PagerDuty (PD) is seen to be on a path to boost annual recurring revenue growth in fiscal 2026 thanks to various key drivers including digitization trends, hybrid work and transitions to the cloud, RBC analysts said in a Friday note.

The cloud computing company reported late Thursday fiscal Q4 results, which the analysts labeled as "relatively good," and the Q1 and fiscal 2016 outlook as "prudent."

PagerDuty's management is confident regarding operations around H2, mainly due to GTM changes, enterprise groups that are "growing faster than average", fewer headwinds from very small businesses and small-to-medium sized businesses, and recent pricing and packaging changes, the analysts said.

RBC lowered PagerDuty's price target to $22 from $24 while maintaining an outperform rating on the stock.