Latest news with #PegasystemsPEGA
Yahoo
30-07-2025
- Business
- Yahoo
Strong Cloud Subscription Aids PEGA's Prospects: What's More to Come?
Pegasystems PEGA expects strong traction in its cloud-subscription business to continue, which is increasingly driving overall cloud growth. Key initiatives to sustain this momentum include a 5-year strategic collaboration with Amazon's cloud arm, Amazon Web Services (AWS), as PEGA intends to capitalize on major market trends, including AI, legacy transformation and cloud second-quarter 2025, PEGA's cloud revenues surged 24% year over year to $166.7 million, driven by increasing adoption as clients continued migrating from legacy systems to its cloud-native solutions. The company's Cloud Annual Contract Value (ACV) increased 28% year over year to $761 million. This robust cloud momentum underscores the increasing impact of subscription revenues on PEGA's overall company's Gen-AI-powered Blueprint plays a pivotal role in client base expansion. Its latest integration of Amazon's AWS Transform product is expected to allow enterprises to modernize legacy systems without disruption, directly feeding demand for Pega Cloud. The availability of the PEGA software on AWS Marketplace will improve accessibility and streamline client onboarding. Each incremental dollar of ACV is expected to boost subscription billings, creating a scalable and predictable revenue stream for the company. The Zacks Consensus Estimate for PEGA's third-quarter 2025 cloud revenues is pegged at $180 million, indicating a 25% year-over-year Public Sector positioning has strengthened with its FedRAMP High certification, a United States government security standard for cloud services, aligning with the government's push toward cloud adoption and AI-driven digital transformation. With a 28% growth in current backlog expected to convert to revenue, Pegasystems' cloud subscriptions remain a key driver of top-line growth. PEGA Faces Intense Competition in Cloud Subscriptions Pegasystems faces stiff competition from players like Salesforce CRM and ServiceNow NOWSalesforce offers its cloud-native CRM platform with an expanded suite of generative-AI tools through its AI Cloud offering. The company recently introduced Marketing Cloud Next, a major evolution of its marketing solution that uses Autonomous AI agents to enable personalized customer engagements at scale. Salesforce's industry-focused solutions like Life Sciences Cloud and Agentforce strengthen its position in delivering AI-powered, data-driven engagement through the through its cloud-based platform, empowers enterprises to digitize workflows, serving more than 85% of Fortune 500 companies. NOW recently announced a partnership with the Ferrari Hypercar team as its official platform provider, deploying its AI-powered platform to streamline real-time race operations and IT workflows across its global divisions. With third-quarter 2025 subscription revenues projected between $3.260 billion and $3.265 billion, ServiceNow maintains a strong competitive edge in delivering enterprise workflow automation. PEGA's Share Price Performance, Valuation, and Estimates Pegasystems shares have appreciated 29.5% in the year-to-date period, outperforming the Zacks Computer and Technology sector's return of 11.2%. PEGA's YTD Price Performance Image Source: Zacks Investment Research PEGA stock is currently trading at a discount, with a forward 12-month Price/Sales of 5.98X compared to the industry's 8.99X. PEGA has a Value Score of F. PEGA Valuation Image Source: Zacks Investment Research The Zacks Consensus Estimate for PEGA's 2025 earnings is pegged at $1.98 per share, up 5.3% over the past 30 days, suggesting 31.13% year-over-year growth. Pegasystems Inc. Price and Consensus Pegasystems Inc. price-consensus-chart | Pegasystems Inc. Quote PEGA currently carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Salesforce Inc. (CRM) : Free Stock Analysis Report ServiceNow, Inc. (NOW) : Free Stock Analysis Report Pegasystems Inc. (PEGA) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
Yahoo
14-07-2025
- Business
- Yahoo
ServiceNow's Workflow Adoption Rises: A Sign for More Upside?
ServiceNow NOW has been benefiting from the rising adoption of its workflows by enterprises undergoing digital transformation.A strong and frequently updated portfolio is helping ServiceNow win customers on a regular basis. NOW had 72 transactions of more than $1 million in net new annual contract value (ACV) in the first quarter of 2025. The company expanded its customer relationships, reaching 508 customers with more than $5 million in ACV at the end of the reported quarter, which represents 20% year-over-year customer is extensively leveraging AI and machine learning technologies to boost the potency of its solutions. The company's expanding Generative AI (GenAI) capabilities are noteworthy, as its total addressable market is expected to hit $275 billion in 2026. NOW's strategy of upgrading the platform twice a year helps simplify customers' workflows and increase productivity. NOW's expanding portfolio has been noteworthy. In May 2025, ServiceNow introduced its Core Business Suite, an AI-powered solution designed to streamline and transform core business operations, including HR, finance, procurement, facilities, and legal, by unifying workflows and automating processes across departments to improve efficiency, reduce time to value, and enhance employee rich partner base, which includes the likes of Amazon, Microsoft, NVIDIA, Five9, Visa, Snowflake, Zoom, Siemens, Rimini Street, IBM, Genesys, Fujitsu, Equinix, Boomi and Infosys, is a key catalyst for future prospects. NOW faces stiff competition in the workflow automation space from the likes of Pegasystems PEGA and UiPath is benefiting from strong demand for its GenAI Blueprint solution, an agent that utilizes AI to combine the company's best practices, as well as knowledge from clients and partners, to design enterprise workflow applications. More than 1,000 new Blueprints are being created every week, more than double from a few months on this momentum, Pegasystems recently expanded its PEGA Blueprint platform with advanced agentic AI capabilities to accelerate digital transformation by analyzing and converting legacy system assets into modern cloud-ready applications. The latest announcement streamlines legacy analysis, enabling faster, more informed application remains a strong force in the booming Robotic Process Automation market, which is poised for substantial expansion over the coming years. UiPath's end-to-end automation platform positions the company to seize opportunities as demand for AI-driven solutions surges. ServiceNow shares have lost 11.4% year to date against the broader Zacks Computer & Technology sector's return of 7.5%. Image Source: Zacks Investment Research NOW stock is trading at a premium, with a forward 12-month Price/Sales of 13.60X compared with the Computer & Technology 6.59X. NOW has a Value Score of F. Image Source: Zacks Investment Research The Zacks Consensus Estimate for second-quarter 2025 earnings is currently pegged at $3.54 per share, which increased by a penny over the past 30 days. This indicates a 13.10% increase year over year. ServiceNow, Inc. price-consensus-chart | ServiceNow, Inc. Quote The consensus mark for 2025 earnings is pegged at $16.54 per share, which has increased by a penny over the past 30 days, suggesting 18.43% year-over-year currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report UiPath, Inc. (PATH) : Free Stock Analysis Report ServiceNow, Inc. (NOW) : Free Stock Analysis Report Pegasystems Inc. (PEGA) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
26-06-2025
- Business
- Yahoo
MSFT vs. PEGA: Which Agentic AI Vendor is a Better Buy in 2H25?
The artificial intelligence (AI) revolution has entered a new phase with the emergence of agentic AI — systems capable of autonomous decision-making and task execution rather than merely assisting human users. Two prominent players in this space, Microsoft MSFT and Pegasystems PEGA, are taking distinctly different approaches to capitalize on this transformative technology. Microsoft leverages its massive cloud infrastructure and enterprise software ecosystem to integrate agentic capabilities across its portfolio, while Pegasystems focuses on specialized workflow automation and legacy system modernization powered by AI companies recently announced significant expansions of their agentic AI offerings, with Microsoft evolving Copilot into autonomous digital workers and Pega enhancing its Blueprint platform to automatically transform legacy systems into modern applications. The timing of these announcements, coupled with strong financial performance from both companies, makes for a compelling comparison as investors seek exposure to the next wave of AI delve deep and closely compare the fundamentals of the two stocks to determine which one is a better investment now. Microsoft's approach to agentic AI represents a comprehensive platform strategy that spans its entire technology stack. The company's third-quarter fiscal 2025 results demonstrated continued momentum, with total revenues reaching $70.1 billion, up 13% year over year. Microsoft Cloud revenues of $42.4 billion grew 22% in constant currency, with Azure showing particularly strong performance at 33% growth, including 16 percentage points from AI services company's agentic AI strategy centers on transforming Copilot from a simple assistant into autonomous digital workers capable of reasoning, planning, and acting independently. Microsoft processed more than 100 trillion tokens during the quarter, representing a five-fold increase year over year, indicating massive adoption of its AI services. The company has introduced specialized agents like Sales Agent and Customer Service Agent while enabling customers to build custom agents through Copilot Studio, with more than 230,000 organizations already using the scale advantages are evident in its infrastructure investments, with capital expenditures of $21.4 billion in the quarter supporting long-term monetization. The company's diverse revenue streams provide stability, though this same diversification may limit the upside potential from any single technology trend. Azure's strong performance demonstrates Microsoft's ability to capture enterprise AI workloads, but the company's massive size means incremental growth from agentic AI represents a smaller percentage impact on overall Zacks Consensus Estimate for Microsoft's fiscal 2025 earnings is pegged at $13.36 per share, indicating a 13.22% year-over-year increase. Microsoft Corporation price-consensus-chart | Microsoft Corporation Quote Find the latest EPS estimates and surprises on Zacks Earnings Calendar. Pegasystems presents a compelling pure-play opportunity in enterprise agentic AI with its specialized focus on workflow automation and legacy system modernization. The company's first-quarter 2025 results showcased accelerating momentum, with Annual Contract Value (ACV) growing more than 13% year over year and Pega Cloud ACV surging 23%. The company generated exceptional free cash flow of $202 million, demonstrating the profitability of its subscription model revolutionary Blueprint platform represents a breakthrough in agentic AI applications, enabling organizations to automatically analyze and convert legacy system assets into modern cloud applications. This addresses a massive market opportunity, as Pega research indicates 88% of IT decision makers cite technical debt as impacting competitive agility. The enhanced Blueprint capabilities now leverage agentic AI to ingest diverse inputs, including videos, documentation, code, and UI screens, dramatically accelerating digital transformation timelines from months to company's focused approach to enterprise workflow automation positions it perfectly for the agentic AI revolution. Unlike broader platform providers, Pega has built its entire value proposition around intelligent automation and decision-making, making agentic AI a natural evolution rather than an add-on feature. With over 1,000 new Blueprints created weekly — more than double the rate from months earlier — customer adoption is accelerating rapidly. The company's smaller scale means successful agentic AI implementations can drive significant percentage growth in key Zacks Consensus Estimate for PEGA's 2025 earnings is pegged at $1.88 per share, indicating a 24.5% year-over-year increase. Pegasystems Inc. price-consensus-chart | Pegasystems Inc. Quote Recent market performance reveals a telling divergence between the two stocks, with Pegasystems significantly outpacing Microsoft over the past three months. PEGA shares have surged 39.5% compared to Microsoft's 26% rise, with Pegasystems also outperforming the broader Zacks Computer and Technology sector. This superior price performance reflects growing investor recognition of Pega's specialized positioning in the agentic AI market and the accelerating adoption of its Blueprint platform Image Source: Zacks Investment Research The valuation metrics present an intriguing contrast that further supports Pegasystems' investment appeal. Microsoft trades at a price-to-earnings ratio of 32.93x, commanding a significant premium that reflects its market dominance and diversified revenue streams but also suggests limited valuation expansion potential. In stark contrast, Pegasystems trades at a more modest 13.2x P/E multiple despite its stronger recent performance and focused exposure to high-growth agentic AI applications. Image Source: Zacks Investment Research While Microsoft offers stability and comprehensive AI capabilities, Pegasystems presents superior upside potential for the second half of 2025. Pega's specialized focus on enterprise workflow automation aligns perfectly with agentic AI capabilities, creating a more concentrated exposure to this transformative technology. The company's accelerating ACV growth, innovative Blueprint platform, and smaller scale mean that successful agentic AI adoption can drive outsized returns. Investors should consider buying Pegasystems stock to capitalize on its focused agentic AI strategy while holding or waiting for better entry points in Microsoft, where AI represents incremental rather than transformational growth potential. PEGA currently sports a Zacks Rank #1 (Strong Buy), whereas MSFT has a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Microsoft Corporation (MSFT) : Free Stock Analysis Report Pegasystems Inc. (PEGA) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
