Can PagerDuty Inc (PD)’s Pricing Model Shift Spark Growth?

PagerDuty Inc (NYSE:PD) is one of the small cap stocks that make up 0.28% of George Soros stock portfolio.

On March 13, TD Cowen cut its price target on PagerDuty Inc (NYSE:PD) to $10 from $20 but reiterated its Buy rating on the stock. The firm pointed to PagerDuty’s subdued revenue guidance as a factor for the price target reduction.

Can PagerDuty Inc (PD)’s Pricing Model Shift Spark Growth?

TD Cowen analyst Andrew Sherman pointed out that PagerDuty forecast flat revenue growth for fiscal 2027, yet the Street had been projecting fiscal 2027 revenue growth of 4%.

PagerDuty, Inc. (NYSE:PD) reported fourth‑quarter and full‑year fiscal 2026 results on March 12, covering the period ended January 31, 2026. It posted fiscal Q4 2026 adjusted EPS of $0.29, above the anticipated $0.24. Revenue of $124.8 million increased 2.7% YoY came above the expected $123.15 million. For fiscal 2026 full-year, the software company posted adjusted EPS of $1.16 on revenue of $492.5 million, which increased 5.4% YoY.

For fiscal 2027, PagerDuty forecast adjusted EPS of $1.23 – $1.28. It anticipates revenue in the band of $488.5 million – $496.5 million, which points to flat growth at the midpoint.

While the weak fiscal 2027 revenue guidance caused TD Cowen to lower its price target on PagerDuty stock, the firm noted that the company’s pricing model shift is showing positive signals.

PagerDuty is transitioning to a usage-based pricing model from a seat-based pricing model. This comes as it has faced headwinds in the seat-based model. TD Cowen believes the shift has started well, and that the faster the company transitions to the usage-based model, the better placed it will be.

PagerDuty Inc (NYSE:PD) is an American software company that specializes in providing cloud-based AI-powered incident management platforms for IT departments. It enables IT operations teams to detect, process, and fix system outages faster. PagerDuty is headquartered in California, and has offices in other countries.

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