PagerDuty's stock drops on tepid guidance amid 'headwinds from small business'

By Jon Swartz

PagerDuty Inc.'s stock tumbled 9% in after-hours trading Thursday following quarterly results that slightly edged analyst estimates but offered tepid guidance.

"The quarter was characterized by strong momentum in the midmarket and enterprise," Howard Wilson, the cloud-computing company's chief financial officer, said in an interview. "We still see headwinds from small business, but our [annual recurring revenue] was 62% from customers using two or more of our products."

PagerDuty (PD) reported a fiscal fourth-quarter net loss of $28.8 million, or 33 cents a share, compared with a net loss of $25 million, or 27 cents a share, in the year-prior quarter. Adjusted earnings were 17 cents a share.

Revenue climbed 10% to $111.1 million, from $100.97 million in the year-prior quarter.

Analysts surveyed by FactSet had expected, on average, adjusted net income of 15 cents a share on revenue of $110.7 million.

PagerDuty provided first-quarter sales guidance of between $110.5 million and $112.5 million. FactSet analysts were forecasting $113.9 million.

Shares of PagerDuty have sunk 28% over the last 12 months. The broader S&P 500 index SPX is up 30% in that time.

-Jon Swartz

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03-14-24 2008ET

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