Progress Software (PRGS) 2017年年度報告「NASDAQ」.pdf

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1、UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington,D.C.20549 FORM 10-K(Mark One)ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended November 30,2017ORTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 193

2、4For the transition period from_to_.Commission File Number:0-19417 PROGRESS SOFTWARE CORPORATION(Exact name of registrant as specified in its charter)DELAWARE(State or other jurisdiction ofincorporation or organization)04-2746201(I.R.S.EmployerIdentification No.)14 Oak ParkBedford,Massachusetts 0173

3、0(Address of Principal Executive Offices)Telephone Number:(781)280-4000 Securities registered pursuant to Section 12(b)of the Act:Title of Each Class Name of Each Exchange on Which RegisteredCommon Stock$.01 par value The NASDAQ Global Select MarketSecurities registered pursuant to Section 12(g)of t

4、he Act:NoneIndicate by check mark if the registrant is a well-known seasoned issuer,as defined in Rule 405 of the Securities Act.Yes No Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d)of the Exchange Act.Yes No Indicate by check mark wh

5、ether the registrant(1)has filed all reports required to be filed by Section 13 or 15(d)of the Securities Exchange Act of 1934 during the preceding 12months(or for such shorter period that the registrant was required to file such reports),and(2)has been subject to such filing requirements for the pa

6、st 90 days.Yes No Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site,if any,every Interactive Data File required to be submitted andposted pursuant to Rule 405 of Regulation S-T during the preceding 12 months(or for such shorter period tha

7、t the registrant was required to submit and post suchfiles).Yes No Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein,and will not be contained,to the best of registrantsknowledge,in definitive proxy or information statements inco

8、rporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.Indicate by check mark whether the registrant is a large accelerated filer,an accelerated filer,a non-accelerated filer,smaller reporting company,or an emerging growth company.See the definitions of“large accelera

9、ted filer,”“accelerated filer,”“smaller reporting company,”and emerging growth company in Rule 12b-2 of the Exchange Act.Large accelerated filer Accelerated filer Non-accelerated filer(Do not check if a smaller reporting company)Smaller reporting company Emerging growth company If an emerging growth

10、 company,indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financialaccounting standards provided pursuant to Section 13(a)of the Exchange Act.Indicate by check mark whether the registrant is a shell company(as define

11、d in Rule 12b-2 of the Exchange Act).Yes No As of May 31,2017(the last business day of the registrants most recently completed second fiscal quarter),the aggregate market value of voting stock held by non-affiliates of theregistrant was approximately$1,381,000,000.As of January 19,2018,there were 46

12、,386,883 common shares outstanding.Documents Incorporated By ReferencePortions of the definitive Proxy Statement in connection with the 2018 Annual Meeting of Shareholders are incorporated by reference into Part III.Table of ContentsPROGRESS SOFTWARE CORPORATIONFORM 10-KFOR THE FISCAL YEAR ENDED NOV

13、EMBER 30,2017INDEX PART I Item 1.Business4Item 1A.Risk Factors11Item 1B.Unresolved Staff Comments16Item 2.Properties17Item 3.Legal Proceedings17Item 4.Mine Safety Disclosures17 PART II Item 5.Market for Registrants Common Equity,Related Stockholder Matters and Issuer Purchases of Equity Securities17

14、Item 6.Selected Financial Data19Item 7.Managements Discussion and Analysis of Financial Condition and Results of Operations19Item 7A.Quantitative and Qualitative Disclosures About Market Risk46Item 8.Financial Statements and Supplementary Data47Item 9.Changes in and Disagreements with Accountants on

15、 Accounting and Financial Disclosure89Item 9A.Controls and Procedures89Item 9B.Other Information91 PART III Item 10.Directors,Executive Officers and Corporate Governance91Item 11.Executive Compensation92Item 12.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Ma

16、tters93Item 13.Certain Relationships and Related Transactions,and Director Independence93Item 14.Principal Accounting Fees and Services93 PART IV Item 15.Exhibits,Financial Statement Schedules94 Signatures973Table of ContentsCAUTIONARY STATEMENTSThe Private Securities Litigation Reform Act of 1995 c

17、ontains certain safe harbor provisions regarding forward-looking statements.This Form 10-K,andother information provided by us or statements made by our directors,officers or employees from time to time,may contain“forward-looking”statements andinformation,which involve risks and uncertainties.Actua

18、l future results may differ materially.Statements indicating that we“expect,”“estimate,”“believe,”“are planning”or“plan to”are forward-looking,as are other statements concerning future financial results,product offerings or other events that have not yetoccurred.There are various factors that could

19、cause actual results or events to differ materially from those anticipated by the forward-looking statements.Such factors are more fully described in Item 1A of this Form 10-K under the heading“Risk Factors.”Although we have sought to identify the mostsignificant risks to our business,we cannot pred

20、ict whether,or to what extent,any of such risks may be realized.We also cannot assure you that we haveidentified all possible issues which we might face.We undertake no obligation to update any forward-looking statements that we make.PART IItem 1.BusinessOverviewProgress offers the leading platform

21、for developing and deploying mission-critical business applications.Progress empowers enterprises and independentsoftware vendors(ISVs)to build and deliver cognitive-first applications that harness big data to derive business insights and competitive advantage.Progressoffers leading technologies for

22、 easily building powerful user interfaces across any type of device,a reliable,scalable and secure backend platform to deploymodern applications,leading data connectivity to all sources,and award-winning predictive analytics that brings the power of machine learning to anyorganization.Over 1,700 ISV

23、s,100,000 enterprise customers,and 2 million developers rely on Progress to power their applications.Our products are generally sold as perpetual licenses,but certain products also use term licensing models and our cloud-based offerings use a subscriptionbased model.More than half of our worldwide l

24、icense revenue is realized through relationships with indirect channel partners,principally applicationpartners and original equipment manufacturers(OEMs).Application partners are ISVs that develop and market applications using our technology and resellour products in conjunction with sales of their

25、 own products that incorporate our technology.OEMs are companies that embed our products into their ownsoftware products or devices.We operate in North America and Latin America(the Americas);Europe,the Middle East and Africa(EMEA);and the Asia Pacific region,through localsubsidiaries as well as ind

26、ependent distributors.Fiscal Year 2017 HighlightsBeginning in late October 2016,with the appointment of Yogesh Gupta as our new Chief Executive Officer,our Board of Directors and executivemanagement team undertook a comprehensive review of our strategy and operations,including our expectations for f

27、iscal year 2017 results.On January 16,2017,we announced a new strategic plan highlighted by a new product strategy and a streamlined operating approach with a tighter focus onareas of strength to more efficiently drive revenue.The key tenets of the new strategic plan are as follows:Streamlined Opera

28、ting Approach.In fiscal year 2017,we adapted our organization and operating principles to focus primarily on customer andpartner retention and success for many of our core products.For selected products that have new customer acquisition potential,we alsostrengthened our demand generation and high v

29、olume,low touch e-commerce capabilities.New Product Strategy.As part of the new strategic plan,we undertook a new product strategy to provide the platform and tools enterprises need tobuild next generation applications that drive their businesses,known as“Cognitive Applications.”We offer this platfo

30、rm to both new customers andpartners as well as our existing OpenEdge partner and customer ecosystems.Our platform for Cognitive Applications makes it easy for developers tobuild machine learning into their applications,and includes:4Table of ContentsOur leading UI development tools,which enable org

31、anizations to easily build engaging user interfaces for any device or front end;Our NativeScript offering,which allows developers to use JavaScript to build native applications across multiple mobile platforms;A mission-critical back-end-as-a-service platform that runs on any cloud,is secure,high-pe

32、rforming,and highly-scalable while supportingall modern user interfaces;Automated and intuitive machine learning capabilities for accelerating the creation and delivery of Cognitive Applications;Our data connectivity and integration capabilities;andOur business logic and rules capabilities.Restructu

33、ring.With the adoption of our new product strategy,we discontinued our investment in our Digital Factory strategy and re-aligned ourresources consistent with our core operating approach.To that end,during fiscal year 2017,we implemented restructuring efforts including theconsolidation of facilities,

34、implementation of a simplified organizational structure and a reduction of marketing and other external expenses.Inaddition,we reduced headcount by over 400 employees,totaling over 20%of our workforce.We reduced our full year expenses by over$30 millionby the end of fiscal year 2017.DataRPM Acquisit

35、ionOn March 1,2017,we acquired DataRPM for an aggregate sum of$30.0 million.DataRPM is a leader in cognitive predictive maintenance for the industrialIoT(IIoT)market.This acquisition is a key part of the Companys strategy to provide the best platform to build and deliver cognitive-first applications

36、.Kinvey AcquisitionOn June 1,2017,we acquired Kinvey for an aggregate sum of$49.2 million.Kinvey is the leading Backend-as-a-Service(BaaS)provider and allowsdevelopers to set up,use,and operate a cloud backend for any native,hybrid,web,or IoT app built using any development tools.This acquisition,in

37、combination with our existing technologies,enables us to offer the premier platform for building and delivering cognitive business applications.Share Repurchase AuthorizationIn September 2017,our Board of Directors increased our total share repurchase authorization to$250.0 million.In fiscal year 20

38、17,we repurchased andretired 2.2 million shares of our common stock for$73.9 million.As of November 30,2017,there is$220.0 million remaining under this currentauthorization.We expect to repurchase$120.0 million of our common stock during the fiscal year ended November 30,2018.Dividend DeclarationOn

39、September 27,2016,our Board of Directors approved the initiation of a quarterly cash dividend of$0.125 per share of common stock to Progressshareholders.On September 6,2017,our Board of Directors approved a 12%increase in our quarterly cash dividend to$0.14 per share of common stock.Wehave declared

40、aggregate per share quarterly cash dividends totaling$0.515 and$0.125 for the years ended November 30,2017 and 2016,respectively.Wehave paid aggregate cash dividends totaling$24.1 million and$0 for the years ended November 30,2017 and 2016,respectively.Our Business SegmentsOpenEdge Business SegmentT

41、he OpenEdge business segment drives growth within OpenEdges large,diverse partner base by providing the product enhancements and marketing supportthese partners need to sell more of their existing solutions to their customers.The OpenEdge business segment is also focused on providing partners anddir

42、ect end users with a clear path to develop and integrate cloud-based applications in the future.Our services organization helps partners and customersleverage their core assets and develop strategies that protect current investments,while addressing changing business requirements.5Table of ContentsT

43、he solutions within the OpenEdge Business Segment include:Progress OpenEdgeProgress OpenEdge is development software for building dynamic multi-language applications for secure deployment across any platform,any device,andany cloud.OpenEdge provides a unified environment comprising development tools

44、,application servers,application management tools,an embeddedrelational database management system,and the capability to connect and integrate with other applications and data sources independently or with otherProgress products.Progress CorticonProgress Corticon is a Business Rules Management Syste

45、m(BRMS)that enables applications with decision automation,decision change process anddecision-related insight capabilities.Corticon helps both business and IT users to quickly create or reuse business rules as well as create,improve,collaborateon,and maintain decision logic.Corticon is a market-lead

46、ing platform for automating and executing business rules.DataRPMDataRPM offers an award-winning cognitive predictive maintenance solution for industrial IoT.The patented platform automates predictive modeling,leveraging proprietary Meta Learning capabilities to increase quality,accuracy and timeline

47、ss of equipment failure predictions,leading to hundreds ofmillions of dollars in savings.The technology enables customers such as Jaguar,Samsung and Mitsubishi Heavy Industries to predict and prevent assetfailures,and increase yield and efficiencies to generate outcomes for industrial IoT.KinveyKinv

48、ey is a provider of backend as a service technology that enables developers to operate a serverless and compliant cloud backend for any native,hybrid,web or IoT app.From mission-critical consumer and business experiences for global insurance,manufacturing and media companies,to HIPAA-compliantand li

49、fe-critical apps for healthcare,health implant manufacturers and pharma,Kinvey powers more than 31,000 apps,used by more than 100 million end-users.Kinveys BaaS serves more than 10 billion API calls a month and was also named a leader and top ranked in the current offering category in TheForrester W

50、ave:Mobile Development Platforms,Q4 2016.Data Connectivity and Integration Business SegmentThe Data Connectivity and Integration Business Segment(DCI)is focused on the growth of our data assets,including the data integration components of ourcloud offerings.Data is at the core of every application,a

51、nd with the exponential growth in the number and volume of data sources,this business segmentaddresses the increasingly complex challenges that organizations have in accessing and integrating that data.The solutions within the DCI Business Segment include:Progress DataDirect ConnectProgress DataDire

52、ct Connect software provides data connectivity using industry-standard interfaces to connect applications running on various platforms toany major database,for both corporate IT organizations and software vendors.With software components embedded in the products of over 350 softwarecompanies and in

53、the applications of thousands of large enterprises,the DataDirect Connect product set is a global leader in the data connectivity market.The primary products,in addition to other drivers we have developed,are ODBC drivers,JDBC drivers and ADO.NET providers.They provide the capabilityto connect and i

54、ntegrate with other applications and data sources independently or with our cloud-based offerings.Progress DataDirect Hybrid Data PipelineProgress DataDirect Hybrid Data Pipeline is a data access service that provides simple,secure access to organizations cloud and on-premises data sources forhybrid

55、 cloud applications,such as CRM,data management platforms or hosted analytics.Progress DataDirect Hybrid Data Pipeline represents the firstvendor-agnostic hybrid connector that provides secure firewall-friendly access to back-office data from any cloud,independent of vendor or technology.Itenables d

56、evelopers to integrate applications and data quickly,no matter where that data lives-on-site,in the cloud or both.6Table of ContentsApplication Development and Deployment Business SegmentThe Application Development and Deployment(AppDev)business segment is focused on serving the evolving needs of ou

57、r substantial developercommunity,and on generating net new customers for our application development assets.Substantially all of the products within the AppDev segment wereacquired in connection with our acquisition of Telerik,Inc.in December 2014.This business segment has the focus and agility of a

58、 start-up,able to reactquickly to changes in this rapidly-evolving market.Having a team solely focused on this market enables us to rapidly meet the demands of developers whoare seeking to increase their productivity and move toward the cloud.The solutions within the AppDev Business Segment include:

59、DevToolsDevTools is a cross-platform,user experience design,quality assurance,debugging and reporting suite for next generation web,mobile,desktop and HTML5applications.Utilizing DevTools enables developers to focus on business logic and not infrastructure.Included in DevTools are Fiddler and Kendo

60、UI.NativeScriptNativeScript is an open-source application development platform that enables developers to use JavaScript to build cross-platform,native iOS and Androidapplications.Test StudioTest Studio is an application lifecycle management suite for testing web,mobile and desktop applications that

61、 covers the process from idea to deployment.SitefinitySitefinity is a next-generation web content management and customer analytics platform for managing and optimizing digital experiences.Sitefinitycombines superior end user experience with a high level of customization capabilities for developers.

62、Product DevelopmentMost of our products have been developed by our internal product development staff or the internal staffs of acquired companies.We believe that the featuresand performance of our products are competitive with those of other available development and deployment tools and that none

63、of the current versions of ourproducts are approaching obsolescence.However,we believe that significant investments in new product development and continuing enhancements of ourcurrent products will be required for us to maintain our competitive position.As of November 30,2017,we have four primary d

64、evelopment offices in North America,two primary development offices in India and one primarydevelopment office in EMEA.We spent$77.0 million,$88.6 million,and$88.3 million in fiscal years 2017,2016 and 2015,respectively,on productdevelopment,including capitalized software development costs.Customers

65、We market our products globally through several channels:directly to end users and indirectly to application partners(or ISVs),OEMs,and systemintegrators.Sales of our solutions and products through our direct sales force have historically been to business managers or IT managers in corporations andg

66、overnmental agencies.We also target developers who create business applications,from individuals to teams,within enterprises of all sizes.We also market our products through indirect channels,primarily application partners and OEMs who embed our products as part of an integrated solution.We use inte

67、rnational distributors in certain locations where we do not have a direct presence or where it is more economically feasible for us to do so.Morethan half of our license revenues are derived from indirect channels.7Table of ContentsApplication PartnersOur application partners cover a broad range of

68、markets,offer an extensive library of business applications and are a source of follow-on revenue.We havekept entry costs,consisting primarily of the initial purchase of development licenses,low to encourage a wide variety of application partners to buildapplications.If an application partner succee

69、ds in marketing its applications,we obtain follow-on revenue as the application partner licenses our deploymentproducts to allow its application to be installed and used by customers.In recent years,a significantly increasing amount of our revenue from applicationpartners has been generated from sub

70、scriptions to application partners who have chosen to enable their business applications under a SaaS platform.Original Equipment ManufacturersWe enter into arrangements with OEMs in which the OEM embeds our products into its solutions,typically either software or technology devices.OEMstypically li

71、cense the right to embed our products into their solutions and distribute those solutions for initial terms ranging from one to three years.Historically,most of our OEMs have renewed their agreements upon the expiration of the initial term.However,we are not assured that they will continue torenew i

72、n the future.No single customer has accounted for more than 10%of our total revenue in any of our last three fiscal years.Sales and MarketingWe sell our products and solutions through our direct sales force and indirect channel partners.We have sold our products and solutions to enterprises in over1

73、80 countries.Our sales and field marketing groups are organized primarily by region.We operate by region in North America,Latin America,EMEA andAsia Pacific.We believe this structure allows us to maintain direct contact with our customers and support their diverse market requirements.Ourinternationa

74、l operations provide focused local sales,support and marketing efforts and are able to respond directly to changes in local conditions.In addition to our direct sales efforts,we distribute our products through systems integrators,resellers,distributors,and OEM partners in the United States andintern

75、ationally.Systems integrators typically have expertise in vertical or functional markets.In some cases,they resell our products,bundling them withtheir broader service offerings.In other cases,they refer sales opportunities for our products to our direct sales force.Distributors sublicense our produ

76、cts andprovide service and support within their territories.OEMs embed portions of our technology in their product offerings.Sales personnel are responsible for developing new direct end user accounts,recruiting new indirect channel partners and new independent distributors,managing existing channel

77、 partner relationships and servicing existing customers.We actively seek to avoid conflict between the sales efforts of ourapplication partners and our own direct sales efforts.We use our inside sales team to enhance our direct sales efforts and to generate new business and follow-on business from e

78、xisting customers.Our marketing personnel conduct a variety of marketing engagement programs designed to create demand for our products,enhance the market readiness ofour products,raise the general awareness of our company and our products and solutions,generate leads for the sales organization and

79、promote our variousproducts.These programs include press relations,analyst relations,investor relations,digital/web marketing,marketing communications,participation intrade shows and industry conferences,and production of sales and marketing literature.We also hold global events,as well as regional

80、user events in variouslocations throughout the world.Our sales and marketing efforts with respect to certain of our products,including DevTools,differ from our traditional sales and marketing efforts because thetarget markets are different.For these products,we have designed our marketing and sales

81、model to be efficient for high volumes of lower-price transactions.Our marketing efforts focus on driving traffic to our websites and on generating high quality sales leads,in many cases,consisting of developer end users whodownload a free evaluation of our software.Our sales efforts then focus on c

82、onverting these leads into paying customers through a high volume,shortduration,sales process.Of particular importance to our target market,we enable our customers to buy our products in a manner convenient to them,whetherby purchase order,online with a credit card or through our channel partners.8T

83、able of ContentsCustomer SupportOur customer support staff provides telephone and Web-based support to end users,application developers and OEMs.Customers may purchase maintenanceservices entitling them to software updates,technical support and technical bulletins.Maintenance is generally not requir

84、ed with our products and ispurchased at the customers option.We provide support to customers primarily through our main regional customer support centers in Bedford,Massachusetts;Morrisville,North Carolina;Rotterdam,The Netherlands;Hyderabad,India;Melbourne,Australia;and Sofia,Bulgaria.Local technic

85、alsupport for specific products is provided in certain other countries as well.Professional ServicesOur global professional services organization delivers business solutions for customers through a combination of products,consulting and education.Ourconsulting organization offers project management,

86、implementation services,custom development,programming and other services.Our consultingorganization also provides services to Web-enable existing applications or to take advantage of the capabilities of new product releases.Our educationorganization offers numerous training options,from traditional

87、 instructor-led courses to advanced learning modules available via the web or on CDs.Our services offerings include:application modernization;data management,managed database services;performance enhancements and tuning;andanalytics/business intelligence.CompetitionThe computer software industry is

88、intensely competitive.We experience significant competition from a variety of sources with respect to all of our products.Factors affecting competition in the markets we serve include product performance in complex applications,application solutions,vendor experience,ease ofintegration,price,trainin

89、g and support.We compete in various markets with a number of entities,such as ,Inc.,A,Inc.,Software AG,RedHat,Inc.,Pivotal Software,Inc.,Microsoft Corporation,Oracle Corporation and other smaller firms.Many of these vendors offer platform-as-a-service(PaaS),application development,dataintegration an

90、d other tools in conjunction with their CRM,web services,operating systems and relational database management systems.We believe thatIBM Corporation,Microsoft Corporation and Oracle Corporation currently dominate the relational database market.We do not believe that there is adominant vendor in the

91、other infrastructure software markets,including application development.Some of our competitors have greater financial,marketingor technical resources than we have and/or may be able to adapt more quickly to new or emerging technologies and changes in customer requirements or todevote greater resour

92、ces to the promotion and sale of their products than we can.Increased competition could make it more difficult for us to maintain ourrevenue and market presence.Copyrights,Trademarks,Patents and LicensesWe rely on a combination of contractual provisions and copyright,patent,trademark and trade secre

93、t laws to protect our proprietary rights in our products.We generally distribute our products under software license agreements that grant customers a perpetual nonexclusive license to use our products and containterms and conditions prohibiting the unauthorized reproduction or transfer of our produ

94、cts.We also distribute our products through various channel partners,including application partners,OEMs and system integrators.We also license our products under term or subscription arrangements.In addition,we attemptto protect our trade secrets and other proprietary information through agreements

95、 with employees,consultants and channel partners.Although we intend toprotect our rights vigorously,there is no assurance that these measures will be successful.We seek to protect the source code of our products as trade secrets and as unpublished copyrighted works.We hold numerous patents covering

96、portions ofour products.We also have several patent applications for some of our other product technologies.Where possible,we seek to obtain protection of ourproduct names and service offerings through trademark registration and other similar procedures throughout the world.We believe that due to th

97、e rapid pace of innovation within our industry,factors such as the technological and creative skills of our personnel are as importantin establishing and maintaining a leadership position within the industry as are the various legal protections of our technology.In addition,we believe thatthe nature

98、 of our customers,the importance of our products to them and their need for continuing product support may reduce the risk of unauthorizedreproduction,although no assurances can be made in this regard.9Table of ContentsBusiness Segment and Geographical InformationWe operate and report as three disti

99、nct business segments:OpenEdge,Data Connectivity and Integration,and Application Development and Deployment.For additional information on business segments as well as geographical financial information,see Note 16 to our Consolidated Financial Statements in Item8 of this Form 10-K.EmployeesAs of Nov

100、ember 30,2017,we had 1,470 employees worldwide,including 409 in sales and marketing,219 in customer support and services,642 in productdevelopment and 200 in administration.None of our U.S.employees are subject to a collective bargaining agreement.Employees in certain foreign jurisdictions are repre

101、sented by local workerscouncils and/or collective bargaining agreements as may be customary or required in those jurisdictions.We have experienced no work stoppages andbelieve our relations with employees are good.Available InformationOur Annual Report on Form 10-K,Quarterly Reports on Form 10-Q,Cur

102、rent Reports on Form 8-K,including exhibits,and amendments to those reports filedor furnished pursuant to Sections 13(a)and 15(d)of the Securities Exchange Act of 1934,as amended,are available free of charge on our website as soon as reasonably practicable after such reports are electronically filed

103、 with,or furnished to,the U.S.Securities and ExchangeCommission.The information posted on our website is not incorporated into this Annual Report.Our Code of Conduct is also available on our website.Additional information about this code and amendments and waivers thereto can be found below inPart I

104、II,Item 10 of this Form 10-K.10Table of ContentsItem 1A.Risk FactorsWe operate in a rapidly changing environment that involves certain risks and uncertainties,some of which are beyond our control.The risks described beloware not the only risks we face.Additional risks and uncertainties not currently

105、 known to us or that we currently deem to be immaterial may also materiallyadversely affect our business,financial condition and/or operating results.Our revenue and quarterly results may fluctuate,which could adversely affect our stock price.We have experienced,and may in the future experience,sign

106、ificant fluctuations in our quarterly operating results that may be caused by many factors.These factors include:changes in demand for our products;introduction,enhancement or announcement of products by us or our competitors;market acceptance of our new products;the growth rates of certain market s

107、egments in which we compete;size and timing of significant orders;a high percentage of our revenue is generated in the third month of each fiscal quarter and any failure to receive,complete or process orders at theend of any quarter could cause us to fall short of our revenue targets;budgeting cycle

108、s of customers;mix of distribution channels;mix of products and services sold;mix of international and North American revenues;fluctuations in currency exchange rates;changes in the level of operating expenses;changes in management;restructuring programs;changes in our sales force;completion or anno

109、uncement of acquisitions by us or our competitors;customer order deferrals in anticipation of new products announced by us or our competitors;andgeneral economic conditions in regions in which we conduct business.Revenue forecasting is uncertain,and the failure to meet our forecasts could result in

110、a decline in our stock price.Our revenues,particularly new softwarelicense revenues,are difficult to forecast.We use a pipeline system to forecast revenues and trends in our business.Our pipeline estimates may prove to beunreliable either in a particular quarter or over a longer period of time,in pa

111、rt because the conversion rate of the pipeline into contracts can be difficult toestimate and requires management judgment.A variation in the conversion rate could cause us to plan or budget incorrectly and materially adversely impactour business or our planned results of operations.Furthermore,most

112、 of our expenses are relatively fixed,including costs of personnel and facilities.Thus,anunexpected reduction in our revenue,or failure to achieve the anticipated rate of growth,would have a material adverse effect on our profitability.If ouroperating results do not meet our publicly stated guidance

113、 or the expectations of investors,our stock price may decline.The addition of a subscription model to augment our traditional perpetual licensing model may negatively impact our license growth in the near term.Under a subscription model,downturns or upturns in sales may not be immediately reflected

114、in our results of operations.Subscription pricing allowscustomers to use our products at a lower initial cost when compared to the sale of a perpetual license.Although the subscription model is designed to increasethe number of customers who purchase our products and services and create a recurring

115、revenue stream that is more predictable,it creates certain risks relatedto the timing of revenue recognition and reduced cash flows.A decline in new or renewed subscriptions in any period may not be immediately reflected inour results for that period,but may result in a decline in our revenue in fut

116、ure quarters.If we were to experience significant downturns in subscription salesand renewal rates,our results of operations might not reflect such downturns until future periods.Further,any increases in sales under our subscription salesmodel could result in decreased revenues over the short term i

117、f they are offset by a decline in sales from perpetual license customers.We recognize a substantial portion of our revenue from sales made through third parties,including our application partners,distributors/resellers,andOEMs,and adverse developments in the businesses of these third parties or in o

118、ur relationships with them could harm our revenues and results ofoperations.Our future results depend upon our continued successful distribution of our products through our application partner,distributor/reseller,andOEM channels.The activities of these third parties are not within our direct contro

119、l.Our failure to manage our relationships with these third partieseffectively could impair the success of our sales,marketing and support activities.A reduction in the sales efforts,technical capabilities or financial viabilityof these parties,a misalignment of interest between us and them,or a term

120、ination of our relationship with a11Table of Contentsmajor application partner,distributor/reseller,or OEM could have a negative effect on our sales and financial results.Any adverse effect on the applicationpartners,distributors/resellers,or OEMs businesses related to competition,pricing and other

121、factors could also have a material adverse effect on ourbusiness,financial condition and operating results.Weakness in the U.S.and international economies may result in fewer sales of our products and may otherwise harm our business.We are subject to therisks arising from adverse changes in global e

122、conomic conditions,especially those in the U.S.,Europe and Latin America.If global economic conditionsweaken,credit markets tighten and/or financial markets are unstable,customers may delay,reduce or forego technology purchases,both directly and throughour application partners and OEMs.This could re

123、sult in reductions in sales of our products,longer sales cycles,slower adoption of new technologies andincreased price competition.Further,deteriorating economic conditions could adversely affect our customers and their ability to pay amounts owed to us.Any of these events would likely harm our busi

124、ness,results of operations,financial condition or cash flows.Our international operations expose us to additional risks,and changes in global economic and political conditions could adversely affect ourinternational operations,our revenue and our net income.Approximately 44%of our total revenue is g

125、enerated from sales outside North America.Politicaland/or financial instability,oil price shocks and armed conflict in various regions of the world can lead to economic uncertainty and may adversely impactour business.For example,the announcement of the Referendum of the United Kingdoms(or the U.K.)

126、Membership of the European Union(E.U.)(referred toas Brexit),advising for the exit of the United Kingdom from the European Union,resulted in significant volatility in global stock markets and currencyexchange rate fluctuations.If customers buying patterns,decision-making processes,timing of expected

127、 deliveries and timing of new projects unfavorablychange due to economic or political conditions,there would be a material adverse effect on our business,financial condition and operating results.Other potential risks inherent in our international business include:longer payment cycles;credit risk a

128、nd higher levels of payment fraud;greater difficulties in accounts receivable collection;varying regulatory requirements;compliance with international and local trade,labor and export control laws;compliance with U.S.laws such as the Foreign Corrupt Practices Act,and local laws prohibiting bribery a

129、nd corrupt payments to governmentofficials;restrictions on the transfer of funds;difficulties in developing,staffing,and simultaneously managing a large number of varying foreign operations as a result of distance,language,andcultural differences;reduced or minimal protection of intellectual propert

130、y rights in some countries;laws and business practices that favor local competitors or prohibit foreign ownership of certain businesses;seasonal reductions in business activity during the summer months in Europe and certain other parts of the world;economic instability in emerging markets;andpotenti

131、ally adverse tax consequences.Any one or more of these factors could have a material adverse effect on our international operations,and,consequently,on our business,financial conditionand operating results.Fluctuations in foreign currency exchange rates could have an adverse impact on our financial

132、condition and results of operations.Changes in the valueof foreign currencies relative to the U.S.dollar have adversely affected our results of operations and financial position.For example,during periods in whichthe value of the U.S.dollar strengthens in comparison to certain foreign currencies,par

133、ticularly in Europe,Brazil and Australia,our reported internationalrevenue is reduced because foreign currencies translate into fewer U.S.dollars.As approximately one-third of our revenue is denominated in foreigncurrencies,our revenue results have been impacted,and we expect will continue to be imp

134、acted,by fluctuations in foreign currency exchange rates.We seek to reduce our exposure to fluctuations in exchange rates by entering into foreign exchange forward contracts to hedge certain actual and forecastedtransactions of selected currencies(mainly in Europe,Brazil,India and Australia).Our cur

135、rency hedging transactions may not be effective in reducing anyadverse impact of fluctuations in foreign currency exchange rates.Further,the imposition of exchange or price controls or other restrictions on the conversionof foreign currencies could have a material adverse effect on our business.12Ta

136、ble of ContentsTechnology and customer requirements evolve rapidly in our industry,and if we do not continue to develop new products and enhance our existingproducts in response to these changes,our business could be harmed.Ongoing enhancements to our product sets will be required to enable us to ma

137、intainour competitive position and the competitive position of our application partners,distributors/resellers,and OEMs.We may not be successful in developingand marketing enhancements to our products on a timely basis,and any enhancements we develop may not adequately address the changing needs of

138、themarketplace.Overlaying the risks associated with our existing products and enhancements are ongoing technological developments and rapid changes incustomer and partner requirements.Our future success will depend upon our ability to develop and introduce in a timely manner new products that takead

139、vantage of technological advances and respond to new customer and partner requirements.We may not be successful in developing new productsincorporating new technology on a timely basis,and any new products may not adequately address the changing needs of the marketplace.Failure todevelop new product

140、s and product enhancements that meet market needs in a timely manner could have a material adverse effect on our business,financialcondition and operating results.We are substantially dependent on our Progress OpenEdge products.We derive a significant portion of our revenue from software license and

141、 maintenancerevenue attributable to our Progress OpenEdge product set.Accordingly,our future results depend on continued market acceptance of OpenEdge.If newtechnologies emerge that are superior to,or more responsive to customer requirements,than OpenEdge such that we are unable to maintain OpenEdge

142、scompetitive position within its marketplace,this will have a material adverse effect on our business,financial condition and operating results.We have made significant investments in furtherance of our Cognitive-First strategy and these investments may not generate the revenues we expect,whichcould

143、 adversely affect our business and financial results.In 2017,we made significant investments in furtherance of our Cognitive First strategy,includingtwo acquisitions.Under our Cognitive First strategy,we provide the platform and tools enterprises need to build next generation applications that drive

144、 theirbusinesses,known as“Cognitive First Applications.”Our initial focus in this area is in providing cognitive predictive maintenance solutions for theindustrial IoT(IIoT)market.IIoT is a relatively new market and there are a significant number of competitors in the market.If the market does not e

145、xpand as rapidly as we or othersexpect or if customers adopt competitive solutions rather than our solutions,our IIoT business may not generate the revenues we expect.Further,ourcustomers and potential customers often begin the process of implementing IIoT with a proof-of-concept evaluation,in some

146、cases with multiple differenttechnology vendors.Our pace of growth in this emerging market will depend on our ability to engage with customers to ensure that their investment movesbeyond planning to broader deployment and yields value at their desired speed and expected costs.The increased emphasis

147、on a cloud strategy may give rise to risks that could harm our business.We are devoting significant resources to the development ofcloud-based technologies and service offerings where we have a limited operating history.Our cloud strategy requires continued investment in productdevelopment and cloud

148、 operations as well as a change in the way we price and deliver our products.Many of our competitors may have advantages over usdue to their larger presence,larger developer network,deeper experience in the cloud-based computing market,and greater sales and marketing resources.Itis uncertain whether

149、 these strategies will prove successful or whether we will be able to develop the infrastructure and business models more quickly than ourcompetitors.Our cloud strategy may give rise to a number of risks,including the following:if new or current customers desire only perpetual licenses,we may not be

150、 successful in selling subscriptions;although we intend to support our perpetual license business,the increased emphasis on a cloud strategy may raise concerns among our installedcustomer base;we may be unsuccessful in achieving our target pricing;our revenues might decline over the short or long te

151、rm as a result of this strategy;our relationships with existing partners that resell perpetual licenses may be damaged;andwe may incur costs at a higher than forecasted rate as we enhance and expand our cloud operations.We may make additional acquisitions or investments in new businesses,products or

152、 technologies that involve additional risks,which could disrupt ourbusiness or harm our financial condition,results of operations or cash flows.We may make acquisitions of businesses or investments in companies thatoffer complementary products,services and technologies.Any acquisitions that we do co

153、mplete involve a number of risks,including the risks of assimilatingthe operations and personnel of acquired companies,realizing the value of the acquired assets relative to the price paid,distraction of management from ourongoing businesses and potential product disruptions associated with the sale

154、 of the acquired companys products.In addition,an acquisition may notfurther our business strategy as we expected,we may not integrate an acquired company or technology as successfully as we expected or we may otherwisenot realize the expected return on our investments,which could adversely affect o

155、ur business or operating results and potentially cause impairment to assetsthat we recorded as a part of an acquisition including intangible assets and goodwill.These factors could have a material adverse effect on our business,financial13Table of Contentscondition,operating results and cash flows.T

156、he consideration we pay for any future acquisitions could include our stock.As a result,future acquisitionscould cause dilution to existing shareholders and to earnings per share.The segments of the software industry in which we participate are intensely competitive,and our inability to compete effe

157、ctively could harm our business.We experience significant competition from a variety of sources with respect to the marketing and distribution of our products.Many of our competitors havegreater financial,marketing or technical resources than we do and may be able to adapt more quickly to new or eme

158、rging technologies and changes incustomer requirements or to devote greater resources to the promotion and sale of their products than we can.Increased competition could make it moredifficult for us to maintain our market presence or lead to downward pricing pressure.In addition,the marketplace for

159、new products is intensely competitive and characterized by low barriers to entry.For example,an increase in marketacceptance of open source software may cause downward pricing pressures.As a result,new competitors possessing technological,marketing or othercompetitive advantages may emerge and rapid

160、ly acquire market share.In addition,current and potential competitors may make strategic acquisitions orestablish cooperative relationships among themselves or with third parties,thereby increasing their ability to deliver products that better address the needs ofour prospective customers.Current an

161、d potential competitors may also be more successful than we are in having their products or technologies widelyaccepted.We may be unable to compete successfully against current and future competitors,and our failure to do so could have a material adverse effect onour business,prospects,financial con

162、dition and operating results.We rely on the experience and expertise of our skilled employees,and must continue to attract and retain qualified technical,marketing and managerialpersonnel in order to succeed.Our future success will depend in a large part upon our ability to attract and retain highly

163、 skilled technical,managerial,salesand marketing personnel.There is significant competition for such personnel in the software industry.We may not continue to be successful in attracting andretaining the personnel we require to develop new and enhanced products and to continue to grow and operate pr

164、ofitably.Our periodic workforce restructurings can be disruptive.We have in the past restructured or made other adjustments to our workforce in response tomanagement changes,product changes,performance issues,change in strategies,acquisitions and other internal and external considerations.In the pas

165、t,these types of restructurings have resulted in increased restructuring costs and temporary reduced productivity.In addition,we may not achieve or sustain theexpected growth or cost savings benefits of these restructurings,or do so within the expected timeframe.These effects could recur in connecti

166、on with futurerestructurings and our revenues and other results of operations could be negatively affected.The loss of technology licensed from third parties could adversely affect our ability to deliver our products.We utilize certain technology that we licensefrom third parties,including software

167、that is integrated with internally developed software and used in our products to perform key functions.Thistechnology,or functionally similar technology,may not continue to be available on commercially reasonable terms in the future,or at all.The loss of anysignificant third-party technology licens

168、e could cause delays in our ability to deliver our products or services until equivalent technology is developedinternally or equivalent third-party technology,if available,is identified,licensed and integrated.Our business practices with respect to the collection,use and management of personal info

169、rmation could give rise to operational interruption,liabilities orreputational harm as a result of governmental regulation,legal requirements or industry standards relating to consumer privacy and data protection.Asregulatory focus on privacy issues continues to increase and worldwide laws and regul

170、ations concerning the handling of personal information expand andbecome more complex,potential risks related to data collection and use within our business will intensify.For example,the European Union(EU)and theUnited States(U.S.)formally entered into a new framework in July 2016 that provides a me

171、chanism for companies to transfer data from EU member states tothe U.S.This new framework,called the Privacy Shield,is intended to address shortcomings identified by the Court of Justice of the EU in the previous EU-U.S.Safe Harbor Framework,which the Court of Justice invalidated in October 2015.The

172、 Privacy Shield and other data transfer mechanisms are likely to bereviewed by the European courts,which may lead to uncertainty about the legal basis for data transfers to the U.S.or interruption of such transfers.In theevent any court blocks transfers to or from a particular jurisdiction on the ba

173、sis that no transfer mechanisms are legally adequate,this could give rise tooperational interruption in the performance of services for customers and internal processing of employee information,regulatory liabilities or reputationalharm.In addition,U.S.and foreign governments have enacted or are con

174、sidering enacting legislation or regulations,or may in the near future interpretexisting legislation or regulations,in a manner that could significantly impact our ability and the ability of our customers and data partners to collect,augment,analyze,use,transfer and share personal and other informat

175、ion that is integral to certain services we provide.Regulators globally are also imposing greater monetary fines for privacy violations.For example,in 2016,the EU adopted a new law governing datapractices and privacy called the General Data Protection Regulation(GDPR),which becomes effective in May

176、2018.The law establishes new requirementsregarding the handling of personal data.Non-compliance with the GDPR14Table of Contentsmay result in monetary penalties of up to 4%of worldwide revenue.The GDPR and other changes in laws or regulations associated with the enhancedprotection of certain types o

177、f sensitive data,such as healthcare data or other personal information,could greatly increase our cost of providing our productsand services or even prevent us from offering certain services in jurisdictions that we operate.Additionally,public perception and standards related to the privacy of perso

178、nal information can shift rapidly,in ways that may affect our reputation orinfluence regulators to enact regulations and laws that may limit our ability to provide certain products.Any failure,or perceived failure,by us to complywith U.S.federal,state,or foreign laws and regulations,including laws a

179、nd regulations regulating privacy,data security,or consumer protection,or otherpolicies,public perception,standards,self-regulatory requirements or legal obligations,could result in lost or restricted business,proceedings,actions orfines brought against us or levied by governmental entities or other

180、s,or could adversely affect our business and harm our reputation.If our products contain software defects or security flaws,it could harm our revenues and expose us to litigation.Our products,despite extensive testingand quality control,may contain defects or security flaws,especially when we first

181、introduce them or when new versions are released.We may need to issuecorrective releases of our software products to fix any defects or errors.The detection and correction of any security flaws can be time consuming and costly.Errors in our software products could affect the ability of our products

182、to work with other hardware or software products,delay the development or release ofnew products or new versions of products,adversely affect market acceptance of our products and expose us to potential litigation.If we experience errors ordelays in releasing new products or new versions of products

183、,such errors or delays could have a material adverse effect on our revenue.We could incur substantial cost in protecting our proprietary software technology or if we fail to protect our technology,which would harm our business.We rely principally on a combination of contract provisions and copyright

184、,trademark,patent and trade secret laws to protect our proprietary technology.Despite our efforts to protect our proprietary rights,unauthorized parties may attempt to copy aspects of our products or to obtain and use information that weregard as proprietary.Policing unauthorized use of our products

185、 is difficult.Litigation may be necessary in the future to enforce our intellectual propertyrights,to protect our trade secrets or to determine the validity and scope of the proprietary rights of others.This litigation could result in substantial costs anddiversion of resources,whether or not we ult

186、imately prevail on the merits.The steps we take to protect our proprietary rights may be inadequate to preventmisappropriation of our technology;moreover,others could independently develop similar technology.We could be subject to claims that we infringe intellectual property rights of others,which

187、could harm our business,financial condition,results ofoperations or cash flows.Third parties could assert infringement claims in the future with respect to our products and technology,and such claims might besuccessful.This litigation could result in substantial costs and diversion of resources,whet

188、her or not we ultimately prevail on the merits.This litigation couldalso lead to our being prohibited from selling one or more of our products,cause reluctance by potential customers to purchase our products,or result inliability to our customers and could have a material adverse effect on our busin

189、ess,financial condition,operating results and cash flows.If our security measures are breached,our products and services may be perceived as not being secure,customers may curtail or stop using our productsand services,and we may incur significant legal and financial exposure.Our products and servic

190、es involve the storage and transmission of our customersproprietary information,and security breaches could expose us to a risk of loss of this information,litigation,and potential liability.Our security measuresmay be breached due to the actions of outside parties,employee error,malfeasance,or othe

191、rwise,and,as a result,an unauthorized party may obtain access toour data or our customers data.Any such breach or unauthorized access could result in significant legal and financial exposure,increased costs to defendlitigation or damage to our reputation,and a loss of confidence in the security of o

192、ur products and services that could potentially have an adverse effect onour business.Because the techniques used to obtain unauthorized access,disable or degrade service,or sabotage systems change frequently and often are notrecognized until launched against a target,we may be unable to anticipate

193、these techniques or to implement adequate preventative measures.If an actual orperceived breach of our security occurs,the market perception of the effectiveness of our security measures could be harmed and we could lose customers.We may have exposure to additional tax liabilities.As a multinational

194、 corporation,we are subject to income taxes in the U.S.and various foreignjurisdictions.Significant judgment is required in determining our global provision for income taxes and other tax liabilities.In the ordinary course of aglobal business,there are many intercompany transactions and calculations

195、 where the ultimate tax determination is uncertain.Our income tax returns areroutinely subject to audits by tax authorities.Although we regularly assess the likelihood of adverse outcomes resulting from these examinations todetermine our tax estimates,a final determination of tax audits or tax dispu

196、tes could have an adverse effect on our financial condition,results of operationsand cash flows.15Table of ContentsWe are also subject to non-income taxes,such as payroll,sales,use,value-added,net worth,property and goods and services taxes in the U.S.and variousforeign jurisdictions.We are regularl

197、y under audit by tax authorities with respect to these non-income taxes and may have exposure to additional non-income tax liabilities,which could have an adverse effect on our results of operations,financial condition and cash flows.In addition,our future effective tax rates could be favorably or u

198、nfavorably affected by changes in tax rates,changes in the valuation of our deferred taxassets or liabilities,or changes in tax laws or their interpretation.Such changes could have a material adverse impact on our financial results.We are required to comply with certain financial and operating coven

199、ants under our credit facility and to make scheduled debt payments as they becomedue;any failure to comply with those covenants or to make scheduled payments could cause amounts borrowed under the facility to become immediatelydue and payable or prevent us from borrowing under the facility.In Novemb

200、er 2017,we entered into an amended and restated credit agreement,whichconsists of a$123.8 million term loan and a$150.0 million revolving loan(and may be increased by an additional$125.0 million if the existing oradditional lenders are willing to make such increased commitments).This facility mature

201、s in November 2022,at which time any amounts outstanding will bedue and payable in full.We may wish to borrow additional amounts under the facility in the future to support our operations,including for strategicacquisitions and share repurchases.We are required to comply with specified financial and

202、 operating covenants and to make scheduled repayments of our term loan,which may limit our abilityto operate our business as we otherwise might operate it.Our failure to comply with any of these covenants or to meet any payment obligations under thefacility could result in an event of default which,

203、if not cured or waived,would result in any amounts outstanding,including any accrued interest and unpaidfees,becoming immediately due and payable.We might not have sufficient working capital or liquidity to satisfy any repayment obligations in the event ofan acceleration of those obligations.In addi

204、tion,if we are not in compliance with the financial and operating covenants at the time we wish to borrow funds,we will be unable to borrow funds.Our annual operating cash flows may not be sufficient to enable us to meet our targeted capital allocation policy,which could decrease your expectedreturn

205、 on investment in Progress stock.In September 2017,we increased our quarterly dividend by 12%and announced a new capital allocation strategy inwhich we are targeting to return approximately 50%of annual cash flows from operations to stockholders through share repurchases and 25-30%throughdividends.M

206、eeting these targets requires us to generate consistent cash flow and have available capital in an amount sufficient to enable us to continueinvesting in our business.We may not meet these targets if we do not generate the operating cash flows we expect,if we use our available cash to satisfy otherp

207、riorities,if we have insufficient funds available to make such repurchases and/or dividends or if we are unable to borrow funds under our credit facility.Our common stock price may continue to be volatile,which could result in losses for investors.The market price of our common stock,like that of ot

208、hertechnology companies,is volatile and is subject to wide fluctuations in response to quarterly variations in operating results,announcements of technologicalinnovations or new products by us or our competitors,changes in financial estimates by securities analysts or other events or factors.Our sto

209、ck price may alsobe affected by broader market trends unrelated to our performance.As a result,purchasers of our common stock may be unable at any given time to sell theirshares at or above the price they paid for them.Our business could be negatively impacted as a result of actions by activist stoc

210、kholders or others.We may be subject to actions or proposals from activiststockholders or others that may not align with our business strategies or the interests of our other stockholders.Responding to these actions could be costlyand time-consuming,disrupt our business and operations,and divert the

211、 attention of our Board of Directors and senior management from the pursuit of ourbusiness strategies.Activist stockholders may create perceived uncertainties as to the future direction of our business or strategy which may be exploited byour competitors and may make it more difficult to attract and

212、 retain qualified personnel,potential customers and business partners and may affect ourrelationships with current customers,vendors,investors and other third parties.In addition,actions of activist stockholders may cause periods of fluctuationin our stock price based on temporary or speculative mar

213、ket perceptions or other factors that do not necessarily reflect the underlying fundamentals andprospects of our business.Item 1B.Unresolved Staff CommentsAs of the date of this report,we do not have any open comments from the U.S.Securities and Exchange Commission(SEC)related to our financial state

214、mentsor periodic filings with the SEC.16Table of ContentsItem 2.PropertiesWe own our principal administrative,sales,support,marketing,product development and distribution facilities,which are located in three buildings totalingapproximately 258,000 square feet in Bedford,Massachusetts.In addition,we

215、 maintain offices in leased facilities in various other locations in North Americaand outside North America,including Australia,Bulgaria,Germany,India,Netherlands,and the United Kingdom.The terms of our leases generally rangefrom one to six years.We believe that our facilities are adequate for our c

216、urrent needs and that suitable additional space will be available as needed.Item 3.Legal ProceedingsWe are subject to various legal proceedings and claims,either asserted or unasserted,which arise in the ordinary course of business.While the outcome ofthese claims cannot be predicted with certainty,

217、management does not believe that the outcome of any of these legal matters will have a material effect on ourconsolidated financial position,results of operations or cash flows.Item 4.Mine Safety DisclosuresNot applicable.PART IIItem 5.Market for Registrants Common Equity,Related Stockholder Matters

218、 and Issuer Purchases of Equity SecuritiesThe following table sets forth,for the periods indicated,the range of high and low sale prices for our common stock.Our common stock trades on theNASDAQ Global Select Market under the symbol PRGS.Fiscal Year Ended November 30,2017 November 30,2016 High Low H

219、igh LowFirst quarter$32.47$27.16$27.11$22.01Second quarter30.70 27.46 26.55 22.57Third quarter33.89 28.63 29.80 24.20Fourth quarter42.97 33.23 30.24 25.55On September 27,2016,our Board of Directors approved the initiation of a quarterly cash dividend of$0.125 per share of common stock to Progresssha

220、reholders.On September 6,2017,our Board of Directors approved a 12%increase in our quarterly cash dividend to$0.14 per share of common stock.OnJanuary 5,2018,our Board of Directors declared a quarterly dividend of$0.14 per share of common stock that will be paid on March 15,2018 toshareholders of re

221、cord as of the close of business on March 1,2018.As of December 31,2017,our common stock was held by approximately 164 shareholders of record.In fiscal year 2015,we repurchased and retired 1.3 million shares of our common stock for$32.9 million under the share repurchase program previouslyauthorized

222、 by our Board of Directors.In fiscal year 2016,we repurchased and retired 3.1 million shares of our common stock for$79.2 million under the sharerepurchase program authorized by our Board of Directors.In September 2017,our Board of Directors increased the total share repurchase authorization to$250.

223、0 million.In fiscal year 2017,we repurchased andretired 2.2 million shares of our common stock for$73.9 million.As of November 30,2017,there is$220.0 million remaining under this currentauthorization.17Table of ContentsStock Performance Graph and Cumulative Total ReturnThe graph below compares the c

224、umulative total stockholder return on our common stock with the cumulative total return on the NASDAQ Composite Indexand the NASDAQ Computer Index for each of the last five fiscal years ended November 30,2017,assuming an investment of$100 at the beginning of suchperiod and the reinvestment of any di

225、vidends.Comparison of 5 Year Cumulative Total Return(1)Among Progress Software Corporation,the NASDAQ Composite Index and theNASDAQ Computer Index(1)$100 invested on November 30,2012 in stock or index,including reinvestment of dividends.November 30,2012 2013 2014 2015 2016 2017Progress Software Corp

226、oration$100.00$130.23$129.59$119.29$147.04$205.57NASDAQ Composite 100.00 134.38 157.04 169.71 176.85 228.35NASDAQ Computer 100.00 126.06 159.08 172.03 184.51 260.9418Table of ContentsItem 6.Selected Financial DataThe following table sets forth selected financial data for the last five fiscal years(i

227、n thousands,except per share data):Year Ended November 30,2017 2016 2015 2014 2013Revenue$397,572$405,341$377,554$332,533$333,996Income(loss)from operations 70,614(29,709)14,754 80,740 63,740Income(loss)from continuing operations 37,417(55,726)(8,801)49,458 39,777Net income(loss)37,417(55,726)(8,801

228、)49,458 74,907Basic earnings(loss)per share from continuing operations 0.78(1.13)(0.17)0.97 0.73Diluted earnings(loss)per share from continuing operations 0.77(1.13)(0.17)0.96 0.72Cash dividends declared per common share 0.515 0.125 Cash,cash equivalents and short-term investments 183,609 249,754 24

229、1,279 283,268 231,440Total assets 718,718 754,827 877,123 702,756 682,187Long-term debt,including current portion 121,909 135,000 144,375 Shareholders equity 376,084 406,629 522,464 543,245 513,654Fiscal year 2016 amounts have been impacted by a$92.0 million impairment charge related to the goodwill

230、 of the Application Development andDeployment reporting unit.Refer to Note 6 to the Consolidated Financial Statements for additional details.Fiscal years 2017,2016,and 2015 amounts havebeen impacted by the acquisition of Telerik AD.Refer to Item 7,Managements Discussion and Analysis of Financial Con

231、dition and Results of Operations,and Note 7 to the Consolidated Financial Statements for additional details.We also entered into a credit agreement during fiscal year 2015 to partially fundour acquisition of Telerik AD,which was amended and restated during fiscal year 2017.Refer to Note 8 to the Con

232、solidated Financial Statements foradditional details.Item 7.Managements Discussion and Analysis of Financial Condition and Results of OperationsForward-Looking StatementsCertain statements below about anticipated results and our products and markets are forward-looking statements that are based on o

233、ur current plans andassumptions.Important information about the bases for these plans and assumptions and factors that may cause our actual results to differ materially fromthese statements is contained below and in Item 1A.“Risk Factors”of this Annual Report on Form 10-K.Use of Constant CurrencyRev

234、enue from our international operations has historically represented a substantial portion of our total revenue.As a result,our revenue results have beenimpacted,and we expect will continue to be impacted,by fluctuations in foreign currency exchange rates.For example,if the local currencies of our fo

235、reignsubsidiaries strengthen,our consolidated results stated in U.S.dollars are positively impacted.As exchange rates are an important factor in understanding period to period comparisons,we believe the presentation of revenue growth rates on aconstant currency basis enhances the understanding of ou

236、r revenue results and evaluation of our performance in comparison to prior periods.The constantcurrency information presented is calculated by translating current period results using prior period weighted average foreign currency exchange rates.These results should be considered in addition to,not

237、as a substitute for,results reported in accordance with accounting principles generally accepted inthe United States of America(GAAP).OverviewProgress offers the leading platform for developing and deploying mission-critical business applications.Progress empowers enterprises and independentsoftware

238、 vendors(ISVs)to build and deliver cognitive-first applications that harness big data to derive business insights and competitive advantage.Progressoffers leading technologies for easily building powerful user interfaces across any type of device,a reliable,scalable and secure backend platform to de

239、ploymodern applications,leading19Table of Contentsdata connectivity to all sources,and award-winning predictive analytics that brings the power of machine learning to any organization.Over 1,700 ISVs,100,000 enterprise customers,and 2 million developers rely on Progress to power their applications.W

240、e operate as three distinct segments:OpenEdge,DataConnectivity and Integration,and Application Development and Deployment.Beginning in late October 2016,with the appointment of Yogesh Gupta as our new Chief Executive Officer,our Board of Directors and executivemanagement team undertook a comprehensi

241、ve review of our strategy and operations,including our expectations for fiscal year 2017 results.On January 16,2017,we announced a new strategic plan highlighted by a new product strategy and a streamlined operating approach with a tighter focus onareas of strength to more efficiently drive revenue.

242、The key tenets of the new strategic plan are as follows:Streamlined Operating Approach.In fiscal year 2017,we adapted our organization and operating principles to focus primarily on customer andpartner retention and success for many of our core products.For selected products that have new customer a

243、cquisition potential,we alsostrengthened our demand generation and high volume,low touch e-commerce capabilities.New Product Strategy.As part of the new strategic plan,we undertook a new product strategy to provide the platform and tools enterprises need tobuild next generation applications that dri

244、ve their businesses,known as“Cognitive Applications.”We offer this platform to both new customers andpartners as well as our existing OpenEdge partner and customer ecosystems.Our platform for Cognitive Applications makes it easy for developers tobuild machine learning into their applications,and inc

245、ludes:Our leading UI development tools,which enable organizations to easily build engaging user interfaces for any device or front end;Our NativeScript offering,which allows developers to use JavaScript to build native applications across multiple mobile platforms;A mission-critical back-end-as-a-se

246、rvice platform that runs on any cloud,is secure,high-performing,and highly-scalable while supportingall modern user interfaces;Automated and intuitive machine learning capabilities for accelerating the creation and delivery of Cognitive Applications;Our data connectivity and integration capabilities

247、;andOur business logic and rules capabilities.Restructuring.With the adoption of our new product strategy,we discontinued our investment in our Digital Factory strategy and re-aligned ourresources consistent with our core operating approach.To that end,during fiscal year 2017,we implemented restruct

248、uring efforts including theconsolidation of facilities,implementation of a simplified organizational structure and a reduction of marketing and other external expenses.Inaddition,we reduced headcount by over 400 employees,totaling over 20%of our workforce.We reduced our full year expenses by over$30

249、 millionby the end of fiscal year 2017.On March 1,2017,we acquired DataRPM for an aggregate sum of$30.0 million.DataRPM is a leader in cognitive predictive maintenance for the industrialIoT(IIoT)market.This acquisition is a key part of the Companys strategy to provide the best platform to build and

250、deliver cognitive-first applications.On June 1,2017,we acquired Kinvey for an aggregate sum of$49.2 million.Kinvey is the leading Backend-as-a-Service(BaaS)provider and allowsdevelopers to set up,use,and operate a cloud backend for any native,hybrid,web,or IoT app built using any development tools.T

251、his acquisition,incombination with our existing technologies,enables us to offer the premier platform for building and delivering cognitive business applications.We derive a significant portion of our revenue from international operations,which are primarily conducted in foreign currencies.As a resu

252、lt,changes in thevalue of these foreign currencies relative to the U.S.dollar have significantly impacted our results of operations and may impact our future results ofoperations.For example,in fiscal years 2015 and 2016,the value of the U.S.dollar strengthened in comparison to certain foreign curre

253、ncies,including inEurope,Brazil and Australia.Since approximately one-third of our revenue is denominated in foreign currency,our revenue results during those periods werenegatively impacted.The impact of foreign exchange did not result in a material impact on revenue during fiscal year 2017.We expe

254、ct that futurefluctuations in foreign currency exchange rates will impact our results.20Table of ContentsIn September 2017,we announced a new capital allocation strategy pursuant to which we are targeting to return approximately 50%of our annual cash flowsfrom operations to stockholders in the form

255、of share repurchases and 25-30%through dividends.To that end,our Board of Directors increased our total sharerepurchase authorization to$250.0 million.In fiscal year 2017,we repurchased and retired 2.2 million shares of our common stock for$73.9 million.As ofNovember 30,2017,there is$220.0 million r

256、emaining under this current authorization.We expect to repurchase$120.0 million of shares of our commonstock in fiscal year 2018.However,the timing and amount of any shares repurchased will be determined by management based on its evaluation of marketconditions and other factors,and we may choose to

257、 suspend,expand or discontinue the repurchase program at any time.On September 6,2017,our Board of Directors approved a 12%increase in our quarterly cash dividend to$0.14 per share of common stock.We began payingquarterly cash dividends of$0.125 per share of common stock to Progress shareholders in

258、December 2016.We expect to continue paying quarterly cashdividends in subsequent quarters consistent with our capital allocation strategy.However,we may terminate or modify this program at any time withoutnotice.On January 5,2018,our Board of Directors declared a quarterly dividend of$0.14 per share

259、 of common stock that will be paid on March 15,2018 toshareholders of record as of the close of business on March 1,2018.We expect to continue to evaluate possible acquisitions and other strategic transactions designed to expand our business and/or add complementary productsand technologies to our e

260、xisting product sets.As a result,our expected uses of cash could change,our cash position could be reduced and we may incuradditional debt obligations to the extent we complete additional acquisitions.However,we believe that existing cash balances,together with fundsgenerated from operations and amo

261、unts available under our credit facility,will be sufficient to finance our operations and meet our foreseeable cashrequirements,including quarterly cash dividends and stock repurchases to Progress shareholders,through at least the next twelve months.On December 22,2017,the Tax Cuts and Jobs Act(the

262、New Tax Legislation)was signed into law.The New Tax Legislation had no impact on theCompanys operating results,cash flows and financial condition in the fiscal year ended November 30,2017.The New Tax Legislation will impact theCompanys operating results,cash flows,and financial condition beginning i

263、n the fiscal year ended November 30,2018 and the Company is currentlyevaluating the extent of the impact.The New Tax Legislation includes a number of provisions,including the reduction of the U.S.corporate tax rate from35%to 21%,effective January 1,2018.The New Tax Legislation also includes provisio

264、ns that may partially offset the benefit of such rate reduction,including the repeal of the deduction for domestic production activities.As a result of the New Tax Legislation,we expect to realize a one-time tax benefit or expense for the remeasurement of deferred tax assets and liabilities.Theeffec

265、t of the international provisions of the New Tax Legislation,which generally establish a territorial-style system for taxing foreign-source income ofdomestic multinational corporations,are still being analyzed.Based on preliminary analysis,the deemed repatriation tax on unremitted foreign earnings a

266、ndprofits and the remeasurement of our deferred tax assets and liabilities is not expected to have a material impact on our consolidated financial statements.TheCompany will continue to analyze such impacts and record any such amounts in fiscal 2018.Other international provision of New Tax Legislati

267、on,includingthe provisions for global intangible low-taxed income and foreign-derived intangible income,will not become effective for the Company until fiscal 2019.In September 2017,Praesidium Investment Management,one of our largest shareholders,publicly announced its disagreement with our strategy

268、 in aSchedule 13D filed with the Securities and Exchange Commission and stated that it was seeking changes in the composition of our Board of Directors.Infiscal year 2017,we incurred professional and other fees relating to Praesidiums actions.We expect to continue to incur these fees in fiscal year

269、2018.21Table of ContentsResults of OperationsFiscal Year 2017 Compared to Fiscal Year 2016Revenue Fiscal Year Ended Percentage Change(In thousands)November 30,2017 November 30,2016 As Reported ConstantCurrencyRevenue$397,572$405,341(2)%(2)%Total revenue decreased$7.8 million,or 2%,in fiscal year 201

270、7 as compared to fiscal year 2016.Revenue would have decreased by the same percentage ifexchange rates had been constant in fiscal year 2017 as compared to exchange rates in fiscal year 2016.Changes in prices from fiscal year 2016 to 2017 didnot have a significant impact on our revenue.License Reven

271、ue Fiscal Year Ended Percentage Change(In thousands)November 30,2017 November 30,2016 As Reported ConstantCurrencyLicense$124,406$134,863(8)%(8)%As a percentage of total revenue31%33%Software license revenue decreased$10.5 million,or 8%,in fiscal year 2017 as compared to fiscal year 2016.Software li

272、cense revenue would have decreasedby the same percentage if exchange rates had been constant in fiscal year 2017 as compared to exchange rates in effect in fiscal year 2016.The decrease inlicense revenue is primarily due to decreases in license revenue in North America from products included in our

273、Data Connectivity and Integration segment,due to the timing of certain OEM renewal agreements.Maintenance and Services Revenue Fiscal Year Ended Percentage Change(In thousands)November 30,2017 November 30,2016 As Reported ConstantCurrencyMaintenance$241,398$238,377 1%1%As a percentage of total reven

274、ue61%59%Professional services$31,768$32,101(1)%(1)%As a percentage of total revenue8%8%Total maintenance and services revenue$273,166$270,478 1%1%As a percentage of total revenue69%67%Maintenance and services revenue increased$2.7 million in fiscal year 2017 as compared to fiscal year 2016.Maintenan

275、ce revenue increased 1%andprofessional services revenue decreased 1%compared to the prior year.The increase in maintenance revenue is primarily due to higher maintenance revenuefrom our DevTools and Sitefinity products included in our Application Development and Deployment segment.The decrease in se

276、rvices revenue is primarilydue to lower revenue from our OpenEdge segment partially offset by higher professional services revenue generated by our Application Development andDeployment segment.22Table of ContentsRevenue by Region Fiscal Year Ended Percentage Change(In thousands)November 30,2017 Nov

277、ember 30,2016 As Reported ConstantCurrencyNorth America$223,942$229,203(2)%(2)%As a percentage of total revenue56%57%EMEA$130,359$130,818%1%As a percentage of total revenue33%32%Latin America$21,158$21,156%(6)%As a percentage of total revenue5%5%Asia Pacific$22,113$24,164(8)%(10)%As a percentage of

278、total revenue6%6%Total revenue generated in North America decreased$5.3 million,and total revenue generated outside North America decreased$2.5 million,in fiscal year2017 as compared to fiscal year 2016.The decrease in North America was primarily due to license revenue decreases in our Data Connecti

279、vity andIntegration segment.The decrease in Asia Pacific is primarily due to maintenance revenue decreases in our OpenEdge segment related to a single,largecustomer not renewing maintenance,and also related to a large deal in our Data Connectivity and Integration segment with a customer in Japan tha

280、t occurredin the second quarter of fiscal year 2016.Total revenue generated in markets outside North America represented 44%of total revenue in fiscal year 2017 compared to 43%of total revenue in fiscalyear 2016.If exchange rates had remained constant in fiscal year 2017 as compared to the exchange

281、rates in effect in fiscal year 2016,total revenue generatedin markets outside North America would have remained at 44%of total revenue.Revenue by Segment Fiscal Year Ended(In thousands)November 30,2017 November 30,2016 Percentage ChangeOpenEdge segment$276,172$276,267%Data Connectivity and Integrati

282、on segment40,955 48,009(15)%Application Development and Deployment segment80,445 81,065(1)%Total revenue$397,572$405,341(2)%Revenue in the OpenEdge segment remained flat in fiscal year 2017 as compared to fiscal year 2016,primarily due to higher license sales and software-as-a-service revenue offset

283、 by decreases in maintenance and services revenue.Revenue in the OpenEdge segment would have remained flat if exchange rates hadbeen constant in fiscal year 2017 as compared to exchange rates in fiscal year 2016.Data Connectivity and Integration revenue decreased$7.1 million,or15%,in fiscal year 201

284、7 as compared to fiscal year 2016,primarily due to the timing of certain OEM renewals.Application Development and Deploymentrevenue decreased$0.6 million,or 1%,year over year primarily as a result of a decrease in license revenue,offset by higher maintenance revenue from ourDevTools and Sitefinity p

285、roducts.Cost of Software Licenses Fiscal Year Ended(In thousands)November 30,2017 November 30,2016 PercentageChangeCost of software licenses$5,752$5,456 5%As a percentage of software license revenue5%4%As a percentage of total revenue1%1%23Table of ContentsCost of software licenses consists primaril

286、y of costs of royalties,electronic software distribution costs,duplication and packaging.Cost of software licensesincreased$0.3 million,or 5%,in fiscal year 2017 as compared to fiscal year 2016,and increased as a percentage of software license revenue from 4%to 5%.Cost of software licenses as a perc

287、entage of software license revenue varies from period to period depending upon the relative product mix.Cost of Maintenance and Services Fiscal Year Ended(In thousands)November 30,2017 November 30,2016 PercentageChangeCost of maintenance and services$43,299$44,760(3)%As a percentage of maintenance a

288、nd services revenue16%17%As a percentage of total revenue11%11%Cost of maintenance and services consists primarily of costs of providing customer support,consulting and education.Cost of maintenance and servicesdecreased$1.5 million,or 3%,in fiscal year 2017 as compared to fiscal year 2016,and decre

289、ased as a percentage of maintenance and services revenue from17%to 16%.The decrease in cost of maintenance and services is primarily due to lower compensation-related costs resulting from a decrease in headcount.Amortization of Acquired Intangibles Fiscal Year Ended(In thousands)November 30,2017 Nov

290、ember 30,2016 PercentageChangeAmortization of acquired intangibles$20,108$15,496 30%As a percentage of total revenue5%4%Amortization of acquired intangibles included in costs of revenue primarily represents the amortization of the value assigned to technology-relatedintangible assets obtained in bus

291、iness combinations.Amortization of acquired intangibles increased$4.6 million,or 30%,in fiscal year 2017 as compared tofiscal year 2016.The increase was primarily due to the addition of intangible assets associated with the technology obtained in connection with theacquisitions of DataRPM in the sec

292、ond quarter of fiscal year 2017 and Kinvey in the third quarter of fiscal year 2017,partially offset by the impairment ofintangible assets associated with the technology obtained in connection with the acquisition of Modulus as well as the completion of amortization of certainintangible assets acqui

293、red in prior years.Gross Profit Fiscal Year Ended(In thousands)November 30,2017 November 30,2016 PercentageChangeGross profit$328,413$339,629(3)%As a percentage of total revenue83%84%Our gross profit decreased$11.2 million,or 3%,in fiscal year 2017 as compared to fiscal year 2016,and our gross profi

294、t as a percentage of total revenuedecreased from 84%to 83%compared to fiscal year 2016.The dollar decrease is primarily due to the decreases of license revenue and increases ofamortization of acquired intangibles as described above.24Table of ContentsSales and Marketing Fiscal Year Ended(In thousand

295、s)November 30,2017 November 30,2016 PercentageChangeSales and marketing$96,345$121,501(21)%As a percentage of total revenue24%30%Sales and marketing expenses decreased$25.2 million,or 21%,in fiscal year 2017 as compared to fiscal year 2016,and decreased as a percentage of totalrevenue from 30%to 24%

296、.The decrease in sales expenses was primarily due to lower compensation-related and travel costs as a result of the headcountreduction actions which occurred in the first quarter of fiscal year 2017,as well as a decrease in spending on marketing programs.Product Development Fiscal Year Ended(In thou

297、sands)November 30,2017 November 30,2016 PercentageChangeProduct development$76,988$88,587(13)%As a percentage of total revenue19%22%Product development expenses decreased$11.6 million,or 13%,in fiscal year 2017 as compared to fiscal year 2016,and decreased as a percentage ofrevenue from 22%to 19%.Th

298、e decrease in product development expense is primarily due to lower compensation-related costs as a result of the headcountreduction actions which occurred in the first quarter of fiscal year 2017.General and Administrative Fiscal Year Ended(In thousands)November 30,2017 November 30,2016 PercentageC

299、hangeGeneral and administrative$45,739$46,532(2)%As a percentage of total revenue12%11%General and administrative expenses include the costs of our finance,human resources,legal,information systems and administrative departments.Generaland administrative expenses decreased$0.8 million,or 2%,in fisca

300、l year 2017 as compared to fiscal year 2016,and increased as a percentage of revenue from11%to 12%.The dollar decrease was primarily due to lower compensation-related costs as a result of the headcount reduction actions which occurred in thefirst quarter of fiscal year 2017.Impairment of Goodwill Fi

301、scal Year Ended(In thousands)November 30,2017 November 30,2016 PercentageChangeImpairment of goodwill$92,000(100)%As a percentage of total revenue%23%During fiscal year 2017,we tested goodwill for impairment for each of our reporting units as of October 31,2017.Our reporting units each had fair valu

302、eswhich significantly exceeded their carrying values as of the annual impairment date.As a result,we did not recognize any goodwill impairment chargesduring fiscal year 2017.During fiscal year 2016,we tested goodwill for impairment for each of our reporting units as of October 31,2016.Our OpenEdge a

303、nd Data Connectivity andIntegration reporting units had fair values which significantly exceeded their carrying25Table of Contentsvalues as of the annual impairment date.Our Application Development and Deployment reporting unit did not pass the first step of the impairment test.As aresult,we recorde

304、d a$92.0 million goodwill impairment charge related to the Application Development and Deployment reporting unit(see Note 6 to theConsolidated Financial Statements in Item 8 of this Form 10-K for further information on the impairment charge).Amortization of Acquired Intangibles Fiscal Year Ended(In

305、thousands)November 30,2017 November 30,2016 PercentageChangeAmortization of acquired intangibles$13,039$12,735 2%As a percentage of total revenue3%3%Amortization of acquired intangibles included in operating expenses primarily represents the amortization of value assigned to intangible assets obtain

306、ed inbusiness combinations other than assets identified as purchased technology.Amortization of acquired intangibles increased slightly in fiscal year 2017 dueto the addition of intangible assets obtained in connection with the acquisitions of DataRPM and Kinvey,which occurred in the second and thir

307、d quarters offiscal year 2017,respectively.Impairment of Intangible Assets Fiscal Year Ended(In thousands)November 30,2017 November 30,2016 PercentageChangeImpairment of intangible assets$5,051(100)%As a percentage of total revenue%1%During fiscal year 2017,we did not impair the value of any intangi

308、ble assets.During fiscal year 2016,we evaluated the ongoing value of the intangible assets associated with the technology obtained in connection with the acquisitionof Modulus.As a result of our decision to abandon the related assets due to a change in our expected ability to use the technology inte

309、rnally,we determinedthat the intangible assets were fully impaired.As a result,we incurred an impairment charge of$5.1 million during fiscal year 2016.See Note 6 to theConsolidated Financial Statements in Item 8 of this Form 10-K for additional details.Fees Related to Shareholder Activist Fiscal Yea

310、r Ended(In thousands)November 30,2017 November 30,2016 PercentageChangeFees related to shareholder activist$2,020$100%As a percentage of total revenue1%In September 2017,Praesidium Investment Management,one of our largest shareholders,publicly announced its disagreement with our strategy in aSchedul

311、e 13D filed with the Securities and Exchange Commission and stated that it was seeking changes in the composition of our Board of Directors.Infiscal year 2017,we incurred professional and other fees relating to Praesidiums actions.Restructuring Expenses Fiscal Year Ended(In thousands)November 30,201

312、7 November 30,2016 PercentageChangeRestructuring expenses$22,210$1,692 1,213%As a percentage of total revenue6%26Table of ContentsWe incurred restructuring expenses of$22.2 million in fiscal year 2017 as compared to$1.7 million in fiscal year 2016.Restructuring expenses recorded infiscal year 2017 r

313、elate to the restructuring activities occurring in the first fiscal quarter of 2017.See Note 13 to the Consolidated Financial Statements in Item8 of this Form 10-K for additional details,including types of expenses incurred and the timing of future expenses and cash payments.See also the Liquidityan

314、d Capital Resources section of this Item 7,Managements Discussion and Analysis of Financial Condition and Results of Operations.Acquisition-Related Expenses Fiscal Year Ended(In thousands)November 30,2017 November 30,2016 PercentageChangeAcquisition-related expenses$1,458$1,240 18%As a percentage of

315、 total revenue%Acquisition-related costs are expensed as incurred and include those costs incurred as a result of a business combination.These costs consist of professionalservices fees,including third-party legal and valuation-related fees,as well as retention fees,and earn-out payments treated as

316、compensation expense.Acquisition-related expenses in fiscal year 2017 relate to the acquisitions of DataRPM and Kinvey,which occurred in the second and third quarters of fiscalyear 2017,respectively.Acquisition-related expenses in fiscal year 2016 relate primarily to retention bonuses associated wit

317、h our Telerik acquisition.SeeNote 7 to the consolidated financial statements for additional details.Income(Loss)from Operations Fiscal Year Ended(In thousands)November 30,2017 November 30,2016 PercentageChangeIncome(loss)from operations$70,614$(29,709)(338)%As a percentage of total revenue18%(7)%Inc

318、ome from operations increased$100.3 million,or 338%,in fiscal year 2017 as compared to fiscal year 2016.As discussed above,the increase wasprimarily driven by the impairment of goodwill during fiscal year 2016 as well as the headcount reduction actions that began in the first quarter of fiscal year2

319、017.The increase was partially offset by the restructuring expenses recorded in fiscal year 2017 as well as the decreases of license revenue and increases ofamortization of acquired intangibles as described above.Income(Loss)from Operations by Segment Fiscal Year Ended(In thousands)November 30,2017

320、November 30,2016 Percentage ChangeOpenEdge segment$203,675$203,329%Data Connectivity and Integration segment31,626 35,249(10)%Application Development and Deployment segment53,800 40,885 32%Other unallocated expenses(218,487)(309,172)29%Total income(loss)from operations$70,614$(29,709)338%Note that t

321、he following expenses are not allocated to our segments as we manage and report our business in these functional areas on a consolidated basisonly:certain product development and corporate sales and marketing expenses,customer support,administration,amortization and impairment of acquiredintangibles

322、,impairment of goodwill,stock-based compensation,fees related to shareholder activist,restructuring,and acquisition-related expenses.27Table of ContentsOther(Expense)Income,Net Fiscal Year Ended(In thousands)November 30,2017 November 30,2016 PercentageChangeInterest expense$(4,631)$(4,178)11%Interes

323、t income and other,net921 839 10%Foreign currency loss,net(1,317)(2,232)(41)%Total other(expense)income,net$(5,027)$(5,571)10%As a percentage of total revenue(1)%(1)%Total other expense,net decreased$0.5 million in fiscal year 2017 as compared to fiscal year 2016 primarily due to a foreign currency

324、loss of$1.3 million infiscal year 2017 compared to a foreign currency loss of$2.2 million in fiscal year 2016.The change in foreign currency gains/losses is a result of movementsin exchange rates and the impact during fiscal year 2017 on our intercompany receivables and payables denominated in curre

325、ncies other than localcurrencies.Provision for Income Taxes Fiscal Year Ended(In thousands)November 30,2017 November 30,2016 PercentageChangeProvision for income taxes$28,170$20,446 38%As a percentage of total revenue7%5%Our effective income tax rate was 43%in fiscal year 2017 and(58)%in fiscal year

326、 2016.In fiscal year 2016,our rate was impacted unfavorably as a result ofthe goodwill impairment expense that is not tax deductible,partially offset by a$2.7 million release of a valuation allowance on state research anddevelopment tax credits recorded in the fourth quarter of fiscal year 2016 and

327、the out-of-period benefit described below.During the preparation of our condensed consolidated financial statements for the three months ended May 31,2016,we identified an error in our prior yearincome tax provision whereby income tax expense was overstated for the year ended November 30,2015 by$2.7

328、 million related to our tax treatment of anintercompany gain.We determined that the error is not material to the prior year financial statements.We also concluded that recording an out-of-periodcorrection would not be material and corrected this error by recording an out-of-period$2.7 million tax be

329、nefit in our interim financial statements for theperiod ended May 31,2016.Net Income(Loss)Fiscal Year Ended(In thousands)November 30,2017 November 30,2016 PercentageChangeNet income(loss)$37,417$(55,726)167%As a percentage of total revenue9%(14)%28Table of ContentsFiscal 2016 Compared to Fiscal 2015

330、Revenue Fiscal Year Ended Percentage Change(In thousands)November 30,2016 November 30,2015 As Reported ConstantCurrencyRevenue$405,341$377,554 7%9%Total revenue increased$27.8 million,or 7%,in fiscal year 2016 as compared to fiscal year 2015.Revenue would have increased by 9%if exchange rateshad bee

331、n constant in fiscal year 2016 as compared to exchange rates in fiscal year 2015.The increase in revenue is primarily due to the impact of the Telerikacquisition during the first quarter of fiscal year 2015.As a result of acquisition accounting,the acquired deferred revenue balance was significantly

332、 reducedto reflect its fair value as of the acquisition date.Therefore,the reduction of the acquisition date deferred revenue had a negative impact on revenue in fiscalyear 2015.However,in fiscal year 2016 we recognized revenue related to the full value of Telerik deferred revenue that was generated

333、 during fiscal years2015 and 2016.The increase in revenue in fiscal year 2016 was also the result of an increase in license and maintenance and services revenue as furtherdescribed below.Changes in prices from fiscal year 2015 to 2016 did not have a significant impact on our revenue.License Revenue Fiscal Year Ended Percentage Change(In thousands)November 30,2016 November 30,2015 As Reported Const