What happened
Shares of Pegasystems (PEGA 0.95%), a low-code platform provider, were plummeting today after the company reported disappointing second-quarter results. Sales and earnings both fell below analysts' consensus estimates, which spurred one analyst to downgrade Pegasystems' stock today.
The tech stock was down by 13.8% as of 2:38 p.m. ET on Thursday.
So what
Pegasystems reported an adjusted loss of $0.38 per share, down from earnings of $0.25 in the year-ago quarter and far below Wall Street's average estimate of a profit of $0.11 per share.
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The company's second-quarter revenue of $274.3 million was down 16% from the year-ago quarter and missed the analysts' consensus estimate of $343.5 million.
CEO Alan Trefler said in a press release that the year has been "an extremely volatile business environment," and added: "The ongoing uncertainty will continue to put pressure on our clients. But this is an environment for which Pega is uniquely suited, as our low-code platform allows these same organizations to more easily adapt to change."
But investors and at least one analyst weren't so optimistic. Following the company's release of its second-quarter results, Wedbush analyst Daniel Ives downgraded Pegasystems to neutral from outperform and lowered his price target to $40, down from $95.
Now what
With Pegasystems' dismal second-quarter performance, it's no wonder investors dumped the company's shares today.
Adding to the panic might have been the fact that the latest economic data shows that U.S. gross domestic product (GDP) fell for the second consecutive quarter, spurring additional fears of a potential recession.
