| Metric | Value ($ M) | Q2 FY26 | Q3 FY25 |
|---|---|---|---|
| Revenue | 393.36 | 6.5% | 3.1% |
| Total Income | 393.36 | 6.5% | 3.1% |
| Expenditure | 378.50 | 6.3% | 3.2% |
| PBT | 17.78 | 3.9% | 26.2% |
| Net Profit | 14.09 | 5.7% | 67.5% |
| OPM | 3.78% | 0.18pp | 0.02pp |
| NPM | 3.58% | 0.41pp | 7.79pp |
| EPS | 0.09 | 12.5% | 64.0% |
Pegasystems Reports Q3 2026 Results: Pega Cloud ACV Grows 20%
21 Oct 2026 · 11h ago
Summary
Pegasystems Inc. announced its financial results for the third quarter of 2026, reporting total revenue of $393.36 million, a 3% increase year-over-year. While GAAP net income saw a significant decrease of 68% to $14.09 million, non-GAAP net income grew by 8% to $59.75 million, with non-GAAP diluted EPS up 17% to $0.35. The company highlighted strong Pega Cloud ACV growth of 20% and total ACV growth of 6% (7% in constant currency), reaching $1.65 billion. Management acknowledged go-to-market execution challenges impacting ACV growth through the first three quarters but expressed confidence in demand and is taking decisive actions to accelerate growth, targeting over $700 million in free cash flow by 2028.
Key Highlights
- 1
Pega Cloud ACV grew 20% year-over-year, reaching $975.99 million as of September 30, 2026.
- 2
Total ACV grew 6% as reported and 7% in constant currency year-over-year, reaching $1.65 billion.
- 3
Total revenue for the third quarter of 2026 was $393.36 million, a 3% increase compared to the prior year.
- 4
GAAP Net income for the third quarter of 2026 was $14.09 million, a decrease of 68% compared to $43.36 million in the prior year.
- 5
Non-GAAP Net income for the third quarter of 2026 was $59.75 million, an increase of 8% compared to $55.16 million in the prior year.
- 6
Diluted earnings per share (non-GAAP) increased 17% to $0.35 in Q3 2026 from $0.30 in Q3 2025.
- 7
The company is taking actions to improve execution and accelerate growth, aiming to deliver $700 million or more of free cash flow in 2028.
Management Comments
Alan Trefler
The AI market is still sorting itself out, but we’re confident in our long-term winning strategy to harness models like Claude, OpenAI GPT, and Gemini to help enterprises achieve predictable business outcomes at predictable costs while maintaining the governance, security, and control required for mission-critical operations. Our edge is decades of expertise in workflow automation and decisioning, enabling enterprises to scale AI with confidence, control, and economic efficiency.
Ken Stillwell
While our ACV growth through the first three quarters of 2026 did not reflect the opportunity we see in the market, largely due to go-to-market execution challenges, our Q3 ACV add was the strongest of the year and reinforces our confidence in the demand for our solutions. We are taking decisive actions to improve execution, accelerate growth, and keep us on track to deliver $700M or more of free cash flow in 2028.
Informational and educational content only. Not investment advice.