By Emily Bary
There is still “a higher level of scrutiny on every major purchase,” says PagerDuty’s CFO
PagerDuty Inc. said it is seeing a “stabilization” in a key metric, even as customers are still “cautious” with their spending.
“What we’ve accepted is that deals just take longer in this current environment,” Chief Financial Officer Howard Wilson told MarketWatch on Tuesday. But the company has maintained annual revenue growth at 10% for several quarters, which Wilson sees as “a very positive sign.”
PagerDuty (PD) makes cybersecurity software, including for incident management and automation. While the company’s smaller customers saw pressure in the previous quarter, Wilson says this is easing off somewhat, with both commercial and business customers showing improved retention during the most recent quarter.
Revenue for the fiscal third quarter rose 9% to $118.9 million, while analysts tracked by FactSet had expected $116.6 million.
While software sector investors were encouraged by Snowflake Inc.’s results. (SNOW) last week, which seemed to indicate an improving macroeconomic environment, Wilson said there is still “a higher level of scrutiny on any major purchase.”
Read: Snowflake shares rise as the software company’s prospects impress
PagerDuty’s fiscal fourth-quarter guidance calls for revenue of $118.5 million to $120.5 million, while the FactSet consensus was $121.6 million. Wilson said he took a “cautious view” of the period.
Net income in the latest quarter fell to $6.6 million, or 7 cents per share, from $15.1 million, or 16 cents per share, in the same period a year earlier. After adjustments, the company earned 25 cents per share, while analysts had expected 17 cents per share.
The company’s outlook for adjusted earnings per share for the fiscal fourth quarter is for 15 to 16 cents, while analysts expected 16 cents.
-Emilie Bary
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24-11-26 1656ET
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