PagerDuty, Inc. (NYSE: PD) shares fell more than 24% on Wednesday after the company reported third-quarter fiscal 2026 results that topped earnings forecasts but missed revenue expectations, while also reducing its full-year sales outlook.

The company posted quarterly revenue of $124.5 million, up 4.7% year over year but below the $125.41 million consensus. Adjusted EPS came in at $0.33, exceeding estimates of $0.25. PagerDuty achieved GAAP profitability for a second consecutive quarter, generating $8.1 million in operating income.

Full-year revenue guidance was lowered to $490 million to $492 million, down from $493 million to $497 million and short of the $498 million consensus. However, the company raised its adjusted EPS forecast to $1.11 to $1.12, above expectations of $1.02.

Annual Recurring Revenue (ARR) rose 3% to $497 million, while customers with more than $100,000 in ARR increased 5% to 867. Dollar-based net retention declined to 100% from 107% a year earlier.

For Q4, PagerDuty expects revenue of $122 million to $124 million and adjusted EPS of $0.24 to $0.25.