PagerDuty (PD) Shares Surge 13% on Better-Than-Expected Results and Guidance, Results Seen as Impressive

Shares of PagerDuty (NYSE: PD) rose by nearly 14% in premarket trading Thursday after the company released an upbeat revenue forecast for Q1 and full-fiscal 2023.

The company reported a Q4 adjusted loss per share of 4c, compared to the consensus estimates of 5.6c per share. Revenue came in at $78.5 million in the quarter, above the analyst expectations of $76.3 million.

For the first quarter, the software company expects adjusted loss per share in the range of 8c to 9c and revenue in the range of $81.5 million to $83.5 million, topping the consensus estimates of $80.6 million.

For FY2023, PagerDuty expects an adjusted loss per share from 17c to 23c. It anticipates revenue of $360 million, compared to the expected $352.7 million.

“Driven by ongoing market traction for our new products and strong go to market execution, Q4 results capped a fiscal year of accelerating growth for PagerDuty,” the company said in a statement.

Cowen analyst Derrick Wood reiterated a Buy rating following results.

“We are impressed by another strong beat & FY23 guide, driving shares up 13% AH. We note initial guidance last year was +26% (high end) & finished at 32%, & with execution feeling more consistent we expect continued solid upside trends. We see many growth levers starting to strengthen including multi-product attach, & a growing surface of users and use-cases to target (beyond DevOps) with PD's broader Incident Response, AIOps and Automation platform,” Wood said in a client note.

RBC analyst Matthew Hedberg raised the price target to $46.00 per share, up from the prior $45.00, following “strong” results.

“ARR was disclosed for the first time; we believe it should serve as a cleaner growth metric than billings, though only disclosed annually as of now. Guidance calls for +29% FY/23 revenue growth (+27% organic), though we think it works higher to 30%+. Additionally, management expects to be OM positive by FY/24. We believe PD continues to benefit from digital transformation and the need for increased automation,” Hedberg wrote in a client note.

By Senad Karaahmetovic | [email protected]

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