PagerDuty (PD) Q3 Earnings call transcript Nov 26, 2025

PagerDuty, a leading digital operations management platform, recently held its Q3 FY25 earnings call, providing insights into its financial performance and strategic direction. With key executives, including Jennifer Tejada, PagerDuty’s Chairperson and CEO, and Howard Wilson, Chief Financial Officer, leading the call, the company shared a positive outlook, highlighting solid revenue growth and operational improvements.

Financial Highlights and Strategic Direction

The call began with Jennifer Tejada outlining PagerDuty's solid financial performance, with revenue and non-GAAP operating income above guidance ranges. Revenue growth increased by 9%, and non-GAAP operating margin expanded to 21%. Moreover, the company reported a net new ARR of $9 million, a 21% increase over Q3 of last year, demonstrating a steady upward trajectory.

Tejada emphasized the company's focus on growth reacceleration, acknowledging room for improvement, particularly in large deal conversions. However, she also highlighted improvements in key indicators, such as dollar-based net retention, multiproduct adoption, enterprise contract duration, and total pipeline growth. These metrics suggest a strong commitment to customer satisfaction and product innovation.

Strategic Moves and Competitive Edge

One of the most notable aspects of the call was PagerDuty's strategic moves to address CIO imperatives, including instant management transformation, operations center modernization, and automation standardization. The company's focus on generative AI and chat capabilities, such as PagerDuty Advance, sets it apart from competitors, offering significant value to customers in terms of time and cost savings.

Moreover, the company's expansion of its automation library, addressing manual and repetitive tasks, underscores its commitment to innovation and customer needs. PagerDuty's inclusion in the Forrester AIOps Landscape Report and GigaOm's Radar for AIOps further highlights its product leadership in the industry.

Market Opportunities and Challenges

The call also touched upon the broader market landscape, with Tejada acknowledging the challenges of navigating large enterprise customer conversions. However, she remains optimistic about the company's ability to capitalize on the growing trend towards digital transformation and automation. The EMEA market, in particular, is seen as a source of stability and growth, underscoring PagerDuty's global reach and adaptability.

Looking Ahead

Looking ahead, PagerDuty is poised for a strong fourth quarter, with a focus on delivering strong net new ARR and carrying momentum into FY26. The company's strategic investments in sales capacity, pipeline management, and executive sponsorship programs are expected to drive growth and enhance customer engagement.

Moreover, the company's commitment to innovation, particularly in the areas of generative AI and automation, positions it well to address the evolving needs of the digital operations management market. As PagerDuty continues to navigate the complexities of the enterprise landscape, its focus on customer-centric solutions and strategic partnerships is expected to drive long-term success.