Shares of Progress Software tumbled after the artificial-intelligence software company reported fiscal third-quarter revenue that fell short of Wall Street's estimates.

The stock fell 1.3% in after-hours trading after rising 1.3% to $39.97 in regular trading earlier Wednesday.

Shares have dropped 5.7% this year and are down 14% from their 52-week closing high of $46.87 on Oct. 13, 2025, according to Dow Jones Market Data.

Progress Software posted adjusted earnings of $1.69 a share for the quarter ended Aug. 31. Revenue totaled $246 million, declining 2% year over year. Analysts projected earnings of $1.52 a share and revenue of $247 million, according to FactSet.

The company upgraded its fiscal-year revenue guidance to between $1.04 billion and $1.05 billion, up from prior projections between $990 million and $1 billion, and exceeding analyst estimates of $1 billion. Adjusted earnings are estimated between $6.15 and $6.23 a share, in line with projections.

The company closed its $400 million acquisition of Domo, a business intelligence and data analytics software company, on Sept. 22. Progress Software said the transaction is expected to expand its customer base by more than 2,400 businesses.

CEO Yogesh Gupta said Wednesday the purchase will "further [strengthen] our ability to help customers unlock the value of their data and accelerate AI-powered innovation."

Domo is the latest acquisition fueling Progress Software's expansion from application-development software into AI infrastructure, providing greater exposure to corporate spending on AI and data tools.

In June, Gupta said there was optimism about the shift. He added the company's products "will continue to be highly relevant and integral to our customer success," and in many cases are "becoming even more valuable as customers seek trusted platforms on which to build their AI strategies."