12:20 PM EDT, 07/25/2024 (MT Newswires) -- Pegasystems ( PEGA ) Q2 beat consensus marked by the success in cloud service with artificial intelligence, helping businesses become autonomous, Wedbush Securities said in a note Thursday.

Analysts, including Daniel Ives, noted that Pega Cloud's annual contract value reached $593.8 million, surpassing the Street's estimate of $585.8 million. Pega Cloud attracted more clients this quarter, which incorporates generative AI into customer data.

"Pega Cloud backlog has surpassed $1 billion for the first time ever as the company continues to increase value with existing customers while Pega's model is stabilizing leading to more recurring revenue and higher gross margins driven by Pega Cloud," the analysts said.

The company continues to focus on Blueprint, a tool that helps businesses automate application design using AI. Pegasystems ( PEGA ) expects the first applications using Blueprint to start next quarter, with "significant" demand already lined up.

Wedbush maintained outperform rating with a price target of $90. Shares rose 12% in recent trading.

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