2020 Actual(In millions, except per share Q1 2021 Q1 2021 Q1 Q1 2020amounts) GAAP Non-GAAP 2020 Non-GAAP GAAPRevenue $109 - $119 - $ 110 $ 114 $113 $123Diluted earnings per share $0.21 - $0.72 - $ 0.46 $ 0.76 $0.25 $0.76

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 $6.4 million on GAAP and non-GAAP revenue, and approximately $0.02 on GAAP and non-GAAP diluted earnings per share. The expected positive currency translation impact on Progress' fiscal Q1 2021 business outlook compared to 2020 exchange rates on GAAP and non-GAAP revenue is approximately $1.4 million. The expected currency translation impact on GAAP and non-GAAP earnings per share for fiscal Q1 2021 is not material. 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 fourth quarter of 2020 at 5:00 p.m. ET on Thursday, January14, 2021. The call can be accessed on the investor relations section of the companys website, located at www.progress.com. Additionally, you can listen to the call by telephone by dialing 1-888-458-4121, pass code 6657134. 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.comwithin 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 Chef 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 November30, 2019 and its Quarterly Reports on Form 10-Q for the fiscal quarters ended February 29, 2020, May 31, 2020 and August 31, 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 secureleading to competitive differentiation and business success. Over 1,700 independent software vendors, 100,000 enterprise customers, and three million developers rely onProgressto power their applications. Learn aboutProgressatwww.progress.comor +1-800-477-6473.

Progress andProgress Softwareare trademarks or registered trademarks ofProgress Software Corporationand/or its subsidiaries or affiliates in theU.S.and other countries.Any other names contained herein may be trademarks of their respective owners.

Investor Contact: Press Contact:Garo Toomajanian Erica McShaneProgress Software Progress Software+1 781 280 4817 +1 781 280 4000Investor-Relations@progress.com PR@progress.com

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS(Unaudited)

Three Months Ended Fiscal Year Ended(In thousands, November November November Novemberexcept per share 30,2020 30,2019 %Change 30,2020 30,2019 %Changedata)Revenue: Software licenses $ 37,443 $ 39,336 (5 ) % $ 115,249 $ 122,552 (6 ) %Maintenance and 84,942 77,702 9 % 326,901 290,746 12 %servicesTotal revenue 122,385 117,038 5 % 442,150 413,298 7 %Costs of revenue: Cost of software 1,171 1,598 (27 ) % 4,473 4,894 (9 ) %licensesCost of maintenance 14,137 12,281 15 % 49,744 44,463 12 %and servicesAmortization of 2,923 6,887 (58 ) % 7,897 25,884 (69 ) %acquired intangiblesTotal costs of 18,231 20,766 (12 ) % 62,114 75,241 (17 ) %revenueGross profit 104,154 96,272 8 % 380,036 338,057 12 %Operating expenses: Sales and marketing 32,013 29,369 9 % 100,113 101,701 (2 ) %Product development 24,482 23,868 3 % 88,599 88,572 ? %General and 15,302 14,915 3 % 54,004 53,360 1 %administrativeAmortization of 7,565 7,414 2 % 20,049 22,255 (10 ) %acquired intangiblesImpairment ofintangible & ? 24,096 (100 ) % ? 24,096 (100 ) %long-lived assets^(1)Restructuring 4,080 2,338 75 % 5,906 6,331 (7 ) %expensesAcquisition-related 2,198 298 638 % 3,637 1,658 119 %expensesTotal operating 85,640 102,298 (16 ) % 272,308 297,973 (9 ) %expensesIncome (loss) from 18,514 (6,026 ) * 107,728 40,084 169 %operationsOther expense, net (1,887 ) (3,551 ) 47 % (11,093 ) (11,589 ) 4 %Income (loss) before 16,627 (9,577 ) * 96,635 28,495 239 %income taxes(Benefit) provision (1,034 ) (4,837 ) (79 ) % 16,913 2,095 (707 ) %for income taxesNet income (loss) $ 17,661 $ (4,740 ) * $ 79,722 $ 26,400 202 % Earnings (loss) per share:Basic $ 0.39 $ (0.11 ) * $ 1.78 $ 0.59 202 %Diluted $ 0.39 $ (0.11 ) * $ 1.76 $ 0.58 203 %Weighted average shares outstanding:Basic 44,723 44,882 ? % 44,886 44,791 ? %Diluted 45,140 44,882 1 % 45,321 45,340 ? % Cash dividendsdeclared per common $ 0.175 $ 0.165 6 % $ 0.670 $ 0.630 6 %share^(1)Primarily represents a reduction in the carrying values of the intangibleassets associated with Kinvey and DataRPM.

Stock-based compensation is included in the condensed consolidated statements of operations, as follows: Cost of $ 357 $ 323 11 % $ 1,336 $ 1,134 18 %revenueSales and 1,267 950 33 % 4,462 4,155 7 %marketingProduct 1,768 1,812 (2 ) % 7,286 7,205 1 %developmentGeneral and 2,731 2,815 (3 ) % 10,398 10,817 (4 ) %administrativeTotal $ 6,123 $ 5,900 4 % $ 23,482 $ 23,311 1 % *Not meaningful

CONDENSED CONSOLIDATED BALANCE SHEETS(Unaudited)

(In thousands) November 30, November 30, 2020 2019Assets Current assets: Cash, cash equivalents and short-term investments $ 105,995 $ 173,685 Accounts receivable, net 84,040 72,820 Unbilled receivables and contract assets 24,917 10,880 Other current assets 23,983 27,280 Total current assets 238,935 284,665 Property and equipment, net 29,817 29,765 Goodwill and intangible assets, net 704,473 532,216 Right-of-use lease assets 30,635 ? Long-term unbilled receivables and contract assets 17,133 12,492 Other assets 20,789 22,133 Total assets $ 1,041,782 $ 881,271 Liabilities and shareholders' equity Current liabilities: Accounts payable and other current liabilities $ 70,899 $ 72,674 Current portion of long-term debt, net 18,242 10,717 Short-term operating lease liabilities 7,015 ? Short-term deferred revenue 166,387 157,494 Total current liabilities 262,543 240,885 Long-term debt, net 364,260 284,002 Long-term operating lease liabilities 26,966 ? Long-term deferred revenue 26,908 19,752 Other long-term liabilities 15,092 6,350 Shareholders' equity: Common stock and additional paid-in capital 306,244 295,953 Retained earnings 39,769 34,329 Total shareholders' equity 346,013 330,282 Total liabilities and shareholders' equity $ 1,041,782 $ 881,271

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(Unaudited)

Three Months Ended Fiscal Year Ended November November November November(In thousands) 30, 30, 30, 30, 2020 2019 2020 2019Cash flows from operating activities:Net income (loss) $ 17,661 $ (4,740 ) $ 79,722 $ 26,400 Depreciation and 12,044 16,519 34,765 56,679 amortizationStock-based compensation 6,123 5,900 23,482 23,311 Impairment of intangible ? 24,096 ? 24,096 and long-lived assets^(1)Other non-cash (2,024 ) (8,252 ) 6,287 (13,947 )adjustmentsChanges in operating 8,958 3,078 591 11,945 assets and liabilitiesNet cash flows from 42,762 36,601 144,847 128,484 operating activitiesCapital expenditures (3,098 ) (2,168 ) (6,517 ) (3,998 )Repurchases of common (37,927 ) 2,918 (48,901 ) (15,735 )stock, net of issuancesDividend payments to (7,542 ) (6,941 ) (29,900 ) (27,760 )shareholdersPayments foracquisitions, net of cash (213,057 ) ? (213,057 ) (225,298 )acquiredProceeds from theissuance of debt, net of 98,500 ? 98,500 183,374 payment of issuance costsProceeds from sale of 889 ? 889 6,146 long-lived assets, netPayments of principal on (3,763 ) (1,882 ) (11,288 ) (5,309 )long-term debtOther (888 ) (240 ) (2,263 ) (5,732 )Net change in cash, cashequivalents and (124,124 ) 28,288 (67,690 ) 34,172 short-term investmentsCash, cash equivalentsand short-term 230,119 145,397 173,685 139,513 investments, beginning ofperiodCash, cash equivalentsand short-term $ 105,995 $ 173,685 $ 105,995 $ 173,685 investments, end ofperiod^(1)Primarily represents a reduction in the carrying values of the intangibleassets associated with Kinvey and DataRPM.

RECONCILIATIONS OF GAAP TO NON-GAAP SELECTED FINANCIAL MEASURES - FOURTH QUARTER(Unaudited)

Three Months Ended % Change (In thousands, except per November 30, 2020 November 30, 2019 Non-GAAP share data)Adjusted revenue: GAAP revenue $ 122,385 $ 117,038 Acquisition-related 6,678 6,378 revenue^(1)Non-GAAP revenue $ 129,063 100 % $ 123,416 100 % 5 % Adjusted income from operations:GAAP income (loss) from $ 18,514 15 % $ (6,026 ) (5 ) % operationsAmortization of acquired 10,488 8 % 14,301 12 % intangiblesStock-based compensation 6,123 4 % 5,900 4 % Impairment of intangible ? ? % 24,096 20 % and long-lived assets^(2)Restructuring expenses 4,080 3 % 2,338 2 % and otherAcquisition-related 8,876 7 % 6,676 5 % revenue^(1) and expensesNon-GAAP income from $ 48,081 37 % $ 47,285 38 % 2 %operations Adjusted net income: GAAP net income (loss) $ 17,661 14 % $ (4,740 ) (4 ) % Amortization of acquired 10,488 8 % 14,301 12 % intangiblesStock-based compensation 6,123 5 % 5,900 4 % Impairment of intangible ? ? % 24,096 20 % and long-lived assets^(2)Restructuring expenses 4,080 3 % 2,338 2 % and otherAcquisition-related 8,876 7 % 6,676 5 % revenue^(1) and expensesProvision for income (6,110 ) (5 ) % (12,851 ) (10 ) % taxesNon-GAAP net income $ 41,118 32 % $ 35,720 29 % 15 % Adjusted diluted earnings per share:GAAP diluted earnings $ 0.39 $ (0.11 ) (loss) per shareAmortization of acquired 0.23 0.32 intangiblesStock-based compensation 0.14 0.13 Impairment of intangible ? 0.53 and long-lived assets^(2)Restructuring expenses 0.09 0.05 and otherAcquisition-related 0.20 0.15 revenue^(1) and expensesProvision for income (0.14 ) (0.28 ) taxesNon-GAAP diluted earnings $ 0.91 $ 0.79 15 %per share Non-GAAP weighted avgshares outstanding - 45,140 45,484 (1 ) %diluted ^(1)Acquisition-related revenue constitutes revenue reflected aspre-acquisition deferred revenue that would otherwise have been recognized butfor the purchase accounting treatment of acquisitions. Since GAAP accountingrequires the elimination of this revenue, GAAP results alone do not fullycapture all of our economic activities. Acquisition-related revenue adjustmentsrelate to Progress' Application Development and Deployment business segment forChef in fiscal year 2020 and Progress' OpenEdge business segment for Ipswitchin fiscal year 2019.^(2)Primarily represents a reduction in the carrying values of the intangibleassets associated with Kinvey and DataRPM.

RECONCILIATIONS OF GAAP TO NON-GAAP SELECTED FINANCIAL MEASURES - FISCAL YEAR(Unaudited)

Fiscal Year Ended % Change (In thousands, except per November 30, 2020 November 30, 2019 Non-GAAP share data)Adjusted revenue: GAAP revenue $ 442,150 $ 413,298 Acquisition-related 14,062 18,663 revenue^(1)Non-GAAP revenue $ 456,212 100 % $ 431,961 100 % 6 % Adjusted income from operations:GAAP income from $ 107,728 24 % $ 40,084 10 % operationsAmortization of acquired 27,946 6 % 48,139 11 % intangiblesStock-based compensation 23,482 5 % 23,311 5 % Impairment of intangible ? ? % 24,096 6 % and long-lived assets^(2)Restructuring expenses and 5,906 1 % 6,307 1 % otherAcquisition-related 17,699 4 % 20,321 5 % revenue^(1) and expensesNon-GAAP income from $ 182,761 40 % $ 162,258 38 % 13 %operations Adjusted net income: GAAP net income $ 79,722 18 % $ 26,400 6 % Amortization of acquired 27,946 6 % 48,139 11 % intangiblesStock-based compensation 23,482 5 % 23,311 5 % Impairment of intangible ? ? % 24,096 6 % and long-lived assets^(2)Restructuring expenses and 5,906 1 % 6,307 1 % otherAcquisition-related 17,699 4 % 20,321 5 % revenue^(1) and expensesProvision for income taxes (14,673 ) (3 ) % (26,829 ) (6 ) % Non-GAAP net income $ 140,082 31 % $ 121,745 28 % 15 % Adjusted diluted earnings per share:GAAP diluted earnings per $ 1.76 $ 0.58 shareAmortization of acquired 0.62 1.07 intangiblesStock-based compensation 0.51 0.51 Impairment of intangible ? 0.53 and long-lived assets^(2)Restructuring expenses and 0.13 0.14 otherAcquisition-related 0.39 0.45 revenue^(1) and expensesProvision for income taxes (0.32 ) (0.59 ) Non-GAAP diluted earnings $ 3.09 $ 2.69 15 %per share Non-GAAP weighted avgshares outstanding - 45,321 45,340 ? %diluted

^(1)Acquisition-related revenue constitutes revenue reflected aspre-acquisition deferred revenue that would otherwise have been recognized butfor the purchase accounting treatment of acquisitions. Since GAAP accountingrequires the elimination of this revenue, GAAP results alone do not fullycapture all of our economic activities. Acquisition-related revenue adjustmentsrelate to Progress' Application Development and Deployment business segment forChef in fiscal year 2020 and Progress' OpenEdge business segment for Ipswitchin fiscal year 2019.^(2)Primarily represents a reduction in the carrying values of the intangibleassets associated with Kinvey and DataRPM.

OTHER NON-GAAP FINANCIAL MEASURES(Unaudited)

Quarter to Date Adjusted Free Cash Flow (In thousands) Q4 2020 Q4 2019 % ChangeCash flows from operations $ 42,762 $ 36,601 17 %Purchases of property and equipment (3,098 ) (2,168 ) 43 %Free cash flow 39,664 34,433 15 %Add back: restructuring payments 992 2,272 (56 ) %Adjusted free cash flow $ 40,656 $ 36,705 11 %

Year to Date Adjusted Free Cash Flow (In thousands) FY 2020 FY 2019 % ChangeCash flows from operations $ 144,847 $ 128,484 13 %Purchases of property and equipment (6,517 ) (3,998 ) 63 %Free cash flow 138,330 124,486 11 %Add back: restructuring payments 4,123 4,407 (6 ) %Adjusted free cash flow $ 142,453 $ 128,893 11 %

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

Fiscal Year 2021 Revenue Guidance Fiscal Fiscal Year Ending Year Ended November November 30, 2021 30, 2020(In millions) Low % High % Change ChangeGAAP revenue $ 442.1 $ 487.3 10 % $ 495.3 12 %Acquisition-relatedadjustments - 14.1 25.7 82 % 25.7 82 %revenue^(1)Non-GAAP revenue $ 456.2 $ 513.0 12 % $ 521.0 14 % ^(1)Acquisition-related revenue constitutes revenue reflected aspre-acquisition deferred revenue that would otherwise have been recognized butfor the purchase accounting treatment of acquisitions. Since GAAP accountingrequires the elimination of this revenue, GAAP results alone do not fullycapture all of our economic activities. Acquisition-related revenue adjustmentsrelate to Progress' Application Development and Deployment business segment forChef and Progress' OpenEdge business segment for Ipswitch.

Fiscal Year 2021 Non-GAAP Operating Margin Guidance Fiscal Year Ending November 30, 2021(In millions) Low HighGAAP income from operations $ 91.2 $ 94.6 GAAP operating margin 19 % 19 %Acquisition-related revenue 25.7 25.7 Restructuring expense 1.9 1.9 Stock-based compensation 27.3 27.3 Acquisition-related expenses 0.3 0.3 Amortization of intangibles 44.9 44.9 Total adjustments 100.1 100.1 Non-GAAP income from operations $ 191.3 $ 194.7 Non-GAAP operating margin 37 % 37 %

Fiscal Year 2021 Non-GAAP Earnings per Share and Effective Tax Rate Guidance Fiscal Year Ending November 30, 2021(In millions, except per share data) Low HighGAAP net income $ 62.4 $ 65.1 Adjustments (from previous table) 100.1 100.1 Income tax adjustment^(2) (19.2 ) (19.2 )Non-GAAP net income $ 143.3 $ 146.0 GAAP diluted earnings per share $ 1.40 $ 1.46 Non-GAAP diluted earnings per share $ 3.22 $ 3.28 Diluted weighted average shares outstanding 44.5 44.5 ^(2)Tax adjustment is based on a non-GAAP effective tax rate of approximately20% for Low and High, calculated as follows:Non-GAAP income from operations $ 191.3 $ 194.7 Other (expense) income (12.2 ) (12.2 )Non-GAAP income from continuing operations before 179.1 182.5 income taxesNon-GAAP net income 143.3 146.0 Tax provision $ 35.8 $ 36.5 Non-GAAP tax rate 20 % 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 HighCash flows from operations (GAAP) $ 151 $ 156 Purchases of property and equipment (7 ) (7 )Add back: restructuring payments 6 6 Adjusted free cash flow (non-GAAP) $ 150 $ 155

RECONCILIATIONS OF GAAP TO NON-GAAP FINANCIAL MEASURES FOR Q1 2021 GUIDANCE(Unaudited)

Q1 2021 Revenue Guidance Three Months Three Months Ending Ended February February 28, 2021 29, 2020(In millions) Low % Change High % ChangeGAAP revenue $ 109.7 $ 108.8 (1 ) % $ 112.8 3 %Acquisition-relatedadjustments - 4.1 10.2 149 10.2 149 revenue^(1)Non-GAAP revenue $ 113.8 $ 119.0 5 % $ 123.0 8 % ^(1)Acquisition-related revenue constitutes revenue reflected aspre-acquisition deferred revenue that would otherwise have been recognized butfor the purchase accounting treatment of acquisitions. Since GAAP accountingrequires the elimination of this revenue, GAAP results alone do not fullycapture all of our economic activities. Acquisition-related revenue adjustmentsrelate to Progress; Application Development and Deployment business segment forChef and Progress' OpenEdge business segment for Ipswitch.

Q1 2021 Non-GAAP Earnings per Share Guidance Three Months Ending February 28, 2021 Low HighGAAP diluted earnings per share $ 0.21 $ 0.25 Acquisition-related revenue 0.23 0.23 Stock-based compensation 0.15 0.15 Amortization of intangibles 0.23 0.23 Restructuring expense 0.03 0.03 Total adjustments 0.64 0.64 Income tax adjustment (0.13 ) (0.13 )Non-GAAP diluted earnings per share $ 0.72 $ 0.76