PagerDuty (PD) has just closed out FY 2026 with Q4 revenue of US$124.8 million and basic EPS of US$0.13, alongside trailing 12 month revenue of US$492.5 million and basic EPS of US$1.91 that reflect its recent move into profitability. The company has seen quarterly revenue move from US$118.9 million in FY 2025 Q3 to US$124.8 million in FY 2026 Q4, while basic EPS has swung from a loss of US$0.12 in FY 2025 Q4 to a profit of US$0.13 in the latest quarter. This sets up a story where improving margins sit alongside questions about how durable those earnings really are.
See our full analysis for PagerDuty.With the headline numbers on the table, the next step is to measure them against the widely held narratives about PagerDuty, highlighting where the story around growth, profitability and risk aligns with the data and where it starts to break.
See what the community is saying about PagerDuty
Trailing profit swings and non cash earnings
- On a trailing 12 month basis, PagerDuty reports Basic EPS of US$1.91 and net income of US$173.9 million on US$492.5 million of revenue, which is a sharp contrast to the loss of US$54.5 million on US$467.5 million of revenue a year earlier.
- What jumps out for the bearish narrative is that this profitability sits alongside forecasts for average earnings declines of 81.9% per year over the next three years, while risks highlight a high proportion of non cash earnings that could make the US$173.9 million net profit and 3.7x P/E less reliable than they first appear.
- Bears argue that if a large slice of earnings is non cash, then the move from a loss of US$36.9 million on a trailing basis at the start of FY 2026 to a profit of US$173.9 million may not reflect the same level of underlying cash generation.
- They also point to forecasts for substantial earnings declines despite trailing EPS of US$1.91, suggesting current profits may be difficult to maintain even though the recent year looks strong on paper.
Revenue growth running at about 1%
- Revenue on a trailing 12 month basis is US$492.5 million versus US$467.5 million a year earlier, which lines up with analysis that revenue growth is running at about 1% per year and is forecast to grow slower than the broader US market at 10.5% per year.
- Analysts' consensus view sees this modest top line trend as a mixed signal, with usage based pricing and expansion into regulated industries supporting growth potential, while seat optimization and tougher competition could keep revenue growth below the broader market even as the platform becomes more important for customers.
- Consensus commentary notes that platform usage has grown more than 25% year over year and some usage based product lines are reported at over 60% year over year growth, which contrasts with the roughly 1% revenue growth implied by the trailing figures.
- At the same time, the consensus narrative flags seat downgrades, customer cost control and competition from larger suites as ongoing headwinds, which helps explain why trailing revenue growth lags the 10.5% market growth figure even with stronger usage metrics.
Low 3.7x P/E versus peers
- PagerDuty trades on a trailing P/E of 3.7x, compared with 26.8x for the US software industry and 22.3x for peers, and against a DCF fair value of US$14.69 per share versus a current share price of US$7.07, which implies the stock is trading about 51.9% below that DCF fair value.
- Supporters of the bullish view see this wide gap between 3.7x P/E and industry peers, plus the discount to the DCF fair value, as evidence that the market is not fully reflecting the move to profitability and the potential from AI driven usage growth, even though near term forecasts call for slower revenue growth than the market.
- Bullish commentary leans on the idea that usage on the platform is growing faster than revenue and that deeper AI and automation features could help convert that usage into higher revenue over time, which they argue is not captured in a single digit P/E multiple.
- At the same time, the low P/E sits alongside forecasts for earnings declines and modest revenue growth, so the bulls are effectively arguing that current valuation is anchored on those cautious forecasts and not on scenarios where new products and pricing models lift long run profitability.
Next Steps
To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for PagerDuty on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.
If this mix of cautious and optimistic views feels finely balanced, it is worth looking at the full risk reward profile for yourself and moving quickly to form your own opinion. You can start with 3 key rewards and 2 important warning signs.
See What Else Is Out There
PagerDuty pairs modest revenue growth of about 1% with forecasts for earnings declines and heavy use of non cash items, which raises questions about how durable its current profitability really is.
If you are concerned about paying for earnings that may not be fully supported by cash flow, take a few minutes to scan 68 resilient stocks with low risk scores and compare businesses with profiles that look more resilient to you.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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