Shares in Pegasystems Inc. jumped more than 14% in late trading today after the business process management software provider surprised investors and analysts with strong earnings and revenue beats in its most recent quarter.

For its fourth quarter that ended Dec. 31, Pegasystems reported adjusted earnings per diluted share of $1.77, up from 82 cents in the fourth quarter of 2022, on revenue of $474.2 million, up 20% year-over-year. Analysts were expecting a more modest 98 cents per share on revenue of $414.6 million.

Pegasystem’ impressive figures were driven by strong growth across all of its business sectors. Pega Cloud, the company’s cloud offering, saw revenue rise 25%, to $120.35 million in the quarter. Maintenance saw an 18% increase, to $86.65 million, and subscription revenue, which includes services and licenses, grew a whopping 87%, to $414.55 million.

For the full fiscal year 2023, Pegasystems reported adjusted earnings per diluted share of $2.48, up 244% from 72 cents a year prior, on revenue of $1.433 billion, up 9% year-over-year.

Annual contract value, a metric used to describe the amount of revenue a company receives from a given customer each year, grew 11%, to $1.255 billion. Free cash flow over the year came in at $201 million, up from negative $13 million in 2022.

“We delivered transformative innovation to change the way the world builds software while deepening and expanding our client relationships,” Alan Trefler, founder and chief executive officer of Pegasystems, said in the company’s earnings release. “I couldn’t be more excited about the incredible opportunity ahead to leverage GenAI and revolutionize the way clients use our technology to drive success in 2024 and beyond.”

Pegasystems did not provide guidance for the first quarter of 2024 but did provide an outlook for the full year. For 2024, Pegasystems expects diluted earnings per share of $2.75 on revenue of $1.5 billion. Annual contract revenue growth in 2024 is expected to be 11% and free cash flow is forecast to come in at $350 million.

Image: Pegasystems