NEW YORK (AP) -- Progress Software Corp.'s stock plunged more than 11 percent on Friday after the business software maker announced that its second-quarter results are likely to come in below analysts' expectations.
THE SPARK: Late Thursday Progress Software said that it expects quarterly adjusted earnings of 17 cents to 19 cents per share on revenue of $110 million to $115 million. Analysts surveyed by FactSet predict earnings of 28 cents per share on revenue of $126.2 million.
Progress Software said that its quarterly performance was hurt in part because of its recently announced strategic plan.
In April the company announced that it planned to cut its workforce by 10 percent to 15 percent and eliminate 10 product lines as it looked to cut costs and concentrate more on cloud computing. The job cuts were expected to affect 175 to 260 of its 1,744 workers.
The Bedford, Mass., company will report its second-quarter financial results on June 27.
THE ANALYSIS: Greg McDowell of JMP Securities reaffirmed a "Market Perform" rating on Progress Software but lowered its price target to $25 from $27. The analyst said in a client note that he was disappointed by the second-quarter results, but remains confident in the company's core business.
SHARE ACTION: Shares of Progress Software dropped $2.39, or 11.8 percent, to $17.90 in morning trading. Over the past year, the stock has traded between $16.71 and $26.28.
