Analyst(s): Futurum Research
Publication Date: October 31, 2025
PROS Q3 FY 2025 shows stable subscription growth, stronger margins, and healthy free cash flow despite macro caution and a pending acquisition. Customer additions and expansions, alongside improved services efficiency, point to sustained execution as the company suspends guidance during the transaction process.
What is Covered in this Article:
- PROS’s Q3 FY 2025 financial results
- Subscription scale and retention dynamics
- Demand environment, AI posture, and customer activity
- Services Growth Signals Implementation Strength
- Outlook and Final Thoughts
The News: PROS Holdings, Inc. (NYSE: PRO) reported Q3 FY 2025 results. Revenue was $91.7 million, up 11% year-on-year (YoY), versus Wall Street consensus of $91.1 million. Subscription revenue was $76.0 million (+13% YoY), services revenue was $13.6 million (+11% YoY), and maintenance and support revenue was $2.1 million (-37% YoY). Non-GAAP gross margin was 70.8% (Q3 FY 2024: 68.1%), and non-GAAP operating income was $14.1 million, up from $8.4 million a year ago. Adjusted EBITDA was $15.0 million, up 61% YoY. Non-GAAP net income was $10.4 million (58% YoY) and non-GAAP EPS was $0.22, compared to $0.14 a year ago.
In light of the pending Thoma Bravo acquisition, PROS announced that it would not be hosting a Q3 earnings conference call and is suspending its practice of providing financial guidance.
PROS Holdings Q3 FY 2025 Results: Subscription Growth, Margin Gains
Analyst Take: PROS’ quarter reflects durable subscription growth and improved delivery efficiency, with the Thoma Bravo transaction framing near-term market communication. Recurring revenue mix at 85% and gross revenue retention above 93% underscore stable customer value realization and contract durability. Margin expansion benefited from cloud infrastructure optimization and higher services utilization. The pipeline backdrop remains measured given macro complexity, but customer wins and expansions point to steady platform adoption.
Subscription Scale and Retention
The 13% YoY growth in subscription revenue, reaching $76.0 million, is the quarter’s central positive indicator. This top-line growth is strongly supported by a gross revenue retention rate exceeding 93% over the last twelve months, which signals high customer satisfaction and low churn. More importantly, this growth is increasingly profitable; the subscription gross margin improved to 80%, up from 78% in the prior-year period. Management directly attributes this margin expansion to continued optimization of cloud infrastructure, confirming the platform’s delivery model is scaling efficiently. This positive subscription trend is further reinforced by the planned 37% YoY decline in maintenance revenue; this is not a sign of customer loss but rather the intended result of the company’s strategy to migrate maintenance customers to its cloud offerings. Finally, future revenue is supported by a substantial backlog, with Remaining Performance Obligations (RPO) of $487.5 million, of which $257.2 million is expected to be recognized within the next 12 months
Demand Environment, AI Posture, and Customer Activity
Management notes measured customer buying behavior amid macro uncertainty, with elongated approvals and a preference for staged scope and rapid ROI. New customers such as Kraft Heinz, Bleckmann, ELKO Grupa, Greene King, and MANE, and expansions at Adobe, American Airlines, AutoZone, Holcim, and multiple airlines reflect diversified platform adoption. The company’s AI heritage and continued expansion with AI agents and pricing science align with secular interest in generative AI use cases. Digital purchasing trends, omnichannel consistency, and real-time pricing remain core drivers for enterprises seeking faster, more consistent conversion. Geography remained balanced, with revenue roughly split across the United States (35%; +11% YoY), Europe (31%; +11% YoY), and the rest of the world (34%; +10% YoY). These dynamics suggest steady multi-vertical demand for price optimization and intelligent commerce capabilities.
Services Growth Signals Implementation Strength
Beyond the core subscription metrics, PROS demonstrated notable strength in its professional services division, which is critical for successful platform implementation and long-term customer adoption. Services revenue grew 11% YoY to $13.6 million. Management attributed this increase primarily to the result of higher billable utilization of its professional services organization. This suggests that as PROS sells more complex, AI-powered platform subscriptions, it is also successfully managing and monetizing the implementation and consulting work required. Driving higher utilization from its professional services team shows strong resource management and an ability to meet customer deployment needs, which is a critical forerunner to long-term customer success.
Final Thoughts: A Strong Handoff to Thoma Bravo
PROS suspended its financial guidance and did not host an earnings call, citing the pending $1.4 billion all-cash acquisition by Thoma Bravo. This Q3 report, therefore, acts as the final public data point, and it is a strong one. The company is delivering on its strategic plan, citing rapid market interest in generative AI and digital purchasing as key demand drivers it is successfully capturing. While macro and transaction-related uncertainty remain, RPO levels and retention provide near-term revenue visibility. The move to a private structure will likely remove the short-term pressures of quarterly reporting and allow management to accelerate investment in its AI platform to capitalize on these long-term trends.
See the full press release on PROS’s Q3 FY 2025 financial results on the company website.
Declaration of generative AI and AI-assisted technologies in the writing process: This content has been generated with the support of artificial intelligence technologies. Due to the fast pace of content creation and the continuous evolution of data and information, The Futurum Group and its analysts strive to ensure the accuracy and factual integrity of the information presented. However, the opinions and interpretations expressed in this content reflect those of the individual author/analyst. The Futurum Group makes no guarantees regarding the completeness, accuracy, or reliability of any information contained herein. Readers are encouraged to verify facts independently and consult relevant sources for further clarification.
Disclosure: Futurum is a research and advisory firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this article. The author does not hold any equity positions with any company mentioned in this article.
Analysis and opinions expressed herein are specific to the analyst individually and data and other information that might have been provided for validation, not those of Futurum as a whole.
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