PagerDuty (PD) Q4 2026 earnings summary

Executive summary

• Fiscal 2026 marked a transformational year with the first full year of GAAP profitability, Q4 net income of $11 million, and annual net income of $174 million, driven by a one-time $169 million tax benefit.

• Q4 revenue reached $125 million, up 3% year-over-year, with non-GAAP operating margin at 24%, both exceeding guidance.

• Platform innovation and AI-first operations drove structural efficiency, product differentiation, and customer expansion.

• Expanded enterprise customer base, with 861 customers above $100,000 ARR and strong momentum in large multi-year deals.

• Leadership changes included new board and executive appointments, with a CFO transition planned for Q2.

Financial highlights

• FY26 revenue was $493 million, up 5% year-over-year; Q4 revenue was $125 million, up 3% year-over-year.

• Annual recurring revenue (ARR) at Q4 end was $499 million, up 1% year-over-year.

• GAAP net income for FY26 was $174 million, including a one-time $169 million tax benefit; Q4 GAAP net income was $11 million.

• Non-GAAP operating margin for FY26 was 24.6%; Q4 non-GAAP operating income was $29.8 million (24% margin).

• Free cash flow for FY26 was $103 million (21% margin); cash, cash equivalents, and investments totaled $470 million at year-end.

Outlook and guidance

• FY27 revenue guidance is $488.5 million to $496.5 million, with the midpoint essentially flat year-over-year.

• Non-GAAP operating margin expected at 24%-25% for FY27, with an 8% increase in EPS.

• Q1 FY27 revenue expected between $118 million and $120 million, with non-GAAP operating margin of 19%-20%.

• Free cash flow margin expected to be 2-4 percentage points lower than FY26 due to lower interest income, higher CapEx, and payment timing.

• Targeting long-term non-GAAP operating margin of 30% and gross margin between 84% and 86%.