PagerDuty (NYSE:PD) Posts Earnings Results, Beats Estimates By $0.05 EPS

PagerDuty (NYSE:PD) announced its earnings results on Thursday. The company reported $0.29 earnings per share for the quarter, topping analysts’ consensus estimates of $0.24 by $0.05, FiscalAI reports. The company had revenue of $124.79 million for the quarter, compared to analyst estimates of $122.96 million. PagerDuty had a return on equity of 10.27% and a net margin of 31.12%.The firm’s quarterly revenue was up 2.7% compared to the same quarter last year. During the same quarter last year, the company earned $0.22 earnings per share. PagerDuty updated its Q1 2027 guidance to 0.230-0.250 EPS and its FY 2027 guidance to 1.230-1.280 EPS.

Here are the key takeaways from PagerDuty’s conference call:

• PagerDuty reported its first full‑year GAAP profitability (Q4 GAAP net income $11M) and expanded non‑GAAP operating margin to 24% in Q4, while stating a clear path toward a long‑term 30% non‑GAAP operating margin (full‑year GAAP net income included a one‑time $169M tax benefit).
• Revenue and ARR stabilized with Q4 revenue of $125M (+3% YoY) and ending ARR of approximately $499 million, while new and expansion bookings accelerated (Q4 bookings +6% YoY, +37% sequential) and growth concentrated in larger enterprise accounts.
• Management is driving a shift to flex consumption pricing and AI agent products, pointing to multiple large multi‑year deals (e.g., $4.5M and $2.7M wins) and new partnerships (Anthropic, Cursor, LangChain) as levers for higher consumption and expansion.
• Retention and seat compression remain headwinds — dollar‑based net retention fell to 98% due to lower gross retention and modest churn in the $100K ARR cohort, and management set a conservative FY27 revenue guide with the midpoint essentially flat YoY.
• Strong balance sheet and capital returns — $470M in cash and investments, ~10M shares repurchased in FY26 under a $200M plan (≈$63M remaining), and management expects to sustain GAAP profitability while funding AI/product investments.

PagerDuty Price Performance

Shares of PD traded down $0.05 during trading hours on Friday, hitting $7.22. 2,043,774 shares of the company were exchanged, compared to its average volume of 3,273,689. The company has a quick ratio of 2.37, a current ratio of 2.37 and a debt-to-equity ratio of 1.23. PagerDuty has a fifty-two week low of $6.15 and a fifty-two week high of $19.70. The company has a market cap of $662.38 million, a price-to-earnings ratio of 4.55, a P/E/G ratio of 1.84 and a beta of 0.73. The firm’s fifty day moving average is $9.19 and its 200 day moving average is $13.00.

Analyst Upgrades and Downgrades

A number of research analysts have commented on the company. Royal Bank Of Canada decreased their price objective on PagerDuty from $9.00 to $8.00 and set a “sector perform” rating on the stock in a report on Friday. Zacks Research cut shares of PagerDuty from a “strong-buy” rating to a “hold” rating in a research report on Monday, January 26th. William Blair restated a “market perform” rating on shares of PagerDuty in a research note on Friday. Craig Hallum lowered shares of PagerDuty from a “buy” rating to a “hold” rating and lowered their price target for the stock from $20.00 to $15.00 in a research report on Wednesday, November 26th. Finally, TD Cowen dropped their price objective on shares of PagerDuty from $20.00 to $10.00 and set a “buy” rating for the company in a research note on Friday. Three equities research analysts have rated the stock with a Buy rating, eight have given a Hold rating and three have issued a Sell rating to the company. According to data from MarketBeat, PagerDuty presently has an average rating of “Hold” and an average price target of $14.45.

Key Headlines Impacting PagerDuty

Here are the key news stories impacting PagerDuty this week:

• Positive Sentiment: EPS beat, margin expansion and ambitious EPS guidance — PagerDuty reported a Q4 EPS beat and highlighted FY2027 EPS guidance (1.23–1.28) well above consensus, and management flagged expanded non‑GAAP margins and the company’s first GAAP profitable year, supporting profitability re-rating. Zacks: PagerDuty Beats Q4
• Positive Sentiment: Analyst conviction on AI / usage-based upside — TD Cowen reiterated a Buy, citing the company’s usage‑based transition, early signs of growth reacceleration and underappreciated AI-driven upside that could lift long‑term multiples. TipRanks: TD Cowen Buy
• Positive Sentiment: Product/AI roadmap progress — PagerDuty expanded its AI ecosystem and rolled out Spring 2026 platform updates to support autonomous operations and AI agents, strengthening its strategic positioning in AI‑first operations. BusinessWire: AI Ecosystem Expansion
• Neutral Sentiment: Official results and materials are available — The company posted its Q4 press release, slide deck and call transcript for investors to review detailed metrics. These show mixed signals across top line, margins and cash flow. Quarterly Press Release / Slide Deck
• Negative Sentiment: Revenue guidance below Street — PagerDuty set FY2027 revenue guidance ($488.5M–$496.5M) and Q1 revenue guidance ($118M–$120M) below consensus, which outweighed the EPS beats and prompted investor concern about near‑term top‑line reacceleration. Investing.com: Stock Tumbles on Weak Revenue Outlook
• Negative Sentiment: Market focused on cash‑flow and metric inconsistencies — Third‑party summaries flagged weaker operating cash flow, lower cash on hand versus prior year and some profitability metric variability, amplifying the sell‑off after hours. QuiverQuant: Stock Falls, Cash‑Flow Notes
• Negative Sentiment: Shares reacted negatively after hours — Despite the mixed fundamental picture (EPS beat, margin progress, AI product wins), investors sold shares on the weaker revenue outlook, driving a notable post‑earnings decline. Yahoo Finance: Stock Drops After Q4

Insiders Place Their Bets

In related news, Director Dan Alexandru Solomon sold 266,667 shares of the company’s stock in a transaction dated Tuesday, December 30th. The shares were sold at an average price of $13.35, for a total transaction of $3,560,004.45. Following the completion of the sale, the director owned 2,389,665 shares of the company’s stock, valued at $31,902,027.75. This represents a 10.04% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is available through the SEC website. 8.00% of the stock is owned by corporate insiders.

Hedge Funds Weigh In On PagerDuty

Several hedge funds and other institutional investors have recently made changes to their positions in the company. Kestra Advisory Services LLC bought a new stake in shares of PagerDuty during the 4th quarter worth approximately $68,000. Los Angeles Capital Management LLC bought a new position in PagerDuty in the fourth quarter valued at approximately $114,000. One68 Global Capital LLC acquired a new position in PagerDuty during the third quarter valued at approximately $165,000. Inceptionr LLC acquired a new position in PagerDuty during the fourth quarter valued at approximately $132,000. Finally, State of Tennessee Department of Treasury bought a new stake in PagerDuty during the second quarter worth $160,000. 97.26% of the stock is currently owned by institutional investors and hedge funds.

About PagerDuty

PagerDuty, Inc engages in the operation of a digital operations management platform in the United States and internationally. The company’s digital operations management platform collects data and digital signals from virtually any software-enabled system or device and leverage machine learning to correlate, process, and predict opportunities and issues. Its platform includes PagerDuty Incident Management that provides a real-time view across the status of a digital service while incorporating noise reduction to remove false positives; AIOps that applies machine learning to correlate and automate the identification of incidents from billions of events; Process Automation offers centralized design time and run time environment for orchestrating automated workflows that span across departments, technologies, and networks; Customer Service Operations, which is offered to orchestrate, automate, and scale responses to customer impacting issues.