What happened

Shares of PagerDuty (NYSE:PD) fell sharply on Friday, declining 12.7% by the time the market closed. The stock's drop followed the digital operations management company's fiscal third-quarter results.

Bearishness toward the stock is likely due to PagerDuty's wider-than-expected adjusted loss per share and management's worsened outlook for its full-year adjusted loss per share.

A chalkboard sketch of a chart showing a stock price moving lower

Image source: Getty Images.

So what

Revenue in PagerDuty's third quarter of fiscal 2020 rose 37% year over year to $42.8 million, beating a consensus analyst estimate for $42.1 million. The tech company's non-GAAP (adjusted) loss per share was $0.10 -- narrower than a non-GAAP loss per share of $0.24 in the year-ago period but missing analysts' average forecast for $0.09.

CEO Jennifer Tejada was happy with the results, noting, "With strong customer growth at 15% year over year and growth in accounts over $100k [in annual recurring revenue] at 49%, we are excited to bring PagerDuty to more customers than ever before."

Now what

Management guided for full-year fiscal 2020 revenue between $165 million and $166 million, representing 40% to 41% year-over-year growth. Previously, management expected revenue in fiscal 2020 to rise 37% to 39% year over year.

PagerDuty said it expects a full-year non-GAAP loss per share from $0.38 to $0.39 -- wider than its previous expectation in a range of $0.36 to $0.37 per share.

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