Summary
PagerDuty's fiscal 2026 first quarter revenue rose 7.8% year over year to $119.8 million, up from $111.2 million in the prior-year quarter. Gross profit was $100.6 million, up 9.6%, and gross margin reached 84.0%, up 1.4 percentage points from 82.6%. Annual recurring revenue hit $496 million as of April 30, 2025, a 7% increase. On a non-GAAP basis the company reported operating income of $24.4 million and a 20.3% operating margin, a wide gap from the GAAP result. Revenue growth came mostly from existing customers adding users and buying more products.
The GAAP numbers show real cost discipline alongside continued losses. Operating loss was $10.3 million, narrower than the $21.7 million loss in the year-ago quarter, and operating margin improved to negative 8.6% from negative 19.5%. Net loss attributable to PagerDuty was $7.2 million, compared with $17.1 million a year earlier, and diluted loss per share was $0.07 versus the $0.26 loss reported in the prior-year quarter. Research and development spending fell, general and administrative costs declined, and sales and marketing rose as the company pushed media campaigns. Stock-based compensation of $25.8 million, restructuring costs of $3.8 million and shareholder matters of $2.3 million explain most of the distance between the GAAP loss and non-GAAP net income per diluted share of $0.24.
Cash generation held firm. Operating cash flow was $30.7 million for the quarter, up 7.1% from $28.6 million a year ago. Capital expenditures were $0.4 million, down 3.5%. Free cash flow, a non-GAAP measure, was $29.0 million. Cash, cash equivalents and investments totaled $597.1 million as of April 30, 2025, a balance the company says covers working capital and capital spending needs for at least the next twelve months. Deferred revenue was $239.7 million, up 7.2% from the prior-year quarter, and remaining performance obligations were $430 million, up 10.8%.
Customer metrics were mixed. Total paid customers reached 15,247 as of April 30, 2025, up from 15,120 a year earlier. Customers with ARR above $100 thousand grew 5% to 848 from 811. Dollar-based net retention slipped to 104% from 106%, which points to softer expansion inside the existing base even as new logos land. Management highlighted lands and expands at Anduril, Anthropic, DoorDash, Fujitsu, Scale AI and Worldline, a strategic collaboration agreement with Amazon Web Services, and FedRAMP Low authorization.
Guidance for the second quarter of fiscal 2026 points to revenue growth of 6% to 7% year over year, with non-GAAP net income per diluted share of $0.19 to $0.20. For the full fiscal year 2026, the company trimmed its revenue outlook while raising non-GAAP net income per diluted share guidance to $0.95 to $1.00 from $0.90 to $0.95. Full-year growth is still guided at 5% to 7%. The shape of the outlook is telling: slower top-line growth, better profitability.
The risks are plain. PagerDuty still runs a GAAP operating loss, and its filings point to the ability to achieve and maintain future profitability, dependence on a single product, competition, seasonality, and the effect of tariffs and trade policy on global demand. A convertible note matures during the three months ending July 31, 2025 and will be repaid in cash, which pulls on liquidity even with a strong balance sheet. A repurchase program authorized in March 2025 had no shares bought back as of April 30, 2025. Marketing spend and severance costs both showed up in the quarter, and the dip in net retention suggests the enterprise transition will keep pressure on near-term growth.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q1 FY2026 | Q4 FY2025 | QoQ | Q1 FY2025 | YoY |
|---|---|---|---|---|---|
| Revenue | $119.8M | $121.4M | -1.4% | $111.2M | +7.8% |
| Gross profit | $100.6M | $101.5M | -0.8% | $91.8M | +9.6% |
| Gross margin | 84.0% | 83.5% | +0.4 pp | 82.6% | +1.4 pp |
| Research & development | $34.0M | $34.6M | -1.6% | $37.5M | -9.3% |
| Sales & marketing | $50.0M | $53.1M | -5.7% | $48.5M | +3.2% |
| General & administrative | $26.9M | $25.5M | +5.3% | $27.5M | -2.5% |
| Total operating expenses | $110.9M | $113.2M | -2.0% | $113.6M | -2.3% |
| Operating income (loss) | -$10.3M | -$11.7M | +11.9% | -$21.7M | +52.5% |
| Operating margin | -8.6% | -9.7% | +1.0 pp | -19.6% | +10.9 pp |
| Net income (loss) | -$7.4M | -$8.9M | +16.9% | -$17.3M | +57.5% |
| Net margin | -6.2% | -7.3% | +1.1 pp | -15.6% | +9.4 pp |
| Diluted EPS | -$0.07 | -$0.12 | +$0.05 | -$0.26 | +$0.19 |
| Customers | 15,120 | — | — | 15,089 | +0.2% |
| Net retention rate | 104.0% | 106.0% | -2.0 pp | 106.0% | -2.0 pp |
Risks
The filing adds an expanded risk factor on international trade policies, tariffs, sanctions and trade barriers. Although PagerDuty does not import or export physical goods, customers exposed to tariffs may reduce demand or extend sales cycles, and retaliatory policies or anti-U.S. sentiment may favor local competitors and hurt non-U.S. adoption.
The filing emphasizes that ARR and other operational metrics rely on internal non-financial systems, have not been independently verified, and may not accurately reflect actual or future performance. MD&A also reports dollar-based net retention rate declined to 104% for the last 12 months ended April 30, 2025 from 106% in the prior-year period.
SaaS KPIs
All quarters →Free Cash Flow Margin
Non-GAAP Operating Margin
Free Cash Flow
Dollar-Based Net Retention Rate
Total Paid Customers
Non-GAAP Gross Margin
Non-GAAP Operating Income
Annual Recurring Revenue (ARR)
Free and Paid Customers
Remaining Performance Obligations
Customers with ARR over $100K
Summary, forecast, risks and KPIs are extracted from PagerDuty, Inc.'s SEC filings for Q1 FY2026 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 2, 2026.