PagerDuty (PD) Q4 loss weaker than expected, revenue rises

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pager PD reported a non-GAAP loss of 4 cents per share in the fourth quarter of fiscal 2022, which topped Zacks’ consensus estimate of 33.33% and was narrower than the quarter’s loss of 6 cents. the previous year.

Revenue of $78.5 million was up 32.4% year-over-year, primarily due to strong business and mid-market expansion. The figure topped the consensus revenue estimate of 3.2%.

International revenues represented 24% of total revenues.

PagerDuty shares rose 14% in after-hours trading after the results. PagerDuty shares underperformed the Zacks IT and Technology sector as well as Zacks Internet Software peers like CrowdStrike CRWD and Focus on benefits BNFT, but outperformed Quickly FSLY year to date.

While PagerDuty shares were down 22.7%, the IT & Technology sector was down 20.8%. Shares of Benefitfocus, CrowdStrike and Fastly are down 5.8%, 7.4% and 56.5% respectively since the start of the year.

PagerDuty Price, Consensus and EPS Surprise

PagerDuty price-consensus-eps-surprise-chart | PagerDuty Quote

Top Line Customer Growth Aids

PagerDuty continued to strengthen in the enterprise and mid-market market, with a total dollar net retention rate of 124% as of January 31, 2022.

Customers with annual recurring revenue (“ARR”) greater than $100,000 numbered 594 as of January 31, 2022, compared to 426 a year ago.

Customers with an ARR over $1,000,000 were 43 as of January 31, 2022, up from 26 a year ago.

The total number of paying customers was 14,865 as of January 31, 2022.

Quarter details

In the fourth quarter of fiscal 2022, non-GAAP gross profit increased 30.1% year over year to $66.1 million. Gross margin contracted by 150 basis points (bps) to 84.2%.

Non-GAAP research and development (R&D) expenses increased 42.7% to $19.3 million.

Non-GAAP sales and marketing (S&M) expenses increased 22.9% year over year to $36.5 million. Non-GAAP general and administrative (G&A) expenses increased 5.2% from the prior year quarter to $12.7 million.

The non-GAAP operating loss of $2.5 million was lower than the loss of $4.6 million in the prior year quarter.

Balance sheet and cash flow

As of January 31, 2022, PagerDuty had cash and cash equivalents and current investments of $543.4 million.

Net cash provided by operating activities was $1.35 billion, compared to $3.39 billion in the prior year quarter.

Advice

For the first quarter of fiscal 2023, revenue is expected to be between $81.5 million and $83.5 million, indicating year-over-year growth of 28-31%. The non-GAAP net loss is expected between 9 cents and 8 cents per share.

For fiscal year 2023, revenue is forecast between $360 million and $366 million. Non-GAAP net loss per share is expected between 23 cents and 17 cents.

Zacks Rank

Currently, PagerDuty carries a Zacks Rank #3 (Hold). You can see the full list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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