At a glance
Pegasystems Inc is worth $5.79B, about 17 times its fiscal 2025 earnings. Revenue grew 16.6% to $1.75B in fiscal 2025, with 22.5% kept as profit; over 5 years it has grown 11.4% a year. It pays a 0.57% dividend yield, and returned $701.3M to shareholders in dividends and buybacks over FY2021–FY2025. The stock returned −45.7% over the past year with dividends reinvested and −9.4% a year over five years, against +11.5% and +11.7% for the S&P 500. At its worst it fell 38.3% in the 2020 crash (S&P 500: 33.7%) and 72.3% in the 2022 bear market (S&P 500: 24.5%), and was back at its earlier high 3 months and 27 months after the lows.
The business in plain English
Pegasystems makes software that large companies and government agencies use to automate work and make decisions in real time. Its core product, Pega Platform, is “low-code” workflow software. Low-code means clients build applications mostly by configuring ready-made parts rather than writing code. Pega also offers customer service and sales applications. Its Customer Decision Hub uses AI to predict customer behavior and suggest the most relevant offer or next step. Pega Blueprint uses generative AI to help design applications and replace outdated systems.
In the fiscal year ended December 31, 2025, revenue was about $1.75 billion. Pega Cloud, where Pega runs the software for clients using third-party hosting providers, made up 39.9%. Subscription licenses, where clients run the software themselves, were 29.1%. Maintenance, meaning support and updates, added 18%. Consulting to set up the software brought in 13.1%.
The United States supplied 54.8% of fiscal 2025 revenue. Europe (excluding the U.K.), the Middle East and Africa added 15.5%, Asia-Pacific 12.2%, the U.K. 10.9% and other parts of the Americas 6.6%. Pega also reaches clients through partners, such as systems integrators (consulting firms that install business software) and large cloud providers. Its success depends partly on government clients.
Price history
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PEGA -45.7% over the year to Oct 28, 2026, total return with dividends reinvested.
How it makes money
By product or service
| Pega Cloud | $695.9M | 39.9% |
| Subscription license | $507.4M | 29.1% |
| Maintenance | $314.6M | 18% |
| Consulting | $227.9M | 13.1% |
By geography
| U.S. | $956.3M | 54.8% |
| Europe (excluding U.K.), Middle East, and Africa | $270.6M | 15.5% |
| Asia-Pacific | $213.6M | 12.2% |
| United Kingdom (“U.K.”) | $190.0M | 10.9% |
| Other Americas | $115.3M | 6.6% |
Latest results
- In Q3 FY2026 (ended Sep 30, 2026), revenue was $393.4M, up 3.1% from a year earlier, and net income was $14.1M (-67.5%).
- For fiscal 2025, revenue was $1.75B (+16.6% year over year; +11.4% a year from FY2020 to FY2025) with a 22.5% net margin.
Financial health check
| Revenue growth a year (FY2020–FY2025) | +11.4% good |
|---|---|
| Operating margin | 15.1% good |
| Free cash flow margin | 28.1% good |
| Return on equity (FY2025) | 50% good |
| Return on assets (FY2025) | 24.1% good |
| Net cash (cash minus debt) | $309.7M good |
| Fiscal year | Revenue | Net income | Free cash flow |
|---|---|---|---|
| FY2020 | $1.02B | $-61.4M | $-25.9M |
| FY2021 | $1.21B | $-63.0M | $28.7M |
| FY2022 | $1.32B | $-345.6M | $-13.0M |
| FY2023 | $1.43B | $67.8M | $201.0M |
| FY2024 | $1.50B | $99.2M | $338.2M |
| FY2025 | $1.75B | $393.4M | $490.7M |
Valuation snapshot
| Market value | $5.79B |
|---|---|
| P/E ratio | 16.6 |
| Dividend yield | 0.57% |
Rank among 1514 US companies
Market value at each year end
Pegasystems’s market value went from $2.75B at the end of 2016 to $5.79B on Oct 28, 2026, about 2.1 times as much; since the end of 2025 it is down 43%.
Show as a table
| Year end | Market value | Change |
|---|---|---|
| Oct 28, 2026 | $5.79B | -42.9% |
| 2025 | $10.14B | +26.8% |
| 2024 | $7.99B | +95.8% |
| 2023 | $4.08B | +45.1% |
| 2022 | $2.81B | -69.2% |
| 2021 | $9.13B | -15.1% |
| 2020 | $10.75B | +70.2% |
| 2019 | $6.32B | +67.9% |
| 2018 | $3.76B | +2.5% |
| 2017 | $3.67B | +33.6% |
| 2016 | $2.75B |
Price behavior
| YTD | 1 yr | 3 yr | 5 yr | 10 yr | |
|---|---|---|---|---|---|
| PEGA price data to Oct 28, 2026 | -40.4% | -45.7% | +20.1% | -9.4% | +9.2% |
Show as a table
| Year | Price data |
|---|---|
| 2026 (to date) | -40.4% |
| 2025 | +28.5% |
| 2024 | +91.3% |
| 2023 | +43.4% |
| 2022 | -69.2% |
| 2021 | -15.9% |
| 2020 | +67.7% |
| 2019 | +67.1% |
| 2018 | +1.9% |
| 2017 | +31.6% |
| 2016 | +32.0% |
| 2015 | +33.7% |
| 2014 | -14.6% |
| 2013 | +120.3% |
| 2012 | -21.6% |
| 2011 | -18.6% |
| 2010 | +9.3% |
| 2009 | +180.1% |
| 2008 | +8.0% |
| 2007 | +27.9% |
| 2006 | +38.0% |
| 2008 financial crisis stocks fell Oct 9, 2007 – Mar 9, 2009 | Gained 23.2% over that stretch · deepest drop along the way 32.2%, back to its old high 2.8 months after the low |
|---|---|
| 2020 COVID crash stocks fell Feb 19, 2020 – Mar 23, 2020 | Lost 35.8% over that stretch · deepest drop along the way 38.3%, back to its old high 3.4 months after the low |
| 2022 bear market stocks fell Jan 3, 2022 – Oct 12, 2022 | Lost 72% over that stretch · deepest drop along the way 72.3%, back to its old high 27.4 months after the low |
Insider activity
Form 4 filings from 2025-11-03 to 2026-11-03 (25 read): 0 open-market purchases and 11 sales ($2.3M), 2 of them under pre-arranged 10b5-1 trading plans.
| Date | Insider | Type | Value |
|---|---|---|---|
| Sep 11, 2026 | Kenneth Stillwell COO, CFO | sell | $1.4M |
| Sep 11, 2026 | Rifat Kerim Akgonul Chief Product Officer | sell | $252K |
| Oct 28, 2026 | Rifat Kerim Akgonul Chief Product Officer | sell | $249K |
| Oct 29, 2026 | Larry Weber Director | sell | $100K |
| Aug 25, 2026 | Rifat Kerim Akgonul Chief Product Officer | sell | $58K |
Who owns it
Large shareholders (13G filings)
| ALAN TREFLER | 46% | Sep 30, 2025 |
| TREFLER ALAN | 46% | Jun 30, 2025 |
| BlackRock, Inc. | 5.1% | Jun 30, 2025 |
ETFs with the most weight in PEGA
| BOTZ Global X Robotics & Artificial Intelligence ETF | 2.87% |
| ROBT First Trust Nasdaq Artificial Intelligence & Robotics ETF | 1.7% |
| FCLD Fidelity Cloud Computing ETF | 1.21% |
| BUYO KraneShares Man Buyout Beta Index ETF | 1.08% |
| FSGS First Trust SMID Growth Strength ETF | 0.79% |
| XSW SPDR S&P Software & Services ETF | 0.71% |
| BTAL AGF U.S. Market Neutral Anti-Beta Fund | 0.36% |
| TMFX Motley Fool Next Index ETF | 0.35% |
What could go wrong
- Trade secret lawsuit with Appian Corp. Pega is in a trade secret lawsuit with Appian Corp. The company warns that if it loses the case, its operating results and financial condition could suffer.
- Founder holds nearly half the shares. Founder and CEO Alan Trefler reported owning about 46% of the stock as of September 30, 2025. That means heavy influence over shareholder votes, and the company carries no significant key-person life insurance.
- Growth depends on repeat business from clients. Pega's contracts often cover one purpose or area of a client's operations. Its growth relies on winning follow-on deals and keeping subscription clients in a crowded, fast-changing software market.
- Cloud hosting costs and outage risk. Pega Cloud, the largest revenue source, runs on third-party hosting providers. Those recurring fees can make its margins lower than license sales, and any provider disruption could interrupt service to clients.
- Uneven deal timing makes results hard to predict. The timing of license and Pega Cloud revenue and bookings (new contracts signed) is hard to forecast, so results can swing between quarters. Missing its own guidance could push the share price down.
- Big AI investments may not pay off. Pega is investing heavily in AI, including generative AI, while competitors do the same and AI rules keep changing. Rivals could move faster, and complying with rules in many countries could raise costs.
Recent events
- Quarterly results released
- Quarterly results released
- Shareholder vote results
- Investor presentation or announcement
- Quarterly results released
- Executive or board change
- Quarterly results released; Other company announcement
- Restructuring or exit costs
- Other company announcement
For income and retirement investors
Pegasystems pays a small dividend. The yield was 0.57% as of October 28, 2026. Adjusted for the 2025 2-for-1 split, the dividend held at $0.06 per share from fiscal 2020 to 2024, then rose to $0.105 in fiscal 2025. That makes a one-year streak of increases. It used just 3.9% of earnings and 3.1% of free cash flow, which is the cash left after capital spending. Buybacks are much larger: $646 million over fiscal 2021–2025, versus $55 million in dividends, yet the share count barely changed.
The stock has dropped hard in downturns. It fell 32.2% in the 2008 financial crisis and 38.3% in the 2020 COVID crash, recovering in about three months each time. In the 2022 bear market it fell 72.3% and took 27.4 months to recover. With such a small dividend, an income investor's return rests almost entirely on a share price that can fall just when cash is needed. A single stock carries more risk than a diversified fund.
Questions investors ask
How does Pegasystems make money?
Pegasystems makes money mainly from subscriptions to software that automates business workflows and uses AI to guide decisions about customers. Revenue was about $1.75 billion for the fiscal year ended December 31, 2025. Pega Cloud, where Pega hosts the software for clients, brought in 39.9%. Subscription licenses, where clients run it themselves, added 29.1%. Maintenance, meaning support and updates, contributed 18%, and consulting to set up the software 13.1%. The United States supplied 54.8% of revenue.
Is Pegasystems profitable?
Yes. For the fiscal year ended December 31, 2025, Pegasystems earned $393.4 million of net income on $1.75 billion of revenue, so 22.5% of sales became profit. It also generated $490.7 million of free cash flow. That followed net losses in fiscal 2020 through 2022, including $345.6 million in 2022. Profit slowed in the quarter ended September 30, 2026: net income fell 67.5% from a year earlier to $14.1 million, while revenue grew 3.1%.
Does Pegasystems (PEGA) pay a dividend?
Yes, but it is small. Pegasystems paid $0.105 per share for fiscal 2025, up from $0.06 a year in fiscal 2020 through 2024, adjusted for the 2025 2-for-1 stock split. The yield was 0.57% as of October 28, 2026. The dividend used only 3.9% of fiscal 2025 earnings. The company returns far more cash through share buybacks, which totaled $499.7 million in fiscal 2025.
Who owns the most Pegasystems stock?
Founder and CEO Alan Trefler is the largest shareholder, reporting about 46% of the stock as of September 30, 2025. BlackRock reported 5.1% as of June 30, 2025. With nearly half the shares, the founder has significant influence over shareholder votes, and the company lists this as a risk for other investors. The company also says it depends heavily on its CEO and does not carry significant key-person life insurance.
How has Pegasystems stock performed?
It has been volatile. Based on share price as of October 28, 2026, the stock was down 40.4% for 2026 to date and 45.7% over one year. Its largest peak-to-trough drop within that year was 60.9%. Over 10 years it gained 141% in total, about 9.2% a year, but it lost 9.4% a year over five years. Calendar-year results ranged from a 69.2% loss in 2022 to a 91.3% gain in 2024.