Good afternoon, and thank you for joining us to discuss PagerDuty's third quarter fiscal year 2023 results. With me on today's call are Jennifer Tejada, PagerDuty's Chairperson and Chief Executive Officer, and Howard Wilson, PagerDuty's Chief Financial Officer. Before we begin, let me remind everyone that statements made on this call include forward-looking statements based on the environment as we currently see it, which involve known and unknown risks and uncertainties that may cause our actual results, performance, or achievements to be materially different from those expressed or implied by the forward-looking statements. These forward-looking statements include our growth prospects and future revenue, among others, aod represent our management's belief and assumptions only as of the date such statements are made, and we undertake no obligation to update these. During today's call, we will discuss non-GAAP financial measures, which are in addition to and not a substitute for or superior to measures of financial performance prepared in accordance with GAAP. A reconciliation between GAAP and non-GAAP financial measures is available in our earnings release. Further information on these and other factors that could cause the company's financial results to differ materially are included in filings we make with the Securities and Exchange Commission, including our most recently filed Form 10-K and Form 10-Q, as well as our subsequent filings made with the SEC. With that, I will turn the call over to Jennifer. Thanks, Tony, and thanks everyone for joining us today. We are pleased to report another quarter of strong results as we continue to execute on our Operations Cloud vision. Revenue grew 31% year-over-year to $94 million, above the high end of our guidance and marking our sixth straight quarter of growth above 30%. In Q3, we achieved non-GAAP profitability a quarter ahead of our previous guidance with $3 million in operating income, an improvement of 1,000 basis points over Q3 last year. We exceeded the high end of our guidance ranges for both top and bottom line and realized our profitability milestone a quarter ahead of schedule. We continue to see strength in our focus segments, mid-market and enterprise. Our customer cohort spending over $100,000 in ARR grew 31% over last year. Total free and paid customers on our platform grew 22% year-over-year. Dollar-based net retention was 123% as our customers continued to expand users and adopt more products and services. In the quarter, more than half of our ARR came from customers with two or more products. While the macro environment is likely to remain a headwind for our business in the near term, we continue to see positive trends underpinning our performance and remain bullish about both long-term opportunities and our balanced growth investment plans. First, we continue to see strong growth in incident response. Cloud adoption and digital acceleration are enduring multi-year initiatives. DevOps transformation is now required to achieve the efficiency demanded by this macro environment. PagerDuty is essential infrastructure, leading to some large digital transformation wins in traditional industries, which I will discuss later. Second, we saw solid adoption of new products, especially automation and our AIOps solution, where customers chose the efficiency and effectiveness of our integrated operations cloud offering ahead of point solutions. Third, our low cost of ownership and fast time to return on investment makes PagerDuty more attractive to customers than expensive long deployment solutions. Our sales pipeline is strong heading into Q4 for both incident response and new products. Finally, we have positioned ourselves well to navigate the challenging macro environment, achieving profitability by improving our cost structure such that we can continue to invest in growth capacity and product innovation. During Q3, we extended our competitive lead as we balanced strategic investments in product innovation growth while also significantly improving operating leverage. Our results this quarter demonstrate the continued strength of our value proposition for enterprises and our team's ability to execute with an increasingly efficient go-to-market motion. PagerDuty's Operations Cloud underpins operational resilience and digital maturity for our customers at a moment when they need it more than ever. Automation capabilities integrated across every aspect of the platform reduce time and effort spent by technical employees managing interrupt work and translate to both money saved and better experiences for their customers. Our ability to orchestrate digital operations across the entire enterprise makes PagerDuty the platform onto which companies are consolidating previously fragmented tech spending. As organizations come under pressure to protect revenue, prioritize IT spending, and do more with less, our customers have made it clear they consider PagerDuty essential. This was validated as we closed a record number of mid-market and enterprise expansion transactions, managed churn well below 5% of starting ARR, and increased both average revenue per user and average revenue per customer. Our mission to revolutionize operations has always been grounded in building a durable growth company while improving the efficiency of our go-to-market and G&A spend. We are investing to deepen our competitive moat through innovation in AIOps, automation, customer service operations, and flexible workflows that help teams across the enterprise manage interrupt work. Our efforts over the past year to sustainably lower our cost base, our cost structure with new lower cost, high talent locations like Lisbon will enable ongoing operating leverage improvement similar to the pace we have delivered this financial year. In a volatile macro environment, we are controlling the controllables with the objective of continuing to make demonstrable progress from the early 30s towards operating as a Rule of 40 company. Given our role as essential infrastructure, our loyal customer base and our competitive track record and our innovation roadmap, we are positioned to weather this environment well. We are confident that we will emerge stronger as a high-performing, profitable growth company, the leading Operations Cloud for modern enterprises. In November, we announced early availability of more flexible Incident Workflows that enable PagerDuty customers to tailor workflows to different use cases and automate steps when a major incident occurs. We launched capabilities to reduce noise and improve developer productivity so our customers can take back hours of engineering time. Over time, flexible Incident Workflows will be the primary solution to enable non-technical teams to manage interrupt work. Early this week at AWS re:Invent, we also announced Automation Actions for PagerDuty AWS customers. These capabilities improve resiliency and increase the use of best practices, all while saving developer time. FreedomPay, a data-driven commerce platform, is saving the equivalent of four people's dedicated time, making their critical processes more reliable and removing the risks of human error by automating tasks with PagerDuty. During Q3, a Fortune 100 global security and aerospace company nearly doubled its PagerDuty user footprint on digital operations and signed a multi-year contract. This long-term PagerDuty customer is realizing a return on investment in excess of 30 x its annual spend with us. In the last 18 months, this customer significantly reduced its meantime to resolve incidents, translating into tens of millions of dollars in savings. Their expansion with PagerDuty was explicitly due to our ability to reduce their costs while also freeing up time for their innovation teams. In the quarter, an Australian-based home improvement retailer in the midst of a large scale digital transformation expanded its investment with PagerDuty. The customer has nearly doubled its PagerDuty footprint since its initial deployment in 2020. This quarter, they adopted PagerDuty Process Automation to address more advanced use cases, including automated diagnostics and auto remediation. They expect to increase engineering productivity and resolve incidents faster as we advance their digital maturity. During the quarter, a multinational Fortune 200 wireless technology innovator turned to PagerDuty to consolidate digital operations on an integrated platform for action. The company sought a more flexible solution that could provide faster time to value, lower maintenance costs, visibility across multiple departments, and ultimately consolidate their tech spend. They had been using a point solution for AIOps in their IT service center for several years, but upgraded to PagerDuty Digital Operations, Automated Actions, and Event Intelligence, replacing that vendor and signing a multi-year six-figure investment. Their expansion with PagerDuty enables them to automatically detect, action, and manage all in the same platform. PagerDuty is central to their technology strategy to exponentially scale services while keeping service costs low. They anticipate payback in less than a quarter and a return on investment of nearly 500% within the first year. Our value proposition has proven resilient, even as decision-making within organizations becomes more cautious. PagerDuty's Operations Cloud is the only platform integrating incident response, AIOps and automation. We deliver tangible ROI and fast time to value, help mature our customers' digital operations, and deliver operational resilience, which is critical in today's environment. As customers realize initial value, they adopt new products, expand users, and move towards more advanced use cases. In an environment where it's much easier to sell more to current customers than find new ones, we have several new products to attach as the result of our recent innovation and a large under-penetrated opportunity within our install base. The operating leverage PagerDuty exhibited during the third quarter is the outcome of structural changes implemented throughout the past several years to generate profitable growth. We have responded to the recent changes in the demand environment by accelerating the implementation of several efficiency initiatives, including standardizing our go-to-market motions across regions, opening lower cost, high talent employee locations, improving our digital marketing returns, and refining our R&D investments. We continue to expand our operating margins as we move forward into the next fiscal year. We are executing well on our long-term operations cloud strategy, balancing growth and profitability. We were recently recognized on several fronts for progress that will also support success in FY 2024. Earlier this week, we were honored at AWS re:Invent to receive the Rising Star Award, celebrating significant year-over-year growth in our business on the AWS Marketplace. We expect our momentum with AWS to continue. Our investment in attracting and retaining top talent, creating an inclusive workspace, and ensuring a healthy company culture manifests in the success of our teams. During the quarter, we won multiple Stevie Awards, including for special achievement in workplace health and well-being and for best corporate social responsibility strategy. This fall, TrustRadius recognized PagerDuty as a Tech Cares Awards winners for our ongoing commitment to corporate social responsibility. G2 named PagerDuty a leader in incident response, AIOps, and workload automation. Our results from Q3, the persistence of long-term tailwinds, and customer demand for our high ROI fast time to value platform reinforce our confidence in our ability to both execute well in the near term and emerge even stronger. Even as we scale efficiently, we know that innovation fuels our competitive advantage. PagerDuty is the partner our customers trust on their worst days. It is our responsibility and our privilege to deliver for them. As we move into FY 2024, we expect to continue monetizing our product investments as customers see value from PagerDuty Operations Cloud. I want to thank our customers for their trust and partnership, and I wanna recognize our global Dutonians for their dedication to championing our customers, for their resilience, and for their great execution this quarter. With that, I'll turn the call to Howard and look forward to your questions. Thank you, Jen. Good day to everyone joining us on this afternoon's call. Our third quarter results demonstrated the agility of PagerDuty and our commitment to profitable growth. The combination of our ongoing programmatic efforts as well as our operational agility enabled us to reach the profitability target put forth during our Q4 FY 2022 call one quarter earlier, while preserving our strategic growth investments. Evidence that PagerDuty Operations Cloud is well-positioned to meet our customers' challenges, reducing costs, protecting revenue, and retaining talent, and enabling them to do more with less. Unless otherwise stated, all references to our expenses and operating results are on a non-GAAP basis and are reconciled to our GAAP results in the earnings release that was posted before the call. Revenue was $94 million in the third quarter, up 31% year-over-year. The contribution from international was 23% of total revenues compared to 24% in Q3 of last year, reflecting the challenging economic environment in Europe. Our customers continue to expand with us, adding new users and new products. We had a record number of customers expand with us this quarter. While many of these transactions were on the smaller side, the volume of customers demonstrating their reliance on PagerDuty, even in a challenging environment, is a further testament to our durable growth. We saw the most strength in our North American mid-market and enterprise business and PagerDuty Online, our self-service business. We did notice an increase in customer approval requirements, particularly with larger deals. We delivered dollar-based net retention in Q3 of 123% compared to 124% in the same period one year ago. We expect dollar-based net retention to be at or above 120% for Q4. Customers spending over $100K in annual recurring revenue grew to 710, up 31% from a year ago, demonstrating our ongoing strength in mid-market and enterprise. Total paid customers increased by 5% annually to 15,265, compared to 6% in the year ago period. Free and paid companies on our platform grew to over 23,000, an increase of approximately 22% compared to Q3 last year. Q3 gross margins of 85% remained within our target range of 84%-86%. Operating income was $3 million or 3% of revenue, an improvement compared to a loss of $5 million or -7% of revenue in the same quarter last year. Please note the fully diluted share count associated with Q3 profitability was 101 million weighted average shares. Operating margin outperformed by 600 basis points compared to the high end of our guidance range for the quarter as we accelerated our scaling initiatives, refining our go-to-market model, leveraging our global locations, and increasing use of automation. We usually experience a sequential improvement in operating income from Q3 to Q4. However, this year, we expect operating income to decline marginally in Q4. This is primarily due to our investment in AWS re:Invent, as well as a full quarter of expenses from third quarter hires. Now to cash. Third quarter cash from operations was nearly break even at -$0.4 million compared to $3 million in Q3 of last year. Free cash flow was -$2 million compared to +$2 million in the year-ago period. We expect positive free cash flow in the fourth quarter. Turning to the balance sheet, we ended the quarter with $459 million in cash equivalents, and investments. Total deferred revenue ended the quarter at $180 million, up 26% year-over-year. Quarterly calculated billings were $104 million, which was an increase of 29% year-over-year, ending above the 20%-25% range provided during last quarter's call. This result includes approximately $2.6 million in prepaid multi-year billings. Adjusting for this, the increase was 26% and also above the range provided. Last year in Q4, we had strong 30% billings growth that included $3.2 million of multi-year prepaid contracts that are not available for renewal this period. Given a tougher compare and adjusting for the volatile macro, we expect billings growth for Q4 to be approximately 20%. Given quarter-to-quarter fluctuations in billings associated with our co-term practices, we focus on trailing 12 months billings. On a trailing 12 months basis, billings were $385 million, an increase of 30% compared to a year ago and above the 27% estimate previously provided. We expect trailing 12 months billings growth exiting the fourth quarter to be at or above 25% over last year. Turning now to our guidance. Our guidance reflects our understanding and consideration of the impacts of the current evolving uncertain macro environment. For the fourth quarter fiscal 2023, we expect revenue in the range of $98 million-$100 million, representing a growth rate of 25%-27%. Net income per diluted share attributable to PagerDuty Inc. in the range of $0.02-$0.03, with fully diluted shares outstanding of approximately 102 million. This implies an operating margin in the range of 1%-2%. For the full fiscal year 2023, we expect revenue in the range of $368 million-$370 million, representing a growth rate of 31%. We're improving guidance for net loss per share attributable to PagerDuty Inc. to, $0.01 to break even, with basic shares outstanding of approximately 90 million and fully diluted shares outstanding of approximately 101 million. This implies an operating margin of negative 1% to break even for the year. Before I close, I would like to thank our customers for their continued partnership and for our teams across the globe who champion them. Our rapid pace of innovation positions us to realize our vision to transform critical work and revolutionize operations. We remain confident in our Operations Cloud strategy, the market opportunity, and our performance as we continue to demonstrate profitable growth, expanding our operating leverage in Q4 and in a strong position to achieve a similar level of improvement in the next financial year. With that, I will open up the call for Q&A. Okay. It looks like several of our analysts have queued for questions already. We'll start with Joel Fishbein from Truist. Joel, if you'd like to kick us off. Okay. Actually, let's move over to Sanjit. Sanjit at Morgan Stanley. You wanna kick us off in our Q&A session, please? Yeah, I'll try. Can you hear me? We've got you. We can. Awesome. Well, well, congrats to the team on achieving profitability a quarter ahead of time. It's very nice to see. Jen, in your script, you said you had a phrase that I love, you know, controlling the controllables, as well as talking about, you know, sort of targeting kind of Rule of 40 type growth versus profitability. If I sort of look at it this quarter, 31% growth, 3% operating margin, certainly making progress. When we think about, you know, 2023, calendar 2023, it looks like it's gonna be a pretty uncertain year across software, and that's the uncontrollable piece. So as you think about that 40% Rule of 40 type framework, what's sort of the operating plan? In other words, how are you sort of going to manage, making progress on that, going into next year and beyond? Thanks for the question. We are really proud of the quarter. I think we did a great job of executing in a relatively uncertain environment. You sort of saw customers continue to demonstrate their demand for a platform like ours with record expansion, record number of expansion transactions, and our large customer cohort, customers spending over 100K in ARR growing 31%. We still feel like the top line is strong because we are a platform that delivers very fast time to value and high ROI. Having said that, I mean, we've been in process underway now for several quarters to improve the overall efficiency and productivity of our business. We are starting to see that come together in, you know, just the efficiency, the improved efficiency and go-to-market, especially marketing and sales, where we're seeing us still drive that growth and drive that demand and continue to build loyalty within the customer base, but do it with much better operating leverage. I think we put ourselves in a really good position that regardless of, you know, what we see happen from a macro perspective, we can continue to manage to improve the efficiency and the productivity of the company. While we're not giving any guidance for FY 2024, Rule of 40 is a really important goal for me and for the team, and we're laser focused on it. Makes total sense. Just as a follow-up, as we think about some of the components that drive growth at PagerDuty in a seat-based model. We've seen a lot of headlines in terms of pretty sizable layoffs within Big Tech, yet the overall employment picture across the United States is still looking pretty solid. How do we think about, you know, when we see layoffs within engineering departments and with Big Tech, is that... You know, something that's gonna be a modest impact or more noise, and we should look at the broader employment picture to assess that risk in terms of, you know, the expansion opportunities within the PagerDuty model? Is it something to be more concerned about as we see, some of these layoffs accelerating, among tech and other companies? There's 3 characteristics of our business I would point you to. One is we have a very diverse customer base. While we do have customers in high tech, that represents a portion of a very, very diverse set of verticals. You know, in the quarter, we saw tech, retail, financial services, other verticals perform quite well. The diversity of our customer base, I think, is a strength in an environment like this, and it certainly was during the pandemic. Second, I would say when you look at our customer base and you look at the number of tech workers within our customer base, we're largely under-penetrated in that total addressable market. Even if we were to see headcount compress much more dramatically, we still have huge opportunity just within the install base, from a headcount perspective, but also from a new product attach and new use case attach. We don't see layoffs, for instance, as having a material impact on demand. The last thing that I would say is, you know, when you look across the developer community, I mean, the TAM that we measure is 25 million developers around the world, and we're in single digits of penetrating that TAM. I would just come back to kind of what we've always said, this is an early and nascent category. We think it's a huge opportunity. Developers tend to be the last heads to go when you do see customers taking action. To your point, when you look at, the broader. Mm-hmm. -employment situation across the market, the diversity of our customer base, you know, really, I think puts us in a, in a good position. At the end of the day, it really comes down to that TAM inside of our install base is still very, very large. I appreciate the thoughts. Congrats on the quarter. Thank you. Okay. Next, we'll hear from Matthew Hedberg at RBC. Matt, if you'll go ahead. Sure. Thanks for the question. Jen, go blue. Go blue. Did anybody see our game this weekend? I mean, that was exciting stuff for a Big Ten fan. Certainly fun to see. Yeah, congrats on that. Congrats on the quarter. Howard, maybe a question for you. You know, it was good results, I think, in a really challenging environment. Could you talk a little bit more about the linearity of the quarter? You know, and maybe how, you know, how has November treaded thus far versus maybe past Novembers? Yeah. You know, the pattern of linearity when we looked through Q3 was not unlike what we saw in Q2. I think some of the factors that we saw that we referenced even in our call on Q2, you know, played out in Q3 in terms of just some of the decision-making processes within the customer base took a little bit longer. You know, there was at least a steady momentum as we moved through the quarter, particularly in the last month of the quarter. That was pleasing. I think the thing that really stood out for me was that our customers are doing so many different expansion transactions with us, whether it's adding users or adding product. We had a record number of expansions for the quarter, but those tended to be smaller, and that really indicated, though, that our customers are applying a level of consideration to the purchase that they make. You know, to our durable growth, they continue to make those purchases and continuing to grow with PagerDuty. That was, for us, was a really positive sign, and we expect that trend to continue. Got it. Maybe just one other guidance question. I appreciate the billings guide for Q4 and normalizing for the multiyear prepay. I guess, you know, thinking more about the assumptions in your guidance, are you assuming that we kinda get a December and, in your case, January budget flush? Just sort of curious on, you know, are you assuming things kinda stay the same from a demand perspective? Just a little bit more perspective on that. Yeah. I mean, we typically do see that for companies with, you know, calendar year ends, that there is a certain amount of increased activity in December. December's never a quiet month for us, even with the holidays. January again ends up being a, you know, for those companies that are able to then access new budget tends to also create, you know, a fair amount of momentum for us. We're still expecting that trend to continue even within the current macro environment. How that plays out exactly in terms of what people are prepared to spend and the size of checks they're prepared to write, you know, that we'll have to see. Certainly our pipeline is really strong coming into Q4. We certainly are seeing that customers' interest, particularly in our platform as a mechanism to be able to help them reduce spend or for them to be able to be more efficient or consolidate spend across a number of niche vendors, is coming to the fore. Got it. Thanks a lot. Congrats, guys. Thanks. Thanks, Matt. Thanks, Matt. Okay. Next, can we hear from Mr. Fishbein, Joel at Truist? If he'd like to go. Apologies for the technical difficulties earlier, congrats on the great results and on the operating margin surprise. Howard, great work. Just on that vein, you know, Jennifer, in this challenging environment, and Howard, you know, obviously the, you know, macro uncertainties out there, you've highlighted that on the call. How are you thinking about your optionality with regard to balancing growth and profitability at this point? How are you know, how should we be thinking about margins in the future? I mean, I know that we always ask for more and more and more, so I figured I'd throw that out there. I mean, the fact that that's a big milestone for you guys and love to just hear directionally how we should be thinking about that. Thank you. Well, I'll take a crack at that, then Howard, you can jump in. First of all, we're incredibly proud to hit the profitability milestone this quarter, a quarter early. It was a lot of work from a lot of people across the organization to structurally improve our cost base, not just make sweeping, you know, headcount changes, for instance. I wanna congratulate our teams 'cause they've been incredibly disciplined with their capital allocation, which has enabled us to continue to invest in innovation. You've seen a slew of new products and services that we've come out with in the last couple of quarters. We now have an install base that is available for us to attach those products and services. From a growth perspective, a lot of that investment, you know, is right time, right place for us to go to market in an environment where our offerings, which you know, improve efficiency, improve productivity, reduce revenue risk, are very relevant and timely. I feel like we put ourselves in as good of a position as we can be in given the macro. While I can't, you know, see the future or tell you what's gonna happen next week or tomorrow, what I can tell you is our customers are incredibly engaged. I've been spending a lot of time with customers. In the last couple weeks, we had a large team at re:Invent, where customers really wanna learn about automation. It was a strong quarter for automation, for instance. You see that in that large cohort, large customer cohort of customers over 100, you know, spending over 100K, growing 31%, and also the expansion volume. We are absolutely still investing in growth, but being very disciplined and balanced around capital allocation to make sure we can progress against our Rule 40 goal, and that we can demonstrate that we are a profitable, durable growth company long term. Yeah. I think what I would add to Jen's comments is, you know, if you have a look at the achievement this year where, you know, our guide points to 700 basis points-800 basis points improvement over last year, we've really laid the foundation to continue to improve and expand our margins into next year. I don't expect the rate of change around that improvement to slow down. Along with that, even this year, we expect our free cash flow, you know, one or two points better than where we end from an operating margin perspective. For us, that becomes a point of focus for next year, like how do we ensure that our free cash flow margins are also continuing to be strong? I think we've laid a really good foundation. We will give you more detailed guidance, of course, on our Q4 call, but, you know, you can see from the pattern that we've been following how we expect to continue to execute. Well, Just to follow up real quickly, it just makes it sound like, just to be clear, that you're not giving up any growth for the fact that you're profitable, so that we can continue to see some leverage and the strong growth that you've been delivering. Yeah. We're not providing any specific guidance on growth for next year. We provided the guide for this year. We certainly, you know, again, to Jen's comment, controlling what we can control. We know that we have created an operating model that is sustainable for the long term, and we expect to be sustainably profitable and to be a profitable grower. Of course, the macro is an environment that, you know, is subject to all kinds of things. Thank you so much. Thanks, Joel. Okay. Next we'll hear from, Chad, with Craig-Hallum. Chad Bennett, go ahead. Yeah. Great. Thanks for taking my questions. Kudos also on the quarter and profitability and all that good stuff. So just thinking about, you know, your commentary around, you know, new logos seem to be a bit more challenging in this environment for anybody. Your net new customer ad number I think was, you know, kinda down relatively speaking to prior quarters and so forth. You spoke very bullishly about cross-sell, up-sell expansion and so forth in the pipeline there. You know, net expansion is coming in a little bit. Obviously, it's comping against really good numbers. You know, how should we think about overall revenue growth relative to net expansion in that delta? You know, from where it is today to maybe in a tougher environment for new logos? I know there's a timing difference in everything and so forth, but, you know, should we expect less from new logo contribution, you know, if we look out over the next three to four quarters? Chad, I think what I would say is that if you look at our business, our growth primarily comes from expansion. Yeah. We tend to have a small land and customers grow with us over time. Lands are important, but expansion is always the near-term opportunity for us from a growth perspective. When we look at lands, what's also important for us is the right kind of lands. This last quarter, we had over 100 enterprise and mid-market lands that we saw as being really healthy and strong, which lays a good foundation for us for the future. The contribution from new, you know, within the first year always remains relatively small, new logos. For us, of course, the fact that we do have such a strong install base that is able to take up new products and, you know, add users and can do that with ease and can get to value really quickly. You know, there's a total cost of ownership equation there that doesn't require a whole lot of effort or services to be able to get up and running, I think puts us in a good place. Got it. Then maybe any more color, you know, we've heard from a lot of calls in the space just on renewal and expansion conversations with customers and how customers are being a little more cautious on seat expansion and so forth. You know, I'd love your commentary on that, just kinda what you're hearing, but specifically in the tech sector where you're seeing some pretty healthy layoffs and whatnot. I know you guys are fairly horizontal from a vertical standpoint, but just any commentary on renewal discussion and seat expansion. Thanks. Well, you saw, and, you know, like I said, I've been talking to a lot of customers lately. You saw, that, you know, we continued to see churn below 5% of starting ARR, so very strong retention of the base. You know, renewals, those conversations continue to go well. Record number of expansions as customers are looking for new ways to automate more because they're being asked by their own leadership to do more with less. I think, you know, all of the automation we've built into the platform, from detection to orchestration all the way through to auto remediation, is super relevant and timely in this moment. What I would tell you is it's more that there are just more approvals in the process. Like, we don't see deals moving out of the pipeline. We don't see deals going to competition. We just see things taking longer because there's more diligence associated with how these deals get done. In long term, that actually may be good for us because more and more senior people are gonna understand what PagerDuty does and what our value proposition is, et cetera. It's a little annoying right now, you know, when you think you're done, and then you find out there's two more approvers who've never met us before that, you know, this has to go through just because they're trying to control and constrain spend at the top. What this has definitely shown me in the conversations I've had with customers is we truly are essential infrastructure. We saw that, you know, in the pandemic when customers sort of pumped the brakes while they were trying to figure out everything else that they had to figure out at the beginning of the pandemic. You know, when you see those additional approvals come up, we ultimately sort of win the day. Like I said, it's just taking a little bit longer. I really like what I'm seeing, though, in terms of engagement around some of our more advanced use cases. I think the market probably doesn't understand yet how important Incident Workflows are, which we EA'd recently. Flexible workflows enable, you know, a big opening up of lots of different types of use cases that our customers are looking to leverage PagerDuty for. It's one of the most requested feature sets, that we've been asked for over the years, and it's really us building Catalytic's capability and IP into the core platform. I'm really excited about the discussions that we're having there as well. Got it. Well, thanks. Kudos again on the quarter. Thanks. Thank you, Chad. Okay, we'll hear next from Matt Stotler with William Blair. Yeah. Hey there. Thank you for taking the questions. You know, Jen, that's actually a good segue because my first question here is gonna be on Catalytic, right? Obviously seemed like some pretty compelling, you know, capabilities that you acquired there. I would love to get an update, you know, kinda on the overall integration, progress timeline, but also, you know, how those capabilities are impacting the conversations you're having with customers, and potentially contributing to the expansion we're seeing in the user base at this point. One of the critical success factors for us has always been to make the app that our users are engaging with as simple and usable as possible because they're often using us in a moment of significant duress or stress. For me, it felt like a really natural next step to really move into no-code or low-code workflow automation because you can't get much simpler than sort of drag and drop. What we've learned, particularly as we've gone into large enterprise, highly regulated industries that have very specific requirements where they wanna use us for risk mitigation or, you know, in a healthcare environment, et cetera, they want to change what has been historically a very deterministic workflow. Incident Workflows and no-code workflows really open up a lot of that opportunity for us and just make it easier for customers to deploy PagerDuty's automation into different types of incident response process and more broadly, different types of interrupt work. I just can't tell you, I mean, maybe it's because I'm from the Midwest and Catalytic is a Chicago company, but we're thrilled with that team. It's a great group of technologists. We're thrilled with how well they're advancing and progressing. In fact, our automation product had a much improved quarter this quarter as well. You know, we were last quarter, I think we talked about automation deals being a little bit larger and taking a little bit longer. This quarter, we saw strong attach there. Really good to see some of those inorganic investments, you know, starting to take hold within the broader business. That was very helpful. Maybe one on the federal vertical specifically. You know, historically something you guys have talked about as a, kind of a key part to that $1 billion, you know, growth or revenue aspiration. You know, obviously with the government fiscal year ending Q3, we'd love to just get kind of a broader update on progress there and maybe contribution that you're seeing today. Well, today Federal is a small part of our total ARR. We do see a lot of customers in the SLED, state and local government, education, and we are underway with our FedRAMP certification process, which will, I think, open up more and more opportunities in Federal. That's more of a forward-looking opportunity in my view. You know, I talked earlier in my prepared remarks about a large aerospace company. It's a Fortune 100 company. What I loved about that deal is they're a customer that was able to tell us they've realized tremendous return on investment, 30 x their initial investment and a very high ROI. They really doubled down on our products and services. We like to see. Mm-hmm. that kind of advancement in these highly regulated industries because it demonstrates how truly horizontal PagerDuty can be. I don't know, Howard, if you have anything to add there. No, I think you've covered it. Great. Thank you again. Okay, thank you. Next, we'd like to welcome Fred Lee from Credit Suisse. All right. Hey, Jennifer. Hey, Howard. Hey, Fred. Hi, Fred. How are you? Hey, G-Go Blue. Go Blue. We didn't get to host you here in Scottsdale this week, but hopefully we'll see you in Phoenix at the game, right? Maybe. I hope so. Hey, listen. Actually, apologies in advance if you addressed this already. I missed the first part of the call. Last quarter, you called out the digital operations business accelerated year-over-year nicely. I was wondering if, you know, I was wondering how the business has trended in the quarter and through the first month of this quarter, if the shape of the uptake has changed at all? Yeah. I can comment on that, Fred. In terms of digital operations, right? Digital operations SKU, if you like, is one of the opportunities for customers to acquire additional products. It's the add-on from our business plan that allows customers to incorporate the Event Intelligence product amongst some other capabilities. We continue to see strong demand for that, particularly as customers are trying to or are keen to leverage the capabilities of our Event Intelligence or AIOps solution, which helps them be more efficient and helps them respond more quickly to issues. This quarter, again, we saw strong multi-product attach, which is Jen commented in her script that more than 50% of our ARR is coming from customers with two or more products. The, you know, the product attaches across AIOps and across the Process Automation piece. Just a quick follow-up. Do you find that AIOps tend to behave from a demand perspective more acyclical versus incident response? Or are they more similar in terms of the pro cyclicality relative to the environment? Thank you. Yeah. I'm not aware of any discernible difference in terms of how the buying behavior changes around that. I think it's often related to the maturity of the customer. We have a maturity model that we often discuss with customers that take them from being reactive to being predictive. As companies go through their own journey, the Event Intelligence or AIOps products seem to fit in naturally with that progression. Whether they're already at that point or aspiring to get to being a level of being proactive, then the Event Intelligence product fits in really well. Sometimes it's a function of that more than anything else. Jen, I don't know if you have anything to add. No, I think you nailed it. It's more about digital maturity and how an organization is organized. You know, some teams are early adopters of analytics in the flow of a production environment. Others have more of a centralized mindset, where they will analyze incidents after they happen and then try and affect learning. By integrating AIOps into the core operations platform means you can do both. The product serves at high scale, both distributed teams and centralized teams. Where we saw some momentum this quarter was a number of customers that have paid for point solutions in the AIOps space and seen the value of being able to not only leverage AIOps from an analytics perspective and alerting perspective, but be able to action on that data and information immediately and inside the same platform without context switching, which is a huge time saver and money saver and potentially a way to get to predictive much faster. 'Cause the idea of AIOps is you're looking at events and preventing those event storms from becoming major incidents, as opposed to just learning from incidents after they happen. Having AIOps incident response and automation all integrated into one platform is one of the things that makes us really unique and drives a lot of value. Thank you very much and very nice quarter, especially in this environment. Thank you. Thank you, Fred. Okay, thank you. Next, we're going over to Kingsley Crane with Canaccord Genuity. Kingsley? Thanks. Thanks for taking my questions. It seems like the business is holding up really well. I wanna touch on something that everyone's touched on a little bit. Record number of expansions in the quarter, they've tended to be a little bit smaller. How has the profile of those expansions changed over the past few quarters? Thinking about from a seat expansion versus a feature expansion standpoint. Yeah. I can comment on that to begin with. What we have seen is that with customers with that change in profile, there's been, if you like, a slower uptake of users or seats, in that customers are making smaller purchases of seats than what they would ordinarily purchase. We have on the other side, though, seen customers, you know, being eager to adopt incremental products, which then helps them with their digital maturity that we just spoke about. It's a little bit of a mix, but I think the beauty of our model is that we allow customers to buy what they need when they need it. Like, you don't have to sign like a large deal with us that you then draw down over time. We've enabled a model supported by self-service, regardless of where you are, what kind of size company you are, to acquire the seats or the users that you need when you need them. We've certainly seen customers taking that approach of incremental purchases as they need them. Right. Makes sense. Jen, you mentioned, you know, customers looking to do more with less. In the case that a customer is slower in hiring or is not expanding seats as quickly, could that be a catalyst to start looking at more automation features? We've definitely seen that. We've seen that both, you know, inside of IT and outside of IT. I think it creates a huge opportunity in customer service operations. I think it's gonna create opportunities across the business, particularly with Incident Workflows coming out. For sure, we have definitely seen a transition in the conversation from, "I just wanna advance my DevOps transformation," to, "How can you help me do more with less? How can I reduce the toil on my precious developer team? Not that they're precious, but they're precious resources. And enable them to, you know, more effectively focus on high value impact. The other thing that I would say is that even in a difficult macro environment, incidents don't go away, and in fact, they become much more expensive because, you know, it's harder to attract new customers for almost all businesses. If you've paid to get a new customer into your product experience and then something goes wrong, that loss is much larger the longer it takes you to detect it, to understand it, and then recover from it. I think that's one of the things, the fact that incidents are very expensive business for all of our customers that has made us essential infrastructure in an environment like this. I would say there's just more of an appetite now, even for individuals who historically might have been worried about being automated out of a job, there's much more appetite for how can I demonstrate I'm more productive by using automation, right? We're even encouraging that across our own business, like, you know, encouraging our employees to use automation instead of doing things manually to improve the productivity of their team so that they can increase their own capacity. Right. All right, really helpful. Thank you. Thank you. Okay, it looks like we're down to a couple more hands up. We have Andrew Sherman from Cowen. Andrew, go ahead, please. Oh, great. Thanks so much for Derek. Congrats on the quarter. Jen, the big aerospace win was impressive. I think that kind of customer and industry is somewhat new for you. Could this become a larger trend as those kinds of customers and industries grow their digital maturity? Well, we have definitely seen a lot of momentum over the last couple of years, frankly, in highly regulated, more traditional industries as more and more of their business has become digital. It's that, you know, digital transformation is not something you can sort of stop midway through and kinda take a break. Like, it's something that's going on. Rathi Murthy, who's a customer and a board member, was talking about Expedia's digital transformation yesterday or 2 days ago on AWS's stage. I mean, it's a multi-year, sometimes multi-decade challenge. One of the things I like that I'm seeing about our business is even some of the most traditional industries that have historically been slow to adopt digital automation, slow to shift the way they do DevOps or SRE are coming to PagerDuty and making big bets on us. You know, that deal in particular, one of the things I liked about it was, you know, it was total platform, included automation and multi-year. That's a long-term partnership, and we're gonna learn a lot from that as well. It was a customer who'd been with us before, seeing very immediate high value and made it, you know, made those discussions much easier in terms of how you expand on the renewal on the back of that. Yeah, that's great. It sounds like the US had a strong quarter. Wanted to ask about Europe and how this performed, relative to expectations and what your expectations there are going forward. Yeah, the Americas did have a good quarter. You know, as I said earlier, mid-market and enterprise continue to post strong results. Europe, as we mentioned last quarter, we definitely saw, you know, more pressure and more diligence on deals there. Deals are getting done. I mean, I just heard yesterday about a big customer land. I'm not gonna share all the details so I can save some fun for next quarter. Like I said, customers are very engaged. It's just taking them a bit more time to get organized around how they're gonna make investments. You know, again, from a European perspective, Europe represents about 13% of our revenue. Again, being diversified, making new investments in places like Japan, you know, that gives us the ability to continue to grow the business even as we see, you know, some mix in economic health or macroeconomic health around the world. Great. Thanks. Thanks, Andrew. Thank you. Okay, we'll round out today's Q&A with Rob Oliver with Baird. Rob, please go ahead. Great. Can you guys hear me okay? We can, Rob. Yeah. Okay. Yeah. Hey, hey, Jen. Hey, Howard. Thanks for taking my question, squeezing me in here. Appreciate it. Hey, Tony. I wanted to touch on the vendor consolidation point, which you guys touched on, you know, sort of second quarter in a row where Jen, you mentioned that a little bit. I wanted to try to flesh that out a little bit. I mean, obviously a lot of our coverage, I think probably all of us are dealing with companies that could be pressured from that trend potentially, if we get into a tough environment. It seems like you guys are seeing, you know, potentially the other side of that. Is that, you know, what areas is that in? Is that, you know, AIOps where, you know, we have a mix of some, you know, private vendors and some public vendors trying to do it, where you guys, you know, may have certainly a brand advantage and a platform advantage? Is it digital operations more broadly? Just any color you can add there would be great. Thanks. We're seeing it in AIOps for sure, and more broadly in spaces across the incident response lifecycle or digital operations lifecycle, where a lot of point solutions have popped up, and they do one thing. Maybe they do on-call or maybe they do, you know, SRE or maybe they do AIOps or, you know, something else. We even have customers that ask us to help them leverage our Event Intelligence data to understand which of their observability tools are adding the most value because everybody's got a lot of observability and telemetry instrumentation in their environment, and they're looking for ways to reduce duplication. I think that is, you know, that's kind of the key theme is nobody wants to have three of the same thing if they could be effective with one, right? I agree that, you know, with your thesis that we are benefiting from a consolidation perspective, but I think it's not just because we have multiple solutions on the platform, it's because our platform's easy to deploy, fast time to value and, you know, frankly, delivering a very high ROI in a short order. I think that's very attractive to our customers right now as opposed to some of the, you know, larger long cycle, long deployment, environments they would need to be in, where they've got to bring in a lot of contractors to help them get up and running. Got it. Okay, I appreciate that color. Thanks, guys, for squeezing me in. Thank you. It's great to see you. Good to see you. Jennifer, can we turn to you for final comments? Sure. Well, I just wanna say thank you so much for all of your questions and to all of you who've joined us today on our earnings call. We are very proud of our results, and we continue our track record of durable growth and are pleased that we're demonstrating that ability to balance growth with expanding operating margins and achieving profitability a quarter ahead of our previous guidance. You know, in this environment, I think PagerDuty's Operations Cloud is very well positioned because we do help customers with mission-critical challenges. We help them protect their revenue and reduce their own cost run rate. Importantly, I wanna thank our customers for their trust in us, and again, just thank all of our Dutonians around the globe for their hard work, their resilience, and for delivering another successful quarter for PagerDuty. Thank you.