Pegasystems (PEGA) 10-Q 26 Oct 22 2022 Q3 Quarterly report Financial data

COVER PAGE

COVER PAGE - shares	9 Months Ended
	Sep. 30, 2022	Oct. 19, 2022
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2022
Document Transition Report	false
Entity File Number	1-11859
Entity Registrant Name	PEGASYSTEMS INC.
Entity Incorporation, State or Country Code	MA
Entity Tax Identification Number	04-2787865
Entity Address, Address Line One	One Main Street
Entity Address, City or Town	Cambridge
Entity Address, State or Province	MA
Entity Address, Postal Zip Code	02142
City Area Code	617
Local Phone Number	374-9600
Title of 12(b) Security	Common Stock, $.01 par value per share
Trading Symbol	PEGA
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		82,190,957
Amendment Flag	false
Entity Central Index Key	0001013857
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q3
Current Fiscal Year End Date	--12-31

UNAUDITED CONDENSED CONSOLIDATE

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Current assets:
Cash and cash equivalents	$ 107,626	$ 159,965
Marketable securities	168,085	202,814
Total cash, cash equivalents, and marketable securities	275,711	362,779
Accounts receivable	139,670	182,717
Unbilled receivables	182,403	226,714
Other current assets	62,457	68,008
Total current assets	660,241	840,218
Unbilled receivables	108,285	129,789
Goodwill	81,201	81,923
Other long-term assets	316,731	541,601
Total assets	1,166,458	1,593,531
Current liabilities:
Accounts payable	13,562	15,281
Accrued expenses	61,012	63,890
Accrued compensation and related expenses	85,999	120,946
Deferred revenue	245,146	275,844
Other current liabilities	8,253	9,443
Total current liabilities	413,972	485,404
Convertible senior notes, net	592,884	590,722
Operating lease liabilities	82,705	87,818
Other long-term liabilities	11,936	13,499
Total liabilities	1,101,497	1,177,443
Commitments and contingencies (Note 14)
Stockholders’ equity:
Preferred stock, 1,000 shares authorized; none issued	0	0
Common stock, 200,000 shares authorized; 82,164 and 81,712 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively	822	817
Additional paid-in capital	204,189	145,810
(Accumulated deficit) retained earnings	(111,126)	276,449
Accumulated other comprehensive (loss)	(28,924)	(6,988)
Total stockholders’ equity	64,961	416,088
Total liabilities and stockholders’ equity	$ 1,166,458	$ 1,593,531

UNAUDITED CONDENSED CONSOLIDA_2

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - shares shares in Thousands	Sep. 30, 2022	Dec. 31, 2021
Stockholders’ equity:
Preferred stock, shares authorized (in shares)	1,000	1,000
Preferred stock, shares issued (in shares)	0	0
Common stock, shares authorized (in shares)	200,000	200,000
Common stock, shares issued (in shares)	82,164	81,712
Common stock, shares outstanding (in shares)	82,164	81,712

UNAUDITED CONDENSED CONSOLIDA_3

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Revenue
Total revenue	$ 270,731	$ 256,268	$ 921,375	$ 895,469
Cost of revenue
Total cost of revenue	93,050	84,222	276,362	251,200
Gross profit	177,681	172,046	645,013	644,269
Operating expenses
Selling and marketing	153,517	152,479	472,951	457,641
Research and development	75,342	64,728	221,173	191,565
General and administrative	26,043	20,176	94,530	57,607
Total operating expenses	254,902	237,383	788,654	706,813
(Loss) from operations	(77,221)	(65,337)	(143,641)	(62,544)
Foreign currency transaction gain (loss)	3,826	518	8,415	(4,983)
Interest income	520	166	1,036	555
Interest expense	(1,992)	(1,908)	(5,882)	(5,747)
(Loss) on capped call transactions	(6,876)	(14,735)	(56,381)	(7,543)
Other (loss) income, net	(29)	2	6,497	108
(Loss) before provision for (benefit from) income taxes	(81,772)	(81,294)	(189,956)	(80,154)
Provision for (benefit from) income taxes	11,748	(24,826)	190,239	(54,360)
Net (loss)	$ (93,520)	$ (56,468)	$ (380,195)	$ (25,794)
(Loss) per share
Basic (in dollars per share)	$ (1.14)	$ (0.69)	$ (4.65)	$ (0.32)
Diluted (in dollars per share)	$ (1.14)	$ (0.69)	$ (4.65)	$ (0.32)
Weighted-average number of common shares outstanding
Basic (in shares)	81,996	81,526	81,842	81,284
Diluted (in shares)	81,996	81,526	81,842	81,284
Subscription services
Revenue
Total revenue	$ 174,885	$ 161,557	$ 516,750	$ 457,051
Cost of revenue
Total cost of revenue	34,541	30,817	103,104	88,206
Subscription license
Revenue
Total revenue	31,112	35,421	210,245	251,226
Cost of revenue
Total cost of revenue	628	606	1,923	1,811
Perpetual license
Revenue
Total revenue	9,223	2,874	18,929	20,922
Cost of revenue
Total cost of revenue	103	50	173	151
Consulting
Revenue
Total revenue	55,511	56,416	175,451	166,270
Cost of revenue
Total cost of revenue	$ 57,778	$ 52,749	$ 171,162	$ 161,032

UNAUDITED CONDENSED CONSOLIDA_4

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Statement of Comprehensive Income [Abstract]
Net (loss)	$ (93,520)	$ (56,468)	$ (380,195)	$ (25,794)
Other comprehensive (loss), net of tax
Unrealized (loss) gain on available-for-sale securities	(73)	53	(1,000)	1,184
Foreign currency translation adjustments	(6,700)	(4,400)	(20,936)	(3,669)
Total other comprehensive (loss), net of tax	(6,773)	(4,347)	(21,936)	(2,485)
Comprehensive (loss)	$ (100,293)	$ (60,815)	$ (402,131)	$ (28,279)

UNAUDITED CONDENSED CONSOLIDA_5

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands	Total	Cumulative Effect, Period of Adoption, Adjustment	Common Stock	Additional Paid-In Capital	Additional Paid-In Capital Cumulative Effect, Period of Adoption, Adjustment	Retained Earnings (Accumulated Deficit)	Retained Earnings (Accumulated Deficit) Cumulative Effect, Period of Adoption, Adjustment	Accumulated Other Comprehensive (Loss)
Balance, beginning of period (in shares) at Dec. 31, 2020			80,890
Balance, beginning of period at Dec. 31, 2020	$ 542,172	$ (52,205)	$ 809	$ 204,432	$ (61,604)	$ 339,879	$ 9,399	$ (2,948)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Repurchase of common stock (in shares)			(70)
Repurchase of common stock	(9,146)		$ (1)	(9,145)
Issuance of common stock for share-based compensation plans (in shares)			402
Issuance of common stock for stock compensation plans	(25,509)		$ 4	(25,513)
Issuance of common stock under the employee stock purchase plan (in shares)			24
Issuance of common stock under the employee stock purchase plan	2,288			2,288
Stock-based compensation	30,100			30,100
Cash dividends declared ($0.03 per share)	(2,438)					(2,438)
Other comprehensive income (loss)	280							280
Net income (loss)	(6,617)					(6,617)
Balance, end of period (in shares) at Mar. 31, 2021			81,246
Balance, end of period at Mar. 31, 2021	478,925		$ 812	140,558		340,223		(2,668)
Balance, beginning of period (in shares) at Dec. 31, 2020			80,890
Balance, beginning of period at Dec. 31, 2020	542,172	$ (52,205)	$ 809	204,432	$ (61,604)	339,879	$ 9,399	(2,948)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Other comprehensive income (loss)	(2,485)
Net income (loss)	(25,794)
Balance, end of period (in shares) at Sep. 30, 2021			81,670
Balance, end of period at Sep. 30, 2021	459,632		$ 817	148,098		316,150		(5,433)
Balance, beginning of period (in shares) at Mar. 31, 2021			81,246
Balance, beginning of period at Mar. 31, 2021	478,925		$ 812	140,558		340,223		(2,668)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Repurchase of common stock (in shares)			(81)
Repurchase of common stock	(10,246)		$ (1)	(10,245)
Issuance of common stock for share-based compensation plans (in shares)			267
Issuance of common stock for stock compensation plans	(16,196)		$ 3	(16,199)
Issuance of common stock under the employee stock purchase plan (in shares)			24
Issuance of common stock under the employee stock purchase plan	2,859		$ 1	2,858
Stock-based compensation	30,698			30,698
Cash dividends declared ($0.03 per share)	(2,445)					(2,445)
Other comprehensive income (loss)	1,582							1,582
Net income (loss)	37,291					37,291
Balance, end of period (in shares) at Jun. 30, 2021			81,456
Balance, end of period at Jun. 30, 2021	522,468		$ 815	147,670		375,069		(1,086)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Repurchase of common stock (in shares)			(96)
Repurchase of common stock	(12,796)		$ (1)	(12,795)
Issuance of common stock for share-based compensation plans (in shares)			286
Issuance of common stock for stock compensation plans	(18,114)		$ 3	(18,117)
Issuance of common stock under the employee stock purchase plan (in shares)			24
Issuance of common stock under the employee stock purchase plan	2,639			2,639
Stock-based compensation	28,701			28,701
Cash dividends declared ($0.03 per share)	(2,451)					(2,451)
Other comprehensive income (loss)	(4,347)							(4,347)
Net income (loss)	(56,468)					(56,468)
Balance, end of period (in shares) at Sep. 30, 2021			81,670
Balance, end of period at Sep. 30, 2021	$ 459,632		$ 817	148,098		316,150		(5,433)
Balance, beginning of period (in shares) at Dec. 31, 2021	81,712		81,712
Balance, beginning of period at Dec. 31, 2021	$ 416,088		$ 817	145,810		276,449		(6,988)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Repurchase of common stock (in shares)			(242)
Repurchase of common stock	(22,583)		$ (2)	(22,581)
Issuance of common stock for share-based compensation plans (in shares)			297
Issuance of common stock for stock compensation plans	(12,128)		$ 3	(12,131)
Issuance of common stock under the employee stock purchase plan (in shares)			35
Issuance of common stock under the employee stock purchase plan	2,446			2,446
Stock-based compensation	28,227			28,227
Cash dividends declared ($0.03 per share)	(2,455)					(2,455)
Other comprehensive income (loss)	(2,548)							(2,548)
Net income (loss)	(379)					(379)
Balance, end of period (in shares) at Mar. 31, 2022			81,802
Balance, end of period at Mar. 31, 2022	$ 406,668		$ 818	141,771		273,615		(9,536)
Balance, beginning of period (in shares) at Dec. 31, 2021	81,712		81,712
Balance, beginning of period at Dec. 31, 2021	$ 416,088		$ 817	145,810		276,449		(6,988)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Other comprehensive income (loss)	(21,936)
Net income (loss)	$ (380,195)
Balance, end of period (in shares) at Sep. 30, 2022	82,164		82,164
Balance, end of period at Sep. 30, 2022	$ 64,961		$ 822	204,189		(111,126)		(28,924)
Balance, beginning of period (in shares) at Mar. 31, 2022			81,802
Balance, beginning of period at Mar. 31, 2022	406,668		$ 818	141,771		273,615		(9,536)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Repurchase of common stock (in shares)			(38)
Repurchase of common stock	(1,925)			(1,925)
Issuance of common stock for share-based compensation plans (in shares)			117
Issuance of common stock for stock compensation plans	(3,251)		$ 1	(3,252)
Issuance of common stock under the employee stock purchase plan (in shares)			59
Issuance of common stock under the employee stock purchase plan	2,357			2,357
Stock-based compensation	31,300			31,300
Cash dividends declared ($0.03 per share)	(2,459)					(2,459)
Other comprehensive income (loss)	(12,615)							(12,615)
Net income (loss)	(286,296)					(286,296)
Balance, end of period (in shares) at Jun. 30, 2022			81,940
Balance, end of period at Jun. 30, 2022	133,779		$ 819	170,251		(15,140)		(22,151)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock for share-based compensation plans (in shares)			138
Issuance of common stock for stock compensation plans	(2,196)		$ 2	(2,198)
Issuance of common stock under the employee stock purchase plan (in shares)			86
Issuance of common stock under the employee stock purchase plan	2,363		$ 1	2,362
Stock-based compensation	33,774			33,774
Cash dividends declared ($0.03 per share)	(2,466)					(2,466)
Other comprehensive income (loss)	(6,773)							(6,773)
Net income (loss)	$ (93,520)					(93,520)
Balance, end of period (in shares) at Sep. 30, 2022	82,164		82,164
Balance, end of period at Sep. 30, 2022	$ 64,961		$ 822	$ 204,189		$ (111,126)		$ (28,924)

UNAUDITED CONDENSED CONSOLIDA_6

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) - $ / shares	3 Months Ended
	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022	Sep. 30, 2021	Jun. 30, 2021	Mar. 31, 2021
Statement of Stockholders' Equity [Abstract]
Cash dividend declared (in dollars per share)	$ 0.03	$ 0.03	$ 0.03	$ 0.03	$ 0.03	$ 0.03

UNAUDITED CONDENSED CONSOLIDA_7

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Operating activities
Net (loss)	$ (93,520)	$ (56,468)	$ (380,195)	$ (25,794)
Adjustments to reconcile net (loss) to cash (used in) operating activities
Stock-based compensation	33,774	28,695	93,301	89,483
Deferred income taxes			169,489	(53,638)
Loss on capped call transactions	6,876	14,735	56,381	7,543
Amortization of deferred commissions	11,597	10,186	39,752	31,388
Lease expense			11,500	9,274
Amortization of intangible assets and depreciation			12,381	24,030
Foreign currency transaction (gain) loss	(3,826)	(518)	(8,415)	4,983
Other non-cash			(1,705)	5,246
Change in operating assets and liabilities, net			(5,935)	(97,836)
Cash (used in) operating activities			(13,446)	(5,321)
Investing activities
Purchases of investments			(39,056)	(67,170)
Proceeds from maturities and called investments			53,952	96,859
Sales of investments			18,415	25,123
Payments for acquisitions, net of cash acquired			(922)	(4,993)
Investment in property and equipment			(22,285)	(7,089)
Cash provided by investing activities			10,104	42,730
Financing activities
Proceeds from employee stock purchase plan			7,166	7,786
Dividend payments to stockholders			(7,368)	(7,310)
Common stock repurchases			(43,282)	(91,907)
Cash (used in) financing activities			(43,484)	(91,431)
Effect of exchange rate changes on cash and cash equivalents			(5,513)	(1,466)
Net (decrease) in cash and cash equivalents			(52,339)	(55,488)
Cash and cash equivalents, beginning of period			159,965	171,899
Cash and cash equivalents, end of period	$ 107,626	$ 116,411	$ 107,626	$ 116,411

BASIS OF PRESENTATION

BASIS OF PRESENTATION	9 Months Ended
	Sep. 30, 2022
Accounting Policies [Abstract]
BASIS OF PRESENTATION	NOTE 1. BASIS OF PRESENTATION Pegasystems Inc. (together with its subsidiaries, “the Company”) has prepared the accompanying unaudited condensed consolidated financial statements pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Accordingly, they do not include all the information required by accounting principles generally accepted in the United States of America (“U.S.”) for complete financial statements and should be read in conjunction with the Company’s audited financial statements included in the Annual Report on Form 10-K for the year ended December 31, 2021. In the opinion of management, the Company has prepared the accompanying unaudited condensed consolidated financial statements on the same basis as its audited financial statements, and these financial statements include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results of the interim periods presented. All intercompany transactions and balances were eliminated in consolidation. The operating results for the interim periods presented do not necessarily indicate the expected results for the full year 2022. Certain prior period amounts reported in our condensed consolidated financial statements and notes thereto have been reclassified to conform to the current year’s presentation. Such reclassifications did not affect total revenues, operating income, or net income.

MARKETABLE SECURITIES

MARKETABLE SECURITIES	9 Months Ended
	Sep. 30, 2022
Investments, Debt and Equity Securities [Abstract]
MARKETABLE SECURITIES	NOTE 2. MARKETABLE SECURITIES September 30, 2022 December 31, 2021 (in thousands) Amortized Cost Unrealized Gains Unrealized Losses Fair Value Amortized Cost Unrealized Gains Unrealized Losses Fair Value Government debt $ 2,992 $ — $ (67) $ 2,925 $ 2,000 $ — $ (10) $ 1,990 Corporate debt 168,894 — (3,734) 165,160 201,659 2 (837) 200,824 $ 171,886 $ — $ (3,801) $ 168,085 $ 203,659 $ 2 $ (847) $ 202,814 As of September 30, 2022, marketable securities’ maturities ranged from November 2022 to November 2024, with a weighted-average remaining maturity of 0.7 years.

RECEIVABLES, CONTRACT ASSETS, A

RECEIVABLES, CONTRACT ASSETS, AND DEFERRED REVENUE	9 Months Ended
	Sep. 30, 2022
Receivables [Abstract]
RECEIVABLES, CONTRACT ASSETS, AND DEFERRED REVENUE	NOTE 3. RECEIVABLES, CONTRACT ASSETS, AND DEFERRED REVENUE Receivables (in thousands) September 30, 2022 December 31, 2021 Accounts receivable $ 139,670 $ 182,717 Unbilled receivables 182,403 226,714 Long-term unbilled receivables 108,285 129,789 $ 430,358 $ 539,220 Unbilled receivables Unbilled receivables are client-committed amounts for which revenue recognition precedes billing, and billing is solely subject to the passage of time. Unbilled receivables by expected billing date: (Dollars in thousands) September 30, 2022 1 year or less $ 182,403 63 % 1-2 years 78,893 27 % 2-5 years 29,392 10 % $ 290,688 100 % Unbilled receivables by contract effective date: (Dollars in thousands) September 30, 2022 2022 $ 87,874 30 % 2021 130,196 45 % 2020 45,589 16 % 2019 15,747 5 % 2018 and prior 11,282 4 % $ 290,688 100 % Major clients Clients accounting for 10% or more of the Company’s total receivables: September 30, 2022 December 31, 2021 Client A Accounts receivable * 1 % Unbilled receivables * 15 % Total receivables * 10 % * Client accounted for less than 10% of receivables. Contract assets Contract assets are client-committed amounts for which revenue recognized exceeds the amount billed to the client, and billing is subject to conditions other than the passage of time, such as the completion of a related performance obligation. (in thousands) September 30, 2022 December 31, 2021 Contract assets (1) $ 12,429 $ 12,530 Long-term contract assets (2) 10,541 10,643 $ 22,970 $ 23,173 (1) Included in other current assets. (2) Included in other long-term assets. Deferred revenue Deferred revenue consists of billings and payments received in advance of revenue recognition. (in thousands) September 30, 2022 December 31, 2021 Deferred revenue $ 245,146 $ 275,844 Long-term deferred revenue (1) 3,949 5,655 $ 249,095 $ 281,499 (1) Included in other long-term liabilities. The change in deferred revenue in the nine months ended September 30, 2022 was primarily due to new billings in advance of revenue recognition offset by $252.8 million of revenue recognized during the period that was included in deferred revenue as of December 31, 2021.

DEFERRED COMMISSIONS

DEFERRED COMMISSIONS	9 Months Ended
	Sep. 30, 2022
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
DEFERRED COMMISSIONS	NOTE 4. DEFERRED COMMISSIONS (in thousands) September 30, 2022 December 31, 2021 Deferred commissions (1) $ 122,673 $ 135,911 (1) Included in other long-term assets. Three Months Ended Nine Months Ended (in thousands) 2022 2021 2022 2021 Amortization of deferred commissions (1) $ 11,597 $ 10,186 $ 39,752 $ 31,388 (1) Included in selling and marketing expense.

GOODWILL AND OTHER INTANGIBLES

GOODWILL AND OTHER INTANGIBLES	9 Months Ended
	Sep. 30, 2022
Goodwill and Intangible Assets Disclosure [Abstract]
GOODWILL AND OTHER INTANGIBLES	NOTE 5. GOODWILL AND OTHER INTANGIBLES Goodwill Change in goodwill: Nine Months Ended (in thousands) 2022 2021 January 1, $ 81,923 $ 79,231 Acquisition — 2,701 Currency translation adjustments (722) 22 September 30, $ 81,201 $ 81,954 Intangibles Intangible assets are recorded at cost and amortized using the straight-line method over their estimated useful lives. September 30, 2022 (in thousands) Useful Lives Cost Accumulated Amortization Net Book Value (1) Client-related 4-10 years $ 63,007 $ (58,211) $ 4,796 Technology 2-10 years 68,038 (60,913) 7,125 Other 1-5 years 5,361 (5,361) — $ 136,406 $ (124,485) $ 11,921 (1) Included in other long-term assets. December 31, 2021 (in thousands) Useful Lives Cost Accumulated Amortization Net Book Value (1) Client-related 4-10 years $ 63,165 $ (57,342) $ 5,823 Technology 2-10 years 67,142 (58,902) 8,240 Other 1-5 years 5,361 (5,361) — $ 135,668 $ (121,605) $ 14,063 (1) Included in other long-term assets. Amortization of intangible assets: Three Months Ended Nine Months Ended (in thousands) 2022 2021 2022 2021 Cost of revenue $ 705 $ 629 $ 2,017 $ 1,887 Selling and marketing 343 373 1,028 1,119 $ 1,048 $ 1,002 $ 3,045 $ 3,006 Future estimated intangibles assets amortization: (in thousands) September 30, 2022 Remainder of 2022 $ 1,048 2023 3,917 2024 3,147 2025 2,608 2026 874 2027 327 $ 11,921

OTHER ASSETS AND LIABILITIES

OTHER ASSETS AND LIABILITIES	9 Months Ended
	Sep. 30, 2022
Other Assets and Liabilities [Abstract]
OTHER ASSETS AND LIABILITIES	NOTE 6. OTHER ASSETS AND LIABILITIES Other current assets (in thousands) September 30, 2022 December 31, 2021 Income tax receivables $ 11,948 $ 25,691 Contract assets 12,429 12,530 Other 38,080 29,787 $ 62,457 $ 68,008 Other long-term assets (in thousands) September 30, 2022 December 31, 2021 Deferred income taxes $ 6,041 $ 180,656 Deferred commissions 122,673 135,911 Right of use assets 80,163 87,521 Capped call transactions 3,583 59,964 Property and equipment 45,350 26,837 Venture investments 11,910 7,648 Intangible assets 11,921 14,063 Contract assets 10,541 10,643 Other 24,549 18,358 $ 316,731 $ 541,601 Other current liabilities (in thousands) September 30, 2022 December 31, 2021 Operating lease liabilities $ 5,787 $ 6,989 Dividends payable 2,466 2,454 $ 8,253 $ 9,443 Other long-term liabilities (in thousands) September 30, 2022 December 31, 2021 Deferred revenue $ 3,949 $ 5,655 Other 7,987 7,844 $ 11,936 $ 13,499

LEASES

LEASES	9 Months Ended
	Sep. 30, 2022
Leases [Abstract]
LEASES	NOTE 7. LEASES Corporate headquarters In February 2021, the Company agreed to accelerate its exit from its previous corporate headquarters to October 1, 2021, in exchange for a one-time payment from its landlord of $18 million, which was amortized over the remaining lease term. The exit accelerated depreciation on the related leasehold improvements and reduced the Company’s future lease liabilities by $21.1 million and right of use assets by $20.3 million. On March 31, 2021, the Company leased office space at One Main Street, Cambridge, Massachusetts, to serve as its corporate headquarters. The 4.5 year lease includes a base rent of $2 million per year. New Waltham office On July 6, 2021, the Company entered into an office space lease for 131 thousand square feet in Waltham, Massachusetts. The lease term of 11 years began on August 1, 2021. The annual rent equals the base rent plus a portion of building operating costs and real estate taxes. Rent first became payable on August 1, 2022. Base rent for the first year is approximately $6 million and will increase by 3% annually. In addition, the Company will receive an improvement allowance from the landlord of up to $11.8 million. This lease increased the Company’s lease liabilities and lease-related right of use assets by $42.1 million on August 1, 2021. Expense Three Months Ended Nine Months Ended (in thousands) 2022 2021 2022 2021 Fixed lease costs (1) $ 4,688 $ (3,108) $ 14,747 $ (6,780) Short-term lease costs 916 542 2,510 1,516 Variable lease costs 905 1,099 2,395 3,826 $ 6,509 $ (1,467) $ 19,652 $ (1,438) (1) The lower fixed lease costs in the nine months ended September 30, 2021 was due to the modification of the corporate headquarters lease. Right of use assets and lease liabilities (in thousands) September 30, 2022 December 31, 2021 Right of use assets (1) $ 80,163 $ 87,521 Operating lease liabilities (2) $ 5,787 $ 6,989 Long-term operating lease liabilities $ 82,705 $ 87,818 (1) Represents the Company’s right to use the leased asset during the lease term. Included in other long-term assets. (2) Included in other current liabilities. Weighted-average remaining lease term and discount rate for the Company’s leases were: September 30, 2022 December 31, 2021 Weighted-average remaining lease term 7.4 years 7.7 years Weighted-average discount rate (1) 4.2 % 4.4 % (1) The rates implicit in most of the Company’s leases are not readily determinable. Therefore, the Company uses its incremental borrowing rate as the discount rate when measuring operating lease liabilities. The incremental borrowing rate represents an estimate of the interest rate the Company would incur to borrow an amount equal to the lease payments on a collateralized basis over the lease term in a similar economic environment. Maturities of lease liabilities: (in thousands) September 30, 2022 Remainder of 2022 $ (4,717) 2023 18,804 2024 16,841 2025 14,778 2026 11,257 2027 and thereafter 48,397 Total lease payments 105,360 Less: imputed interest (1) (16,868) $ 88,492 (1) Lease liabilities are measured at the present value of the remaining lease payments using a discount rate determined at lease commencement unless the discount rate is updated due to a lease reassessment event. Cash flow information Nine Months Ended (in thousands) 2022 2021 Cash paid for leases $ 11,628 $ 14,403 Right of use assets recognized for new leases and amendments (non-cash) $ 6,618 $ 54,716

DEBT

DEBT	9 Months Ended
	Sep. 30, 2022
Debt Disclosure [Abstract]
DEBT	NOTE 8. DEBT Convertible senior notes and capped calls Convertible senior notes In February 2020, the Company issued Convertible Senior Notes (the "Notes") with an aggregate principal of $600 million, due March 1, 2025, in a private placement. No principal payments are due before maturity. The Notes accrue interest at an annual rate of 0.75%, payable semi-annually in arrears on March 1 and September 1, beginning on September 1, 2020. Conversion rights The conversion rate is 7.4045 shares of common stock per $1,000 principal amount of the Notes, representing an initial conversion price of $135.05 per share of common stock. The Company will settle conversions by paying or delivering cash, shares of its common stock, or a combination of cash and shares of its common stock, at the Company’s election, based on the applicable conversion rate. The conversion rate will be adjusted upon certain events, including spin-offs, tender offers, exchange offers, and certain stockholder distributions. Beginning on September 1, 2024, noteholders may convert their Notes at any time at their election. Before September 1, 2024, noteholders may convert their Notes in the following circumstances: • During any calendar quarter beginning after June 30, 2020 (and only during such calendar quarter), if the last reported sale price per share of the Company’s common stock exceeds 130% of the conversion price for each of at least 20 trading days (whether or not consecutive) during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter. • During the five consecutive business days immediately after any five consecutive trading day period (the “Measurement Period”), if the trading price per $1,000 principal amount of Notes for each trading day of the Measurement Period was less than 98% of the product of the last reported sale price per share of common stock on such trading day and the conversion rate on such trading day. • Upon certain corporate events or distributions or if the Company calls any Notes for redemption, noteholders may convert before the close of business on the business day immediately before the related redemption date (or, if the Company fails to pay the redemption price in full on the redemption date, until the Company pays the redemption price). As of September 30, 2022, the Notes were not eligible for conversion. Repurchase rights On or after March 1, 2023 and on or before the 40th scheduled trading day immediately before the maturity date, the Company may redeem for cash all or part of the Notes at a repurchase price equal to 100% of the principal amount, plus accrued and unpaid interest, if the last reported sale price of the Company’s common stock exceeded 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company provides a redemption notice. If certain corporate events that constitute a “Fundamental Change” occur, each noteholder will have the right to require the Company to repurchase for cash all of such noteholder’s Notes, or any portion of the principal thereof that is equal to $1,000 or a multiple of $1,000, at a repurchase price equal to 100% of the principal amount thereof, plus accrued and unpaid interest. A Fundamental Change relates to mergers, changes in control of the Company, liquidation/dissolution of the Company, or the delisting of the Company’s common stock. Carrying value of the Notes: (in thousands) September 30, 2022 December 31, 2021 Principal $ 600,000 $ 600,000 Unamortized issuance costs (7,116) (9,278) Convertible senior notes, net $ 592,884 $ 590,722 Interest expense related to the Notes: Three Months Ended Nine Months Ended (in thousands) 2022 2021 2022 2021 Contractual interest expense (0.75% coupon) $ 1,125 $ 1,125 $ 3,375 $ 3,375 Amortization of issuance costs 724 677 2,163 2,025 $ 1,849 $ 1,802 $ 5,538 $ 5,400 The effective interest rate for the Notes: Nine Months Ended 2022 2021 Weighted-average effective interest rate 1.2 % 1.2 % Future payments of principal and contractual interest: September 30, 2022 (in thousands) Principal Interest Total 2023 $ — $ 4,500 $ 4,500 2024 — 4,500 4,500 2025 600,000 2,250 602,250 $ 600,000 $ 11,250 $ 611,250 Capped call transactions In February 2020, the Company entered into privately negotiated capped call transactions (the “Capped Call Transactions”) with certain financial institutions. The Capped Call Transactions cover approximately 4.4 million shares (representing the number of shares for which the Notes are initially convertible) of the Company’s common stock. The Capped Call Transactions are expected to reduce common stock dilution and/or offset any potential cash payments the Company must make, other than for principal and interest, upon conversion of the Notes, with such reduction and/or offset subject to a cap of $196.44. The cap price of the Capped Call Transactions is subject to adjustment upon specified extraordinary events affecting the Company, including mergers and tender offers. The Capped Call Transactions are accounted for as derivative instruments and do not qualify for the Company’s own equity scope exception in ASC 815 since, in some cases of early settlement, the settlement value of the Capped Call Transactions, calculated following the governing documents, may not represent a fair value measurement. The Capped Call Transactions are classified as other long-term assets and remeasured to fair value each reporting period, resulting in a non-operating gain or loss. Change in capped call transactions: Nine Months Ended (in thousands) 2022 2021 January 1, $ 59,964 $ 83,597 Fair value adjustment (56,381) (7,543) September 30, $ 3,583 $ 76,054 Credit facility In November 2019, and as since amended, the Company entered into a five-year $100 million senior secured revolving credit agreement (the “Credit Facility”) with PNC Bank, National Association. The Company may use borrowings for general corporate purposes and to finance working capital needs. Subject to specific conditions, the Credit Facility allows the Company to increase the aggregate commitment to $200 million. The commitments expire on November 4, 2024, and any outstanding loans will be payable on such date. The Credit Facility, as amended, contains customary covenants, including, but not limited to, those relating to additional indebtedness, liens, asset divestitures, and affiliate transactions. The Company is required to comply with financial covenants, including: • Beginning with the fiscal quarter ended March 31, 2022 and ending with the fiscal quarter ended December 31, 2022, Pegasystems Inc. must maintain at least $200 million in cash, investments, and availability under the Revolving Credit Loan. • Beginning with the fiscal quarter ended March 31, 2023, a maximum net consolidated leverage ratio of 3.5 to 1.0 (with a step-up for certain acquisitions) and a minimum consolidated interest coverage ratio of 3.5 to 1.0. As of September 30, 2022 and December 31, 2021, the Company had no outstanding cash borrowings under the Credit Facility. As of September 30, 2022, the Company had $27.3 million in outstanding letters of credit which reduce the available borrowing capacity under the Credit Facility.

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS	9 Months Ended
	Sep. 30, 2022
Fair Value Disclosures [Abstract]
FAIR VALUE MEASUREMENTS	NOTE 9. FAIR VALUE MEASUREMENTS Assets and liabilities measured at fair value on a recurring basis The Company records its cash equivalents, marketable securities, Capped Call Transactions, and venture investments at fair value on a recurring basis. Fair value is an exit price, representing the amount that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants based on assumptions that market participants would use in pricing an asset or liability. As a basis for classifying the fair value measurements, a three-tier fair value hierarchy, which classifies the fair value measurements based on the inputs used in measuring fair value, was established as follows: • Level 1 - observable inputs, such as quoted prices in active markets for identical assets or liabilities; • Level 2 - significant other inputs that are observable either directly or indirectly; and • Level 3 - significant unobservable inputs on which there is little or no market data, which require the Company to develop its own assumptions. This hierarchy requires the Company to use observable market data, when available, and minimize unobservable inputs when determining fair value. The fair value of the Capped Call Transactions at the end of each reporting period is determined using a Black-Scholes option-pricing model. The valuation model uses various market-based inputs, including stock price, remaining contractual term, expected volatility, risk-free interest rate, and expected dividend yield. The Company applies judgment when determining expected volatility. The Company considers both historical and implied volatility levels of the underlying equity security. The Company’s venture investments are recorded at fair value based on multiple valuation methods, including observable public companies and transaction prices and unobservable inputs, including the volatility, rights, and obligations of the securities the Company holds. Assets and liabilities measured at fair value on a recurring basis: September 30, 2022 December 31, 2021 (in thousands) Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Cash equivalents $ 20,899 $ — $ — $ 20,899 $ 3,216 $ — $ — $ 3,216 Marketable securities $ — $ 168,085 $ — $ 168,085 $ — $ 202,814 $ — $ 202,814 Capped Call Transactions (1) $ — $ 3,583 $ — $ 3,583 $ — $ 59,964 $ — $ 59,964 Venture investments (1) (2) $ — $ — $ 11,910 $ 11,910 $ — $ — $ 7,648 $ 7,648 (1) Included in other long-term assets. (2) Investments in privately-held companies. Changes in venture investments: Nine Months Ended (in thousands) 2022 2021 January 1, $ 7,648 $ 8,345 New investments 400 500 Sales of investments (3,954) (400) Changes in foreign exchange rates (675) (52) Changes in fair value: included in other income 5,989 100 included in other comprehensive income 2,502 1,220 September 30, $ 11,910 $ 9,713 The carrying value of certain other financial instruments, including receivables and accounts payable, approximates fair value due to these items’ short maturities. Fair value of the Notes The Notes’ fair value (including the conversion feature embedded in the Notes) was $488.3 million as of September 30, 2022 and $642.0 million as of December 31, 2021. The fair value was determined based on the Notes’ quoted price in an over-the-counter market on the last trading day of the reporting period and classified within Level 2 in the fair value hierarchy.

REVENUE

REVENUE	9 Months Ended
	Sep. 30, 2022
Revenue from Contract with Customer [Abstract]
REVENUE	NOTE 10. REVENUE Geographic revenue Three Months Ended Nine Months Ended (Dollars in thousands) 2022 2021 2022 2021 U.S. $ 148,200 55 % $ 132,016 52 % $ 513,197 56 % $ 515,881 58 % Other Americas 18,546 7 % 17,510 7 % 80,558 9 % 43,469 5 % United Kingdom (“U.K.”) 24,074 9 % 25,982 10 % 83,837 9 % 86,747 10 % Europe (excluding U.K.), Middle East, and Africa 46,212 17 % 46,306 18 % 140,586 15 % 143,763 15 % Asia-Pacific 33,699 12 % 34,454 13 % 103,197 11 % 105,609 12 % $ 270,731 100 % $ 256,268 100 % $ 921,375 100 % $ 895,469 100 % Revenue streams Three Months Ended Nine Months Ended (in thousands) 2022 2021 2022 2021 Perpetual license $ 9,223 $ 2,874 $ 18,929 $ 20,922 Subscription license 31,112 35,421 210,245 251,226 Revenue recognized at a point in time 40,335 38,295 229,174 272,148 Maintenance 77,526 83,188 235,568 237,531 Pega Cloud 97,359 78,369 281,182 219,520 Consulting 55,511 56,416 175,451 166,270 Revenue recognized over time 230,396 217,973 692,201 623,321 Total revenue $ 270,731 $ 256,268 $ 921,375 $ 895,469 Three Months Ended Nine Months Ended (in thousands) 2022 2021 2022 2021 Pega Cloud $ 97,359 $ 78,369 $ 281,182 $ 219,520 Maintenance 77,526 83,188 235,568 237,531 Subscription services 174,885 161,557 516,750 457,051 Subscription license 31,112 35,421 210,245 251,226 Subscription 205,997 196,978 726,995 708,277 Perpetual license 9,223 2,874 18,929 20,922 Consulting 55,511 56,416 175,451 166,270 $ 270,731 $ 256,268 $ 921,375 $ 895,469 Remaining performance obligations ("Backlog") Expected future revenue from existing non-cancellable contracts: As of September 30, 2022: (Dollars in thousands) Subscription services Subscription license Perpetual license Consulting Total Maintenance Pega Cloud 1 year or less $ 191,045 $ 328,111 $ 69,753 $ 814 $ 27,968 $ 617,691 53 % 1-2 years 55,141 213,304 4,113 4,505 6,699 283,762 25 % 2-3 years 24,496 115,416 1,420 2,252 1,648 145,232 13 % Greater than 3 years 16,198 82,807 1,734 — 508 101,247 9 % $ 286,880 $ 739,638 $ 77,020 $ 7,571 $ 36,823 $ 1,147,932 100 % As of September 30, 2021: (Dollars in thousands) Subscription services Subscription license Perpetual license Consulting Total Maintenance Pega Cloud 1 year or less $ 196,667 $ 284,359 $ 49,265 $ 15,686 $ 31,673 $ 577,650 56 % 1-2 years 59,360 177,214 16,872 1,064 6,561 261,071 25 % 2-3 years 37,734 79,775 420 4,094 5,165 127,188 12 % Greater than 3 years 33,935 30,113 245 2,127 1,697 68,117 7 % $ 327,696 $ 571,461 $ 66,802 $ 22,971 $ 45,096 $ 1,034,026 100 %

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION	9 Months Ended
	Sep. 30, 2022
Share-Based Payment Arrangement [Abstract]
STOCK-BASED COMPENSATION	NOTE 11. STOCK-BASED COMPENSATION Expense Three Months Ended Nine Months Ended (in thousands) 2022 2021 2022 2021 Cost of revenue $ 6,797 $ 5,114 $ 19,754 $ 16,889 Selling and marketing 12,933 13,376 36,524 41,844 Research and development 7,724 6,231 22,425 19,343 General and administrative 6,320 3,974 14,598 11,407 $ 33,774 $ 28,695 $ 93,301 $ 89,483 Income tax benefit $ (600) $ (5,845) $ (1,505) $ (18,028) As of September 30, 2022, the Company had $161.0 million of unrecognized stock-based compensation expense, net of estimated forfeitures, which is expected to be recognized over a weighted-average period of 2.1 years. Grants Nine Months Ended (in thousands) Shares Total Fair Value Restricted stock units 1,436 $ 112,303 Non-qualified stock options 4,529 $ 102,332 Common stock 14 $ 600

INCOME TAXES

INCOME TAXES	9 Months Ended
	Sep. 30, 2022
Income Tax Disclosure [Abstract]
INCOME TAXES	NOTE 12. INCOME TAXES Effective income tax rate Three Months Ended Nine Months Ended (Dollars in thousands) 2022 2021 2022 2021 Provision for (benefit from) income taxes $ 11,748 $ (24,826) $ 190,239 $ (54,360) Effective income tax rate (benefit rate) 100 % (68) % The change in the effective income tax rate (benefit rate) in the nine months ended September 30, 2022 was primarily due to the recognition of a $191.9 million valuation allowance recognized at June 30, 2022, on the Company’s U.S. and U.K deferred tax assets. As a result of recording the valuation allowance, the Company is no longer recording any income tax benefit on its U.S and U.K losses. The $11.7 million provision for (benefit from) income taxes for the three months ended September 30, 2022 primarily represents non-U.K. foreign income taxes. The Company recognizes deferred tax assets to the extent that it believes that these assets are more likely than not to be realized. Future realization of deferred tax assets ultimately depends on sufficient taxable income within the available carryback or carryforward periods. The Company’s deferred tax valuation allowance requires significant judgment and uncertainties, including assumptions about future taxable income based on historical and projected information. On a quarterly basis, the Company reassesses the need for a valuation allowance on its existing net deferred tax assets by tax-paying jurisdiction, weighing positive and negative evidence to assess its recoverability. In making such a determination, the Company considers all available and objectively verifiable negative and positive evidence, including future reversals of existing taxable temporary differences, committed contractual backlog (“Backlog”), projected future taxable income inclusive of the impact of enacted legislation, tax-planning strategies, and results of recent operations. The weight given to the potential effect of negative and positive evidence is commensurate with the extent to which it can be objectively verified. As of June 30, 2022, the Company’s Backlog balance was not sufficient to recover our net deferred tax assets. The Backlog balance and other unsettled circumstances, impacting the Company’s operations, reduced the Backlog’s weight as objectively verifiable positive evidence to generate sufficient taxable income to recover its net deferred tax assets. These unsettled circumstances include growing and extended geopolitical turmoil, increasing inflation, and an uncertain global economic outlook. As of June 30, 2022, the combination of the above factors caused the Company to conclude there is not sufficient objectively verifiable positive evidence to support that it is more likely than not the Company will generate sufficient future taxable income to recover the Company’s U.S. and U.K. net deferred tax assets. Accordingly, the Company recorded a valuation allowance of $191.9 million in income tax expense during the three months ended June 30, 2022. The Company intends to continue maintaining a full valuation allowance on our U.S and U.K deferred tax assets until there is sufficient evidence to support the realization of these deferred tax assets.

(LOSS) PER SHARE

(LOSS) PER SHARE	9 Months Ended
	Sep. 30, 2022
Earnings Per Share [Abstract]
(LOSS) PER SHARE	NOTE 13. (LOSS) PER SHARE Basic (loss) per share is calculated using the weighted-average number of common shares outstanding during the period. Diluted (loss) per share is calculated using the weighted-average number of common shares outstanding during the period, plus the dilutive effect of outstanding stock options, RSUs, and convertible senior notes. Calculation of (loss) per share: Three Months Ended Nine Months Ended (in thousands, except per share amounts) 2022 2021 2022 2021 Net (loss) $ (93,520) $ (56,468) $ (380,195) $ (25,794) Weighted-average common shares outstanding 81,996 81,526 81,842 81,284 (Loss) per share, basic $ (1.14) $ (0.69) $ (4.65) $ (0.32) Net (loss) $ (93,520) $ (56,468) $ (380,195) $ (25,794) Weighted-average common shares outstanding, assuming dilution (1) (2) (3) 81,996 81,526 81,842 81,284 (Loss) per share, diluted $ (1.14) $ (0.69) $ (4.65) $ (0.32) Outstanding anti-dilutive stock options and RSUs (4) 3,019 5,815 3,589 6,136 (1) In periods of loss, all dilutive securities are excluded as their inclusion would be anti-dilutive. (2) The shares underlying the conversion options in the Company’s Notes are included using the if-converted method, if dilutive in the period. If the outstanding conversion options were fully exercised, the Company would issue an additional approximately 4.4 million shares. (3) The Company’s Capped Call Transactions represent the equivalent of approximately 4.4 million shares of the Company’s common stock (representing the number of shares for which the Notes are initially convertible). The Capped Call Transactions are expected to reduce common stock dilution and/or offset any potential cash payments the Company must make, other than for principal and interest, upon conversion of the Notes, with such reduction and/or offset subject to a cap of $196.44. The Capped Call Transactions are excluded from weighted-average common shares outstanding, assuming dilution, in all periods as their effect would be anti-dilutive. (4) Outstanding stock options and RSUs that were anti-dilutive under the treasury stock method in the period were excluded from the computation of diluted (loss) per share. These awards may be dilutive in the future.

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	9 Months Ended
	Sep. 30, 2022
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	NOTE 14. COMMITMENTS AND CONTINGENCIES Commitments See "Note 7. Leases" for additional information. Legal proceedings In addition to the matters below, the Company is, or may become, involved in a variety of claims, demands, suits, investigations, and proceedings that arise from time to time relating to matters incidental to the ordinary course of the Company’s business, including actions concerning contracts, intellectual property, employment, benefits, and securities matters. Regardless of the outcome, legal disputes can have a material effect on the Company because of defense and settlement costs, diversion of management resources, and other factors. In addition, as the Company is a party to ongoing litigation, it is at least reasonably possible that our estimates will change in the near term and the effect may be material. As of September 30, 2022 and December 31, 2021, the Company has no accrued losses for litigation. Pegasystems Inc. v. Appian Corp. & Business Process Management Inc. On July 3, 2019, the Company filed suit in Massachusetts federal court against Appian Corp. (“Appian”) and Business Process Management, Inc. (“BPM”) relating to a BPM “Market Report” that Appian had used to promote itself against the Company. Pegasystems Inc. v. Appian Corp. & Business Process Management Inc., No. 1:19-cv-11461 (D. Mass). On April 15, 2022, each of the parties filed motions for summary judgment with the court. On September 30, 2022, the court entered an order allowing in part and denying in part each party’s motion for summary judgment, thereby narrowing the potential issues for trial. On October 24, 2022, the court entered an order setting a trial date of January 3, 2023. The Company continues to believe the counterclaims brought by Appian against the Company are without merit, and the Company intends to vigorously pursue its claims against Appian and defend against the counterclaims brought against the Company in this matter. The Company is unable to reasonably estimate possible damages or a range of possible damages in this matter given the Company’s belief that the damages claimed by Appian fail to satisfy the required legal standard, the status of the proceeding, and due to the uncertainty as to how a jury may rule if this ultimately proceeds to trial. Appian Corp. v. Pegasystems Inc. & Youyong Zou As previously reported, the Company is a defendant in litigation brought by Appian in the Circuit Court of Fairfax County, Virginia (the “Court”) titled Appian Corp. v. Pegasystems Inc. & Youyong Zou, No. 2020-07216 (Fairfax Cty. Ct.). On May 9, 2022, the jury rendered its verdict finding that the Company had misappropriated one or more of Appian’s trade secrets, that the Company had violated the Virginia Computer Crimes Act, and that the trade secret misappropriation was willful and malicious. The jury awarded damages in the amount of $2,036,860,045 for trade secret misappropriation and $1.00 for the violation of the Virginia Computer Crimes Act. On September 15, 2022, the circuit court of Fairfax County entered judgment in the amount of $2,060,479,287, consisting of the damages previously awarded by the jury plus attorneys’ fees and costs, and stating that the judgment is subject to post-judgment interest at a rate of 6.0% per annum, from the date of the jury verdict (May 9, 2022) as to the amount of the jury verdict and from September 15, 2022 as to the amount of the award of attorneys’ fees and costs. On September 15, 2022, the Company filed a notice of appeal from the judgment. On September 29, 2022, the circuit court of Fairfax County approved a $25,000,000 letter of credit obtained by the Company to secure the judgment and entered an order suspending the judgment during the pendency of the Company’s appeal. This appeals process could potentially take years to complete. The Company continues to believe that it did not misappropriate any alleged trade secrets and that its sales of the Company’s products at issue were not caused by, or the result of, any alleged misappropriation of trade secrets. The Company is unable to reasonably estimate possible damages because of, among other things, uncertainty as to the outcome of appellate proceedings and/or any potential new trial resulting from the appellate proceedings. City of Fort Lauderdale Police and Firefighters’ Retirement System, Individually and on Behalf of All Others Similarly Situated v. Pegasystems Inc., Alan Trefler, and Kenneth Stillwell On May 19, 2022, a lawsuit was filed against the Company, the Company’s chief executive officer and the Company’s chief operating and financial officer in the United States District Court for the Eastern District of Virginia Alexandria Division, captioned City of Fort Lauderdale Police and Firefighters’ Retirement System, Individually and on Behalf of All Others Similarly Situated v. Pegasystems Inc., Alan Trefler, and Kenneth Stillwell (Case 1:22-cv-00578-LMB-IDD). The complaint generally alleges, among other things, that the defendants violated Section 10(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and Rule 10b-5 promulgated thereunder and that the individual defendants violated Section 20(a) of the Exchange Act, in each case by allegedly making materially false and/or misleading statements, as well as allegedly failing to disclose material adverse facts about the Company’s business, operations, and prospects, which caused the Company’s securities to trade at artificially inflated prices. The complaint seeks unspecified damages on behalf of a class of purchasers of the Company’s securities between May 29, 2020 and May 9, 2022. The litigation has since been transferred to the United States District Court for the District of Massachusetts (Case 1:22-cv-11220-WGY), and lead plaintiff class representatives—Central Pennsylvania Teamsters Pension Fund - Defined Benefit Plan, Central Pennsylvania Teamsters Pension Fund - Retirement Income Plan 1987, and Construction Industry Laborers Pension Fund—have been appointed. On October 18, 2022, a consolidated amended complaint was filed that does not add any new parties or legal claims, is based upon the same general factual allegations as the original complaint, and now seeks unspecified damages on behalf of a class of purchasers of the Company’s securities between June 16, 2020 and May 9, 2022. The Company believes the claims brought against the defendants are without merit, and intends to vigorously defend against these claims. The Company is unable to reasonably estimate possible damages or a range of possible damages in this matter given the stage of the lawsuit, the Company’s belief that the claims are without merit, and there being no specified quantum of damages sought in the complaint.

BASIS OF PRESENTATION (Policies

BASIS OF PRESENTATION (Policies)	9 Months Ended
	Sep. 30, 2022
Accounting Policies [Abstract]
Basis of presentation	Pegasystems Inc. (together with its subsidiaries, “the Company”) has prepared the accompanying unaudited condensed consolidated financial statements pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Accordingly, they do not include all the information required by accounting principles generally accepted in the United States of America (“U.S.”) for complete financial statements and should be read in conjunction with the Company’s audited financial statements included in the Annual Report on Form 10-K for the year ended December 31, 2021. In the opinion of management, the Company has prepared the accompanying unaudited condensed consolidated financial statements on the same basis as its audited financial statements, and these financial statements include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results of the interim periods presented. All intercompany transactions and balances were eliminated in consolidation. The operating results for the interim periods presented do not necessarily indicate the expected results for the full year 2022. Certain prior period amounts reported in our condensed consolidated financial statements and notes thereto have been reclassified to conform to the current year’s presentation. Such reclassifications did not affect total revenues, operating income, or net income.
Assets and liabilities measured at fair value on a recurring basis	Assets and liabilities measured at fair value on a recurring basis The Company records its cash equivalents, marketable securities, Capped Call Transactions, and venture investments at fair value on a recurring basis. Fair value is an exit price, representing the amount that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants based on assumptions that market participants would use in pricing an asset or liability. As a basis for classifying the fair value measurements, a three-tier fair value hierarchy, which classifies the fair value measurements based on the inputs used in measuring fair value, was established as follows: • Level 1 - observable inputs, such as quoted prices in active markets for identical assets or liabilities; • Level 2 - significant other inputs that are observable either directly or indirectly; and • Level 3 - significant unobservable inputs on which there is little or no market data, which require the Company to develop its own assumptions. This hierarchy requires the Company to use observable market data, when available, and minimize unobservable inputs when determining fair value. The fair value of the Capped Call Transactions at the end of each reporting period is determined using a Black-Scholes option-pricing model. The valuation model uses various market-based inputs, including stock price, remaining contractual term, expected volatility, risk-free interest rate, and expected dividend yield. The Company applies judgment when determining expected volatility. The Company considers both historical and implied volatility levels of the underlying equity security. The Company’s venture investments are recorded at fair value based on multiple valuation methods, including observable public companies and transaction prices and unobservable inputs, including the volatility, rights, and obligations of the securities the Company holds.

MARKETABLE SECURITIES (Tables)

MARKETABLE SECURITIES (Tables)	9 Months Ended
	Sep. 30, 2022
Investments, Debt and Equity Securities [Abstract]
Schedule of marketable securities	September 30, 2022 December 31, 2021 (in thousands) Amortized Cost Unrealized Gains Unrealized Losses Fair Value Amortized Cost Unrealized Gains Unrealized Losses Fair Value Government debt $ 2,992 $ — $ (67) $ 2,925 $ 2,000 $ — $ (10) $ 1,990 Corporate debt 168,894 — (3,734) 165,160 201,659 2 (837) 200,824 $ 171,886 $ — $ (3,801) $ 168,085 $ 203,659 $ 2 $ (847) $ 202,814

RECEIVABLES, CONTRACT ASSETS,_2

RECEIVABLES, CONTRACT ASSETS, AND DEFERRED REVENUE (Tables)	9 Months Ended
	Sep. 30, 2022
Receivables [Abstract]
Summary of receivables	Receivables (in thousands) September 30, 2022 December 31, 2021 Accounts receivable $ 139,670 $ 182,717 Unbilled receivables 182,403 226,714 Long-term unbilled receivables 108,285 129,789 $ 430,358 $ 539,220
Summary of unbilled receivables	Unbilled receivables by expected billing date: (Dollars in thousands) September 30, 2022 1 year or less $ 182,403 63 % 1-2 years 78,893 27 % 2-5 years 29,392 10 % $ 290,688 100 %
Summary of unbilled receivables by contract effective date	Unbilled receivables by contract effective date: (Dollars in thousands) September 30, 2022 2022 $ 87,874 30 % 2021 130,196 45 % 2020 45,589 16 % 2019 15,747 5 % 2018 and prior 11,282 4 % $ 290,688 100 %
Schedules of clients accounting for 10% or more of the total receivables	Clients accounting for 10% or more of the Company’s total receivables: September 30, 2022 December 31, 2021 Client A Accounts receivable * 1 % Unbilled receivables * 15 % Total receivables * 10 % * Client accounted for less than 10% of receivables.
Summary of contract assets and deferred revenue	Contract assets Contract assets are client-committed amounts for which revenue recognized exceeds the amount billed to the client, and billing is subject to conditions other than the passage of time, such as the completion of a related performance obligation. (in thousands) September 30, 2022 December 31, 2021 Contract assets (1) $ 12,429 $ 12,530 Long-term contract assets (2) 10,541 10,643 $ 22,970 $ 23,173 (1) Included in other current assets. (2) Included in other long-term assets. Deferred revenue Deferred revenue consists of billings and payments received in advance of revenue recognition. (in thousands) September 30, 2022 December 31, 2021 Deferred revenue $ 245,146 $ 275,844 Long-term deferred revenue (1) 3,949 5,655 $ 249,095 $ 281,499 (1) Included in other long-term liabilities.

DEFERRED COMMISSIONS (Tables)

DEFERRED COMMISSIONS (Tables)	9 Months Ended
	Sep. 30, 2022
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Schedule of impairment of deferred contract costs	(in thousands) September 30, 2022 December 31, 2021 Deferred commissions (1) $ 122,673 $ 135,911
Schedule of amortization of deferred contract costs	Three Months Ended Nine Months Ended (in thousands) 2022 2021 2022 2021 Amortization of deferred commissions (1) $ 11,597 $ 10,186 $ 39,752 $ 31,388

GOODWILL AND OTHER INTANGIBLES

GOODWILL AND OTHER INTANGIBLES (Tables)	9 Months Ended
	Sep. 30, 2022
Goodwill and Intangible Assets Disclosure [Abstract]
Changes in carrying amount of goodwill	Change in goodwill: Nine Months Ended (in thousands) 2022 2021 January 1, $ 81,923 $ 79,231 Acquisition — 2,701 Currency translation adjustments (722) 22 September 30, $ 81,201 $ 81,954
Schedule of amortizable intangible assets	Intangible assets are recorded at cost and amortized using the straight-line method over their estimated useful lives. September 30, 2022 (in thousands) Useful Lives Cost Accumulated Amortization Net Book Value (1) Client-related 4-10 years $ 63,007 $ (58,211) $ 4,796 Technology 2-10 years 68,038 (60,913) 7,125 Other 1-5 years 5,361 (5,361) — $ 136,406 $ (124,485) $ 11,921 (1) Included in other long-term assets. December 31, 2021 (in thousands) Useful Lives Cost Accumulated Amortization Net Book Value (1) Client-related 4-10 years $ 63,165 $ (57,342) $ 5,823 Technology 2-10 years 67,142 (58,902) 8,240 Other 1-5 years 5,361 (5,361) — $ 135,668 $ (121,605) $ 14,063 (1) Included in other long-term assets.
Amortization expense of acquired intangibles	Amortization of intangible assets: Three Months Ended Nine Months Ended (in thousands) 2022 2021 2022 2021 Cost of revenue $ 705 $ 629 $ 2,017 $ 1,887 Selling and marketing 343 373 1,028 1,119 $ 1,048 $ 1,002 $ 3,045 $ 3,006
Estimated future amortization expense related to intangible assets	Future estimated intangibles assets amortization: (in thousands) September 30, 2022 Remainder of 2022 $ 1,048 2023 3,917 2024 3,147 2025 2,608 2026 874 2027 327 $ 11,921

OTHER ASSETS AND LIABILITIES (T

OTHER ASSETS AND LIABILITIES (Tables)	9 Months Ended
	Sep. 30, 2022
Other Assets and Liabilities [Abstract]
Schedule of other assets and other liabilities	Other current assets (in thousands) September 30, 2022 December 31, 2021 Income tax receivables $ 11,948 $ 25,691 Contract assets 12,429 12,530 Other 38,080 29,787 $ 62,457 $ 68,008 Other long-term assets (in thousands) September 30, 2022 December 31, 2021 Deferred income taxes $ 6,041 $ 180,656 Deferred commissions 122,673 135,911 Right of use assets 80,163 87,521 Capped call transactions 3,583 59,964 Property and equipment 45,350 26,837 Venture investments 11,910 7,648 Intangible assets 11,921 14,063 Contract assets 10,541 10,643 Other 24,549 18,358 $ 316,731 $ 541,601 Other current liabilities (in thousands) September 30, 2022 December 31, 2021 Operating lease liabilities $ 5,787 $ 6,989 Dividends payable 2,466 2,454 $ 8,253 $ 9,443 Other long-term liabilities (in thousands) September 30, 2022 December 31, 2021 Deferred revenue $ 3,949 $ 5,655 Other 7,987 7,844 $ 11,936 $ 13,499

LEASES (Tables)

LEASES (Tables)	9 Months Ended
	Sep. 30, 2022
Leases [Abstract]
Schedule of lease expense	Three Months Ended Nine Months Ended (in thousands) 2022 2021 2022 2021 Fixed lease costs (1) $ 4,688 $ (3,108) $ 14,747 $ (6,780) Short-term lease costs 916 542 2,510 1,516 Variable lease costs 905 1,099 2,395 3,826 $ 6,509 $ (1,467) $ 19,652 $ (1,438) (1) The lower fixed lease costs in the nine months ended September 30, 2021 was due to the modification of the corporate headquarters lease.
Schedule of right of use asset and lease liabilities	(in thousands) September 30, 2022 December 31, 2021 Right of use assets (1) $ 80,163 $ 87,521 Operating lease liabilities (2) $ 5,787 $ 6,989 Long-term operating lease liabilities $ 82,705 $ 87,818 (1) Represents the Company’s right to use the leased asset during the lease term. Included in other long-term assets. (2) Included in other current liabilities.
Schedule of weighted average and discount rate	Weighted-average remaining lease term and discount rate for the Company’s leases were: September 30, 2022 December 31, 2021 Weighted-average remaining lease term 7.4 years 7.7 years Weighted-average discount rate (1) 4.2 % 4.4 % (1) The rates implicit in most of the Company’s leases are not readily determinable. Therefore, the Company uses its incremental borrowing rate as the discount rate when measuring operating lease liabilities. The incremental borrowing rate represents an estimate of the interest rate the Company would incur to borrow an amount equal to the lease payments on a collateralized basis over the lease term in a similar economic environment.
Schedule of lease maturities	Maturities of lease liabilities: (in thousands) September 30, 2022 Remainder of 2022 $ (4,717) 2023 18,804 2024 16,841 2025 14,778 2026 11,257 2027 and thereafter 48,397 Total lease payments 105,360 Less: imputed interest (1) (16,868) $ 88,492 (1) Lease liabilities are measured at the present value of the remaining lease payments using a discount rate determined at lease commencement unless the discount rate is updated due to a lease reassessment event.
Schedule of supplemental cash flow lease information	Nine Months Ended (in thousands) 2022 2021 Cash paid for leases $ 11,628 $ 14,403 Right of use assets recognized for new leases and amendments (non-cash) $ 6,618 $ 54,716

DEBT (Tables)

DEBT (Tables)	9 Months Ended
	Sep. 30, 2022
Debt Disclosure [Abstract]
Carrying value, interest expense, and effective interest rate for the notes	Carrying value of the Notes: (in thousands) September 30, 2022 December 31, 2021 Principal $ 600,000 $ 600,000 Unamortized issuance costs (7,116) (9,278) Convertible senior notes, net $ 592,884 $ 590,722 Interest expense related to the Notes: Three Months Ended Nine Months Ended (in thousands) 2022 2021 2022 2021 Contractual interest expense (0.75% coupon) $ 1,125 $ 1,125 $ 3,375 $ 3,375 Amortization of issuance costs 724 677 2,163 2,025 $ 1,849 $ 1,802 $ 5,538 $ 5,400 The effective interest rate for the Notes: Nine Months Ended 2022 2021 Weighted-average effective interest rate 1.2 % 1.2 %
Schedule of future payments of principal and contractual interest	Future payments of principal and contractual interest: September 30, 2022 (in thousands) Principal Interest Total 2023 $ — $ 4,500 $ 4,500 2024 — 4,500 4,500 2025 600,000 2,250 602,250 $ 600,000 $ 11,250 $ 611,250
Schedule of change in capped call transactions	Change in capped call transactions: Nine Months Ended (in thousands) 2022 2021 January 1, $ 59,964 $ 83,597 Fair value adjustment (56,381) (7,543) September 30, $ 3,583 $ 76,054

FAIR VALUE MEASUREMENTS (Tables

FAIR VALUE MEASUREMENTS (Tables)	9 Months Ended
	Sep. 30, 2022
Fair Value Disclosures [Abstract]
Assets and liabilities measured at fair value	Assets and liabilities measured at fair value on a recurring basis: September 30, 2022 December 31, 2021 (in thousands) Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Cash equivalents $ 20,899 $ — $ — $ 20,899 $ 3,216 $ — $ — $ 3,216 Marketable securities $ — $ 168,085 $ — $ 168,085 $ — $ 202,814 $ — $ 202,814 Capped Call Transactions (1) $ — $ 3,583 $ — $ 3,583 $ — $ 59,964 $ — $ 59,964 Venture investments (1) (2) $ — $ — $ 11,910 $ 11,910 $ — $ — $ 7,648 $ 7,648 (1) Included in other long-term assets. (2) Investments in privately-held companies.
Changes in venture investments	Changes in venture investments: Nine Months Ended (in thousands) 2022 2021 January 1, $ 7,648 $ 8,345 New investments 400 500 Sales of investments (3,954) (400) Changes in foreign exchange rates (675) (52) Changes in fair value: included in other income 5,989 100 included in other comprehensive income 2,502 1,220 September 30, $ 11,910 $ 9,713

REVENUE (Tables)

REVENUE (Tables)	9 Months Ended
	Sep. 30, 2022
Revenue from Contract with Customer [Abstract]
Schedule of revenue by geographic location	Geographic revenue Three Months Ended Nine Months Ended (Dollars in thousands) 2022 2021 2022 2021 U.S. $ 148,200 55 % $ 132,016 52 % $ 513,197 56 % $ 515,881 58 % Other Americas 18,546 7 % 17,510 7 % 80,558 9 % 43,469 5 % United Kingdom (“U.K.”) 24,074 9 % 25,982 10 % 83,837 9 % 86,747 10 % Europe (excluding U.K.), Middle East, and Africa 46,212 17 % 46,306 18 % 140,586 15 % 143,763 15 % Asia-Pacific 33,699 12 % 34,454 13 % 103,197 11 % 105,609 12 % $ 270,731 100 % $ 256,268 100 % $ 921,375 100 % $ 895,469 100 %
Schedule of revenue streams	Revenue streams Three Months Ended Nine Months Ended (in thousands) 2022 2021 2022 2021 Perpetual license $ 9,223 $ 2,874 $ 18,929 $ 20,922 Subscription license 31,112 35,421 210,245 251,226 Revenue recognized at a point in time 40,335 38,295 229,174 272,148 Maintenance 77,526 83,188 235,568 237,531 Pega Cloud 97,359 78,369 281,182 219,520 Consulting 55,511 56,416 175,451 166,270 Revenue recognized over time 230,396 217,973 692,201 623,321 Total revenue $ 270,731 $ 256,268 $ 921,375 $ 895,469 Three Months Ended Nine Months Ended (in thousands) 2022 2021 2022 2021 Pega Cloud $ 97,359 $ 78,369 $ 281,182 $ 219,520 Maintenance 77,526 83,188 235,568 237,531 Subscription services 174,885 161,557 516,750 457,051 Subscription license 31,112 35,421 210,245 251,226 Subscription 205,997 196,978 726,995 708,277 Perpetual license 9,223 2,874 18,929 20,922 Consulting 55,511 56,416 175,451 166,270 $ 270,731 $ 256,268 $ 921,375 $ 895,469
Revenue for remaining performance obligations expected to be recognized	Expected future revenue from existing non-cancellable contracts: As of September 30, 2022: (Dollars in thousands) Subscription services Subscription license Perpetual license Consulting Total Maintenance Pega Cloud 1 year or less $ 191,045 $ 328,111 $ 69,753 $ 814 $ 27,968 $ 617,691 53 % 1-2 years 55,141 213,304 4,113 4,505 6,699 283,762 25 % 2-3 years 24,496 115,416 1,420 2,252 1,648 145,232 13 % Greater than 3 years 16,198 82,807 1,734 — 508 101,247 9 % $ 286,880 $ 739,638 $ 77,020 $ 7,571 $ 36,823 $ 1,147,932 100 % As of September 30, 2021: (Dollars in thousands) Subscription services Subscription license Perpetual license Consulting Total Maintenance Pega Cloud 1 year or less $ 196,667 $ 284,359 $ 49,265 $ 15,686 $ 31,673 $ 577,650 56 % 1-2 years 59,360 177,214 16,872 1,064 6,561 261,071 25 % 2-3 years 37,734 79,775 420 4,094 5,165 127,188 12 % Greater than 3 years 33,935 30,113 245 2,127 1,697 68,117 7 % $ 327,696 $ 571,461 $ 66,802 $ 22,971 $ 45,096 $ 1,034,026 100 %

STOCK-BASED COMPENSATION (Table

STOCK-BASED COMPENSATION (Tables)	9 Months Ended
	Sep. 30, 2022
Share-Based Payment Arrangement [Abstract]
Summary of stock based compensation expense	Expense Three Months Ended Nine Months Ended (in thousands) 2022 2021 2022 2021 Cost of revenue $ 6,797 $ 5,114 $ 19,754 $ 16,889 Selling and marketing 12,933 13,376 36,524 41,844 Research and development 7,724 6,231 22,425 19,343 General and administrative 6,320 3,974 14,598 11,407 $ 33,774 $ 28,695 $ 93,301 $ 89,483 Income tax benefit $ (600) $ (5,845) $ (1,505) $ (18,028)
Summary of stock based compensation award granted	Grants Nine Months Ended (in thousands) Shares Total Fair Value Restricted stock units 1,436 $ 112,303 Non-qualified stock options 4,529 $ 102,332 Common stock 14 $ 600

INCOME TAXES (Tables)

INCOME TAXES (Tables)	9 Months Ended
	Sep. 30, 2022
Income Tax Disclosure [Abstract]
Summary of effective income tax rate	Effective income tax rate Three Months Ended Nine Months Ended (Dollars in thousands) 2022 2021 2022 2021 Provision for (benefit from) income taxes $ 11,748 $ (24,826) $ 190,239 $ (54,360) Effective income tax rate (benefit rate) 100 % (68) %

(LOSS) PER SHARE (Tables)

(LOSS) PER SHARE (Tables)	9 Months Ended
	Sep. 30, 2022
Earnings Per Share [Abstract]
Calculation of (loss) per share	Calculation of (loss) per share: Three Months Ended Nine Months Ended (in thousands, except per share amounts) 2022 2021 2022 2021 Net (loss) $ (93,520) $ (56,468) $ (380,195) $ (25,794) Weighted-average common shares outstanding 81,996 81,526 81,842 81,284 (Loss) per share, basic $ (1.14) $ (0.69) $ (4.65) $ (0.32) Net (loss) $ (93,520) $ (56,468) $ (380,195) $ (25,794) Weighted-average common shares outstanding, assuming dilution (1) (2) (3) 81,996 81,526 81,842 81,284 (Loss) per share, diluted $ (1.14) $ (0.69) $ (4.65) $ (0.32) Outstanding anti-dilutive stock options and RSUs (4) 3,019 5,815 3,589 6,136 (1) In periods of loss, all dilutive securities are excluded as their inclusion would be anti-dilutive. (2) The shares underlying the conversion options in the Company’s Notes are included using the if-converted method, if dilutive in the period. If the outstanding conversion options were fully exercised, the Company would issue an additional approximately 4.4 million shares. (3) The Company’s Capped Call Transactions represent the equivalent of approximately 4.4 million shares of the Company’s common stock (representing the number of shares for which the Notes are initially convertible). The Capped Call Transactions are expected to reduce common stock dilution and/or offset any potential cash payments the Company must make, other than for principal and interest, upon conversion of the Notes, with such reduction and/or offset subject to a cap of $196.44. The Capped Call Transactions are excluded from weighted-average common shares outstanding, assuming dilution, in all periods as their effect would be anti-dilutive. (4) Outstanding stock options and RSUs that were anti-dilutive under the treasury stock method in the period were excluded from the computation of diluted (loss) per share. These awards may be dilutive in the future.

MARKETABLE SECURITIES - Schedul

MARKETABLE SECURITIES - Schedule of Marketable Securities (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Marketable Securities [Line Items]
Amortized Cost	$ 171,886	$ 203,659
Unrealized Gains	0	2
Unrealized Losses	(3,801)	(847)
Fair Value	168,085	202,814
Government debt
Marketable Securities [Line Items]
Amortized Cost	2,992	2,000
Unrealized Gains	0	0
Unrealized Losses	(67)	(10)
Fair Value	2,925	1,990
Corporate debt
Marketable Securities [Line Items]
Amortized Cost	168,894	201,659
Unrealized Gains	0	2
Unrealized Losses	(3,734)	(837)
Fair Value	$ 165,160	$ 200,824

MARKETABLE SECURITIES - Narrati

MARKETABLE SECURITIES - Narrative (Details)	Sep. 30, 2022
Investments, Debt and Equity Securities [Abstract]
Marketable debt security weighted-average remaining maturity	8 months 12 days

RECEIVABLES, CONTRACT ASSETS,_3

RECEIVABLES, CONTRACT ASSETS, AND DEFERRED REVENUE - Summary of Receivable (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Receivables [Abstract]
Accounts receivable	$ 139,670	$ 182,717
Unbilled receivables	182,403	226,714
Long-term unbilled receivables	108,285	129,789
Total receivables	$ 430,358	$ 539,220

RECEIVABLES, CONTRACT ASSETS,_4

RECEIVABLES, CONTRACT ASSETS, AND DEFERRED REVENUE - Summary of Unbilled Receivables (Details) $ in Thousands	Sep. 30, 2022 USD ($)
Receivables [Abstract]
1 year or less	$ 182,403
1-2 years	78,893
2-5 years	29,392
Total	$ 290,688
Percentage of unbilled receivables, 1 year or less	63%
Percentage of unbilled receivables, 1-2 years	27%
Percentage of unbilled receivables, 2-5 years	10%
Total percentage of unbilled receivables	100%

RECEIVABLES, CONTRACT ASSETS,_5

RECEIVABLES, CONTRACT ASSETS, AND DEFERRED REVENUE- Contract Effective (Details) $ in Thousands	Sep. 30, 2022 USD ($)
Receivables [Abstract]
2022	$ 87,874
2021	130,196
2020	45,589
2019	15,747
2018 and prior	11,282
Unbilled revenue total	$ 290,688
2022	30%
2021	45%
2020	16%
2019	5%
2018 and prior	4%
Total percentage of unbilled revenue	100%

RECEIVABLES, CONTRACT ASSETS,_6

RECEIVABLES, CONTRACT ASSETS, AND DEFERRED REVENUE - Summary of Major Clients (Details)	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Concentration Risk [Line Items]
Percent of total revenue	100%	100%	100%	100%
Client A | Credit concentration risk | Account receivable and unbilled receivables
Concentration Risk [Line Items]
Percent of total revenue					10%
Client A | Credit concentration risk | Accounts receivable
Concentration Risk [Line Items]
Percent of total revenue					1%
Client A | Credit concentration risk | Unbilled receivables
Concentration Risk [Line Items]
Percent of total revenue					15%

RECEIVABLES, CONTRACT ASSETS,_7

RECEIVABLES, CONTRACT ASSETS, AND DEFERRED REVENUE - Summary of Contract Assets and Deferred Revenue (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Dec. 31, 2021
Receivables [Abstract]
Contract assets	$ 12,429	$ 12,530
Contract assets	10,541	10,643
Total contract assets	22,970	23,173
Deferred revenue	245,146	275,844
Long-term deferred revenue	3,949	5,655
Total deferred revenue	249,095	$ 281,499
Revenue recognized during the period that was included in deferred revenue	$ 252,800

DEFERRED COMMISSIONS - Schedule

DEFERRED COMMISSIONS - Schedule of Impairment of Deferred Commissions (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Deferred commissions	$ 122,673	$ 135,911

DEFERRED COMMISSIONS - Schedu_2

DEFERRED COMMISSIONS - Schedule of Amortization of Deferred Commissions (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Amortization of deferred commissions	$ 11,597	$ 10,186	$ 39,752	$ 31,388

GOODWILL AND OTHER INTANGIBLE_2

GOODWILL AND OTHER INTANGIBLES - Changes in Carrying Amount of Goodwill (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Goodwill [Roll Forward]
Beginning balance	$ 81,923	$ 79,231
Acquisition	0	2,701
Currency translation adjustments	(722)	22
Ending balance	$ 81,201	$ 81,954

GOODWILL AND OTHER INTANGIBLE_3

GOODWILL AND OTHER INTANGIBLES - Schedule of Amortizable Intangible Assets (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2022	Dec. 31, 2021
Goodwill and Other Intangible Assets [Line Items]
Cost	$ 136,406	$ 135,668
Accumulated Amortization	(124,485)	(121,605)
Total	11,921	14,063
Client-related
Goodwill and Other Intangible Assets [Line Items]
Cost	63,007	63,165
Accumulated Amortization	(58,211)	(57,342)
Total	4,796	5,823
Technology
Goodwill and Other Intangible Assets [Line Items]
Cost	68,038	67,142
Accumulated Amortization	(60,913)	(58,902)
Total	7,125	8,240
Other
Goodwill and Other Intangible Assets [Line Items]
Cost	5,361	5,361
Accumulated Amortization	(5,361)	(5,361)
Total	$ 0	$ 0
Minimum | Client-related
Goodwill and Other Intangible Assets [Line Items]
Useful Lives	4 years	4 years
Minimum | Technology
Goodwill and Other Intangible Assets [Line Items]
Useful Lives	2 years	2 years
Minimum | Other
Goodwill and Other Intangible Assets [Line Items]
Useful Lives	1 year	1 year
Maximum | Client-related
Goodwill and Other Intangible Assets [Line Items]
Useful Lives	10 years	10 years
Maximum | Technology
Goodwill and Other Intangible Assets [Line Items]
Useful Lives	10 years	10 years
Maximum | Other
Goodwill and Other Intangible Assets [Line Items]
Useful Lives	5 years	5 years

GOODWILL AND OTHER INTANGIBLE_4

GOODWILL AND OTHER INTANGIBLES - Amortization Expense of Acquired Intangibles (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Acquired Finite-Lived Intangible Assets [Line Items]
Amortization of intangible assets	$ 1,048	$ 1,002	$ 3,045	$ 3,006
Cost of revenue
Acquired Finite-Lived Intangible Assets [Line Items]
Amortization of intangible assets	705	629	2,017	1,887
Selling and marketing
Acquired Finite-Lived Intangible Assets [Line Items]
Amortization of intangible assets	$ 343	$ 373	$ 1,028	$ 1,119

GOODWILL AND OTHER INTANGIBLE_5

GOODWILL AND OTHER INTANGIBLES - Estimated Future Amortization Expense Related to Intangible Assets (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Goodwill and Intangible Assets Disclosure [Abstract]
Remainder of 2022	$ 1,048
2023	3,917
2024	3,147
2025	2,608
2026	874
2027	327
Total	$ 11,921	$ 14,063

OTHER ASSETS AND LIABILITIES (D

OTHER ASSETS AND LIABILITIES (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021	Sep. 30, 2021	Dec. 31, 2020
Other Assets and Liabilities [Abstract]
Income tax receivables	$ 11,948	$ 25,691
Contract assets	12,429	12,530
Other	38,080	29,787
Other current assets	62,457	68,008
Deferred income taxes	6,041	180,656
Deferred commissions	122,673	135,911
Right of use assets	80,163	87,521
Capped call transactions	3,583	59,964	$ 76,054	$ 83,597
Property and equipment	45,350	26,837
Venture investments	11,910	7,648
Intangible assets	11,921	14,063
Contract assets	10,541	10,643
Other	24,549	18,358
Other long-term assets	316,731	541,601
Operating lease liabilities	5,787	6,989
Dividends payable	2,466	2,454
Other current liabilities	8,253	9,443
Deferred revenue	3,949	5,655
Other	7,987	7,844
Other long-term liabilities	$ 11,936	$ 13,499

LEASES - Narrative (Details)

LEASES - Narrative (Details) ft² in Thousands, $ in Thousands			1 Months Ended
	Jul. 06, 2021 USD ($) ft²	Mar. 31, 2021 USD ($)	Feb. 28, 2021 USD ($)	Sep. 30, 2022 USD ($)	Dec. 31, 2021 USD ($)	Aug. 01, 2021 USD ($)
Lessee, Lease, Description [Line Items]
Gain lease termination			$ 18,000
Decrease in lease liabilities			21,100
Decrease in operating assets			$ 20,300
Base rent				$ 18,804
Lease liabilities				88,492
Right of use assets				$ 80,163	$ 87,521
Building
Lessee, Lease, Description [Line Items]
Term of contract	11 years	4 years 6 months
Based rent to paid (annually per year)		$ 2,000
Area of office space lease (in square feet) | ft²	131
Base rent	$ 6,000
Base rent increase percentage	0.03
Improvement allowance	$ 11,800
Lease liabilities						$ 42,100
Right of use assets						$ 42,100

LEASES - Operating Lease Expens

LEASES - Operating Lease Expenses (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Leases [Abstract]
Fixed lease costs	$ 4,688	$ (3,108)	$ 14,747	$ (6,780)
Short-term lease costs	916	542	2,510	1,516
Variable lease costs	905	1,099	2,395	3,826
Operating lease expenses	$ 6,509	$ (1,467)	$ 19,652	$ (1,438)

LEASES - Right of Use Assets (D

LEASES - Right of Use Assets (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Leases [Abstract]
Operating lease, right-of-use asset, statement of financial position	Other long-term assets	Other long-term assets
Right of use assets	$ 80,163	$ 87,521
Operating lease, liability, current, statement of financial position	Other current liabilities	Other current liabilities
Operating lease liabilities	$ 5,787	$ 6,989
Long-term operating lease liabilities	$ 82,705	$ 87,818

LEASES - Remaining Lease Term (

LEASES - Remaining Lease Term (Details)	Sep. 30, 2022	Dec. 31, 2021
Leases [Abstract]
Weighted-average remaining lease term	7 years 4 months 24 days	7 years 8 months 12 days
Weighted-average discount rate	4.20%	4.40%

LEASES - Maturities after Adopt

LEASES - Maturities after Adoption of 842 (Details) $ in Thousands	Sep. 30, 2022 USD ($)
Leases [Abstract]
Remainder of 2022	$ (4,717)
2023	18,804
2024	16,841
2025	14,778
2026	11,257
2027 and thereafter	48,397
Total lease payments	105,360
Less: imputed interest	(16,868)
Total lease liability	$ 88,492

LEASES - Cash Flow Information

LEASES - Cash Flow Information (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Leases [Abstract]
Cash paid for leases	$ 11,628	$ 14,403
Right of use assets recognized for new leases and amendments (non-cash)	$ 6,618	$ 54,716

DEBT - Convertible Senior Notes

DEBT - Convertible Senior Notes Narrative (Details)	1 Months Ended	3 Months Ended		9 Months Ended
	Feb. 29, 2020 USD ($) day $ / shares	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Debt Instrument [Line Items]
Redemption percentage	100%
On or after March 1, 2023
Debt Instrument [Line Items]
Redemption percentage	100%
Convertible debt
Debt Instrument [Line Items]
Face amount | $	$ 600,000,000
Interest rate	0.75%	0.75%	0.75%	0.75%	0.75%
Initial conversion rate	0.0074045
Initial conversion price (in dollars per share) | $ / shares	$ 135.05
Convertible debt | After the calendar quarter ending on June 30, 2020
Debt Instrument [Line Items]
Threshold percentage of stock price trigger	130%
Threshold trading days	20
Threshold consecutive trading days	30
Convertible debt | Measurement period
Debt Instrument [Line Items]
Threshold percentage of stock price trigger	98%
Threshold consecutive trading days	5
Threshold consecutive business days	5
Convertible debt | On or after March 1, 2023
Debt Instrument [Line Items]
Threshold percentage of stock price trigger	130%
Threshold trading days	20
Threshold consecutive trading days	30

DEBT - Net Carrying Amount (Det

DEBT - Net Carrying Amount (Details) - Convertible debt - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Debt Instrument [Line Items]
Principal	$ 600,000	$ 600,000
Unamortized issuance costs	(7,116)	(9,278)
Convertible senior notes, net	$ 592,884	$ 590,722

DEBT - Interest Expense (Detail

DEBT - Interest Expense (Details) - Convertible debt - USD ($) $ in Thousands	1 Months Ended	3 Months Ended		9 Months Ended
	Feb. 29, 2020	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Debt Instrument [Line Items]
Interest rate	0.75%	0.75%	0.75%	0.75%	0.75%
Contractual interest expense (0.75% coupon)		$ 1,125	$ 1,125	$ 3,375	$ 3,375
Amortization of issuance costs		724	677	2,163	2,025
Interest expense		$ 1,849	$ 1,802	$ 5,538	$ 5,400
Weighted-average effective interest rate		1.20%	1.20%	1.20%	1.20%

DEBT - Future Payments of Princ

DEBT - Future Payments of Principal and Contractual Interest (Details) - Convertible debt - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Principal
2023	$ 0
2024	0
2025	600,000
Principal, total due	600,000	$ 600,000
Interest
2023	4,500
2024	4,500
2025	2,250
Interest expense, total due	11,250
Total
2023	4,500
2024	4,500
2025	602,250
Principal and interest, total due	$ 611,250

DEBT - Capped Call Transactions

DEBT - Capped Call Transactions (Details) $ in Thousands, shares in Millions	1 Months Ended	3 Months Ended		9 Months Ended
	Feb. 29, 2020 $ / derivative shares	Sep. 30, 2022 USD ($) $ / derivative shares	Sep. 30, 2021 USD ($) $ / derivative shares	Sep. 30, 2022 USD ($) $ / derivative shares	Sep. 30, 2021 USD ($) $ / derivative shares
Debt Disclosure [Abstract]
Number of shares issuable upon conversion (in shares) | shares	4.4	4.4	4.4	4.4	4.4
Cap price (in dollars per share) | $ / derivative	196.44	196.44	196.44	196.44	196.44
Capped Call Transaction [Roll Forward]
Beginning balance				$ 59,964	$ 83,597
Fair value adjustment				(56,381)	(7,543)
Ending balance		$ 3,583	$ 76,054	$ 3,583	$ 76,054

DEBT - Credit Facility (Details

DEBT - Credit Facility (Details)		12 Months Ended
	Nov. 30, 2019 USD ($)	Dec. 31, 2022 USD ($)	Mar. 31, 2023	Sep. 30, 2022 USD ($)	Dec. 31, 2021 USD ($)
Debt Instrument [Line Items]
Remaining borrowing capacity				$ 0	$ 0
Outstanding letters of credit				$ 27,300,000
PNC bank, national association | Forecast
Debt Instrument [Line Items]
Minimum consolidated coverage ratio			3.5
Credit agreement | PNC bank, national association | Forecast
Debt Instrument [Line Items]
Maximum consolidated net leverage ratio			3.5
Credit agreement | PNC bank, national association | Subsequent Event
Debt Instrument [Line Items]
Minimum required cash and investments held		$ 200,000,000
Line of Credit | PNC bank, national association | Revolving credit facility
Debt Instrument [Line Items]
Revolving credit agreement term	5 years
Senior notes	$ 100,000,000
Increase in aggregate commitment amount	$ 200,000,000

FAIR VALUE MEASUREMENTS (Detail

FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Fair Value Assets
Marketable securities	$ 168,085	$ 202,814
Capped call transactions	3,583	59,964
Cash equivalents
Fair Value Assets
Cash equivalents	20,899	3,216
Venture investments
Fair Value Assets
Venture investments	11,910	7,648
Level 1
Fair Value Assets
Marketable securities	0	0
Capped call transactions	0	0
Level 1 | Cash equivalents
Fair Value Assets
Cash equivalents	20,899	3,216
Level 1 | Venture investments
Fair Value Assets
Venture investments	0	0
Level 2
Fair Value Assets
Marketable securities	168,085	202,814
Capped call transactions	3,583	59,964
Level 2 | Cash equivalents
Fair Value Assets
Cash equivalents	0	0
Level 2 | Venture investments
Fair Value Assets
Venture investments	0	0
Level 3
Fair Value Assets
Marketable securities	0	0
Capped call transactions	0	0
Level 3 | Cash equivalents
Fair Value Assets
Cash equivalents	0	0
Level 3 | Venture investments
Fair Value Assets
Venture investments	$ 11,910	$ 7,648

FAIR VALUE MEASUREMENTS - Chang

FAIR VALUE MEASUREMENTS - Change in Investment in Privately Held Companies (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning balance	$ 7,648
Ending balance	11,910
Convertible debt fair value	488,300		$ 642,000
Privately held investment
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning balance	7,648	$ 8,345
New investments	400	500
Sales of investments	(3,954)	(400)
Changes in foreign exchange rates	(675)	(52)
Changes in fair value included in other income	5,989	100
Changes in fair value included in other comprehensive income	2,502	1,220
Ending balance	$ 11,910	$ 9,713

REVENUE - Geographic Revenue (D

REVENUE - Geographic Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Disaggregation of Revenue [Line Items]
Revenue	$ 270,731	$ 256,268	$ 921,375	$ 895,469
Percent of total revenue	100%	100%	100%	100%
U.S.
Disaggregation of Revenue [Line Items]
Revenue	$ 148,200	$ 132,016	$ 513,197	$ 515,881
Other Americas
Disaggregation of Revenue [Line Items]
Revenue	18,546	17,510	80,558	43,469
United Kingdom (“U.K.”)
Disaggregation of Revenue [Line Items]
Revenue	24,074	25,982	83,837	86,747
Europe (excluding U.K.), Middle East, and Africa
Disaggregation of Revenue [Line Items]
Revenue	46,212	46,306	140,586	143,763
Asia-Pacific
Disaggregation of Revenue [Line Items]
Revenue	$ 33,699	$ 34,454	$ 103,197	$ 105,609
Total revenue | U.S. | Geographic Concentration Risk
Disaggregation of Revenue [Line Items]
Percent of total revenue	55%	52%	56%	58%
Total revenue | Other Americas | Geographic Concentration Risk
Disaggregation of Revenue [Line Items]
Percent of total revenue	7%	7%	9%	5%
Total revenue | United Kingdom (“U.K.”) | Geographic Concentration Risk
Disaggregation of Revenue [Line Items]
Percent of total revenue	9%	10%	9%	10%
Total revenue | Europe (excluding U.K.), Middle East, and Africa | Geographic Concentration Risk
Disaggregation of Revenue [Line Items]
Percent of total revenue	17%	18%	15%	15%
Total revenue | Asia-Pacific | Geographic Concentration Risk
Disaggregation of Revenue [Line Items]
Percent of total revenue	12%	13%	11%	12%

REVENUE - Revenue Stream (Detai

REVENUE - Revenue Stream (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Disaggregation of Revenue [Line Items]
Revenue	$ 270,731	$ 256,268	$ 921,375	$ 895,469
Perpetual license
Disaggregation of Revenue [Line Items]
Revenue	9,223	2,874	18,929	20,922
Subscription license
Disaggregation of Revenue [Line Items]
Revenue	31,112	35,421	210,245	251,226
Subscription services
Disaggregation of Revenue [Line Items]
Revenue	174,885	161,557	516,750	457,051
Subscription
Disaggregation of Revenue [Line Items]
Revenue	205,997	196,978	726,995	708,277
Consulting
Disaggregation of Revenue [Line Items]
Revenue	55,511	56,416	175,451	166,270
Revenue recognized at a point in time
Disaggregation of Revenue [Line Items]
Revenue	40,335	38,295	229,174	272,148
Revenue recognized at a point in time | Perpetual license
Disaggregation of Revenue [Line Items]
Revenue	9,223	2,874	18,929	20,922
Revenue recognized at a point in time | Subscription license
Disaggregation of Revenue [Line Items]
Revenue	31,112	35,421	210,245	251,226
Revenue recognized over time
Disaggregation of Revenue [Line Items]
Revenue	230,396	217,973	692,201	623,321
Revenue recognized over time | Maintenance
Disaggregation of Revenue [Line Items]
Revenue	77,526	83,188	235,568	237,531
Revenue recognized over time | Pega Cloud
Disaggregation of Revenue [Line Items]
Revenue	97,359	78,369	281,182	219,520
Revenue recognized over time | Consulting
Disaggregation of Revenue [Line Items]
Revenue	$ 55,511	$ 56,416	$ 175,451	$ 166,270

REVENUE - Performance Obligatio

REVENUE - Performance Obligations (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Sep. 30, 2021
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	$ 1,147,932	$ 1,034,026
Revenue remaining performance obligation (in percent)	100%	100%
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation		$ 577,650
Revenue remaining performance obligation (in percent)		56%
Expected timing of satisfaction		1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	$ 617,691	$ 261,071
Revenue remaining performance obligation (in percent)	53%	25%
Expected timing of satisfaction	1 year	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	$ 283,762	$ 127,188
Revenue remaining performance obligation (in percent)	25%	12%
Expected timing of satisfaction	1 year	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	$ 145,232	$ 68,117
Revenue remaining performance obligation (in percent)	13%	7%
Expected timing of satisfaction	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	$ 101,247
Revenue remaining performance obligation (in percent)	9%
Expected timing of satisfaction
Maintenance
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	$ 286,880	$ 327,696
Maintenance | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation		196,667
Maintenance | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	191,045	59,360
Maintenance | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	55,141	37,734
Maintenance | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	24,496	33,935
Maintenance | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	16,198
Pega Cloud
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	739,638	571,461
Pega Cloud | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation		284,359
Pega Cloud | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	328,111	177,214
Pega Cloud | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	213,304	79,775
Pega Cloud | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	115,416	30,113
Pega Cloud | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	82,807
Subscription license
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	77,020	66,802
Subscription license | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation		49,265
Subscription license | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	69,753	16,872
Subscription license | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	4,113	420
Subscription license | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	1,420	245
Subscription license | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	1,734
Perpetual license
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	7,571	22,971
Perpetual license | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation		15,686
Perpetual license | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	814	1,064
Perpetual license | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	4,505	4,094
Perpetual license | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	2,252	2,127
Perpetual license | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	0
Consulting
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	36,823	45,096
Consulting | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation		31,673
Consulting | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	27,968	6,561
Consulting | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	6,699	5,165
Consulting | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	1,648	$ 1,697
Consulting | Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-10-01
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligation	$ 508

STOCK-BASED COMPENSATION - Summ

STOCK-BASED COMPENSATION - Summary of Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation before tax	$ 33,774	$ 28,695	$ 93,301	$ 89,483
Income tax benefit	(600)	(5,845)	(1,505)	(18,028)
Cost of revenue
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation before tax	6,797	5,114	19,754	16,889
Selling and marketing
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation before tax	12,933	13,376	36,524	41,844
Research and development
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation before tax	7,724	6,231	22,425	19,343
General and administrative
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation before tax	$ 6,320	$ 3,974	$ 14,598	$ 11,407

STOCK-BASED COMPENSATION - Narr

STOCK-BASED COMPENSATION - Narrative (Details) $ in Millions	9 Months Ended
	Sep. 30, 2022 USD ($)
Share-Based Payment Arrangement [Abstract]
Unrecognized stock-based compensation expense	$ 161
Weighted-average period of recognition of unrecognized stock-based compensation expense (in years)	2 years 1 month 6 days

STOCK-BASED COMPENSATION - Su_2

STOCK-BASED COMPENSATION - Summary of Stock-Based Compensation Awards Granted (Details) shares in Thousands, $ in Thousands	9 Months Ended
	Sep. 30, 2022 USD ($) shares
Restricted stock units
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Grants in period (in shares) | shares	1,436
Total Fair Value | $	$ 112,303
Non-qualified stock options
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Options granted in period (in shares) | shares	4,529
Total Fair Value | $	$ 102,332
Common Stock
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Grants in period (in shares) | shares	14
Total Fair Value | $	$ 600

INCOME TAXES - Summary of benef

INCOME TAXES - Summary of benefit from income taxes and discrete tax items (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Income Tax Disclosure [Abstract]
Provision for (benefit from) income taxes	$ 11,748	$ (24,826)	$ 190,239	$ (54,360)
Effective income tax rate (benefit rate)			100%	(68.00%)

INCOME TAXES - Narrative (Detai

INCOME TAXES - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended			9 Months Ended
	Sep. 30, 2022	Jun. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Income Tax Disclosure [Abstract]
Deferred tax assets, valuation allowance		$ 191,900
Tax provision related to foreign income	$ 11,700
Provision for (benefit from) income taxes	$ 11,748		$ (24,826)	$ 190,239	$ (54,360)
Recognition of valuation allowance on deferred tax assets		$ 191,900

(LOSS) PER SHARE (Details)

(LOSS) PER SHARE (Details) $ / shares in Units, shares in Thousands, $ in Thousands	1 Months Ended	3 Months Ended						9 Months Ended
	Feb. 29, 2020 $ / derivative shares	Sep. 30, 2022 USD ($) $ / shares $ / derivative shares	Jun. 30, 2022 USD ($)	Mar. 31, 2022 USD ($)	Sep. 30, 2021 USD ($) $ / shares $ / derivative shares	Jun. 30, 2021 USD ($)	Mar. 31, 2021 USD ($)	Sep. 30, 2022 USD ($) $ / shares $ / derivative shares	Sep. 30, 2021 USD ($) $ / shares $ / derivative shares
Earnings Per Share [Abstract]
Net (loss) | $		$ (93,520)	$ (286,296)	$ (379)	$ (56,468)	$ 37,291	$ (6,617)	$ (380,195)	$ (25,794)
Weighted-average common shares outstanding (in shares)		81,996			81,526			81,842	81,284
(Loss) per share, basic (in dollars per share) | $ / shares		$ (1.14)			$ (0.69)			$ (4.65)	$ (0.32)
Weighted-average common shares outstanding, assuming dilution (in shares)		81,996			81,526			81,842	81,284
(Loss) per share, diluted (in dollars per share) | $ / shares		$ (1.14)			$ (0.69)			$ (4.65)	$ (0.32)
Outstanding anti-dilutive stock options and RSUs (in shares)		3,019			5,815			3,589	6,136
Convertible debt (in shares)		4,400			4,400			4,400	4,400
Number of shares issuable upon conversion (in shares)	4,400	4,400			4,400			4,400	4,400
Cap price (in dollars per share) | $ / derivative	196.44	196.44			196.44			196.44	196.44

COMMITMENTS AND CONTINGENCIES (

COMMITMENTS AND CONTINGENCIES (Details) - USD ($)		4 Months Ended
	May 09, 2022	Sep. 15, 2022	Sep. 30, 2022
Loss Contingencies [Line Items]
Outstanding letters of credit			$ 27,300,000
Appian Corp. v. Pegasystems Inc. & Youyong Zou
Loss Contingencies [Line Items]
Outstanding letters of credit		$ 25,000,000
Appian Corp. v. Pegasystems Inc. & Youyong Zou | Judicial Ruling
Loss Contingencies [Line Items]
Loss contingency, damages awarded, value		$ 2,060,479,287
Trade Secret Misappropriation | Appian Corp. v. Pegasystems Inc. & Youyong Zou
Loss Contingencies [Line Items]
Legal fees, post-judgement interest rate, percentage		6%
Trade Secret Misappropriation | Appian Corp. v. Pegasystems Inc. & Youyong Zou | Judicial Ruling
Loss Contingencies [Line Items]
Loss contingency, damages awarded, value	$ 2,036,860,045
Violation of the Virginia Computer Crimes Act | Appian Corp. v. Pegasystems Inc. & Youyong Zou | Judicial Ruling
Loss Contingencies [Line Items]
Loss contingency, damages awarded, value	$ 1

Uncategorized Items - pega-2022

Label	Element	Value
Accounting Standards Update [Extensible Enumeration]	us-gaap_AccountingStandardsUpdateExtensibleList	Accounting Standards Update 2020-06 [Member]