Pegasystems sees opportunity in runaway token costs, pitches outcome-based pricing

Pegasystems outlined advances in its Pega Infinity platform and took aim at runaway token costs by charging a single flat price for outcome no matter how much Pega AI is used.

Although Pegasystems pricing model is uniquely positioned for more outcome-based pricing, the news from Pegaworld, Pegasystems annual conference, is likely to be the beginning of enterprise software vendors looking to address token costs. As AI agents proliferate, you're being increasingly charged for reasoning that starts from scratch for each query. The costs of this overthinking add up.

Pegasystems calls the current state of enterprise affairs the token tax. The company said its Pega Predictable AI architecture focuses on process design upfront so AI agents are reliable and cheaper to run because they don't get caught in a reasoning loop.

The company also launched Pega Infinity Studio, part of Pegasystems broader Infinity platform, to design processes and optimal AI agent workflows. Once workflows are designed and deployed, Pegasystems shifts to semantic mode of AI and runtime where agents don't have to reason over every new workflow. LLM usage is specific and governed by instructions.

Pegasystems big pitch is that it can provide more predictable outcomes and costs. The message is timely given enterprises are struggling with balancing probabilistic and deterministic work and minimizing the churn of LLMs that frankly overthink processes and work.

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Deterministic flows

For Pegasystems, the ability to price by outcome over tokens isn't too much of a stretch.

The company has been primarily focused on deterministic processes that have to be exactly the same way repeatedly. Pegasystems is now combining probabilistic workflows that are the specialty of large language models.

Pegasystems measures a piece of work called a case. Pegasystems business model licenses cases. Speaking at an investor conference this month, Kenneth Stillwell, chief operating and financial officer explained:

"A case is a unit of measure in Pega. Think of a case as a piece of work. So, we license based on the pieces of work. A piece of work could be a dispute on a credit card, a loan origination, the number of clients that are onboarded, different measures, the number of card replacements that you might have for lost credit cards. So that unit of measure of the case is how we license. And we feel like the more that the system automates work, the more cases that it does, the more that Pega should receive compensation because we're automating and driving efficiency."

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In many respects, a case rhymes with a usage model. More than 75% of Pegasystems contracts are based on cases. In 2025, Pegasystems delivered revenue of $1.746 billion and is projecting revenue of $2 billion for 2026.

Pegasystems is targeting 15% growth in annual contract value and expects 75% of ACV will derive from Pega Cloud, which is being adopted due to its Pega Blueprint AI.

Pega Infinity Studio

Pegasystems launched Pega Infinity Studio, which is designed to build processes upfront with best practices that minimize AI costs. The launch builds on Pega Blueprint AI, which is a workflow design agent.

Pega Infinity Studio has an AI-first developer interface, but can leverage in-house AI assistants or coding agents via GitHub Copilot, Anthropic Claude and OpenAI Codex.

In many ways, Pega Infinity Studio aims to wrangle AI code. Key items include:

• Pega Infinity Studio includes industry standards and best practices from Pega Blueprint AI.
• The design of Infinity Studio is the same as Blueprint AI and automatically generates plans with security and governance.
• A natural language interface speeds up development.
• Infinity Studio includes Model Context Protocol support.
• Developers can also use command line interfaces to access, understand and update Pega apps.

Pega Infinity Studio will be available with the launch of the full Pega Infinity 26 suite expected in the third quarter.