PagerDuty : 2Q FY2027 Earnings Conference Call

About this update from Pagerduty, Inc.

Q2 Fiscal Year 2027 Investor Presentation Period ended July 31, 2026 Our Vision: Autonomous Operations Prevents Incidents Data at Scale 750+ API and 20 MCP integrations Human + Agent Incident Response Event orchestration & intelligence Chat-native collaboration AI Agents & Workflow automation 12 billion events * 16 million incident workflows * 10 million Slack and MS Teams actions executed* Over 900+ million incidents managed 99.99% average reliability *per year Autonomous Operations Continuous Improvement Responders : Post-incident analysis Agents - Incident history for context Developers - Fixing root cause & prevention Constant and Deliberate Innovation 16 years of domain expertise 99.9% 86B Events ingested 828M incidents created by customers 10+ years of AI innovation $100M annual R&D investment web availability SLA 2023 2024 2025 Platform 2026 AI Ecosystem MCP 2009 PagerDuty Founded 2010 Escalation Policies On-Call Management 2018 Response Plays 2019 Event Intelligence (AIOps) 2020 Pro code automation 2021 Customer Service Ops Service Graph AIOps 2022 Low code automation Status Pages Incident Management Post-Incident Analysis Chat-first capabilities GenAI AI Agents Ops Console Chat Experience AI & Automation Use Case Library AI Is Accelerating Software - and Operational Risk More code shipped faster, by more autonomous agents, means more can break. Resilient, automated operations are now a board-level priority. Operational efficiency and reliability remain foundational 59% are actively incorporating AI into operations Disruptions are a board-level financial risk 68% lose $300K+ per hour during major incidents Resilience investment is a C-suite decision 95% agree resiliency drives competitive advantage Source: State of the AI-First Operations Report 2026 AI Is Accelerating Software - and Our Opportunity Agentic $s ITOM Spend (e.g. agents) CY25 CY26 CY27 CY28 CY29 CY30 46% $4 $10 $17 $26 $35 $44 C Y26-3 0 CAGR Y/Y: 151% 74% 51% 36% 27% Source: Google DORA, The ROI of AI-assisted Software Development (2026) ; Source: Gartner Forecast: Agentic AI in ITOM SW (May 2026); TAM for simple and autonomous agents, CAGR represented for CY26-CY30 The agentic era is paying off 88% of agentic-AI early adopters already see positive returns Trusted by Innovators and Category Leaders Software & Financial Retail & Healthcare Media & Travel & AI Technology Services & Wholesale Entertainment Hospitality Insurance Q2 Results 8 The AI-first Digital Operations Platform $501M Annual recurring revenue $124M Total revenue 24% Non-GAAP operating margin 26% Free cash flow margin 15,506 Total paid customers 884 Customers > $100K ARR 98% Dollar-based net retention 750+/20+ Platform / MCP integrations See appendix for GAAP-to-non-GAAP reconciliations. Note: As of July 31, 2026 9 Durable Profitability Non-GAAP Operating Margin 30% Target See appendix for GAAP-to-non-GAAP reconciliations for FY24, FY25, FY26, and Q2'FY27. For non-GAAP reconciliation for Q1'FY27, see https://s206.q4cdn.com/635206389/files/doc_financials/2027/q1/FY27-Q1-General-Investor-Presentation.pdf . 10 Gross Margin Performance of 85% Consistently tracking the long-term target baseline target of 84%-86% Disciplined and Efficient Operations Operating cash flow margin Free cash flow margin Modeling assistance update: FY27 free cash flow margin to align with FY26 See appendix for GAAP-to-non-GAAP reconciliations for FY24, FY25, FY26, and Q2'FY27. For non-GAAP reconciliation for Q1'FY27, see https://s206.q4cdn.com/635206389/files/doc_financials/2027/q1/FY27-Q1-General-Investor-Presentation.pdf . Managing for profitable growth Returning cash to investors Share Repurchase Program $100M 2024 Share Repurchase Program completed November 2024 $200M 2025 Share Repurchase Program completed March 2026 $100M 2026 Share Repurchase Program $8M repurchased, $92M remaining Note: As of July 31, 2026 Balance Sheet $470M Cash, cash equivalents and investments $426M* RPO Note: As of July 31, 2026 * Of this amount, approximately $309 million is expected to be recognized over the next 12 months. For full RPO maturity details, see Note 11 to the condensed consolidated financial statements included in our Form 10-Q for the second quarter of fiscal 2027. Flexibility to invest In operational efficiency, productivity and innovation. $309M of RPO expected to be recognized over the next 12 months. Updated Guidance Issued August 27, 2026 Q3 FY 2027 Full-year FY27* Revenue $123M - $125M $488.5M - $496.5M $491.5M - $496.5M Non-GAAP operating margin 26.5% - 27.5% 24 - 25% 25% Non-GAAP EPS (diluted) $0.34- $0.36 $1.27 - $1.32 $1.33 - 26% - $1.37 PagerDuty has not provided the GAAP equivalent or reconciled its expectations as to non-GAAP net income per share attributable to PagerDuty, Inc. common stockholders or our outlook for non-GAAP operating margin to GAAP net income per share attributable to PagerDuty, Inc. common stockholders or GAAP operating margin, respectively, because certain reconciling items such as stock-based compensation expense, employer taxes related to employee stock transactions, acquisition-related expenses, restructuring costs, gains or losses on extinguishment of convertible senior notes, adjustment attributable to redeemable non-controlling interest, and income tax effects and adjustments are out of PagerDuty's control or cannot be reasonably predicted. Accordingly, such reconciliation is not available without unreasonable effort. However, it is important to note that these reconciling items could have a significant effect on PagerDuty's future GAAP results. Thank You Resilient, autonomous operations for the AI era. Investor Relations investor.pagerduty.com Newsroom pagerduty.com/newsroom Customer stories pagerduty.com/customers Product pagerduty.com 15 Appendix 16 Resources I nvestor Relations Page https://investor.pagerduty.com PagerDuty Newsroom https://www.pagerduty.com/newsroom/ PagerDuty Introduction https://support.pagerduty.com/main/docs/introduction Knowledge Base https://support.pagerduty.com/ Case Studies https://www.pagerduty.com/customers/ Executive Spotlight https://www.pagerduty.com/in-perspective/ Impact Hub https://www.pagerduty.com/impact-hub/ Definitions Annual Recurring Revenue (ARR) - Annualized recurring value of all active contracts at the end of a reporting period. Customer - A separate legal entity, such as a company or an educational or government institution, that has an active subscription with us or one of our partners to access our platform. In situations where an organization has multiple subsidiaries or divisions, we treat the parent entity as the customer instead of treating each subsidiary or division as a separate customer. Dollar-Based Net Retention (DBNR) - Calculated as of a period end starting with the ARR from the cohort of all customers as of 12 months prior to such period end. Next, we calculate the ARR from these same customers as of the current period end. Period ARR includes any expansion and is net of downgrades or churn over the last 12 months but excludes ARR from new customers in the current period. We then divide the total Current Period ARR by the total Prior Period ARR to arrive at the dollar-based net retention rate. Gross Retention Rate - Calculated as the annualized impact of ARR lost due to downgrade and churn in the quarter compared to starting ARR. Reconciliation PagerDuty, Inc. Reconciliation of GAAP to Non-GAAP Data (in thousands, except percentages and per share data) (unaudited) Three months ended July 31, Year ended January 31, 2026 2025 2026 2025 2024 Non-GAAP gross profit and non-GAAP gross margin Gross profit $104,399 $104,410 $418,404 $387,834 $352,867 Add: Stock-based compensation 665 1,213 4,283 5,984 7,586 Employer taxes related to employee stock transactions 13 30 125 162 199 Amortization of acquired intangible assets 320 601 2,700 9,075 8,614 Restructuring costs - - 292 (2) 137 Non-GAAP gross profit $105,397 $106,254 $425,804 $403,053 $369,403 Revenue $124,436 $123,411 $492,546 $467,499 $430,699 Gross margin 84% 85% 85% 83% 82% Non-GAAP gross margin 85% 86% 86% 86% 86% Non-GAAP research and development Research and development $30,897 $30,897 $126,937 $141,489 $139,769 Less: Stock-based compensation 5,592 9,560 36,345 44,691 44,800 Employer taxes related to employee stock transactions 96 183 958 1,116 1,398 Acquisition-related expenses - 35 263 978 838 Amortization of acquired intangible assets - - - 116 350 Restructuring costs - - 1,707 424 (26) Impairment of long-lived assets - - 1,213 - - Non-GAAP research and development $25,209 $21,119 $86,451 $94,164 $92,409 Revenue $124,436 $123,411 $492,546 $467,499 $430,699 Research and development as a % of revenue 25% 25% 26% 30% 32% Non-GAAP research and development as a % of revenue 20% 17% 18% 20% 22% Note: Certain figures may not sum due to rounding. Reconciliation con't PagerDuty, Inc. Reconciliation of GAAP to Non-GAAP Data (in thousands, except percentages and per share data) (unaudited) Three months ended July 31, Year ended January 31, 2026 2025 2026 2025 2024 Non-GAAP sales and marketing Sales and marketing $38,325 $44,456 $184,040 $201,821 $196,769 Less: Stock-based compensation 3,064 5,285 22,420 31,185 30,345 Employer taxes related to employee stock transactions 55 121 587 773 919 Amortization of acquired intangible assets 620 632 2,520 2,530 2,459 Restructuring costs - 22 3,296 140 (49) Non-GAAP sales and marketing $34,586 $38,396 $155,217 $167,193 $163,095 Revenue 124,436 123,411 492,546 467,499 430,699 Sales and marketing as a % of revenue 31% 36% 37% 43% 46% Non-GAAP sales and marketing as a % of revenue 28% 31% 32% 36% 38% Non-GAAP general and administrative General and administrative $24,938 $25,491 $101,587 $104,296 $112,575 Less: Stock-based compensation 5,482 9,902 34,756 44,350 44,421 Employer taxes related to employee stock transactions 81 127 644 745 982 Acquisition-related expenses - - 23 (1) 962 Amortization of acquired intangible assets - - - 29 87 Restructuring costs - 51 695 180 132 (1) Shareholder matters - 79 2,470 - - Impairment of long-lived assets - - - - 8,483 (1) Executive transition costs 3,303 - - - - Non-GAAP general and administrative $16,072 $15,332 $62,999 $58,993 $57,508 Revenue 124,436 123,411 492,546 467,499 430,699 General and administrative as a % of revenue 20% 21% 21% 22% 26% Non-GAAP general and administrative as a % of revenue 13% 12% 13% 13% 13% Note: Certain figures may not sum due to rounding. (1) Certain reclassifications of prior period amounts have been made to conform to current period presentation. We have reclassified a portion of restructuring costs to the impairment of long-lived assets line item in the relevant non-GAAP reconciliations. The reclassification has no effect on the reported non-GAAP operating income. 20 Attention : This is an excerpt of the original content. To continue reading it, access the original document here .

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