What Happened?

Shares of enterprise workflow software provider Pegasystems (NASDAQ:PEGA) jumped 32.6% in the morning session after the company reported strong first-quarter 2025 results that significantly exceeded analysts' expectations on both revenue and EPS. Total revenue growth was underpinned by a 23% increase in Pega Cloud annual contract value and a 21% jump in backlog, both suggesting sustained momentum in client demand and deeper customer commitments. Zooming out, we think this was a solid quarter.

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What The Market Is Telling Us

Pegasystems’s shares are somewhat volatile and have had 13 moves greater than 5% over the last year. But moves this big are rare even for Pegasystems and indicate this news significantly impacted the market’s perception of the business.

The biggest move we wrote about over the last year was 9 months ago when the stock gained 15.8% on the news that the company reported strong second-quarter earnings. Pegasystems beat past analysts' revenue, adjusted EBITDA, free cash flow, and EPS expectations. Zooming out, this was an impressive quarter that should delight shareholders.

Pegasystems is down 4.3% since the beginning of the year, and at $88.94 per share, it is trading 20.8% below its 52-week high of $112.29 from January 2025. Investors who bought $1,000 worth of Pegasystems’s shares 5 years ago would now be looking at an investment worth $1,167.

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