PagerDuty (PD) posts profit, boosts cash while growing ARR

Rhea-AI Filing Summary

PagerDuty (PD) reported sharply improved results for the quarter ended October 31, 2025. Revenue rose to $124.5 million from $118.9 million a year earlier, while income from operations flipped to a profit of $8.1 million versus a loss of $10.3 million. A large income tax benefit of $149.7 million, driven by releasing a valuation allowance on U.S. deferred tax assets, lifted net income to $161.4 million from a $6.1 million loss.

For the first nine months, revenue reached $367.8 million and net income attributable to common stockholders was $162.8 million, compared with a $43.9 million loss a year ago. Cash and cash equivalents were $324.3 million with a further $223.5 million in investments, against $402.5 million of convertible notes outstanding. PagerDuty repaid $57.5 million of 2025 notes and repurchased 2.35 million shares for $37.9 million under its 2025 buyback, leaving $162.1 million authorized. Annual recurring revenue was $497.1 million, up from $483.0 million a year earlier.

Positive

• Strong swing to profitability: Net income attributable to common stockholders reached $159.6 million for the quarter and $162.8 million year‑to‑date, versus losses in the prior‑year periods, aided by higher margins and a large tax benefit.
• Tax valuation allowance release: The company released $154.2 million of valuation allowance on U.S. federal and certain state deferred tax assets, reflecting management’s view that future taxable income should support use of these assets.
• Healthy cash and capital returns: Nine‑month operating cash flow was $89.4 million; PagerDuty repaid $57.5 million of 2025 convertible notes and repurchased 2.35 million shares for $37.9 million, with $162.1 million of buyback authorization remaining.

Negative

• None.

Insights

Equity & accounting analyst

PagerDuty swung from losses to sizable profit, helped by tax benefits and tighter costs.

PagerDuty grew quarterly revenue to $124.5 million, while cost discipline reduced operating expenses to $98.1 million from $109.0 million. That shifted income from operations to a profit of $8.1 million from a $10.3 million loss, showing improved underlying profitability even with modest top-line growth.

The standout item was a tax benefit of $149.7 million in the quarter and $150.7 million year-to-date, largely from releasing $154.2 million of valuation allowance on U.S. federal and certain state deferred tax assets. Management concluded recent cumulative U.S. income and projected taxable earnings make it more likely than not those tax assets will be realized, which indicates confidence in sustained profitability.

Cash generation remained solid, with nine‑month operating cash flow of $89.4 million, while the company repaid $57.5 million of 2025 convertible notes and spent $37.9 million on share repurchases under a $200 million program. ARR reached $497.1 million as of October 31 2025. Future filings will show how revenue growth, margins, and cash flows track after the one‑time tax benefit.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

_________________________

FORM 10-Q

_________________________

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934

For the quarterly period ended October 31, 2025

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to                     

Commission File Number: 001-38856

_________________________

PAGERDUTY, INC.

_________________________

(Exact name of registrant as specified in its charter)

Delaware						27-2793871
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification Number)
600 Townsend St., Suite 200 San Francisco, California						94103
(Address of principal executive offices)						(Zip Code)

(844) 800-3889

(Registrant’s telephone number, including area code)

_________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of each class			Trading Symbol(s)			Name of each exchange on which registered
Common Stock, par value $0.000005 per share			PD			New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x No  o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  x No  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

x

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐   No  x

The total number of shares of common stock outstanding as of November 21, 2025, was 91,776,804.

Table of Contents

TABLE OF CONTENTS

			Page
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements			4
Condensed Consolidated Balance Sheets (unaudited)			4
Condensed Consolidated Statements of Operations (unaudited)			5
Condensed Consolidated Statements of Comprehensive Income (Loss) (unaudited)			6
Condensed Consolidated Statements of Stockholders’ Equity (unaudited)			7
Condensed Consolidated Statements of Cash Flows (unaudited)			9
Notes to Condensed Consolidated Financial Statements (unaudited)			10
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			26
Item 3. Quantitative and Qualitative Disclosures about Market Risk			42
Item 4. Controls and Procedures			42
PART II - OTHER INFORMATION
Item 1. Legal Proceedings			44
Item 1A. Risk Factors			44
Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities			47
Item 3. Defaults Upon Senior Securities			47
Item 4. Mine Safety Disclosures			47
Item 5. Other Information			48
Item 6. Exhibits			49
SIGNATURES			50

2

Table of Contents

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (“Form 10-Q”) contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which statements involve substantial risk and uncertainties. All statements contained in this Form 10-Q other than statements of historical fact, including statements regarding our future operating results and financial position, our business strategy and plans, market growth and trends, and our objectives for future operations, are forward-looking statements. The words “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” “could,” “would,” “project,” “plan,” “potentially,” “likely,” “target,” and similar expressions are intended to identify forward-looking statements.

Forward-looking statements contained in this Form 10-Q include, but are not limited to, statements about our expectations regarding:

•the impact of an economic downturn or recession, rising inflation, tariffs and trade wars, or significant market volatility in the global economy on our customers, partners, employees and business;

•trends in key business metrics, including annual recurring revenue (“ARR”), number of customers and dollar-based net retention rate, and non-GAAP financial measures and their usefulness in evaluating our business;

•trends in revenue, cost of revenue, and gross margin;

•trends in operating expenses, including research and development, sales and marketing, and general and administrative expense, and expectations regarding these expenses as a percentage of revenue;

•our existing cash and cash equivalents and cash provided by sales of our subscriptions being sufficient to support working capital and capital expenditures for at least the next 12 months and our ability to meet longer-term expected future cash requirements and obligations, through a combination of cash flows from operating activities and available cash and short-term investment balances;

•our ability to effectively identify, acquire, and integrate complementary companies, technologies, and assets, including our ability to successfully integrate artificial intelligence and machine learning in our offerings;

•our ability to service the interest on our convertible notes and repay such notes, to the extent required;

•our efforts to maintain proper and effective internal controls;

•our ability to expand our operations and increase adoption of our platform internationally;

•our ability to stay abreast of new or modified laws and regulations that currently apply or become applicable to our business both in the United States and internationally; and

•other statements regarding our future operations, financial condition, and prospects and business strategies.

Such forward-looking statements are based on our expectations as of the date of this filing and are subject to a number of risks, uncertainties and assumptions, including, but not limited to, risks detailed in the “Risk Factors” section of this Form 10-Q and in our Annual Report on Form 10-K for the year ended January 31, 2025, filed with the SEC on March 17, 2025, as updated by our Quarterly Report on Form 10-Q for the quarter ended April 30, 2025. Readers are urged to carefully review and consider the various disclosures made in this Form 10-Q and in other documents we file from time to time with the Securities and Exchange Commission (the “SEC”), that disclose risks and uncertainties that may affect our business. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for us to predict all risks, nor can we assess the effect of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties, and assumptions, the future events and trends discussed in this Form 10-Q may not occur, and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.

You should not rely on forward-looking statements as predictions of future events. The events and circumstances reflected in the forward-looking statements may not be achieved or may not occur. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, performance, or achievements. In addition, the forward-looking statements in this Form 10-Q are made as of the date of this filing, and we do not undertake, and expressly disclaim any duty, to update any of these forward-looking statements for any reason after the date of this Form 10-Q or to conform these statements to actual results or revised expectations.

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PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

PAGERDUTY, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands)

(unaudited)

			October 31, 2025						January 31, 2025
Assets
Current assets:
Cash and cash equivalents			$	324,260					$	346,460
Investments			223,521						224,366
Accounts receivable, net of allowance for credit losses of $1,015 and $1,103 as of October 31, 2025 and January 31, 2025, respectively			78,880						107,350
Deferred contract costs, current			18,385						19,787
Prepaid expenses and other current assets			13,855						13,757
Total current assets			658,901						711,720
Property and equipment, net			27,394						21,335
Deferred contract costs, non-current			24,248						25,279
Lease right-of-use assets			8,105						6,806
Goodwill			137,401						137,401
Intangible assets, net			16,588						20,865
Deferred tax assets			151,470						—
Other assets			3,657						3,860
Total assets			$	1,027,764					$	927,266
Liabilities, redeemable non-controlling interest, and stockholders’ equity
Current liabilities:
Accounts payable			$	6,698					$	7,329
Accrued expenses and other current liabilities			17,283						20,322
Accrued compensation			28,178						37,505
Deferred revenue, current			221,809						243,269
Lease liabilities, current			4,103						3,307
Convertible senior notes, net, current			—						57,426
Total current liabilities			278,071						369,158
Convertible senior notes, net, non-current			395,132						393,282
Deferred revenue, non-current			1,227						2,483
Lease liabilities, non-current			9,291						9,637
Other liabilities			4,725						4,661
Total liabilities			688,446						779,221
Commitments and contingencies (Note 10)
Redeemable non-controlling interest (Note 3)			18,819						18,217
Stockholders' equity
Common stock			—						—
Additional paid-in capital			756,061						725,483
Accumulated other comprehensive loss			(206)						(485)
Accumulated deficit			(431,171)						(595,170)
Treasury stock			(4,185)						—
Total stockholders’ equity			320,499						129,828
Total liabilities, redeemable non-controlling interest, and stockholders' equity			$	1,027,764					$	927,266

See accompanying notes to unaudited condensed consolidated financial statements.

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PAGERDUTY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

(unaudited)

			Three months ended October 31,												Nine months ended October 31,
			2025						2024						2025						2024
Revenue			$	124,545					$	118,946					$	367,761					$	346,053
Cost of revenue			18,357						20,268						56,542						59,691
Gross profit			106,188						98,678						311,219						286,362
Operating expenses:
Research and development			29,418						34,267						94,363						106,878
Sales and marketing			44,322						49,272						138,823						148,737
General and administrative			24,369						25,432						76,715						78,800
Total operating expenses			98,109						108,971						309,901						334,415
Income (loss) from operations			8,079						(10,293)						1,318						(48,053)
Interest income			5,700						6,912						17,860						21,408
Interest expense			(2,100)						(2,377)						(6,750)						(6,888)
Other income, net			50						346						284						212
Income (loss) before (benefit from) provision for income taxes			11,729						(5,412)						12,712						(33,321)
(Benefit from) provision for income taxes			(149,673)						715						(150,725)						1,335
Net income (loss)			$	161,402					$	(6,127)					$	163,437					$	(34,656)
Net loss attributable to redeemable non-controlling interest			(184)						(203)						(562)						(681)
Net income (loss) attributable to PagerDuty, Inc.			$	161,586					$	(5,924)					$	163,999					$	(33,975)
Less: Adjustment attributable to redeemable non-controlling interest			2,031						634						1,164						9,881
Net income (loss) attributable to PagerDuty, Inc. common stockholders			$	159,555					$	(6,558)					$	162,835					$	(43,856)
Weighted-average shares used in calculating net income (loss) per share:
Basic			92,836						91,438						92,280						92,530
Diluted			94,662						91,438						94,154						92,530
Net income (loss) per share attributable to PagerDuty, Inc. common stockholders
Basic			$	1.72					$	(0.07)					$	1.76					$	(0.47)
Diluted			$	1.69					$	(0.07)					$	1.73					$	(0.47)

See accompanying notes to unaudited condensed consolidated financial statements.

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PAGERDUTY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(in thousands)

(unaudited)

			Three months ended October 31,												Nine months ended October 31,
			2025						2024						2025						2024
Net income (loss)			$	161,402					$	(6,127)					$	163,437					$	(34,656)
Unrealized gain on investments			416						233						207						174
Foreign currency translation adjustments			51						(5)						72						57
Total comprehensive income (loss)			$	161,869					$	(5,899)					$	163,716					$	(34,425)
Less: comprehensive loss attributable to redeemable non-controlling interest
Net loss attributable to redeemable non-controlling interest			(184)						(203)						(562)						(681)
Comprehensive loss attributable to redeemable non-controlling interest			(184)						(203)						(562)						(681)
Comprehensive income (loss) attributable to PagerDuty, Inc.			$	162,053					$	(5,696)					$	164,278					$	(33,744)

See accompanying notes to unaudited condensed consolidated financial statements.

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PAGERDUTY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in thousands, except share data)

(unaudited)

			Three months ended October 31, 2025
			Common Stock												Additional Paid-in Capital						Accumulated Other Comprehensive (Loss) Income						Accumulated Deficit						Treasury Stock												Total Stockholders’ Equity
			Shares						Amount																								Shares						Amount
Balance as of July 31, 2025			93,238,538						$	—					$	774,139					$	(673)					$	(592,757)					—						$	—					$	180,709
Issuance of common stock upon exercise of stock options			19,803						—						129						—						—						—						—						129
Vesting of restricted stock units, net of employee payroll taxes			609,263						—						(6,337)						—						—						—						—						(6,337)
Other comprehensive income			—						—						—						467						—						—						—						467
Repurchases of common stock			—						—						—						—						—						(2,354,683)						(37,931)						(37,931)
Retirement of treasury stock			(2,092,300)						—						(33,746)						—						—						2,092,300						33,746						—
Stock-based compensation			—						—						23,907						—						—						—						—						23,907
Adjustment to redeemable non-controlling interest			—						—						(2,031)						—						—						—						—						(2,031)
Net income attributable to PagerDuty, Inc.			—						—						—						—						161,586						—						—						161,586
Balance as of October 31, 2025			91,775,304						$	—					$	756,061					$	(206)					$	(431,171)					(262,383)						$	(4,185)					$	320,499

			Nine months ended October 31, 2025
			Common Stock												Additional Paid-in Capital						Accumulated Other Comprehensive (Loss) Income						Accumulated Deficit						Treasury stock												Total Stockholders’ Equity
			Shares						Amount																								Shares						Amount
Balance as of January 31, 2025			91,082,604						$	—					$	725,483					$	(485)					$	(595,170)					—						$	—					$	129,828
Issuance of common stock upon exercise of stock options			493,754						—						3,939						—						—						—						—						3,939
Vesting of restricted stock units and performance stock units, net of employee payroll taxes			1,913,435						—						(20,305)						—						—						—						—						(20,305)
Issuance of common stock in connection with employee stock purchase plan			377,811						—						4,618						—						—						—						—						4,618
Other comprehensive income			—						—						—						279						—						—						—						279
Repurchases of common stock			—						—						—						—						—						(2,354,683)						(37,931)						(37,931)
Retirement of treasury stock			(2,092,300)						—						(33,746)						—						—						2,092,300						33,746						—
Stock-based compensation			—						—						77,236						—						—						—						—						77,236
Adjustment to redeemable non-controlling interest			—						—						(1,164)						—						—						—						—						(1,164)
Net income attributable to PagerDuty, Inc.			—						—						—						—						163,999						—						—						163,999
Balance as of October 31, 2025			91,775,304						$	—					$	756,061					$	(206)					$	(431,171)					(262,383)						$	(4,185)					$	320,499

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			Three months ended October 31, 2024
			Common Stock												Additional Paid-in Capital						Accumulated Other Comprehensive (Loss) Income						Accumulated Deficit						Treasury stock												Total Stockholders’ Equity
			Shares						Amount																								Shares						Amount
Balance as of July 31, 2024			93,032,895						$	—					$	747,599					$	(730)					$	(580,486)					(78,764)						$	(1,699)					$	164,684
Issuance of common stock upon exercise of stock options			121,465						—						723						—						—						—						—						723
Vesting of restricted stock units, net of employee payroll taxes			792,395						—						(8,531)						—						—						—						—						(8,531)
Other comprehensive income			—						—						—						228						—						—						—						228
Repurchases of common stock			—						—						—						—						—						(3,830,761)						(70,585)						(70,585)
Retirement of treasury stock			(3,848,109)						—						(71,159)						—						—						3,848,109						71,159						—
Excise tax on repurchases of common stock			—						—						(490)						—						—						—						—						(490)
Stock-based compensation			—						—						32,125						—						—						—						—						32,125
Adjustment to redeemable non-controlling interest			—						—						(634)						—						—						—						—						(634)
Net loss attributable to PagerDuty, Inc.			—						—						—						—						(5,924)						—						—						(5,924)
Balance as of October 31, 2024			90,098,646						$	—					$	699,633					$	(502)					$	(586,410)					(61,416)						$	(1,125)					$	111,596

			Nine months ended October 31, 2024
			Common Stock												Additional Paid-in Capital						Accumulated Other Comprehensive (Loss) Income						Accumulated Deficit						Treasury stock												Total Stockholders’ Equity
			Shares						Amount																								Shares						Amount
Balance as of January 31, 2024			95,068,187						$	—					$	774,768					$	(733)					$	(552,435)					(2,331,002)						$	(50,000)					$	171,600
Issuance of common stock upon exercise of stock options			253,351						—						1,527						—						—						—						—						1,527
Vesting of restricted stock units and performance stock units, net of employee payroll taxes			1,878,043						—						(22,659)						—						—						—						—						(22,659)
Issuance of common stock in connection with the employee stock purchase plan			312,660						—						5,735						—						—						—						—						5,735
Other comprehensive income			—						—						—						231						—						—						—						231
Repurchases of common stock			—						—						—						—						—						(5,144,009)						(98,648)						(98,648)
Excise tax on repurchases of common stock			—						—						(490)						—						—						—						—						(490)
Retirement of treasury stock			(7,413,595)						—						(147,523)						—						—						7,413,595						147,523						—
Stock-based compensation			—						—						98,156						—						—						—						—						98,156
Adjustment to redeemable non-controlling interest			—						—						(9,881)						—						—						—						—						(9,881)
Net loss attributable to PagerDuty, Inc.			—						—						—						—						(33,975)						—						—						(33,975)
Balance as of October 31, 2024			90,098,646						$	—					$	699,633					$	(502)					$	(586,410)					(61,416)						$	(1,125)					$	111,596

See accompanying notes to unaudited condensed consolidated financial statements.

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PAGERDUTY, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

			Nine months ended October 31,
			2025						2024
Cash flows from operating activities:
Net income (loss) attributable to PagerDuty, Inc. common stockholders			$	162,835					$	(43,856)
Net loss and adjustment attributable to redeemable non-controlling interest			602						9,200
Net income (loss)			163,437						(34,656)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization			10,082						15,526
Amortization of deferred contract costs			16,864						16,261
Amortization of debt issuance costs			1,921						1,950
Stock-based compensation			74,288						97,079
Impairment of long-lived assets			1,213						—
Non-cash lease expense			1,523						2,538
Deferred income taxes			(151,703)						521
Other			(1,892)						(3,852)
Changes in operating assets and liabilities:
Accounts receivable			27,980						24,751
Deferred contract costs			(14,458)						(15,441)
Prepaid expenses and other assets			359						(5,079)
Accounts payable			(556)						603
Accrued expenses and other liabilities			(4,905)						(1,823)
Accrued compensation			(9,760)						4,002
Deferred revenue			(22,657)						(11,386)
Lease liabilities			(2,289)						(4,505)
Net cash provided by operating activities			89,447						86,489
Cash flows from investing activities:
Purchases of property and equipment			(2,058)						(1,646)
Capitalized software costs			(7,267)						(5,019)
Purchases of available-for-sale investments			(137,409)						(153,121)
Proceeds from maturities of available-for-sale investments			139,689						147,827
Proceeds from sales of available-for-sale investments			1,248						2,237
Purchases of non-marketable equity investments			(1,250)						—
Net cash used in investing activities			(7,047)						(9,722)
Cash flows from financing activities:
Cash paid for debt issuance costs			—						(403)
Repurchases of common stock			(36,138)						(97,523)
Repayments of convertible senior notes			(57,500)						—
Proceeds from employee stock purchase plan			4,618						5,735
Proceeds from issuance of common stock upon exercise of stock options			3,939						1,527
Employee payroll taxes paid related to net share settlement of restricted stock units			(20,305)						(22,659)
Net cash used in financing activities			(105,386)						(113,323)
Effects of foreign currency exchange rates on cash, cash equivalents, and restricted cash			(3)						(109)
Net change in cash, cash equivalents, and restricted cash			(22,989)						(36,665)
Cash, cash equivalents, and restricted cash at beginning of period			348,328						366,667
Cash, cash equivalents, and restricted cash at end of period			$	325,339					$	330,002
Reconciliation of cash, cash equivalents, and restricted cash to the condensed consolidated balance sheets:
Cash and cash equivalents			$	324,260					$	326,440
Restricted cash in other long-term assets			1,079						3,562
Total cash, cash equivalents, and restricted cash			$	325,339					$	330,002
Supplemental cash flow data:
Cash paid for income taxes			$	1,547					$	580
Cash paid for interest			$	6,397					$	7,885
Non-cash investing and financing activities:
Purchase of property and equipment, accrued but not yet paid			$	187					$	537
Stock-based compensation capitalized in software costs			$	3,324					$	1,305
Bonuses capitalized in software costs			$	440					$	244
Repurchases of common stock in transit			$	1,793					$	—

See accompanying notes to unaudited condensed consolidated financial statements.

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PAGERDUTY, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

Note 1. Description of Business and Basis of Presentation

Description of Business

PagerDuty, Inc. was incorporated under the laws of the state of Delaware in May 2010.

PagerDuty, Inc., together with its wholly-owned subsidiaries and subsidiaries in which PagerDuty, Inc. holds a controlling interest (collectively, the “Company”), provides a digital operations management platform that manages urgent and mission-critical work for a modern, digital business (the “PagerDuty Platform”). The PagerDuty Platform collects data and digital signals from virtually any software-enabled system or device and leverages powerful machine learning to correlate, process, and predict opportunities and issues. Using incident response, event management, and automation, the Company brings together the right people with the right information so they can resolve issues and act on opportunities in minutes or seconds from wherever they are.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with United States (“U.S.”) generally accepted accounting principles (“U.S. GAAP” or “GAAP”), and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. The condensed consolidated balance sheet as of January 31, 2025 was derived from the audited consolidated financial statements as of that date but does not include all of the information and notes required by GAAP for complete financial statements. Certain information and footnote disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Therefore, these condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the related notes thereto as of and for the year ended January 31, 2025, included in the Company’s Annual Report on Form 10-K.

The condensed consolidated financial statements include the results of PagerDuty, Inc., its wholly-owned subsidiaries, and subsidiaries in which the Company holds a controlling interest. All intercompany balances and transactions have been eliminated in consolidation.

In the opinion of management, the information contained herein reflects all adjustments necessary for a fair statement of the Company’s financial position, results of operations and comprehensive income (loss), stockholders’ equity, and cash flows. The results of operations for the three and nine months ended October 31, 2025 are not necessarily indicative of the results to be expected for the full year ending January 31, 2026 or for any other interim period, or for any future year.

The Company’s fiscal year ends on January 31. References to fiscal 2026 refer to the fiscal year ending January 31, 2026.

Reclassification

Certain reclassifications of prior period amounts have been made in the Company’s condensed consolidated statements of cash flows to conform to the current period presentation. The Company has reclassified the change in deferred tax liabilities from the accrued expenses and other liabilities line item to the deferred income taxes line item on the accompanying condensed consolidated statements of cash flows. These reclassifications had no effect on the reported net cash provided by operating activities.

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Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make, on an ongoing basis, estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from these estimates. The Company’s most significant estimates and judgments involve the period of benefit for amortizing deferred contract costs, the determination of the fair value of acquired assets and assumed liabilities, stock-based compensation, redemption value of redeemable non-controlling interests, income taxes, and estimates related to the Company’s revenue recognition, such as the assessment of performance obligations in the Company’s revenue arrangements and the fair value assigned to each performance obligation, among others. Management bases its estimates on historical experience and on various other assumptions which management believes to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities.

Note 2. Summary of Significant Accounting Policies

Concentrations of Risk and Significant Customers

The Company’s financial instruments that are exposed to concentrations of credit risk consist primarily of cash and cash equivalents, available-for-sale investments, and accounts receivable. All of the Company’s cash equivalents and investments are invested in money market funds, U.S. Treasury securities, commercial paper, corporate debt securities, or U.S. Government agency securities that management believes to be of high credit quality. The Company’s cash, cash equivalents, and available-for-sale investments are spread across several different financial institutions.

No single customer accounted for 10% or more of the total accounts receivable balance as of October 31, 2025 or January 31, 2025. No single customer accounted for 10% or more of revenue for the three and nine months ended October 31, 2025 or 2024.

Segment Information

The Company manages its operations and allocates resources as one operating segment at the consolidated level. The Company’s chief operating decision maker (“CODM”) is its chief executive officer. The CODM uses consolidated net income (loss) to measure segment profit or loss, allocate resources, make operating decisions, and assess performance through monitoring and evaluation of forecast versus actual results. Further, the CODM reviews and utilizes functional expenses (cost of revenue, sales and marketing, research and development, and general and administrative) at the consolidated level to manage the Company’s operations. Net income (loss) is the Company’s primary measure of profit or loss. Significant expenses within net income (loss) include cost of revenue, research and development, sales and marketing, and general and administrative, which each are separately presented on the condensed consolidated statements of operations. Stock-based compensation expense is also a significant expense within net income (loss). Refer to Note 12. Common Stock and Stockholders’ Equity for additional information about the Company’s stock-based compensation expense. Other segment items include interest income, interest expense, other expense, net, and (benefit from) provision for income taxes on the condensed consolidated statements of operations. Refer to Note 15. Geographic Information for information regarding the Company's long-lived assets and revenue by geography.

Related Party Transactions

Certain members of the Company’s Board of Directors serve as directors of, or are executive officers of, and in some cases are investors in, companies that are customers or vendors of the Company. The Company had no material related party transactions in the three and nine months ended October 31, 2025. In the nine months ended October 31, 2024, the Company billed approximately $4.0 million to an entity associated with a related party. Other related party transactions for the three and nine months ended October 31, 2024 were not significant.

Significant Accounting Policies

There have been no material changes to the Company’s significant accounting policies from those described in the Company’s Annual Report on Form 10-K.

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Restricted Cash

The Company has classified cash that is not available for use in its operations as restricted cash. Restricted cash consists primarily of collateral for letters of credit related to security deposits for the Company’s office facility lease arrangements. As of October 31, 2025 and January 31, 2025, the Company had restricted cash of $1.1 million and $1.9 million, respectively, all of which was classified as non-current and included in other assets on the condensed consolidated balance sheets.

Recent Accounting Pronouncements Not Yet Adopted

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. This ASU requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. This ASU is effective for fiscal years beginning after December 15, 2024. The Company is currently evaluating the impact of the new guidance on its condensed consolidated financial statements.

In November 2024, the FASB issued ASU No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. In January 2025, the FASB issued ASU No. 2025-01 to clarify the effective date of ASU 2024-03. ASU 2024-03 requires that at each interim and annual reporting period, an entity discloses the amounts of certain expenses included in each relevant expense caption. The newly required expense disclosures include certain amounts that are already required to be disclosed under current GAAP in the same disclosure as the other disaggregation requirements. The amendment also requires that an entity discloses a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively and disclose the total amount of selling expenses and, in annual reporting periods, an entity’s definition of selling expenses. This ASU is effective for fiscal years beginning after December 15, 2026. The Company is currently evaluating the impact of the new guidance on its condensed consolidated financial statements.

In November 2024, the FASB issued ASU No. 2024-04, Debt - Debt with Conversion and Other Options (Subtopic 470-20): Induced Conversion of Convertible Debt Instruments. This ASU clarifies the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion. The amendments in this update are effective for all entities for annual reporting periods beginning after December 15, 2025. The Company is currently evaluating the impact of the new guidance on its condensed consolidated financial statements.

In September 2025, the FASB issued ASU No. 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40). This ASU amends the requirements for commencing capitalization of software costs related to software development projects. The amendments in this update are effective for all entities for annual reporting periods beginning after December 15, 2027. The Company is currently evaluating the impact of the new guidance on its condensed consolidated financial statements.

Note 3. Redeemable Non-Controlling Interest

In May 2022, the Company established a joint venture, PagerDuty K.K. The Company obtained a 51% controlling interest and has consolidated the financial results of the joint venture.

The agreements with the non-controlling interest holders of PagerDuty K.K. contain redemption features whereby the interest held by the non-controlling interest holders is redeemable either: (i) at the option of the non-controlling interest holders; or (ii) at the option of the Company, both beginning on the tenth anniversary of the initial capital contribution. The balance of the redeemable non-controlling interest is reported at the greater of the initial carrying amount adjusted for the redeemable non-controlling interest's share of earnings or losses and other comprehensive income or loss, or its redemption value, which is determined based on a prescribed formula derived from multiple metrics including the Company’s enterprise value and the annual recurring revenue of PagerDuty K.K. The resulting changes in the estimated redemption amount are recorded with corresponding adjustments against additional paid-in capital due to the absence of retained earnings. The carrying amount of the redeemable non-controlling interest is recorded on the Company's condensed consolidated balance sheets as temporary equity.

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The following table summarizes the activity in the redeemable non-controlling interest for the periods indicated (in thousands):

			Three months ended October 31,												Nine months ended October 31,
			2025						2024						2025						2024
Balance at beginning of period			$	16,972					$	16,062					$	18,217					$	7,293
Net loss attributable to redeemable non-controlling interest			(184)						(203)						(562)						(681)
Adjustments to redeemable non-controlling interest			2,031						634						1,164						9,881
Balance at end of period			$	18,819					$	16,493					$	18,819					$	16,493

Note 4. Cash, Cash Equivalents, and Investments

Cash, cash equivalents, and investments consisted of the following as of the dates indicated (in thousands):

			October 31, 2025						January 31, 2025
Cash and cash equivalents:
Cash			$	46,393					$	47,523
Money market funds			277,867						298,937
Total cash and cash equivalents			$	324,260					$	346,460
Available-for-sale investments:
U.S. Treasury securities			$	51,309					$	58,665
Commercial paper			5,951						7,446
Corporate debt securities			138,917						125,811
U.S. Government agency securities			27,344						32,444
Total available-for-sale investments			$	223,521					$	224,366

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The following tables summarize the amortized cost, net unrealized gains (losses), and fair value of the Company’s investments by significant investment category as of the dates indicated (in thousands). Gross realized gains or losses from sales of available-for-sale securities were not material for the three and nine months ended October 31, 2025 and 2024.

			October 31, 2025
			Amortized Cost						Unrealized Gain (Loss), Net						Estimated Fair Value
Available-for-sale investments:
U.S. Treasury securities			$	51,234					$	75					$	51,309
Commercial paper			5,950						1						5,951
Corporate debt securities			138,738						179						138,917
U.S. Government agency securities			27,325						19						27,344
Total available-for-sale investments			$	223,247					$	274					$	223,521
			January 31, 2025
			Amortized Cost						Unrealized Gain (Loss), Net						Estimated Fair Value
Available-for-sale investments:
U.S. Treasury securities			$	58,620					$	45					$	58,665
Commercial paper			7,446						—						7,446
Corporate debt securities			125,792						19						125,811
U.S. Government agency securities			32,441						3						32,444
Total available-for-sale investments			$	224,299					$	67					$	224,366

The following tables present the Company’s available-for-sale securities by contractual maturity date as of the dates indicated (in thousands):

			October 31, 2025
			Amortized Cost						Fair Value
Due within one year			$	154,394					$	154,557
Due between one to five years			68,853						68,964
Total			$	223,247					$	223,521
			January 31, 2025
			Amortized Cost						Fair Value
Due within one year			$	143,797					$	143,944
Due between one to five years			80,502						80,422
Total			$	224,299					$	224,366

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As of October 31, 2025, there were 35 securities in an unrealized loss position with an aggregate fair value of $52.6 million, 5 of which were in a continuous unrealized loss position for more than 12 months. The total unrealized loss related to the 5 securities was not material. As of January 31, 2025, there were 49 securities in an unrealized loss position with an aggregate fair value of $77.2 million, 1 of which was in a continuous unrealized loss position for more than 12 months. The unrealized loss related to the 1 security was not material.

When evaluating investments for impairment, the Company reviews factors such as the extent to which fair value has been below cost basis, the financial condition of the issuer and any changes thereto, and the Company’s intent to sell, or whether it is more likely than not that the Company will be required to sell, the investment before recovery of the investment’s amortized cost. No impairment loss has been recorded on the securities included in the tables above, as the Company believes that any decrease in fair value of these securities is temporary and the Company expects to recover at least up to the initial cost of the investment for these securities. The Company has not recorded an allowance for credit losses, as the Company believes any such losses would not be material based on the high-grade credit rating for each of its marketable securities as of the end of each period.

Note 5. Fair Value Measurements

The Company measures its financial assets and liabilities at fair value each reporting period using a fair value hierarchy that prioritizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value. A financial instrument’s classification within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Three levels of inputs may be used to measure fair value, as follows:

Level 1—Valuations based on observable inputs that reflect quoted prices for identical assets or liabilities in active markets.

Level 2—Valuations based on inputs that are directly or indirectly observable in the marketplace.

Level 3—Valuations based on unobservable inputs that are supported by little or no market activity.

The following tables present information about the Company’s financial assets that are required to be measured or disclosed at fair value using the above input categories as of the dates indicated (in thousands):

			As of October 31, 2025
			Level 1						Level 2						Level 3						Total
Money market funds			$	277,867					$	—					$	—					$	277,867
U.S. Treasury securities			—						51,309						—						51,309
Commercial paper			—						5,951						—						5,951
Corporate debt securities			—						138,917						—						138,917
U.S. Government agency securities			—						27,344						—						27,344
Total			$	277,867					$	223,521					$	—					$	501,388
Included in cash equivalents																					$	277,867
Included in investments																					$	223,521
			As of January 31, 2025
			Level 1						Level 2						Level 3						Total
Money market funds			$	298,937					$	—					$	—					$	298,937
U.S. Treasury securities			—						58,665						—						58,665
Commercial paper			—						7,446						—						7,446
Corporate debt securities			—						125,811						—						125,811
U.S. Government agency securities			—						32,444						—						32,444
Total			$	298,937					$	224,366					$	—					$	523,303
Included in cash equivalents																					$	298,937
Included in investments																					$	224,366

The Company’s assets that are measured by management at fair value on a recurring basis are generally classified within Level 1 or Level 2 of the fair value hierarchy.

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The Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. As of October 31, 2025 and January 31, 2025, the Company’s Level 2 securities are measured at fair value and classified within Level 2 in the fair value hierarchy because the Company uses quoted market prices for similar instruments or nonbinding market prices that are corroborated by observable market data or alternative pricing sources and models using market observable inputs to determine fair value.

The carrying amounts of certain financial instruments, including cash held in banks, accounts receivable, and accounts payable approximate fair value due to their short-term maturities and are excluded from the fair value table above.

Convertible Senior Notes

As of October 31, 2025, the estimated fair value of the Company’s 1.50% Convertible Senior Notes due 2028 (the “2028 Notes”) was approximately $389.9 million. The fair value was determined based on the quoted price for the 2028 Notes in an inactive market on the last trading day of the reporting period and are considered as Level 2 in the fair value hierarchy.

Note 6. Property and Equipment, Net

Property and equipment, net, consisted of the following as of the dates indicated (in thousands):

			October 31, 2025						January 31, 2025
Leasehold improvements			$	8,137					$	7,629
Computers and equipment			7,575						7,511
Furniture and fixtures			4,406						3,936
Capitalized software			37,752						27,934
Gross property and equipment(1)			57,870						47,010
Accumulated depreciation and amortization			(30,476)						(25,675)
Property and equipment, net			$	27,394					$	21,335

(1) Gross property and equipment includes construction-in-progress for leasehold improvements and capitalized software of $15.7 million and $9.0 million that had not yet been placed in service as of October 31, 2025 and January 31, 2025, respectively. The costs associated with construction-in-progress are not amortized until the asset is available for its intended use.

Depreciation and amortization expense was $1.9 million and $2.2 million for the three months ended October 31, 2025 and 2024, respectively, and $5.7 million and $6.4 million for the nine months ended October 31, 2025 and 2024, respectively.

During the three and nine months ended October 31, 2025, the Company recorded an impairment charge of $1.2 million related to capitalized software. The impairment charge was recorded in research and development on the condensed consolidated statement of operations. No such impairment charges were recorded during the three and nine months ended October 31, 2024.

Note 7. Deferred Contract Costs

Deferred contract costs, which primarily consist of deferred sales commissions, were $42.6 million and $45.1 million as of October 31, 2025 and January 31, 2025, respectively. Amortization expense for deferred contract costs was $5.7 million and $5.6 million for the three months ended October 31, 2025 and 2024, respectively, and $16.9 million and $16.3 million for the nine months ended October 31, 2025 and 2024, respectively. There was no impairment charge related to the costs capitalized for the periods presented.

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Note 8. Leases

Operating Leases

The Company has entered into various non-cancellable operating leases for its office spaces with lease periods expiring between fiscal 2026 and fiscal 2032. The operating lease agreements generally provide for rental payments on a graduated basis and for options to renew, which could increase future minimum lease payments if exercised.

Lease right-of-use assets and liabilities are recognized at the lease’s commencement date based on the present value of lease payments over the lease term. As the implicit rate of the Company's leases is not readily determinable, the Company uses its incremental borrowing rate based on the information available on the commencement date to determine the present value of lease payments. The lease right-of-use assets also include any lease payments made and exclude lease incentives such as tenant improvement allowances.

The Company’s operating leases typically include non-lease components such as common-area maintenance costs. The Company has elected a practical expedient that allows it to include non-lease components with lease payments for the purpose of calculating lease right-of-use assets and liabilities, to the extent that they are fixed. Non-lease components that are not fixed are expensed as incurred as variable lease payments.

Leases with a term of one year or less are not recognized on the Company’s condensed consolidated balance sheets, but rather are expensed on a straight-line basis over the lease term.

In June 2023, the Company entered into a sublease for a portion of its San Francisco office location. The sublease term ended during the nine months ended October 31, 2025. Sublease income, which was recorded as a reduction of rent expense, was zero for the three months ended October 31, 2025 and was not material for the nine months ended October 31, 2025 and three and nine months ended October 31, 2024.

The following table presents information about leases on the condensed consolidated balance sheet as of the dates indicated (in thousands):

			October 31, 2025						January 31, 2025
Assets:
Lease right-of-use assets			$	8,105					$	6,806
Liabilities:
Lease liabilities, current			$	4,103					$	3,307
Lease liabilities, non-current			$	9,291					$	9,637

As of October 31, 2025, the weighted average remaining lease term was 3.5 years and the weighted average discount rate used to determine the net present value of the lease liabilities was 5.4%.

The following table presents information about leases on the condensed consolidated statement of operations for the periods indicated (in thousands):

			Three months ended October 31,												Nine months ended October 31,
			2025						2024						2025						2024
Operating lease expense			$	826					$	858					$	2,226					$	2,560
Short-term lease expense			449						654						1,371						1,706
Variable lease expense			263						273						871						653

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The following table presents supplemental cash flow information about the Company’s leases for the periods indicated (in thousands):

			Three months ended October 31,												Nine months ended October 31,
			2025						2024						2025						2024
Cash paid for amounts included in the measurement of lease liabilities			$	1,107					$	1,660					$	3,380					$	4,929

Note 9. Debt and Financing Arrangements

2025 Convertible Senior Notes

In June 2020, the Company issued an aggregate principal amount of $287.5 million of convertible senior notes due in 2025 (the “2025 Notes”) in a private offering pursuant to an indenture dated June 25, 2020 (the “2025 Indenture”).

During the nine months ended October 31, 2025, the Company repaid in cash $57.5 million in aggregate principal amount of the 2025 Notes, prior to the maturity date of July 1, 2025.

2028 Convertible Senior Notes

In October 2023, the Company issued an aggregate principal amount of $402.5 million of convertible senior notes due in 2028 in a private offering pursuant to an indenture dated October 13, 2023 (the “2028 Indenture” and, together with the 2025 Indenture, the “Indentures”). The total net proceeds from the debt offering, after deducting initial purchasers’ discounts and debt issuance costs of $12.0 million, were $390.4 million.

The 2028 Notes are senior, unsecured obligations of the Company and accrue interest payable semiannually in arrears on April 15 and October 15 of each year, beginning on April 15, 2024, at a rate of 1.50% per year. The 2028 Notes will mature on October 15, 2028, unless such notes are converted, redeemed or repurchased earlier. Upon conversion, the Company will pay cash up to the aggregate principal amount of the 2028 Notes to be converted and pay or deliver, as the case may be, cash, shares of common stock or a combination of cash and shares of common stock, at the Company’s election, in respect to the remainder, if any, of the Company’s conversion obligation in excess of the aggregate principal amount of the 2028 Notes being converted, in the manner and subject to the terms and conditions provided in the 2028 Indenture.

Accounting for the 2025 Notes and the 2028 Notes

The 2028 Notes are, and the 2025 Notes, prior to their repayment were, accounted for as a single liability measured at their amortized cost, as no other embedded features require bifurcation and recognition as derivatives. As of October 31, 2025, the 2028 Notes are classified as non-current liabilities. Issuance costs are amortized to interest expense over the contractual term of the Notes at an effective interest rate of 2.13% for the 2028 Notes.

The net carrying amount of the Notes was as follows as of the dates indicated (in thousands):

			As of October 31, 2025																		As of January 31, 2025
			2025 Notes						2028 Notes						Total						2025 Notes						2028 Notes						Total
Principal			$	—					$	402,500					$	402,500					$	57,500					$	402,500					$	460,000
Unamortized issuance costs			—						(7,368)						(7,368)						(74)						(9,218)						(9,292)
Net carrying amount			$	—					$	395,132					$	395,132					$	57,426					$	393,282					$	450,708

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Interest expense recognized related to the Notes was as follows for the periods indicated (in thousands):

			Three months ended October 31,												Nine months ended October 31,
			2025						2024						2025						2024
Contractual interest expense			$	1,510					$	1,706					$	4,829					$	4,938
Amortization of debt issuance costs			590						671						1,921						1,950
Total interest expense related to the Notes			$	2,100					$	2,377					$	6,750					$	6,888

Capped Call Transactions

In connection with the offering of the 2025 Notes, the Company entered into privately negotiated capped call transactions (the “2025 Capped Calls”) with certain financial institution counterparties. In connection with the offering of the 2028 Notes, the Company entered into separate privately negotiated capped call transactions (the “2028 Capped Calls” and, together with the 2025 Capped Calls, the “Capped Calls”). The Capped Calls are generally intended to reduce or offset the potential dilution to the common stock upon any conversion of the Notes, subject to a cap based on the cap price of such Capped Calls. For accounting purposes, the Capped Calls are separate transactions, and not part of the terms of the Notes. The Capped Calls are recorded in stockholders’ equity and are not accounted for as derivatives. The costs incurred to purchase the 2025 Capped Calls and the 2028 Capped Calls of $35.7 million and $55.1 million, respectively, were recorded as a reduction to additional paid-in capital in the accompanying condensed consolidated balance sheets. The Capped Calls will not be remeasured as long as they continue to meet the conditions for equity classification.

During the nine months ended October 31, 2025, and in connection with the repayment of the 2025 Notes, the 2025 Capped Calls expired.

The 2028 Capped Calls each have an initial strike price of approximately $27.35 per share, subject to certain adjustments, which corresponds to the initial conversion price of the 2028 Notes, and an initial cap price of $42.90 per share, subject to certain adjustments. The 2028 Capped Calls cover, subject to anti-dilution adjustments, approximately 14.7 million shares of the Company’s common stock. The 2028 Capped Calls are subject to automatic exercise over a 60 trading day period commencing on July 20, 2028, subject to earlier termination under certain circumstances and may be settled in cash, shares of common stock or a combination of cash and shares of common stock, at the Company’s election. The 2028 Capped Calls remain outstanding as of October 31, 2025.

Note 10. Commitments and Contingencies

Legal Matters

From time to time, the Company may be subject to various claims and other legal matters arising in the ordinary course of business. The Company investigates these claims as they arise and accrues estimates for resolution of legal and other contingencies when losses are probable and estimable. The Company is not currently a party to any material legal proceedings nor is it aware of any pending or threatened litigation that could reasonably be expected to have a material adverse effect on its business, financial condition, results of operations, or cash flows.

Warranties and Indemnification

The Company has entered into service-level agreements with a portion of its customers defining levels of uptime reliability and performance and permitting those customers to receive credits if the Company fails to meet the defined levels of uptime. To date, the Company has not experienced any significant failures to meet defined levels of uptime reliability and performance as a result of those agreements and, as a result, the Company has not incurred or accrued any material liabilities related to these agreements in the financial statements.

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In the ordinary course of business, the Company may agree to indemnify customers, vendors, lessors, business partners, and other parties with respect to certain matters, including, but not limited to, losses arising out of the breach of such agreements, services to be provided by the Company, or from intellectual property infringement claims made by third parties. As permitted under Delaware law, the Company has entered into indemnification agreements with its directors and certain officers and employees that will require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as directors, officers, or employees. No demands have been made upon the Company to provide indemnification under such agreements, and there are no claims that the Company is aware of that could have a material effect on its consolidated balance sheets, consolidated statements of operations, consolidated statements of comprehensive income (loss), or consolidated statements of cash flows.

Note 11. Deferred Revenue and Performance Obligations

The following table presents the changes to the Company’s deferred revenue for the periods indicated (in thousands):

			Three months ended October 31,												Nine months ended October 31,
			2025						2024						2025						2024
Deferred revenue, beginning of period			$	229,914					$	217,889					$	245,752					$	228,161
Billings			117,667						117,774						345,045						334,609
Revenue recognized			(124,545)						(118,946)						(367,761)						(346,053)
Deferred revenue, end of period			$	223,036					$	216,717					$	223,036					$	216,717

For the three and nine months ended October 31, 2025 and 2024, the majority of revenue recognized was from the deferred revenue balances at the beginning of each period.

The transaction price allocated to the remaining performance obligations represents all future, non-cancelable contracted revenue that has not yet been recognized, inclusive of deferred revenue that has been invoiced and non-cancelable amounts that will be invoiced and recognized as revenue in future periods. The Company estimates its remaining performance obligations at a point in time. Actual amounts and timing of revenue recognition may differ from these estimates largely due to contract renewals and modifications.

As of October 31, 2025, total transaction price allocated to remaining non-cancelable performance obligations under cloud-hosted and term-license software subscription contracts with customers was approximately $415 million. Of this amount, the Company expects to recognize revenue of approximately $287 million, or 69%, over the next 12 months, $101 million, or 24%, over months 13 to 24, and the remainder thereafter.

Note 12. Common Stock and Stockholders’ Equity

Common Stock Repurchases

In May 2024, the Company’s Board of Directors authorized a share repurchase program to repurchase up to $100.0 million of the Company’s common stock (the “2024 Share Repurchase Program”). Under the 2024 Share Repurchase Program, the Company repurchased a total of 5,223,071 shares of the Company’s common stock through open market purchases at an average per share price of $19.15 for a total repurchase price of $100.0 million. During the year ended January 31, 2025, these shares were retired.

In March 2025, the Company’s Board of Directors authorized a share repurchase program to repurchase up to $150.0 million of the Company’s common stock (the “2025 Share Repurchase Program”), which was subsequently increased to $200.0 million in August 2025. The 2025 Share Repurchase Program does not obligate the Company to acquire a specified number of shares, and may be suspended, modified, or terminated at any time, without prior notice. The repurchases are expected to be executed from time to time through March 2027, subject to general business and market conditions and other investment opportunities, through open market purchases or other legally permissible means, including through Rule 10b5-1 plans. During the three and nine months ended October 31, 2025, the Company repurchased a total of 2,354,683 shares under the 2025 Share Repurchase Program and subsequently retired 2,092,300 shares. The cost of the remaining 262,383 shares is recorded as treasury stock in the condensed consolidated balance sheets. As of October 31, 2025, $162.1 million of the total amount authorized to be repurchased remained available.

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Equity Incentive Plan

In 2019, the Company adopted the 2019 Equity Incentive Plan (the “2019 Plan”). As of October 31, 2025 and January 31, 2025, the Company was authorized to grant up to 40,658,856 shares and 36,096,964 shares of common stock, respectively, under the 2019 Plan.

The Company currently uses authorized and unissued shares to satisfy stock award exercises and settlement of restricted stock units (“RSUs”) and performance stock units (“PSUs”). As of October 31, 2025 and January 31, 2025, there were 22,784,379 shares and 20,028,092 shares, respectively, available for future issuance under the 2019 Plan.

Shares of common stock reserved for future issuance as of the end of the period noted are as follows:

			October 31, 2025
Outstanding stock options and unvested RSUs and PSUs			12,128,775
Available for future stock option, RSU, and PSU grants			22,784,379
Available for Employee Stock Purchase Plan (“ESPP”)			4,328,094
Total common stock reserved for future issuance			39,241,248

Stock Options

As of October 31, 2025, there was approximately $0.1 million of total unrecognized compensation cost related to unvested stock options granted under the 2019 Plan, which will be recognized over a weighted average period of 0.4 years.

Restricted Stock Units

A summary of the Company’s RSU activity and related information is as follows:

			Number of RSUs						Weighted Average Grant Date Fair Value Per Share
Outstanding at January 31, 2025			7,114,964						$	24.78
Granted			4,812,535						$	17.65
Vested			(2,848,013)						$	25.43
Forfeited or canceled			(2,178,855)						$	22.97
Outstanding at October 31, 2025			6,900,631						$	20.11

The fair value of the Company’s RSUs is expensed ratably over the vesting period, and is based on the fair value of the underlying shares on the date of grant. The Company accounts for forfeitures as they occur.

As of October 31, 2025, there was $130.8 million of unrecognized stock-based compensation expense related to unvested RSUs, which is expected to be recognized over a weighted average period of 2.2 years based on vesting under the award service conditions.

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Performance Stock Units

The Company grants PSUs to certain employees of the Company, which, in the current fiscal year, are to vest based on the level of achievement of certain targets related to the Company’s operating plan over the one-year performance period. In prior periods, PSUs vested based on both the level of achievement of certain targets related to the Company’s operating plan and the relative growth of the per share price of the Company’s common stock as compared to the S&P Software & Services Select Index over the one-year performance period. The PSUs vest over a three-year period, subject to continuous service with the Company. The number of shares of the Company’s common stock that will vest based on the performance and market conditions can range from 0% to 200% of the target amount. Compensation expense for PSUs with performance conditions is measured using the fair value at the date of grant, and may be adjusted over the vesting period based on interim estimates of performance against the performance condition. Compensation expense for PSUs with market conditions is measured using a Monte Carlo simulation approach. Expense is recorded over the vesting period under the graded-vesting attribution method.

In the nine months ended October 31, 2025, the Compensation Committee of the Company’s Board of Directors certified the results of the Company’s operating plan for the fiscal year ended January 31, 2025. Based on the results, the PSUs granted in April 2024 (“2024 PSU Awards”) were earned at an attainment of 76.3%.

A summary of the Company’s PSU activity and related information is as follows:

			Number of PSUs						Weighted Average Grant Date Fair Value Per Share
Outstanding at January 31, 2025			761,739						$	21.62
Granted(1)			640,646						$	18.23
Vested			(270,830)						$	21.62
Forfeited or canceled			(58,616)						$	21.62
Performance adjustment for 2024 PSU Awards			(171,354)						$	21.62
Outstanding at October 31, 2025			901,585						$	19.21
(1) This amount represents awards granted at 100% attainment.

During the three and nine months ended October 31, 2025, the Company recorded stock-based compensation expense for the number of PSUs considered probable of vesting based on the attainment of the performance targets.

As of October 31, 2025, total unrecognized stock-based compensation cost related to PSUs was $1.9 million. This unrecognized stock-based compensation cost is expected to be recognized using the accelerated attribution method over a weighted-average period of approximately 0.9 years.

Employee Stock Purchase Plan

The Company’s ESPP generally provides for 24-month offering periods beginning June 15 and December 15 of each year, with each offering period consisting of four six-month purchase periods. On each purchase date, eligible employees will purchase the shares at a price per share equal to 85% of the lesser of: (i) the fair market value of the Company’s stock as of the beginning of the offering period; or (ii) the fair market value of the Company’s stock on the purchase date, as defined in the ESPP.

22

During the three months ended October 31, 2025 and 2024, the Company recognized $1.4 million and $1.1 million, respectively, of stock-based compensation expense related to the ESPP. During the nine months ended October 31, 2025 and 2024, the Company recognized $2.9 million and $3.7 million, respectively, of stock-based compensation expense related to the ESPP.

During the three months ended October 31, 2025 and 2024, the Company withheld $1.4 million and $2.6 million, respectively, in contributions from employees. During the nine months ended October 31, 2025 and 2024, the Company withheld $5.3 million and $7.7 million, respectively, in contributions from employees.

During the nine months ended October 31, 2025, 377,811 shares of common stock were issued under the ESPP at a weighted average purchase price of $12.22 per share. During the nine months ended October 31, 2024, 312,660 shares of common stock were issued under the ESPP at a weighted average purchase price of $18.34 per share.

Stock-Based Compensation

Stock-based compensation expense included in the Company’s condensed consolidated statements of operations was as follows for the periods indicated (in thousands):

			Three months ended October 31,												Nine months ended October 31,
			2025						2024						2025						2024
Cost of revenue			$	988					$	1,432					$	3,298					$	4,696
Research and development			8,395						11,576						27,795						34,640
Sales and marketing			5,439						7,639						16,943						23,702
General and administrative			7,753						11,126						26,252						34,041
Total stock-based compensation expense			$	22,575					$	31,773					$	74,288					$	97,079

Note 13. Net Income (Loss) per Share

Net income (loss) used for the purpose of determining basic and diluted net income (loss) per share is determined by taking net income (loss) attributable to PagerDuty, Inc., less the redeemable non-controlling interests redemption value adjustment.

The following table presents the calculation of basic and diluted net income (loss) per share attributable to PagerDuty, Inc. common stockholders for the periods indicated (in thousands, except number of shares and per share data):

			Three months ended October 31,												Nine months ended October 31,
			2025						2024						2025						2024
Numerator:
Net income (loss) attributable to PagerDuty, Inc.			$	161,586					$	(5,924)					$	163,999					$	(33,975)
Less: Adjustment attributable to redeemable non-controlling interest			2,031						634						1,164						9,881
Net income (loss) attributable to PagerDuty, Inc. common stockholders			$	159,555					$	(6,558)					$	162,835					$	(43,856)
Denominator:
Weighted-average shares used in calculating net income (loss) per share:
Basic			92,836						91,438						92,280						92,530
Diluted			94,662						91,438						94,154						92,530
Net income (loss) per share attributable to PagerDuty, Inc. common stockholders
Basic			$	1.72					$	(0.07)					$	1.76					$	(0.47)
Diluted			$	1.69					$	(0.07)					$	1.73					$	(0.47)

23

Since the Company was in a loss position for the three and nine months ended October 31, 2024, basic net loss per share and diluted net loss per share are the same, as the inclusion of all potential common stock outstanding would have been anti-dilutive.

Potentially dilutive securities that were not included in the diluted per share calculations because they would be anti-dilutive were as follows (in thousands):

			Three months ended October 31,												Nine months ended October 31,
			2025						2024						2025						2024
Shares subject to outstanding common stock awards			7,033						13,260						7,578						13,260
Shares issuable pursuant to the ESPP			204						187						261						187
Total			7,237						13,447						7,839						13,447

As described in Note 9. Debt and Financing Arrangements, upon conversion of the Notes, the Company will pay cash up to the aggregate principal amount of the Notes to be converted and pay or deliver, as the case may be, cash, shares of common stock or a combination of cash and shares of common stock, at the Company’s election, in respect to the remainder, if any, of the Company’s conversion obligation in excess of the aggregate principal amount of the Notes being converted. As of October 31, 2025 and 2024, the conversion options of the Notes were out of the money and as a result, there were no potentially dilutive shares related to the conversion of the Notes.

Note 14. Income Taxes

The Company's (benefit from) provision for income taxes for interim periods is determined using an estimate of its annual effective tax rate, adjusted for discrete items, if any, that arise during the period. Each quarter, the Company updates its estimate of the annual effective tax rate, and if the estimated annual effective tax rate changes, the Company makes a cumulative adjustment in such period.

The Company's quarterly tax (benefit) provision, and estimate of its annual effective tax rate, is subject to variation due to several factors, including variability in pre-tax income (or loss), the mix of jurisdictions to which such income (or loss) relates, changes in how the Company does business, and tax law developments. The Company's estimated effective tax rate for the year differs from the U.S. statutory rate of 21% primarily due to the release of the valuation allowance of U.S. federal and certain state deferred tax assets.

The Company recorded a benefit from income taxes of $149.7 million and $150.7 million for the three and nine months ended October 31, 2025, respectively, and a provision for income taxes of $0.7 million and $1.3 million for the three and nine months ended October 31, 2024, respectively. The income tax benefit during the three months ended October 31, 2025 was primarily due to the release of the valuation allowance of U.S. federal and certain state deferred tax assets.

The Company regularly assesses the need for a valuation allowance against its deferred tax assets. In making that assessment, the Company considers both positive and negative evidence in the various jurisdictions in which it operates related to the likelihood of realization of the deferred tax assets to determine, based on the weight of available evidence, whether it is more likely than not that some or all of the deferred tax assets will not be realized. As of October 31, 2025, the Company achieved cumulative U.S. income during the prior twelve quarters when considering pre-tax income adjusted for permanent book-tax differences. Based on all available positive and negative evidence, including the amount of our taxable income in recent years which is objective and verifiable, and taking into account anticipated future taxable earnings, the Company concluded that it is more likely than not that its U.S. federal and certain state deferred tax assets will be realizable. The Company continues to maintain a valuation allowance of $0.8 million against certain other state deferred tax assets due to the uncertainty regarding realizability of these deferred tax assets as they have not met the more likely than not realization criteria. When a change in valuation allowance is recognized during an interim period, the change in valuation allowance resulting from current year income is included in the annual effective tax rate and the release of valuation allowance supported by projections of future taxable income is recorded as a discrete tax benefit in the interim period. The Company released $154.2 million of its valuation allowance as a discrete tax benefit during the three months ended October 31, 2025. The Company will continue to monitor the need for a valuation allowance against its deferred tax assets on a quarterly basis.

24

On July 4, 2025, the U.S. enacted tax reform legislation through the One Big Beautiful Bill Act (“OBBBA”). Included in this legislation are provisions that allow for the immediate expensing of domestic research and development expenses, immediate expensing of certain capital expenditures, and other changes to the U.S. taxation of profits derived from foreign operations. The Company has evaluated the provisions of the OBBBA and determined that the effects are not material to our consolidated financial statements for the three and nine months ended October 31, 2025. The Company will continue to monitor any future changes in its business, forthcoming guidance, or interpretations of the new tax law that could affect its tax position in subsequent periods.

Note 15. Geographic Information

Revenue by location is generally determined by the billing address of the customer. The following table sets forth revenue by geographic area for the periods indicated (in thousands):

			Three months ended October 31,												Nine months ended October 31,
			2025						2024						2025						2024
United States			$	88,803					$	85,530					$	262,914					$	250,637
International			35,742						33,416						104,847						95,416
Total			$	124,545					$	118,946					$	367,761					$	346,053

Other than the United States, no other individual country accounted for 10% or more of revenue for the three and nine months ended October 31, 2025 or 2024.

As of October 31, 2025, 72% of the Company’s long-lived assets, including property and equipment and right-of-use lease assets, were located in the United States, 15% were located in Canada, 11% were located in Portugal, 1% were located in Japan, and 1% were located in Chile.

As of January 31, 2025, 69% of the Company’s long-lived assets, including property and equipment and right-of-use lease assets, were located in the United States, 17% were located in Canada, 12% were located in Portugal, 1% were located in the United Kingdom, and 1% were located in Chile.

Note 16. Restructuring Costs

During the three and nine months ended October 31, 2025, as part of the Company’s ongoing actions to drive efficient growth and expand operating margins, the Company implemented changes that included reallocating certain roles and realigning teams to continue to improve operational resiliency and agility. During the three and nine months ended October 31, 2025, the Company incurred costs associated with the restructuring plan of approximately $2.1 million and $6.0 million, respectively, which was primarily comprised of severance payments, employee benefit contributions, and other related costs. The Company recorded the restructuring costs within the cost of sales, research and development, sales and marketing, and general and administrative operating expense line items of its consolidated statements of operations.

Restructuring costs incurred during the three and nine months ended October 31, 2024 were not material.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of the financial condition and results of operations of PagerDuty, Inc. and its wholly-owned subsidiaries, and subsidiaries in which PagerDuty, Inc. holds a controlling interest (“PagerDuty,” “we,” “us” or “our”) should be read in conjunction with our unaudited consolidated financial statements and related notes thereto included elsewhere in this Quarterly Report on Form 10-Q and with our audited financial statements and related notes in our Annual Report on Form 10-K for the year ended January 31, 2025. You should review the sections titled “Special Note Regarding Forward-Looking Statements” above in this Quarterly Report on Form 10-Q for a discussion of forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those discussed below. Factors that could cause or contribute to such differences include, but are not limited to, adverse effects on our business and general economic conditions as identified below, and those discussed in the section titled “Risk Factors” included in our Annual Report on Form 10-K. The last day of our fiscal year is January 31. Our fiscal quarters end on April 30, July 31, October 31 and January 31. Except as otherwise noted, all references to fiscal 2026 refer to the fiscal year ending January 31, 2026.

Overview and Business Model

PagerDuty, Inc. is a global leader in digital operations management, enabling customers to achieve operational efficiency at scale and transform critical work for modern enterprises. The PagerDuty Operations Cloud combines artificial intelligence (“AI”) operations (“AIOps”), automation, customer service operations, and incident management with a generative AI assistant to create a flexible, resilient, and scalable platform to protect revenue and improve customer experience, accelerate innovation, improve operational efficiency, and mitigate risk of operational failures.

Today, nearly every business is a digital business. From retail to financial services, from travel and entertainment to supply chain logistics, everyday commerce relies on an incredibly complex network of digital infrastructure, systems, software, and teams. And while that complexity is only increasing, the need for those digital operations to be resilient is also rising, as organizations face pressure to meet escalating customer expectations, resolve incidents proactively, and deliver innovation without increasing costs. In this environment, the ability to anticipate, orchestrate, and resolve time-sensitive, critical and unplanned work before it escalates is a critical requirement for success.

Since our founding in 2009, we have expanded our capabilities from a single product focused on on-call management for developers to a multi-product platform that crosses the silos of development, information technology (“IT”) infrastructure and operations, security, customer service, and business operations and reaches executive stakeholder roles across an organization. Today, we collect data and digital signals from virtually any software-enabled system or device and leverage AI and machine learning to correlate, process, and predict opportunities and incidents. Using incident management, automation, AI operations, and customer service operations, our platform for digital operations brings together the right people with the right information so they can resolve issues and act on opportunities in minutes or seconds from wherever they are. In addition, our generative AI capabilities allow organizations to manage mission-critical tasks smarter and faster.

We have spent more than a decade building deep product integrations to our platform, and our ecosystem now includes over 700 direct integrations to enable our customers to gather and correlate digital signals from virtually any software-enabled system or device. This allows technical teams to collect digital signals from nearly any system or platform in their environment, and without the effects of context switching. Those same integrations connect with popular collaboration tools and business applications, as well as all types of technology stacks to drive automation of work.

We generate revenue primarily from cloud-hosted software subscription fees. We also generate revenue from term-license software subscription fees. PagerDuty has a land-and-expand business model that leads to viral adoption and expansion of our products. Although the PagerDuty platform can be used by any size of company, from small to mid-market to enterprise companies, we have increasingly focused our go-to-market motion, including our field sales team, on serving enterprise customers.

The PagerDuty sales and customer success teams drive expansion to additional users, new use cases, and additional products, as well as upgrades to higher-value plans. Our enterprise customers account for the majority of our revenue today. The PagerDuty platform is central to customer initiatives targeted at incident management transformation, operations center modernization, automation standardization, and customer experience operations. Our platform provides the technology to solve the customer problems underlying these and many other business initiatives.

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Macroeconomic Environment

Our business and financial performance has and may continue to be subject to the effects of worldwide macroeconomic conditions, including, but not limited to, global inflation and heightened interest rates, tariffs and trade wars, existing and new laws and regulations, and economic uncertainty and volatility globally and in the jurisdictions in which we do business.

We will continue to monitor the direct and indirect impacts of these or similar circumstances on our business and financial results. For additional information on the potential impact of macroeconomic conditions on our business, see Part II, Item 1A, Risk Factors.

Key Business Metrics

We review the following key business metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans, and make strategic decisions.

While these metrics are based on what we believe to be a reasonable representation of our customer base for the applicable period of measurement, we rely on a third party to validate legal entities using the best available data at period end, and therefore, these metrics are subject to change as new information becomes available. In addition, we are continually seeking to improve our methodology, which may result in future changes to our key metrics.

Annual Recurring Revenue (“ARR”)

We believe ARR is a key metric to measure our business performance because it is an indication of our ability to maintain and expand our relationships with existing customers and generate new business. We define ARR as the annualized recurring revenue of all active contracts at the end of a reporting period.

ARR was as follows as of the dates indicated (in millions):

			As of October 31,
			2025						2024
ARR			$	497.1					$	483.0

Number of Customers

We believe that the number of customers using our platform, particularly those that have subscription agreements for more than $100.0 thousand in ARR, are indicators of our market penetration, particularly within enterprise accounts, the growth of our business, and our potential future business opportunities. We define a customer as 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. Increasing awareness of our platform and its broad range of capabilities, coupled with the fact that the world is always on and powered by increasingly complex technology, has expanded the diversity of our customer base to include organizations of all sizes across virtually all industries. Over time, enterprise and mid-market customers have constituted a greater share of our revenue. The total number of paid customers and the number of customers with greater than $100.0 thousand in ARR were as follows as of the dates indicated:

			As of October 31,
			2025						2024
Customers			15,398						15,050
Customers with greater than $100.0 thousand in ARR			867						825

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Dollar-based Net Retention Rate

We use dollar-based net retention rate to evaluate the long-term value of our customer relationships, since this metric reflects our ability to retain and expand the ARR from our existing paid customers. Our dollar-based net retention rate compares our ARR from the same set of customers across comparable periods.

We calculate dollar-based net retention rate as of a period end by starting with the ARR from the cohort of all paid customers as of 12 months prior to such period end (“Prior Period ARR”). We then calculate the ARR from these same customers as of the current period end (“Current Period ARR”). Current 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. The dollar-based net retention rate was as follows as of the dates indicated:

			Last 12 months ended October 31,
			2025						2024
Dollar-based net retention rate			100		%				107		%

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Results of Operations

Three months ended October 31, 2025 compared to three months ended October 31, 2024

The following table sets forth our results of operations for the periods indicated and as a percentage of revenue (in thousands, except percentages):

			Three months ended October 31,
			2025												2024
Revenue			$	124,545					100.0		%				$	118,946					100.0		%
Cost of revenue(1)			18,357						14.7		%				20,268						17.0		%
Gross profit			106,188						85.3		%				98,678						83.0		%
Operating expenses:
Research and development(1)			29,418						23.6		%				34,267						28.8		%
Sales and marketing(1)			44,322						35.6		%				49,272						41.4		%
General and administrative(1)			24,369						19.6		%				25,432						21.4		%
Total operating expenses			98,109						78.8		%				108,971						91.6		%
Income (loss) from operations			8,079						6.5		%				(10,293)						(8.7)		%
Interest income			5,700						4.6		%				6,912						5.8		%
Interest expense			(2,100)						(1.7)		%				(2,377)						(2.0)		%
Other income (expense), net			50						—		%				346						0.3		%
Income (loss) before (benefit from) provision for income taxes			11,729						9.4		%				(5,412)						(4.5)		%
(Benefit from) provision for income taxes			(149,673)						(120.2)		%				715						0.6		%
Net income (loss)			$	161,402					129.6		%				$	(6,127)					(5.2)		%
Net loss attributable to redeemable non-controlling interest			(184)						(0.1)		%				(203)						(0.2)		%
Net income (loss) attributable to PagerDuty, Inc.			$	161,586					129.7		%				$	(5,924)					(5.0)		%
Less: Adjustment attributable to redeemable non-controlling interest			2,031						1.6		%				634						0.5		%
Net income (loss) attributable to PagerDuty, Inc. common stockholders			$	159,555					128.1		%				$	(6,558)					(5.5)		%

______________

(1)    Includes stock-based compensation expense as follows (in thousands):

			Three months ended October 31,
			2025						2024
Cost of revenue			$	988					$	1,432
Research and development			8,395						11,576
Sales and marketing			5,439						7,639
General and administrative			7,753						11,126
Total			$	22,575					$	31,773

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Revenue

We generate revenue primarily from cloud-hosted software subscription fees. We also generate revenue from term-license software subscription fees. Revenue generated from term-license software subscription fees is not material. Our subscriptions are typically one year in duration but can range from monthly to multi-year. Subscription fees are driven primarily by the number of customers, the number of users per customer, and the level of subscription purchased. We generally invoice customers in advance in annual installments for subscriptions to our software. Revenue related to our cloud-hosted software subscriptions is recognized ratably over the related contractual term beginning on the date that our platform is made available to a customer. For our term-license software subscriptions, we recognize license revenue upon delivery, and software maintenance revenue ratably, typically beginning on the start of the contractual term of the arrangement.

Due to the low complexity of implementation and integration of our platform with our customers’ existing infrastructure, revenue from professional services has not been material to date.

The following sets forth our revenue for the periods indicated (in thousands, except percentages):

			Three months ended October 31,												Change
			2025						2024						$						%
Revenue			$	124,545					$	118,946					$	5,599					4.7		%

Revenue increased primarily due to a combination of growth from both new and existing customers. Growth from existing customers was driven by an increase in the number of users and upsell of additional products and services.

Cost of Revenue and Gross Margin

Cost of revenue primarily consists of expenses related to providing our platform to customers, including personnel expenses for operations and global support, payments to our third-party cloud infrastructure providers for hosting our software, payment processing fees, amortization of capitalized software costs, amortization of acquired developed technology, and allocated overhead costs for facilities, information technology, and other allocated overhead costs. We will continue to invest additional resources in our platform infrastructure and our customer support and success organizations to expand the capability of our platform and ensure that our customers are realizing the full benefit of our offerings. The level and timing of investment in these areas could affect our cost of revenue in the future.

Gross profit represents revenue less cost of revenue. Gross margin is gross profit expressed as a percentage of revenue. Our gross margin may fluctuate from period to period as our revenue fluctuates, and as a result of the timing and amount of investments to expand the capacity of our third-party cloud infrastructure providers and our continued efforts to enhance our platform support and customer success teams.

The following sets forth our cost of revenue and gross margin for the periods indicated (in thousands, except percentages):

			Three months ended October 31,												Change
			2025						2024						$						%
Cost of revenue			$	18,357					$	20,268					$	(1,911)					(9.4)		%
Gross margin			85.3		%				83.0		%

The decrease in cost of revenue is primarily due to: (i) a decrease of $1.7 million in amortization of acquired intangible assets; (ii) a decrease of $0.7 million in outside services spend for the customer service team; and (iii) a decrease of $0.6 million in personnel costs, driven largely by a decrease in stock-based compensation; offset by (iv) an increase of $1.0 million in hosting, software, and telecom costs.

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Operating Expenses

Our operating expenses consist of research and development, sales and marketing, and general and administrative expenses. Personnel expenses are the most significant component of operating expenses and consist of salaries, benefits, bonuses, stock-based compensation expense, and sales commissions. Operating expenses also include amortization of acquired intangible assets, acquisition-related expenses, allocated overhead costs for facilities, shared IT related expenses, including depreciation expense, and certain company-wide events and functions.

The following table sets forth our operating expenses for the periods indicated (in thousands, except percentages):

			Three months ended October 31,												Change
			2025						2024						$						%
Operating expenses:
Research and development			$	29,418					$	34,267					$	(4,849)					(14.2)		%
Sales and marketing			44,322						49,272						(4,950)						(10.0)		%
General and administrative			24,369						25,432						(1,063)						(4.2)		%
Total operating expenses			$	98,109					$	108,971					$	(10,862)					(10.0)		%

Research and development: Research and development expenses consist primarily of personnel costs for our engineering, product, and design teams. Additionally, research and development expenses include outside services, depreciation of equipment used in research and development activities, acquisition-related expenses, and allocated overhead costs. We expect that our research and development expenses will generally increase in dollar value as our business grows.

Research and development expenses decreased primarily due to: (i) a decrease of $6.1 million in personnel costs as a result of a decrease in headcount and a decrease in stock-based compensation; offset by (ii) an increase of $1.2 million primarily due to an impairment of capitalized software.

Sales and marketing: Sales and marketing expenses consist primarily of personnel costs, costs of general marketing activities and promotional activities, travel-related expenses, amortization of acquired intangible assets, allocated overhead costs, and credit loss expense. Sales commissions earned by our sales force that are considered incremental and recoverable costs of obtaining a subscription with a customer are deferred and amortized on a straight-line basis over the expected period of benefit, which we have determined to be four years. We expect that our sales and marketing expenses will generally increase in dollar value and continue to be our largest operating expense for the foreseeable future as we expand our sales and marketing efforts.

Sales and marketing expenses decreased primarily due to: (i) a decrease of $2.8 million in personnel costs, driven largely by a decrease in stock-based compensation; (ii) a decrease of $1.3 million in outside services spend due to higher leverage of internal resources; and (iii) a decrease of $0.9 million in training and travel-related costs.

General and administrative: General and administrative expenses consist primarily of personnel costs and outside services fees for finance, legal, human resources, information technology, and other administrative functions. In addition, general and administrative expenses include non-personnel costs, such as legal, accounting, and other professional fees, hardware and software costs, certain tax, license and insurance-related expenses, acquisition-related expenses, and allocated overhead costs. We expect that our general and administrative expenses will increase in dollar value as our business grows. However, we expect that our general and administrative expenses will decrease as a percentage of our revenue over the longer term, as we expect our investments to allow for improved efficiency for future growth in the business.

General and administrative expenses decreased primarily due to: (i) a decrease of $3.0 million in personnel costs, driven largely by a decrease in stock-based compensation; and (ii) a decrease of $0.2 million in training and travel-related costs; offset by (iii) an increase of $1.8 million in outside services spend for consulting services; (iv) an increase of $0.5 million in costs to support the business and related infrastructure, which include allocated overhead costs.

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Non-Operating Income (Expenses)

The following table sets forth our non-operating income (expenses) for the periods indicated (in thousands, except percentages):

			Three months ended October 31,												Change
			2025						2024						$						%
Interest income			$	5,700					$	6,912					$	(1,212)					(17.5)		%
Interest expense			$	(2,100)					$	(2,377)					$	277					(11.7)		%
Other income, net			$	50					$	346					$	(296)					(85.5)		%
(Benefit from) provision for income taxes			$	(149,673)					$	715					$	(150,388)					(21,033.3)		%

Interest income: Interest income consists of accretion income and amortization expense on our available-for-sale investments, income earned on our cash and cash equivalents, and interest earned on our short-term investments which consist of U.S. Treasury securities, commercial paper, corporate debt securities, and U.S. Government agency securities.

Interest income decreased primarily due to a decrease in interest-earning cash balances in the current quarter.

Interest expense: Interest expense consists primarily of contractual interest expense and amortization of debt issuance costs on our 1.25% Convertible senior notes due 2025 (the “2025 Notes”) that were repaid during the nine months ended October 31, 2025 and the contractual interest expense and amortization of debt issuance costs on our 1.50% Convertible Senior Notes due 2028 (the “2028 Notes”) that were issued in October 2023.

Interest expense decreased primarily due to an decrease in interest expense related to the Convertible Notes, driven by the repayment of the 2025 Notes during the nine months ended October 31, 2025.

Other income, net: Other income, net primarily consists of foreign currency transaction gains and losses.

The change in other income (expense), net was due to fluctuations in foreign currency during the period.

(Benefit from) provision for income taxes: (Benefit from) provision for income taxes consists primarily of income taxes in certain foreign and U.S. jurisdictions in which we conduct business.

The change in (benefit from) provision for income taxes is primarily attributable to the release of the valuation allowance against U.S. federal and certain state deferred tax assets. The (benefit) provision may fluctuate to the extent the mix of earnings fluctuates between jurisdictions with different tax rates.

The Company regularly assesses the need for a valuation allowance against its deferred tax assets. In making that assessment, the Company considers both positive and negative evidence in the various jurisdictions in which it operates related to the likelihood of realization of the deferred tax assets to determine, based on the weight of available evidence, whether it is more likely than not that some or all of the deferred tax assets will not be realized. As of October 31, 2025, the Company achieved cumulative U.S. income during the prior twelve quarters when considering pre-tax income adjusted for permanent book-tax differences. Based on all available positive and negative evidence, including the amount of our taxable income in recent years which is objective and verifiable, and taking into account anticipated future taxable earnings, the Company concluded that it is more likely than not that its U.S. federal and certain state deferred tax assets will be realizable. We continue to maintain a valuation allowance of $0.8 million against certain other deferred tax assets due to the uncertainty regarding realizability of these deferred tax assets as they have not met the more likely than not realization criteria. When a change in valuation allowance is recognized during an interim period, the change in valuation allowance resulting from current year income is included in the annual effective tax rate and the release of valuation allowance supported by projections of future taxable income is recorded as a discrete tax benefit in the interim period. The Company released $154.2 million of its valuation allowance as a discrete tax benefit during the three months ended October 31, 2025. The Company will continue to monitor the need for a valuation allowance against its deferred tax assets on a quarterly basis.

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Nine months ended October 31, 2025 compared to nine months ended October 31, 2024

The following table sets forth our results of operations for the periods indicated and as a percentage of revenue (in thousands, except percentages):

			Nine months ended October 31,
			2025												2024
Revenue			$	367,761					100.0		%				$	346,053					100.0		%
Cost of revenue(1)			56,542						15.4		%				59,691						17.2		%
Gross profit			311,219						84.6		%				286,362						82.8		%
Operating expenses:
Research and development(1)			94,363						25.7		%				106,878						30.9		%
Sales and marketing(1)			138,823						37.7		%				148,737						43.0		%
General and administrative(1)			76,715						20.9		%				78,800						22.8		%
Total operating expenses			309,901						84.3		%				334,415						96.6		%
Loss from operations			1,318						0.4		%				(48,053)						(13.9)		%
Interest income			17,860						4.9		%				21,408						6.2		%
Interest expense			(6,750)						(1.8)		%				(6,888)						(2.0)		%
Other income (expense), net			284						0.1		%				212						0.1		%
Income (loss) before (benefit from) provision for income taxes			12,712						3.5		%				(33,321)						(9.6)		%
(Benefit from) provision for income taxes			(150,725)						(41.0)		%				1,335						0.4		%
Net income (loss)			$	163,437					44.4		%				$	(34,656)					(10.0)		%
Net loss attributable to redeemable non-controlling interest			(562)						(0.2)		%				(681)						(0.2)		%
Net income (loss) attributable to PagerDuty, Inc.			$	163,999					44.6		%				$	(33,975)					(9.8)		%
Less: Adjustment attributable to redeemable non-controlling interest			1,164						0.3		%				9,881						2.9		%
Net income (loss) attributable to PagerDuty, Inc. common stockholders			$	162,835					44.3		%				$	(43,856)					(12.7)		%

______________

(1)    Includes stock-based compensation expense as follows (in thousands):

			Nine months ended October 31,
			2025						2024
Cost of revenue			$	3,298					$	4,696
Research and development			27,795						34,640
Sales and marketing			16,943						23,702
General and administrative			26,252						34,041
Total			$	74,288					$	97,079

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Revenue

The following sets forth our revenue for the periods indicated (in thousands, except percentages):

			Nine months ended October 31,												Change
			2025						2024						$						%
Revenue			$	367,761					$	346,053					$	21,708					6.3		%

Revenue increased primarily due to growth from a combination of growth from both new and existing customers. Growth from existing customers was driven by an increase in the number of users and upsell of additional products and services.

Cost of Revenue and Gross Margin

The following sets forth our cost of revenue and gross margin for the periods indicated (in thousands, except percentages):

			Nine months ended October 31,												Change
			2025						2024						$						%
Cost of revenue			$	56,542					$	59,691					$	(3,149)					(5.3)		%
Gross margin			84.6		%				82.8		%

The decrease in cost of revenue is primarily due to: (i) a decrease of $4.5 million in amortization of acquired intangible assets; and (ii) a decrease of $2.3 million in outside services spend for the customer service team; offset by (iii) an increase of $1.9 million in hosting, software, and telecom costs; (iv) an increase of $0.7 million in costs to support the business and related infrastructure, which include allocated overhead costs; (v) an increase of $0.7 million in personnel costs as a result of an increase in headcount; and (vi) an increase of $0.3 million in other expenses which primarily consisted of merchant fees.

Operating Expenses

The following table sets forth our operating expenses for the periods indicated (in thousands, except percentages):

			Nine months ended October 31,												Change
			2025						2024						$						%
Operating expenses:
Research and development			$	94,363					$	106,878					$	(12,515)					(11.7)		%
Sales and marketing			138,823						148,737						(9,914)						(6.7)		%
General and administrative			76,715						78,800						(2,085)						(2.6)		%
Total operating expenses			$	309,901					$	334,415					$	(24,514)					(7.3)		%

Research and development: Research and development expenses decreased primarily due to: (i) a decrease of $13.2 million in personnel costs as a result of a decrease in headcount and a decrease in stock-based compensation; and (ii) a decrease of $1.0 million in costs to support the business and related infrastructure, which include allocated overhead costs; offset by (iii) an increase of $1.1 million in other expenses, primarily related to the impairment of capitalized software; and (iv) an increase of $0.4 million in training and travel-related costs.

Sales and marketing: Sales and marketing expenses decreased primarily due to: (i) a decrease of $5.4 million in outside services spend due to higher leverage of internal resources; (ii) a decrease of $5.1 million in personnel costs primarily due to a decrease in stock-based compensation; and (iii) a decrease of $2.2 million in training and travel-related costs; offset by (iv) an increase of $1.8 million in marketing costs for media campaigns during the current period; and (v) an increase of $0.7 million in costs to support the business and related infrastructure, which include allocated overhead costs.

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General and administrative: General and administrative expenses decreased primarily due to: (i) a decrease of $5.8 million in personnel costs, driven largely by a decrease in stock-based compensation; (ii) a decrease of $0.5 million in in training and travel-related costs; and (iii) a decrease of $0.3 million in insurance, business taxes and licenses costs; offset by (iv) an increase of $3.6 million in outside services spend; and (v) an increase of $1.0 million in costs to support the business and related infrastructure, which include allocated overhead costs.

Non-Operating Income (Expenses)

The following table sets forth our non-operating income (expenses) for the periods indicated (in thousands, except percentages):

			Nine months ended October 31,												Change
			2025						2024						$						%
Interest income			$	17,860					$	21,408					$	(3,548)					(16.6)		%
Interest expense			$	(6,750)					$	(6,888)					$	138					(2.0)		%
Other income, net			$	284					$	212					$	72					34.0		%
(Benefit from) provision for income taxes			$	(150,725)					$	1,335					$	(152,060)					(11,390.3)		%

Interest income: Interest income decreased primarily due to a decrease in interest-earning cash balances in the current quarter.

Interest expense: Interest expense decreased primarily due to an decrease in interest expense related to the Convertible Notes, driven by the repayment of the 2025 Notes during the nine months ended October 31, 2025.

Other income, net: The change in other income, net was due to fluctuations in foreign currency during the period.

(Benefit from) provision for income taxes: (Benefit from) provision for income taxes consists primarily of income taxes in certain foreign and U.S. jurisdictions in which we conduct business.

The change in (benefit from) provision for income taxes is primarily attributable to the release of the valuation allowance against U.S. federal and certain state deferred tax assets. The (benefit) provision may fluctuate to the extent the mix of earnings fluctuates between jurisdictions with different tax rates.

The Company regularly assesses the need for a valuation allowance against its deferred tax assets. In making that assessment, the Company considers both positive and negative evidence in the various jurisdictions in which it operates related to the likelihood of realization of the deferred tax assets to determine, based on the weight of available evidence, whether it is more likely than not that some or all of the deferred tax assets will not be realized. As of October 31, 2025, the Company achieved cumulative U.S. income during the prior twelve quarters when considering pre-tax income adjusted for permanent book-tax differences. Based on all available positive and negative evidence, including the amount of our taxable income in recent years which is objective and verifiable, and taking into account anticipated future taxable earnings, the Company concluded that it is more likely than not that its U.S. federal and certain state deferred tax assets will be realizable. We continue to maintain a valuation allowance of $0.8 million against certain other deferred tax assets due to the uncertainty regarding realizability of these deferred tax assets as they have not met the more likely than not realization criteria. When a change in valuation allowance is recognized during an interim period, the change in valuation allowance resulting from current year income is included in the annual effective tax rate and the release of valuation allowance supported by projections of future taxable income is recorded as a discrete tax benefit in the interim period. The Company released $154.2 million of its valuation allowance as a discrete tax benefit during the three months ended October 31, 2025. The Company will continue to monitor the need for a valuation allowance against its deferred tax assets on a quarterly basis.

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Non-GAAP Financial Measures

In addition to our results determined in accordance with United States generally accepted accounting principles (“U.S. GAAP” or “GAAP”), we believe the following non-GAAP financial measures are useful in evaluating our operating performance. We use the below referenced non-GAAP financial information, collectively, to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe that non-GAAP financial information, when taken collectively, may be helpful to investors because it provides consistency and comparability with past financial performance and assists in comparisons with other companies, some of which use similar non-GAAP financial information to supplement their U.S. GAAP results. The non-GAAP financial information is presented for supplemental informational purposes only, should not be considered a substitute for financial information presented in accordance with U.S. GAAP, and may be different from similarly-titled non-GAAP measures used by other companies. The principal limitation of these non-GAAP financial measures is that they exclude significant expenses that are required by U.S. GAAP to be recorded in our financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by our management about which expenses are excluded or included in determining these non-GAAP financial measures. A reconciliation is provided below for each non-GAAP financial measure to the most directly comparable financial measure stated in accordance with U.S. GAAP.

Specifically, we exclude the following from historical and prospective non-GAAP financial measures, as applicable:

Stock-based compensation: PagerDuty utilizes stock-based compensation to attract and retain employees. It is principally aimed at aligning their interests with those of its stockholders and at long-term retention, rather than to address operational performance for any particular period. As a result, stock-based compensation expenses vary for reasons that are generally unrelated to financial and operational performance in any particular period.

Employer taxes related to employee stock transactions: PagerDuty views the amount of employer taxes related to its employee stock transactions as an expense that is dependent on its stock price, employee exercise and other award disposition activity, and other factors that are beyond PagerDuty’s control. As a result, employer taxes related to employee stock transactions vary for reasons that are generally unrelated to financial and operational performance in any particular period.

Amortization of acquired intangible assets: PagerDuty views amortization of acquired intangible assets as items arising from pre-acquisition activities determined at the time of an acquisition. While these intangible assets are evaluated for impairment regularly, amortization of the cost of purchased intangibles is an expense that is not typically affected by operations during any particular period.

Acquisition-related expenses: PagerDuty views acquisition-related expenses, such as transaction costs, acquisition-related retention payments, and acquisition-related asset impairment, as events that are not necessarily reflective of operational performance during a period. In particular, PagerDuty believes the consideration of measures that exclude such expenses can assist in the comparison of operational performance in different periods which may or may not include such expenses.

Amortization of debt issuance costs: The imputed interest rates of the Company's convertible senior notes (the "2025 Notes" and the "2028 Notes" or, collectively, the "Notes") was approximately 1.91% for the 2025 Notes and 2.13% for the 2028 Notes. This is a result of the debt issuance costs, which reduce the carrying value of the convertible debt instruments. The debt issuance costs are amortized as interest expense. The expense for the amortization of the debt issuance costs is a non-cash item, and we believe the exclusion of this interest expense will provide for a more useful comparison of our operational performance in different periods.

Restructuring costs: PagerDuty views restructuring costs, such as employee severance-related costs and real estate impairment costs, as events that are not necessarily reflective of operational performance during a period. In particular, PagerDuty believes the consideration of measures that exclude such expenses can assist in the comparison of operational performance in different periods which may or may not include such expenses.

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Shareholder matters: PagerDuty views certain charges, including third-party legal, consulting, and advisory fees, related to shareholder activity that are outside of the ordinary course of our business and expenses related to a cooperation agreement as events that are not necessarily reflective of operational performance during a period. PagerDuty believes that such charges do not have a direct correlation to the operations of the Company’s business and may vary in size depending on the timing, results, and resolution of such shareholder matters. The consideration of measures that exclude such expenses can assist in the comparison of operational performance in periods which may or may not include such expenses.

Impairment of long-lived assets: PagerDuty views non-cash charges for impairment of long-lived assets, including impairments related to capitalized software costs, office leases, and acquired intangible assets, as events that are not necessarily reflective of operational performance during a period. Impairment charges can vary significantly in terms of amount and timing and PagerDuty believes the exclusion of such adjustments can assist in comparison of operational performance in different periods.

Adjustment attributable to redeemable non-controlling interest: PagerDuty adjusts the value of redeemable non-controlling interest of its joint venture PagerDuty K.K. according to the operating agreement. PagerDuty believes this adjustment is not reflective of operational performance during a period and exclusion of such adjustments can assist in comparison of operational performance in different periods.

Income tax effects and adjustments: Based on PagerDuty’s financial outlook for fiscal 2026, PagerDuty is utilizing a projected non-GAAP tax rate of 22%. PagerDuty uses a projected non-GAAP tax rate in order to provide better consistency across the interim reporting periods by eliminating the impact of non-recurring and period specific items, which can vary in size and frequency. PagerDuty's estimated tax rate on non-GAAP income is determined annually and may be adjusted during the year to take into account events or trends that PagerDuty believes materially impact the estimated annual rate including, but not limited to, significant changes resulting from tax legislation, material changes in the geographic mix of revenue and expenses and other significant events.

Non-GAAP gross profit and non-GAAP gross margin

We define non-GAAP gross profit as gross profit excluding the following expenses typically included in cost of revenue: stock-based compensation expense, employer taxes related to employee stock transactions, amortization of acquired intangible assets, and restructuring costs. We define non-GAAP gross margin as non-GAAP gross profit as a percentage of revenue.

The following table presents the calculation of non-GAAP gross profit and non-GAAP gross margin for the periods indicated (in thousands):

			Three months ended October 31,												Nine months ended October 31,
			2025						2024						2025						2024
Gross profit			$	106,188					$	98,678					$	311,219					$	286,362
Add:
Stock-based compensation			988						1,432						3,298						4,696
Employer taxes related to employee stock transactions			19						29						87						112
Amortization of acquired intangible assets			506						2,200						2,380						6,875
Restructuring costs			292						—						292						(2)
Non-GAAP gross profit			$	107,993					$	102,339					$	317,276					$	298,043
Revenue			$	124,545					$	118,946					$	367,761					$	346,053
Gross margin			85.3		%				83.0		%				84.6		%				82.8		%
Non-GAAP gross margin			86.7		%				86.0		%				86.3		%				86.1		%

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Non-GAAP operating income and non-GAAP operating margin

We define non-GAAP operating income as loss from operations excluding stock-based compensation expense, employer taxes related to employee stock transactions, amortization of acquired intangible assets, acquisition-related expenses, which include transaction costs, acquisition-related retention payments, restructuring costs, shareholder matters, and impairment of long-lived assets which are not necessarily reflective of operational performance during a given period. We define non-GAAP operating margin as non-GAAP operating income as a percentage of revenue.

The following table presents the calculation of non-GAAP operating income and non-GAAP operating margin for the periods indicated (in thousands):

			Three months ended October 31,												Nine months ended October 31,
			2025						2024						2025						2024
Income (loss) from operations			$	8,079					$	(10,293)					$	1,318					$	(48,053)
Add:
Stock-based compensation			22,575						31,773						74,288						97,079
Employer taxes related to employee stock transactions			332						452						1,511						1,729
Amortization of acquired intangible assets			1,139						2,832						4,278						8,917
Acquisition-related expenses			—						227						263						749
Restructuring costs			2,087						—						5,971						10
Shareholder matters			121						—						2,470						—
Impairment of long-lived assets			1,213						—						1,213						—
Non-GAAP operating income			$	35,546					$	24,991					$	91,312					$	60,431
Revenue			$	124,545					$	118,946					$	367,761					$	346,053
Operating margin			6.5		%				(8.7)		%				0.4		%				(13.9)		%
Non-GAAP operating margin			28.5		%				21.0		%				24.8		%				17.5		%

Non-GAAP net income attributable to PagerDuty, Inc. common stockholders

We define non-GAAP net income attributable to PagerDuty, Inc. common stockholders as net income (loss) attributable to PagerDuty, Inc. common stockholders excluding stock-based compensation expense, employer taxes related to employee stock transactions, amortization of debt issuance costs, amortization of acquired intangible assets, acquisition-related expenses, which include transaction costs, acquisition-related retention payments, restructuring costs, shareholder matters, impairment of long-lived assets, adjustment attributable to redeemable non-controlling interest, and income tax adjustments, which are not necessarily reflective of operational performance during a given period.

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The following table presents the calculation of non-GAAP net income attributable to PagerDuty, Inc. common stockholders for the periods indicated (in thousands):

			Three months ended October 31,												Nine months ended October 31,
			2025						2024						2025						2024
Net income (loss) attributable to PagerDuty, Inc. common stockholders			$	159,555					$	(6,558)					$	162,835					$	(43,856)
Add:
Stock-based compensation			22,575						31,773						74,288						97,079
Employer taxes related to employee stock transactions			332						452						1,511						1,729
Amortization of debt issuance costs			590						671						1,921						1,950
Amortization of acquired intangible assets			1,139						2,832						4,278						8,917
Acquisition-related expenses			—						227						263						749
Restructuring costs			2,087						—						5,971						10
Shareholder matters			121						—						2,470						—
Impairment of long-lived assets			1,213						—						1,213						—
Adjustment attributable to redeemable non-controlling interest			2,031						634						1,164						9,881
Income tax effects and adjustments			(158,426)						(6,310)						(173,743)						(16,402)
Non-GAAP net income attributable to PagerDuty, Inc. common stockholders			$	31,217					$	23,721					$	82,171					$	60,057

Free cash flow

We define free cash flow as net cash provided by operating activities, less cash used for purchases of property and equipment and capitalization of software costs. In addition to the reasons stated above, we believe that free cash flow is useful to investors as a liquidity measure because it measures our ability to generate or use cash in excess of our capital investments in property and equipment in order to enhance the strength of our balance sheet and further invest in our business and potential strategic initiatives. A limitation of the utility of free cash flow as a measure of our liquidity is that it does not represent the total increase or decrease in our cash balance for the period. We use free cash flow in conjunction with traditional U.S. GAAP measures as part of our overall assessment of our liquidity, including the preparation of our annual operating budget and quarterly forecasts and to evaluate the effectiveness of our business strategies. There are a number of limitations related to the use of free cash flow as compared to net cash provided by operating activities, including that free cash flow includes capital expenditures, the benefits of which are realized in periods subsequent to those when expenditures are made.

The following table presents the calculation of free cash flow for the periods indicated (in thousands):

			Three months ended October 31,												Nine months ended October 31,
			2025						2024						2025						2024
Net cash provided by operating activities			$	24,803					$	22,073					$	89,447					$	86,489
Purchases of property and equipment			(743)						(552)						(2,058)						(1,646)
Capitalization of software costs			(3,131)						(2,078)						(7,267)						(5,019)
Free cash flow			$	20,929					$	19,443					$	80,122					$	79,824
Net cash provided by (used in) investing activities			$	1,813					$	(3,101)					$	(7,047)					$	(9,722)
Net cash used in financing activities			$	(42,346)					$	(78,118)					$	(105,386)					$	(113,323)

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Liquidity and Capital Resources

Sources and Uses of Liquidity

As of October 31, 2025, our principal sources of liquidity were cash and cash equivalents and investments totaling $547.8 million. We believe that our existing cash and cash equivalents, investments, and net cash generated from our operating activities will be sufficient to support working capital and capital expenditure requirements for at least the next 12 months. Since inception, we have financed operations primarily through sales of our cloud-hosted software subscriptions, net proceeds received from sales of equity securities, and the issuance of our 2028 Notes. We believe we will meet long-term expected future cash requirements and obligations through a combination of cash flows from operating activities and available cash and short-term investment balances.

Debt and Financing Arrangements

Refer to Note 9. Debt and Financing Arrangements, in the notes to our unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for discussion of our debt arrangements, including the timing of expected maturity of such arrangements. The $57.5 million principal of our 2025 Notes was repaid by us in cash at maturity during the nine months ended October 31, 2025.

Deferred Revenue

A significant majority of our customers pay in advance for our cloud-hosted and term-license software subscriptions. Therefore, a substantial source of our cash is from our deferred revenue, which is included in the liabilities section of our condensed consolidated balance sheet. Deferred revenue consists of the unearned portion of customer billings, which is recognized as revenue in accordance with our revenue recognition policy. As of October 31, 2025, we had deferred revenue of $223.0 million, of which $221.8 million was recorded as a current liability and expected to be recorded as revenue in the next 12 months, provided all other revenue recognition criteria are met.

Share Repurchase Programs

In March 2025, we announced that our Board of Directors approved a share repurchase program (the “2025 Share Repurchase Program”) for the repurchase of shares of our common stock in an aggregate amount of up to $150.0 million. In August 2025, our Board of Directors approved an additional $50.0 million under the 2025 Share Repurchase Program, thus allowing for the repurchase of shares of the Company’s common stock in an aggregate amount of up to $200.0 million. No other changes were made to the program. The 2025 Share Repurchase Program does not obligate us to acquire a specified number of shares, and may be suspended, modified, or terminated at any time, without prior notice. The repurchases are expected to be executed from time to time through March 2027, subject to general business and market conditions and other investment opportunities, through open market purchases or other legally permissible means, including through Rule 10b5-1 plans. As of October 31, 2025, we had repurchased 2,354,683 shares under the 2025 Share Repurchase Program and subsequently retired 2,092,300 of those shares. The cost of the remaining 262,383 shares is recorded as treasury stock in the condensed consolidated balance sheets. As of October 31, 2025, $162.1 million of the total amount authorized to be repurchased remained available.

The 2025 Share Repurchase Program replaces the share repurchase program approved by our Board of Directors in May 2024 (the “2024 Share Repurchase Program”) for the repurchase of shares of our common stock in an aggregate amount of up to $100.0 million. The 2024 Share Repurchase Program did not obligate us to acquire a specified number of shares, and could be suspended, modified, or terminated at any time, without prior notice. Under the 2024 Share Repurchase Program, the Company repurchased a total of 5,223,071 shares of common stock through open market purchases, including through 10b5-1 plans, at an average per share price of $19.15 for a total repurchase price of $100.0 million. During the year ended January 31, 2025, these shares were retired.

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Future Contractual Obligations

Our estimated future obligations as of October 31, 2025 include both current and long-term obligations. Our debt obligations total $395.1 million, all of which is long-term. Additionally, we had $1.0 million of irrevocable standby letters of credit outstanding which were fully collateralized by our restricted cash, all of which represents a long-term cash obligation. Under our operating leases, we had a current obligation of $4.1 million and a long-term obligation of $9.3 million. Operating lease obligations primarily represent the initial contracted term for leases that have commenced as of October 31, 2025, not including any future optional renewal periods.

Effect of Exchange Rates

Our changes in cash can be impacted by the effect of fluctuating exchange rates. Foreign exchange had an immaterial effect on cash in the nine months ended October 31, 2025, and a negative effect on cash in the nine months ended October 31, 2024, decreasing our total cash balance by $0.1 million as of October 31, 2024.

Cash Flow Information

The following table sets forth our cash flows for the periods indicated (in thousands):

			Nine months ended October 31,
			2025						2024						$ Change
Net cash provided by operating activities			$	89,447					$	86,489					$	2,958
Net cash used in investing activities			(7,047)						(9,722)						2,675
Net cash used in financing activities			(105,386)						(113,323)						7,937
Effects of foreign currency exchange rates on cash, cash equivalents, and restricted cash			(3)						(109)						106
Net change in cash, cash equivalents, and restricted cash			$	(22,989)					$	(36,665)					$	13,676

Operating Activities

Net cash provided by operating activities improved, primarily due to improvements in our operating income (loss) performance due to the 6.3% increase in revenue, along with our 7.3% decrease in operating expenses. Cash provided by operating activities is subject to variability period-over-period as a result of timing differences, including with respect to the collection of receivables and payments of accounts payable, and other items.

Investing Activities

Net cash used in investing activities decreased, primarily due to a decrease in purchases of available-for-sale investments, offset by a decrease in proceeds from maturities of available-for-sale investments and proceeds from sales of available-for-sale investments, along with an increase in capitalized software costs and an increase in purchases of non-marketable equity investments.

Financing Activities

Net cash used in financing activities decreased, primarily due to a decrease in repurchases of common stock and an increase in proceeds of issuance from common stock upon exercise of stock options.

Off-Balance Sheet Arrangements

Indemnification Agreements

See Note 10. Commitments and Contingencies, in the notes to our unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for a description of our indemnification agreements.

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Letters of Credit

We had $1.0 million of irrevocable standby letters of credit outstanding as of October 31, 2025. Letters of credit are primarily used as a form of security deposits for the spaces we lease.

Critical Accounting Estimates

For a description of our critical accounting estimates, refer to Part II, Item 7, Critical Accounting Estimates in our Annual Report on Form 10-K for the year ended January 31, 2025. In addition to the critical accounting policies and estimates disclosed in our Annual Report on Form 10-K for the year ended January 31, 2025, we believe that the accounting policies described below involve a greater degree of judgment and complexity. Accordingly, these are the estimates we believe are the most critical to aid in fully understanding and evaluating our consolidated financial condition and results of operations.

Income Taxes

The Company is subject to income taxes in the U.S. and in many foreign jurisdictions. Significant judgment is required in determining our provision for income taxes, our deferred tax assets and liabilities, and any valuation allowance recorded against our net deferred tax assets that are not more likely than not to be realized. We monitor the realizability of our deferred tax assets, taking into account all relevant factors at each reporting period. In completing our assessment of realizability of our deferred tax assets, we consider our history of income (loss) measured at pre-tax income (loss) adjusted for permanent book-tax differences on a jurisdictional basis, volatility in actual earnings, excess tax benefits/shortfalls related to stock-based compensation in recent prior years, and impacts of the timing of reversal of existing temporary differences. We also rely on our assessment of the Company’s projected future results of business operations, including uncertainty in future operating results relative to historical results, volatility in the market price of our common stock and its performance over time, variable macroeconomic conditions impacting our ability to forecast future taxable income, and changes in business that may affect the existence and magnitude of future taxable income. Our valuation allowance assessment is based on our best estimate of future results considering all available information.

Recent Accounting Pronouncements

See Note 2. Summary of Significant Accounting Policies, in the notes to our unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q for a description of recently adopted accounting pronouncements and recently issued accounting pronouncements not yet adopted.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

There have been no material changes in our market risk from the information provided in Part II, Item 7A, Quantitative and Qualitative Disclosures About Market Risk, in our Annual Report on Form 10-K for the year ended January 31, 2025.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) are designed to ensure that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosure.

Our management, with the participation and supervision of our chief executive officer and our chief financial officer, have evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on such evaluation, our chief executive officer and chief financial officer have concluded that as of such date, our disclosure controls and procedures were, in design and operation, effective at a reasonable assurance level.

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Limitations on the Effectiveness of Controls

The effectiveness of any system of internal control over financial reporting, including ours, is subject to inherent limitations, including the exercise of judgment in designing, implementing, operating, and evaluating the controls and procedures, and the inability to eliminate misconduct completely. Accordingly, in designing and evaluating the disclosure controls and procedures, management recognizes that any system of internal control over financial reporting, including ours, no matter how well designed and operated, can only provide reasonable, not absolute assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs. Moreover, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. We intend to continue to monitor and upgrade our internal controls as necessary or appropriate for our business but cannot assure you that such improvements will be sufficient to provide us with effective internal control over financial reporting.

Changes in Internal Controls Over Financial Reporting

There were no changes in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the quarter ended October 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings

We are not a party to any material pending legal proceedings. From time to time, we may be subject to legal proceedings and claims arising in the ordinary course of business.

Item 1A. Risk Factors

Our business involves significant risks, some of which are described below. You should carefully consider the following risks, together with all of the other information in this Quarterly Report on Form 10-Q, including our condensed consolidated financial statements and the related notes thereto included elsewhere in this Quarterly Report on Form 10-Q. Any of the following risks could have an adverse effect on our business, results of operations, financial condition or prospects, and could cause the trading price of our common stock to decline. Our business, results of operations, financial condition or prospects could also be harmed by risks and uncertainties not currently known to us or that we currently do not believe are material.

Other than the risk factors below, there have been no material changes from the risk factors described in Part I. Item 1A., “Risk Factors” in our Annual Report on Form 10-K for year ended January 31, 2025, as updated by the “Risk Factors” described under “Part I—Item 1A. Risk Factors” in our Quarterly Report on Form 10-Q for the quarter ended April 30, 2025.

We and the third parties with whom we work are subject to stringent and evolving U.S. and foreign laws, regulations, rules, contractual obligations, industry standards, policies, and other obligations related to data privacy and security. Our actual or perceived failure to comply with such obligations (or such failure by the third parties with whom we work) could lead to regulatory investigations or actions; litigation (including class claims) and mass arbitration demands; fines and penalties; disruptions of our business operations; reputational harm; loss of revenue or profits; loss of customers; and other adverse business consequences.

In the ordinary course of business, we process sensitive data (as defined above). Our data processing activities subject us to numerous data privacy and security obligations, such as various laws, regulations, guidance, industry standards, external and internal privacy and security policies, contractual requirements, and other obligations relating to data privacy and security.

In the United States, federal, state, and local governments have enacted numerous data privacy and security laws, including data breach notification laws, personal data privacy laws, consumer protection laws (e.g., Section 5 of the Federal Trade Commission Act), and other similar laws (e.g., wiretapping laws). For example, numerous U.S. states have enacted comprehensive privacy laws that impose certain obligations on covered businesses, including providing specific disclosures in privacy notices and affording residents with certain rights concerning their personal data. As applicable, such rights may include the right to access, correct, or delete certain personal data, and to opt-out of certain data processing activities, such as targeted advertising, profiling, and automated decision-making. The exercise of these rights may impact our business and ability to provide our products and services. Certain states also impose stricter requirements for processing certain personal data, including sensitive information, such as conducting data privacy impact assessments. These state laws allow for statutory fines for noncompliance. For example, the California Consumer Privacy Act of 2018 (“CCPA”) applies to personal data of consumers, business representatives, and employees who are California residents, and requires businesses to provide specific disclosures in privacy notices and honor requests of such individuals to exercise certain privacy rights. The CCPA provides for administrative fines of up to $7,500 per intentional violation and allows private litigants affected by certain data breaches to recover significant statutory damages.

These developments may further complicate compliance efforts, and increase legal risk and compliance costs for us, the third parties with whom we work, and our customers. Similar laws are being considered in several other states, as well as at the federal and local levels, and we expect more states to pass similar laws in the future.

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Outside the United States, an increasing number of laws, regulations, and industry standards may govern data privacy and security. For example, the European Union’s General Data Protection Regulation (“EU GDPR”), the United Kingdom’s GDPR (“UK GDPR”), and Canada’s Personal Information Protection and Electronic Documents Act (“PIPEDA”) and Canada’s Anti-Spam Legislation (“CASL”), impose strict requirements for processing personal data. For example, under the EU and UK GDPR, companies may face temporary or definitive bans on data processing and other corrective actions; fines of up to 20 million Euros under the EU GDPR, £17.5 million pounds sterling under the UK GDPR or, in each case, 4% of annual global revenue, whichever is greater; or private litigation related to processing of personal data brought by classes of data subjects or consumer protection organizations authorized at law to represent their interests.

We may also become subject to new laws that specifically regulate non-personal data. For example, based on a change in law or change in interpretation of law, we may become subject to certain parts of the EU’s Data Act, which imposes certain obligations on cloud service providers, in particular to facilitate switching to another provider.

Legislative proposals and present laws and regulations regulate the use of cookies and other tracking technologies, electronic communications, and marketing. For example, in the European Economic Area (“EEA”) and the UK, regulators are increasingly focusing on compliance with requirements related to the targeted advertising ecosystem. It is anticipated that the ePrivacy Regulation and national implementing laws will replace the current national laws that implement the ePrivacy Directive that governs electronic communications. In the United States, the CCPA, for example, grants California residents the right to opt-out of a company’s sharing of personal data for advertising purposes in exchange for money or other valuable consideration and requires covered businesses to honor user enabled browser signals from the Global Privacy Control. Partially as a result of these developments, individuals are becoming increasingly resistant to the collection, use, and sharing of personal data to deliver targeted advertising. Individuals are now more aware of options related to consent, “do not track” mechanisms (such as browser signals from the Global Privacy Control), and “ad-blocking” software to prevent the collection of their personal data for targeted advertising purposes. As a result, we may be required to change the way we market our products, face increased challenges to our ability to reach new or existing customers, and compliance with these laws may require us to make significant operational changes or otherwise negatively affect our business.

Our employees and personnel use Emerging AI Technologies to perform their work, and the disclosure and use of personal data in Emerging AI Technologies may be subject to various data privacy and security laws and other privacy obligations. Governments have passed and are likely to pass additional laws regulating AI, including Emerging AI Technologies. Our use of Emerging AI Technologies could result in additional compliance costs, regulatory investigations and actions, and consumer lawsuits. If we are unable to use Emerging AI Technologies, it could make our business less efficient and result in competitive disadvantages.

We use AI, including Emerging AI Technologies in our products and services (collectively, “AI” technologies). The development and use of AI present various data privacy and security risks that may impact our business. Use of AI is subject to data privacy and security laws, as well as increasing regulation and scrutiny. Several jurisdictions around the globe, including Europe and certain U.S. states, have proposed or enacted laws governing AI. For example, the European Union’s Artificial Intelligence Act (“EU AI Act”) imposes strict requirements for the use of AI, and we expect other jurisdictions will adopt similar laws. Additionally, certain privacy laws extend rights to consumers (such as the right to delete certain personal data) and regulate automated decision making, which may be incompatible with our use of AI. These obligations may make it harder for us to conduct our business using AI, lead to regulatory fines or penalties, require us to change our business practices, retrain our AI, or prevent or limit our use of AI. For example, the FTC has required other companies to turn over (or disgorge) valuable insights or trainings generated through the use of AI where they allege the company has violated privacy and consumer protection laws. If we cannot use AI or that use is restricted, our business may be less efficient, or we may be at a competitive disadvantage.

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Additionally, under various privacy laws and other obligations, we may be required to obtain certain consents to process personal data. For example, some of our data processing practices may be challenged under wiretapping laws, if we obtain consumer information from third parties through various methods, including chatbot and session replay providers, or via third-party marketing pixels. These practices may be subject to increased challenges by class action plaintiffs. Our

inability or failure to obtain consent for these practices could result in adverse consequences, including class action litigation and mass arbitration demands. In addition, we may be unable to transfer personal data from Europe and other jurisdictions to the United States or other countries due to data localization requirements or limitations on cross-border data flows. Europe and other jurisdictions have enacted laws requiring data to be localized or limiting the transfer of personal data to other countries. In particular, the EEA and the UK have significantly restricted the transfer of personal data to the United States and other countries whose privacy laws it generally believes are inadequate. Other jurisdictions may adopt or have already adopted similarly stringent data localization and cross-border data transfer laws. Although there are currently various mechanisms that may be used to transfer personal data from the EEA and UK to the United States in compliance with law, such as the EEA standard contractual clauses, the UK’s International Data Transfer Agreement / Addendum, and the EU-U.S. Data Privacy Framework and the UK extension thereto (which allows for transfers to relevant U.S.-based organizations who self-certify compliance and participate in the Framework), these mechanisms are subject to legal challenges, and there is no assurance that we can satisfy or rely on these measures to lawfully transfer personal data to the United States.

If there is no lawful manner for us to transfer personal data from the EEA, the UK, or other jurisdictions to the United States, or if the requirements for a legally compliant transfer are too onerous, we could face significant adverse consequences, including the interruption or degradation of our operations, the need to relocate part of or all of our business or data processing activities to other jurisdictions (such as Europe) at significant expense, increased exposure to regulatory actions, substantial fines and penalties, the inability to transfer data and work with partners, vendors and other third parties, and injunctions against our processing or transferring of personal data necessary to operate our business. Additionally, companies that transfer personal data out of the EEA and UK to other jurisdictions, particularly to the United States, are subject to increased scrutiny from regulators, individual litigants, and activist groups. Some European regulators have ordered certain companies to suspend or permanently cease certain transfers of personal data out of Europe for allegedly violating the GDPR’s cross-border data transfer limitations.

In addition to data privacy and security laws, we are contractually subject to industry standards adopted by industry groups, we are, or and may become subject to such obligations in the future. We are also bound by contractual obligations related to data privacy and security, which have become increasingly stringent and complex due to changes in data privacy and security laws and regulations, and our efforts to comply with such obligations may not be successful. For example, certain privacy laws, such as the GDPR and the CCPA, require our customers to impose specific contractual restrictions on their service providers.

We publish privacy policies, marketing materials, and other statements, such as statements related to compliance with certain certifications or self-regulatory principles, concerning data privacy and security. Regulators in the United States are increasingly scrutinizing these statements, and if these policies, materials, or statements are found to be deficient, lacking in transparency, deceptive, unfair, misleading, or misrepresentative of our practices, we may be subject to investigation, enforcement actions by regulators, or other adverse consequences.

Obligations related to data privacy and security (and consumers’ data privacy expectations) are quickly changing, becoming increasingly stringent, and creating uncertainty. Additionally, these obligations may be subject to differing applications and interpretations, which may be inconsistent or conflict among jurisdictions. Preparing for and complying with these obligations requires us to devote significant resources, which may necessitate changes to our services, information technologies, systems, and practices and to those of any third parties that process personal data on our behalf. In addition, these obligations may require us to change our business model.

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We may at times fail (or be perceived to have failed) in our efforts to comply with our data privacy and security obligations. Moreover, despite our efforts, our personnel or third parties with whom we work, may fail to comply with such obligations, which could negatively impact our business operations. If we or the third parties with whom we work fail, or are perceived to have failed, to address or comply with applicable data privacy and security obligations, we could face significant consequences, including but not limited to: government enforcement actions (e.g., investigations, fines, penalties, audits, inspections, and similar); litigation (including class-action claims) and mass arbitration demands; additional reporting requirements and/or oversight; bans or restrictions on processing personal data; and orders to destroy or not use personal data. In particular, plaintiffs have become increasingly more active in bringing privacy-related claims against companies, including class claims and mass arbitration demands. Some of these claims allow for the recovery of statutory damages on a per violation basis, and, if viable, carry the potential for monumental statutory damages, depending on the volume of data and the number of violations. Any of these events could have a material adverse effect on our reputation, business, or financial condition, including but not limited to: loss of customers, inability to process personal data or to operate in certain jurisdictions; limited ability to develop or commercialize our products and services; expenditure of time and resources to defend any claim or inquiry; adverse publicity; or substantial changes to our business model or operations.

Item 2.    Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities

Unregistered Sales of Equity Securities

None.

Use of Proceeds

None.

Issuer Purchases of Equity Securities

The following table presents information with respect to our repurchases of common stock during the three months ended October 31, 2025:

Period						Total number of shares purchased(1)						Average price paid per share(2)						Total number of shares purchased as part of publicly announced program(1)						Approximate dollar value of shares that may yet be purchased under publicly announced program (in thousands)(1)
August 1 - 31, 2025						—						$	—					—						200,000
September 1 - 30, 2025						700,089						$	16.33					700,089						188,564
October 1 - 31, 2025						1,654,594						$	15.98					1,654,594						162,116
Total						2,354,683												2,354,683

(1) In March 2025, our Board of Directors authorized a stock repurchase program of up to $150.0 million of our common stock., which was subsequently increased to $200.0 million in August 2025. Share repurchases under share repurchase program may be made from time to time on the open market, pursuant to Rule 10b5-1 trading plans, or other legally permissible means. The share repurchase program does not obligate us to acquire a specified number of shares, and may be suspended, modified, or terminated at any time, without prior notice. The number of shares to be repurchased will depend on market conditions and other factors. The share repurchase program is expected to continue through March 2027, unless extended or shortened by the Board of Directors. See Note 12. Common Stock and Stockholders’ Equity elsewhere this Quarterly Report on Form 10-Q for additional information related to share repurchases.

(2) Average price paid per share excludes cash paid for commissions.

Item 3.    Defaults Upon Senior Securities

None.

Item 4.    Mine Safety Disclosures

Not applicable.

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Item 5.    Other Information

Rule 10b5-1 Trading Arrangements

On September 6, 2025, Owen Howard Wilson, our Chief Financial Officer, adopted a trading plan for the sale of the Company’s common stock that is intended to satisfy the affirmative defense of Rule 10b5-1(c). The trading plan is set to expire on November 20, 2026 and provides for the sale of up to 166,667 shares of common stock, all of which are subject to the Company’s stock price reaching certain price thresholds and certain timing constraints, with 166,667 shares being the total of the maximum number of all shares which could be sold under this plan. Because of those pricing and timing conditions, it is not yet determinable how many shares actually will be sold under this plan before its expiration date.

On September 10, 2025, Jennifer Tejada, our Chief Executive Officer, adopted a trading plan for the sale of the Company’s common stock that is intended to satisfy the affirmative defense of Rule 10b5-1(c). The trading plan is set to expire on December 18, 2026 and provides for the sale of up to 1,550,000 shares of common stock, all of which are subject to the Company’s stock price reaching certain price thresholds and certain timing constraints, with 1,550,000 shares being the total of the maximum number of all shares which could be sold under this plan. Because of those pricing and timing conditions, it is not yet determinable how many shares actually will be sold under this plan before its expiration date.

On September 30, 2025, Dan Alexandru Solomon, a member of the Board of Directors, adopted a trading plan for the sale of the Company’s common stock that is intended to satisfy the affirmative defense of Rule 10b5-1(c). The trading plan is set to expire on September 30, 2026 and provides for the sale of up to 800,000 shares of common stock.

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Item 6. Exhibits

The following exhibits are filed as part of this report or hereby incorporated by references to filings previously made with the SEC.

Incorporated by Reference

Exhibit Number

Description

Form

File No.

Exhibit

Filing Date

Filed or Furnished Herewith

3.1

Amended and Restated Certificate of Incorporation of PagerDuty, Inc.

8-K

001-38856

3.1

April 15, 2019

3.2

Amended and Restated Bylaws of PagerDuty, Inc.

8-K

001-38856

3.2

April 15, 2019

31.1

Certification of the Chief Executive Officer pursuant to Exchange Act Rule 13a-14 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

X

31.2

Certification of the Chief Financial Officer pursuant to Exchange Act Rule 13a-14 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

X

32.1*

Certification of the Chief Executive Officer and the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

X

101.INS

XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

X

101.SCH

XBRL Taxonomy Extension Schema Document.

X

101.CAL

XBRL Taxonomy Extension Calculation Linkbase Document.

X

101.DEF

XBRL Taxonomy Extension Definition Linkbase Document.

X

101.LAB

XBRL Taxonomy Extension Label Linkbase Document.

X

101.PRE

XBRL Taxonomy Extension Presentation Linkbase Document.

X

104

Cover Page Interactive Data File (embedded within the Inline XBRL document)

X

* The certifications furnished in Exhibit 32.1 hereto are deemed to accompany this Form 10-Q and will not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, except to the extent that the registrant specifically incorporates it by reference.

† Indicates a management contract or compensatory plan.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

						PAGERDUTY, INC.
						(registrant)
November 25, 2025						/s/ Jennifer G. Tejada
Date						Jennifer G. Tejada
						Chief Executive Officer
						(Principal Executive Officer)
November 25, 2025						/s/ Owen Howard Wilson
Date						Owen Howard Wilson
						Chief Financial Officer
						(Principal Financial Officer)
November 25, 2025						/s/ Paul Underwood
Date						Paul Underwood
						Chief Accounting Officer
						(Principal Accounting Officer)

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