Financial Performance - Total net revenues for the three months ended October 24, 2025, were $1,705 million, a 2.8% increase from $1,658 million for the same period in 2024[20] - Net income for the three months ended October 24, 2025, was $305 million, up from $299 million in the same period of 2024, representing a 2.0% increase[22] - NetApp reported net income of $538 million for the six months ended October 24, 2025, compared to $547 million for the same period in the previous year, reflecting a decrease of approximately 1.6%[28] - Total net revenues for the three months ended October 24, 2025, were $1,705 million, compared to $1,658 million for the same period in 2024, reflecting a year-over-year increase of 2.8%[92] - Revenues from the Americas for the three months ended October 24, 2025, were $863 million, slightly up from $862 million in the same period of 2024[95] Profitability - Gross profit for the six months ended October 24, 2025, was $2,325 million, compared to $2,275 million for the same period in 2024, reflecting a 2.2% increase[20] - The gross profit margin for Hybrid Cloud was 71.4% for the three months ended October 24, 2025, slightly down from 71.8% in the same period of 2024[92] - Total gross profit for the six months ended October 24, 2025, was $2,325 million, compared to $2,275 million for the same period in 2024, marking an increase of 2.2%[94] Cash Flow and Liquidity - Cash flows from operating activities for the six months ended October 24, 2025, were $800 million, compared to $446 million for the same period in 2024, indicating a significant increase[25] - Total cash and cash equivalents decreased to $2,072 million as of October 24, 2025, down from $2,742 million as of April 25, 2025, representing a decline of about 24.4%[39] - Cash, cash equivalents, and short-term investments decreased by $832 million to $3.0 billion as of October 24, 2025, primarily due to debt repayment and stock repurchases[155] Assets and Liabilities - Total current assets decreased to $4,654 million as of October 24, 2025, down from $5,851 million as of April 25, 2025, a decline of 20.4%[15] - Total liabilities decreased to $8,644 million as of October 24, 2025, from $9,783 million as of April 25, 2025, a reduction of 11.6%[17] - Total stockholders' equity as of October 24, 2025, was $986 million, a decrease from $1,040 million as of April 25, 2025[17] - The company’s total liabilities decreased to $1,277 million as of October 24, 2025, down from $1,401 million as of April 25, 2025, indicating a decline of approximately 8.8%[43] Stock and Dividends - The company repurchased $550 million of common stock during the six months ended October 24, 2025[25] - The company declared cash dividends of $0.52 per common share during the reporting period[27] - Cash dividends declared were $207 million for the six months ended October 24, 2025, compared to $213 million for the same period in the previous year, a decrease of approximately 2.8%[28] - Dividends declared per share remained at $1.04 for the six months ended October 24, 2025, with total dividend payments allocated to retained earnings amounting to $65 million[75] Expenses - Research and development expenses for the three months ended October 24, 2025, were $251 million, slightly down from $257 million in the same period of 2024[20] - Total operating expenses for Q2 and the first six months of fiscal 2026 were $805 million (47% of net revenues) and $1,592 million (49% of net revenues), reflecting a decrease of two percentage points year-over-year[140] - Sales and marketing expenses decreased by 4% in Q2 and 3% in the first six months of fiscal 2026 compared to the prior year, totaling $465 million and $926 million respectively[142] - General and administrative expenses increased by 16% in Q2 and 14% in the first six months of fiscal 2026, totaling $77 million and $173 million respectively[146] Restructuring and Charges - The company incurred restructuring charges of $25 million during the first six months of fiscal 2026, with a balance of $32 million remaining at the end of the period[80] - Restructuring charges recorded in the second quarter of fiscal 2026 totaled $23 million, contributing to a total of $25 million for the first six months[118] Future Projections - Future amortization expense related to purchased intangible assets is projected to be $31 million, with $9 million for the remainder of fiscal 2026 and $21 million for fiscal 2027[38] - Capital expenditures for the remainder of fiscal 2026 are anticipated to be between $90 million and $140 million[170] Other Financial Metrics - The effective tax rate for the six months ended October 24, 2025, was 22.8%, an increase from 17.0% in the prior year[81] - Interest income for the three months ended October 24, 2025, was $27 million, while interest expense was $(26) million, resulting in total other income of $(6) million[49] - The company has a total of $2.5 billion in Senior Notes, with maturities ranging from June 2027 to March 2035[166] Market and Sales - Hybrid Cloud product revenues for the three months ended October 24, 2025, were $788 million, an increase from $768 million in the same period of 2024, representing a growth of 2.6%[92] - Public Cloud revenues for the three months ended October 24, 2025, were $171 million, up from $168 million in the same period of 2024, indicating a growth of 1.8%[92] - Product revenues for the second quarter of fiscal 2026 were $768 million, a 3% decrease from $788 million in the same period of fiscal 2025[123] - Services revenues for the second quarter of fiscal 2026 were $917 million, reflecting a 3% increase from $890 million in the same period of fiscal 2025[126]

Revenue Performance - Revenue for Q3 FY 2026 was $108.5 million, up 31.2% from $82.7 million in Q3 FY 2025[3] - The company expects Q4 FY 2026 revenue to be between $97.0 million and $103.0 million[3] - The new revenue growth guidance for FY 2026 is projected to be between 36% and 38%, an increase from the previous estimate of 31% to 35%[6] - Ambarella's edge AI revenue has set its sixth consecutive revenue record, indicating strong demand for its products[6] Profitability Metrics - Non-GAAP net profit for Q3 FY 2026 was $11.9 million, or earnings per diluted share of $0.27, compared to $4.6 million, or $0.11 per diluted share in Q3 FY 2025[3] - GAAP net loss for Q3 FY 2026 was $15.1 million, or loss per diluted share of $0.35, an improvement from a loss of $24.1 million, or $0.58 per diluted share in Q3 FY 2025[3] - GAAP diluted net loss per share for Q3 2025 was $(0.35), an improvement from $(0.58) in Q3 2024[20] - Non-GAAP diluted net income per share for Q3 2025 was $0.27, compared to $0.11 in Q3 2024, reflecting a 145.5% increase[20] Cash and Assets - Total cash, cash equivalents, and marketable debt securities at the end of Q3 FY 2026 was $295.3 million, up from $261.2 million in the prior quarter[5] - Total current assets increased to $383,667,000 as of October 31, 2025, up from $320,551,000 at the end of January 2025, reflecting a 19.7% growth[21] - Cash and cash equivalents rose to $174,057,000, compared to $144,622,000 in January 2025, indicating a 20.3% increase[21] - Accounts receivable increased to $42,227,000 from $29,767,000, a growth of 42%[21] - Inventories rose to $39,159,000, up from $34,428,000, indicating a 13.3% increase[21] Liabilities and Equity - Total liabilities increased to $161,777,000 from $127,556,000, representing a 26.8% rise[21] - Shareholders' equity improved to $590,113,000 as of October 31, 2025, up from $561,412,000, showing a 5.1% increase[21] Operating Expenses - Operating expenses on a non-GAAP basis for Q4 FY 2026 are expected to be between $55.0 million and $58.0 million[3] - Year-to-date free cash flow is 14.8% of revenue, reflecting strong growth and operating efficiency[6] Historical Comparison - GAAP net loss for Q3 2025 was $15,107,000, compared to a loss of $24,071,000 in Q3 2024, representing a 37.5% improvement year-over-year[20] - Non-GAAP net income for Q3 2025 was $11,864,000, significantly higher than $4,459,000 in Q3 2024, marking a 166.5% increase[20]

Drug Development and Clinical Trials - The Company has 18 drug candidates in clinical trials, ranging from Phase 1 to Phase 3, with a robust discovery pipeline capable of generating multiple new clinical candidates each year[19] - REDEMPLO (plozasiran) was approved by the FDA in 2025 to reduce triglycerides in adults with Familial Chylomicronemia Syndrome (FCS), marking the Company's first commercial launch[20] - The Company plans to file a supplemental NDA for severe hypertriglyceridemia (sHTG) in 2026, pending successful completion of Phase 3 studies[20] - ARO-DIMER-PA is a dual functional RNAi molecule targeting PCSK9 and APOC3, representing a significant advancement in RNAi therapeutics[48] - The Company is investigating ARO-MAPT, designed to silence the MAPT gene, in a Phase 1/2a clinical trial for Alzheimer's and tauopathies[57] - ARO-CFB is being developed as a potential treatment for complement-mediated kidney diseases, currently in a Phase 1/2a clinical trial[61] - GSK is conducting Phase 2b clinical trials for GSK-4532990 targeting metabolic-dysfunction associated steatohepatitis (MASH) and alcohol-related liver disease (ALD)[65] - GSK received a worldwide exclusive license for daplusiran/tomligisiran (GSK5637608) to develop a potential therapy for chronic hepatitis B virus infection, with a Phase 2 study currently being initiated[66] - Takeda and the Company co-develop the fazirsiran program for liver disease associated with alpha-1 antitrypsin deficiency, with a 50/50 profit-sharing structure in the U.S.[67] - Fazirsiran aims to reduce the production of the mutant Z-AAT protein to prevent liver injury and fibrosis in patients with alpha-1 antitrypsin deficiency[70] - Amgen is responsible for the clinical development of olpasiran, designed to reduce elevated lipoprotein(a), a risk factor for atherosclerotic cardiovascular disease[73] Regulatory and Compliance - The FDA requires a user fee of approximately $4.682 million for NDA submissions requiring clinical data for fiscal year 2026[106] - The FDA's review process for NDAs typically aims for completion within ten months, with priority reviews targeted at six months[108] - The Company must comply with cGMP requirements to ensure consistent production of its products before the FDA approves an NDA[109] - The FDA may require a REMS plan to mitigate serious risks associated with a drug, which can affect market potential and profitability[110] - The FDA may impose conditions on approved products, including post-approval studies and distribution restrictions, which can materially affect market dynamics[113] - The FDA may not approve any other application to market the same drug for the same indication for seven years, except in very limited circumstances[116] - The FDA's interpretation of orphan drug exclusivity may change, potentially limiting the drugs that can receive such exclusivity[117] - Fast Track Designation allows for priority review and rolling review for drugs addressing serious conditions with unmet medical needs[118] - The FDA may approve a drug under the accelerated approval program if it provides a meaningful advantage over existing therapies and demonstrates an effect on a surrogate endpoint[119] - The Breakthrough Therapy designation provides more intensive guidance and expedited review for drugs showing substantial improvement over existing therapies[120] - Post-approval requirements include ongoing regulation by the FDA, including recordkeeping and reporting of adverse experiences[121] - Drug manufacturers must register with the FDA and are subject to periodic inspections to ensure compliance with cGMP requirements[122] - The FDA may withdraw approval if compliance with regulatory requirements is not maintained or if new problems are discovered post-market[123] Intellectual Property and Licensing - The Company controls approximately 643 issued patents and has around 833 pending patent applications worldwide, covering various RNAi technologies[85] - The Company may need to obtain additional patent licenses prior to commercialization of its candidates due to the complex patent landscape in RNAi and drug delivery[89] - The Company acquired RNAi assets and rights from Novartis, including patents related to RNAi therapeutics and delivery technologies[90] - The acquisition from Roche provided the Company with licenses to patents related to modifications of double-stranded oligonucleotides, enhancing its operational freedom in RNAi-trigger formats[91][92] - The Company holds a worldwide, royalty-bearing, exclusive license under the Alnylam-Novartis License to research, develop, and commercialize 30 undisclosed gene targets[90] Market Exclusivity and Orphan Drug Designation - Orphan drug designation can provide the Company with incentives such as grant funding and tax advantages for drugs intended to treat rare diseases[114] - The company is subject to a 10-year market exclusivity for orphan medicinal products, which can be reduced to six years if criteria are not met[165] - Orphan drug designation provides up to ten years of market exclusivity in the EU, contingent on maintaining the designation at the time of marketing authorization review[163] Manufacturing and Workforce - The Company expanded its footprint with a new manufacturing and laboratory facility in Verona, Wisconsin during Q1 fiscal 2025[208] - The new state-of-the-art GMP manufacturing facility in Verona includes over 251,000 total square feet of laboratories and office space[211] - As of September 30, 2025, the Company employed 711 full-time employees across four facilities in the U.S.[212] - The Company continues to expand its workforce to increase in-house manufacturing capacity and enhance clinical and preclinical research expertise[213] - The Company offers a total compensation package targeting the 50 to 75 percentile of the market, including base salary, cash bonuses, and equity compensation[214] - The Company supports employee development through individualized plans, mentoring, and tuition reimbursement[214] - The Company is committed to fostering an inclusive environment with ongoing programs for awareness and engagement[215] Data Privacy and Security - The company must comply with various data privacy and security laws, including HIPAA and state privacy laws, which impose significant obligations regarding personal information[185] - Failure to comply with data privacy laws can result in substantial civil and criminal penalties, posing financial and reputational risks to the company[188] - The GDPR and UK GDPR impose fines of up to €20 million or 4% of annual global revenues for noncompliance, whichever is greater[191] - The complexity of data protection regulations in the EEA is heightened by varying enforcement and additional national regulations[191] - The transfer of personal data outside the EEA requires appropriate safeguards, such as standard contractual clauses[193] Pricing and Reimbursement - The pricing and reimbursement environment in the EU allows member states to control prices and reimbursement levels, which may affect market access for the company's products[177] - Health technology assessments (HTA) are increasingly influencing pricing and reimbursement decisions in EU member states, focusing on clinical efficacy, safety, and cost-effectiveness[179] - The company may be required to conduct cost-effectiveness studies to obtain favorable pricing and reimbursement conditions in certain EU member states[182] - Orphan pharmaceutical products may be exempted from providing certain clinical and economic data for pricing/reimbursement approval in some EU member states[183] Regulatory Changes in the EU - The UK government enacted the Medicines and Medical Devices Act 2021 to update regulatory frameworks for human medicines and clinical trials, ensuring public health is safeguarded[141] - The centralized procedure for Marketing Authorization (MA) in the EU has a standard evaluation timeframe of 210 days, which can be extended due to additional information requests[152] - New Chemical Entities (NCE) approved in the EU qualify for eight years of data exclusivity and ten years of marketing exclusivity, extendable to eleven years under certain conditions[157] - The European Medicines Agency (EMA) provides scientific advice for drug development, with fees significantly reduced for orphan medicines[149] - The Medical Devices (Amendment) (Great Britain) Regulations 2023 allow CE marked devices to be sold in the UK until 2028 or 2030, depending on the device type[144] - The Medicines and Healthcare products Regulatory Agency (MHRA) plans to implement new 'Pre-Market Regulations' in 2026, extending the sunset period for key EU-derived regulations[144] - The EU Clinical Trials Regulation (CTR) became applicable on January 31, 2022, streamlining the approval process for clinical trials across member states[145] - The current proposal for reforming European pharmaceutical legislation includes shortening data exclusivity from eight to six years, with incentives for developing new antibiotics[161]

Financial Performance - For the three months ended October 31, 2025, revenue was $788.1 million, a 26% increase from $628.0 million in the same period of 2024[121] - GAAP gross profit for the three months ended October 31, 2025, was $603.4 million, with a GAAP gross margin of 77%[139] - Non-GAAP income from operations for the three months ended October 31, 2025, was $171.9 million, resulting in a non-GAAP operating margin of 22%[141] - Annual Recurring Revenue (ARR) as of October 31, 2025, was $3,204 million, up from $2,553 million in 2024, indicating a strong growth in subscription contracts[145] - Free cash flow for the three months ended October 31, 2025, was $413,296 thousand, compared to $291,881 thousand in 2024, reflecting an increase of 42%[144] - The net loss for the three months ended October 31, 2025, was $11.6 million, adjusted for non-cash charges of $297.1 million, which included $188.6 million for stock-based compensation[190] Customer Growth - As of July 31, 2025, the company had over 9,400 customers, up from over 8,650 customers in 2024, representing a growth of approximately 8.6%[125] - The customer base grew by 14% from October 31, 2024, to October 31, 2025, contributing to the revenue increase[166] Operating Expenses - Operating expenses increased to $639,721 thousand in Q3 2025 from $517,160 thousand in Q3 2024, primarily driven by higher sales and marketing expenses[163] - Research and development expenses increased to $200,498 thousand in Q3 2025 from $154,254 thousand in Q3 2024, reflecting ongoing investment in product development[163] - Sales and marketing expenses increased by $67.5 million, or 22%, to $373.6 million, largely due to higher employee-related expenses and marketing costs[169] - General and administrative expenses grew by $8.8 million, or 16%, to $65.7 million, mainly from increased employee-related expenses[172] Cash Flow and Investments - Net cash provided by operating activities for the three months ended October 31, 2025, was $448.3 million, compared to $331.3 million for the same period in 2024, reflecting a year-over-year increase of 35.4%[190][191] - Net cash used in investing activities during the three months ended October 31, 2025, totaled $1,502.2 million, significantly higher than $201.7 million in the same period of 2024, primarily due to $896.4 million in short-term investments and $672.8 million for business acquisitions[192][193] - Net cash provided by financing activities was $3.1 million for the three months ended October 31, 2025, slightly up from $0.9 million in the same period of 2024, mainly from stock option exercises[194] Economic Environment and Future Outlook - The uncertain economic environment is leading to elongated approval processes for transactions, particularly for larger deals[122] - The company expects to continue incurring net losses as it invests in sales, marketing, and research and development[121] - The company expects gross profit to increase in absolute dollars and gross margin to improve slightly over the long term[152] Risk Management - The company has a foreign currency risk management program and uses foreign currency forward contracts to hedge a portion of its forecasted foreign currency-denominated expenses[203][205] - A hypothetical 100 basis point change in interest rates would have changed the fair value of the company's investments in available-for-sale securities by $27.9 million as of October 31, 2025[200] - The effect of a hypothetical 10% change in foreign currency exchange rates would not have a material impact on the company's financial statements for the three months ended October 31, 2025, and 2024[203] Other Financial Metrics - Interest income increased by $3.1 million, or 10%, to $33.2 million, attributed to a higher balance of cash equivalents and short-term investments[173] - Interest expense decreased by $1.0 million, or 32%, to $(2.1) million, primarily due to fair value hedge adjustments[174] - Other expense, net increased by $2.4 million, or 366%, to $(3.0) million, driven by fluctuations in foreign currency transactions[175] - Provision for income taxes decreased by $4.4 million, or 58%, to $3.2 million, mainly due to a tax benefit from the release of a portion of the U.S. valuation allowance[176] - As of October 31, 2025, cash, cash equivalents, and short-term investments totaled $3,321.3 million, supporting working capital and corporate purposes[182] - Deferred revenue amounted to $2,351.3 million, with $1,946.2 million expected to be recognized as revenue in the next 12 months[187] - The company issued $1,725.0 million in 2028 Notes in July 2025, which have a 0.0% interest rate, thus not exposing the company to economic interest rate risk[201][202] - Non-cash charges for the three months ended October 31, 2025, included $188.6 million for stock-based compensation and $48.1 million for amortization of deferred contract acquisition costs[190]

Financial Performance - Arrowhead Pharmaceuticals reported a revenue of $829.448 million for the fiscal year 2025, a significant increase from $3.551 million in 2024[10] - The company achieved an operating income of $98.346 million in 2025, compared to an operating loss of $601.080 million in 2024[10] - Arrowhead's net income attributable to the company was a loss of $1.631 million in 2025, an improvement from a loss of $599.493 million in the previous year[10] - The company has $919.366 million in total cash resources as of September 30, 2025, compared to $680.961 million in 2024[10] - Arrowhead's total assets increased to $1.385 billion in 2025, up from $1.140 billion in 2024[10] Regulatory Approvals and Clinical Trials - The FDA approved REDEMPLO (plozasiran), the first FDA-approved siRNA medicine for familial chylomicronemia syndrome (FCS), which can reduce triglycerides by 80% from baseline[6][11] - The company filed for regulatory clearance to initiate Phase 1/2a clinical trials for ARO-DIMER-PA and ARO-MAPT, targeting atherosclerotic cardiovascular disease and tauopathies, respectively[7] Partnerships and Licensing Agreements - Arrowhead received a $200 million upfront payment from Novartis as part of a global licensing agreement for ARO-SNCA, with potential milestone payments of up to $2 billion[7] - Arrowhead earned $300 million in milestone payments from Sarepta Therapeutics related to the ARO-DM1 clinical study[7] - The company signed an asset purchase agreement with Sanofi, receiving an upfront payment of $130 million and potential milestone payments of up to $265 million for plozasiran in Greater China[8]

Financial Performance - Record Q3 revenue of $27 billion, up 11% year over year, with record Q3 profitability and strong cash generation [2] - Full-year FY26 revenue expected between $111.2 billion and $112.2 billion, representing a 17% increase year over year [6] - Operating income for Q3 was $2.119 billion, up 23% year over year [7] - Total net revenue for the three months ended October 31, 2025, was $27,005 million, representing an 11% increase compared to $24,366 million for the same period in 2024 [21] - Total consolidated net revenue for the three months ended October 31, 2025, was $27,005 million, an increase of 11% compared to $24,366 million for the same period in 2024 [30] - Infrastructure Solutions Group (ISG) net revenue reached $14,107 million, a 24% increase from $11,368 million year-over-year [30] - Client Solutions Group (CSG) total net revenue was $12,478 million, reflecting a 3% increase from $12,131 million in the prior year [30] Earnings and EPS - GAAP diluted EPS expected to be $8.38 at the midpoint, up 31% year over year, and non-GAAP diluted EPS to be $9.92, up 22% [6] - Non-GAAP diluted EPS for Q3 was $2.59, an increase of 17% year over year [7] - Earnings per share attributable to Dell Technologies Inc. increased by 39% to $2.28 for the three months ended October 31, 2025, and by 26% to $5.34 for the nine months ended [46] - Non-GAAP earnings per share attributable to Dell Technologies Inc. is projected to be $3.50 for the three months ending January 30, 2026, and $9.92 for the fiscal year ending January 30, 2026 [53] Cash Flow and Returns - Capital return to shareholders in Q3 amounted to $1.6 billion, with a total of $5.3 billion returned year to date [3] - Free cash flow decreased by 45% to $506 million for the three months ended October 31, 2025, but increased by 122% to $4.602 billion for the nine months ended [50] - Adjusted free cash flow rose by 133% to $1.67 billion for the three months ended October 31, 2025, and by 145% to $6.42 billion for the nine months ended [50] - Cash flow from operations decreased by 25% to $1.172 billion for the three months ended October 31, 2025, while it increased by 65% to $6.511 billion for the nine months ended [50] Orders and Shipments - AI shipment guidance raised to approximately $25 billion, reflecting over 150% year-over-year growth [2] - Record AI server orders of $12.3 billion in Q3, with total orders year to date reaching $30 billion [2] Expenses and Margins - The gross margin for the three months ended October 31, 2025, was 20.7%, down from 22.0% in the same period last year [21] - Research and development expenses increased by 1% to $752 million for the three months ended October 31, 2025 [21] - Non-GAAP gross margin for the three months ended October 31, 2025, was $5,686 million, a 4% increase from $5,490 million in the same quarter of 2024 [38] - Non-GAAP operating income for the three months ended October 31, 2025, was $2,503 million, an 11% increase from $2,252 million year-over-year [38] - Non-GAAP net income for the three months ended October 31, 2025, was $1,762 million, reflecting an 11% increase from $1,583 million in the prior year [38] Assets and Liabilities - Total assets increased to $87,479 million as of October 31, 2025, up from $79,746 million as of January 31, 2025 [23] - Total liabilities rose to $90,099 million as of October 31, 2025, compared to $81,133 million as of January 31, 2025 [23] Interest and Other Expenses - The company reported a 36% decrease in interest and other net expenses, totaling $(178) million for the three months ended October 31, 2025, compared to $(276) million in the same period last year [21]

Financial Performance - Petco reported Q3 2025 net sales of $1.5 billion, a decrease of 3.1% year over year[4] - Comparable sales declined by 2.2% year over year, indicating a continued challenge in sales performance[4] - Operating income increased by $25.2 million to $29.2 million, reflecting improved profitability[4] - GAAP net income rose by $26.0 million to $9.3 million, marking a significant turnaround[4] - Adjusted EBITDA for Q3 2025 was $98.6 million, an increase of $17.3 million year over year[4] - The company tightened its full year 2025 net sales outlook to a decrease of 2.5% - 2.8%[4] - Full year 2025 adjusted EBITDA guidance was revised upward by $6 million, now projected between $395 million and $397 million[4] - For Q4 2025, net sales are expected to decline in low single digits year over year, with adjusted EBITDA projected between $93 million and $95 million[5] Operational Adjustments - Petco plans to close approximately 20 stores as part of its operational adjustments[4] Year-to-Date Performance - Net income for the 39 weeks ended November 1, 2025, was $11,641, a significant improvement compared to a net loss of $87,979 for the same period in 2024[17] - Adjusted EBITDA for the 39 weeks ended November 1, 2025, was $301,873, representing an increase of 25.6% from $240,403 in the prior year[21] - Net sales for the 39 weeks ended November 1, 2025, were $4,446,339, down from $4,564,332, a decline of 2.6%[21] Asset and Liability Management - Total current assets increased to $1,007,400, up from $973,619, reflecting a growth of 3.9%[14] - Cash and cash equivalents at the end of the period rose to $249,423, compared to $121,021 at the end of the same period last year, marking a 106.2% increase[17] - Total liabilities decreased to $4,047,528 from $4,080,800, indicating a reduction of 0.8%[14] - Total assets increased slightly to $5,205,124 from $5,194,430, reflecting a growth of 0.2%[14] Cash Flow Analysis - Cash flows from operating activities provided $160,528, a substantial increase from $81,680 in the previous year[17] - The company reported a net decrease in cash, cash equivalents, and restricted cash of $67,758, compared to a decrease of $15,628 in the same period last year[17] - For the 13 weeks ended November 1, 2025, net cash provided by operating activities was $90,090,000, compared to $20,724,000 for the same period in 2024, representing a significant increase[25] - Free Cash Flow for the 13 weeks ended November 1, 2025, was $60,646,000, a recovery from a negative Free Cash Flow of $(10,288,000) in the same period of 2024[25] - For the 39 weeks ended November 1, 2025, net cash provided by operating activities was $160,528,000, up from $81,680,000 in 2024, indicating strong operational performance[25] - Free Cash Flow for the 39 weeks ended November 1, 2025, was $70,568,000, compared to $(9,361,000) in the prior year, showing a positive trend[25] - Cash paid for fixed assets decreased slightly from $(31,012,000) in 2024 to $(29,444,000) in 2025 for the 13-week period[25] - Cash paid for fixed assets for the 39 weeks ended November 1, 2025, was $(89,960,000), a slight decrease from $(91,041,000) in 2024[25] Profitability Metrics - Gross profit margin improved by approximately 75 basis points to 38.9% as a percentage of net sales[4] - The Adjusted EBITDA margin improved to 6.8% for the 39 weeks ended November 1, 2025, compared to 5.3% in the prior year[21]

Revenue and Growth - Third quarter revenue increased 5% year over year to $125 million[1] - Annual Recurring Revenue (ARR) grew 3% year over year to $497 million[1] - Revenue for the three months ended October 31, 2025, was $124.545 million, representing a 4.5% increase from $118.946 million in the same period of 2024[20] - Total paid customers increased to 15,398, up from 15,050 year over year[8] - Customers with ARR over $100 thousand grew 5% to 867 as of October 31, 2025[8] - Remaining performance obligations were $415 million, with an expected revenue recognition of approximately $287 million over the next 12 months[8] - For the fourth quarter of fiscal 2026, total revenue is expected to be between $122 million and $124 million[13] Profitability - Operating income was $8 million, with a non-GAAP operating income of $36 million[1] - Net income per diluted share attributable to common stockholders was $1.69, with a non-GAAP net income per diluted share of $0.33[5] - Net income attributable to PagerDuty, Inc. common stockholders for the three months ended October 31, 2025, was $159.555 million, compared to a net loss of $6.558 million in the same period of 2024[20] - Non-GAAP net income attributable to common stockholders for the three months ended October 31, 2025, was $31.217 million, compared to $23.721 million in the same period of 2024, a growth of 31.5%[49] - Non-GAAP net income per share attributable to PagerDuty, Inc. common stockholders for the three months ended October 31, 2025, was $0.34, compared to $0.26 in the same period of 2024[49] Expenses and Liabilities - Operating expenses for the three months ended October 31, 2025, totaled $98.109 million, a decrease of 10.0% from $108.971 million in the prior year[20] - Research and development expenses for the three months ended October 31, 2025, were $29.418 million, down from $34.267 million in the prior year, a decrease of 14.0%[20] - Total liabilities decreased to $688.446 million as of October 31, 2025, from $779.221 million on January 31, 2025[22] Cash Flow and Assets - Cash and cash equivalents as of October 31, 2025, were $324.260 million, down from $346.460 million at the beginning of the year[22] - Net cash provided by operating activities for the three months ended October 31, 2025, was $24.803 million, compared to $22.073 million in the same period of 2024[24] - Free cash flow for the three months ended October 31, 2025, was $20.929 million, compared to $19.443 million in the same period of 2024, indicating an increase of 7.6%[52] - Free cash flow margin for the three months ended October 31, 2025, was 16.8%, compared to 16.3% in the same period of 2024[52] - Total assets increased to $1.027 billion as of October 31, 2025, compared to $927.266 million on January 31, 2025[22] Margins and Retention - Dollar-based net retention rate was 100% as of October 31, 2025, down from 107% a year earlier[8] - Non-GAAP gross margin for the three months ended October 31, 2025, was 86.7%, up from 86.0% in the same period of 2024[47] - Non-GAAP operating margin for the three months ended October 31, 2025, was 28.5%, up from 21.0% in the same period of 2024[49] - Operating cash flow margin for the three months ended October 31, 2025, was 19.9%, compared to 18.6% in the same period of 2024[52] Future Projections and Tax - Non-GAAP net income per diluted share for the full fiscal year 2026 is projected to be between $1.11 and $1.12[13] - PagerDuty's projected non-GAAP tax rate for fiscal 2026 is 22%, aimed at providing consistency across reporting periods[37] Non-GAAP Measures - PagerDuty emphasizes the importance of reviewing GAAP financial measures alongside non-GAAP measures for a comprehensive understanding of financial performance[44] - Non-GAAP operating income for the three months ended October 31, 2025, was $35.546 million, up from $24.991 million in the same period of 2024, reflecting a growth of 42.3%[49] - Non-GAAP gross profit for the three months ended October 31, 2025, was $107,993,000, compared to $102,339,000 for the same period in 2024, representing a 5.2% increase[47] - Non-GAAP operating expenses for the three months ended October 31, 2025, were $19,348,000 in research and development, down from $22,291,000 in 2024, a decrease of 8.7%[47] - Non-GAAP net income for the nine months ended October 31, 2025, was not explicitly stated but reflects adjustments for various non-operational items[41]

Revenue Growth - Net revenues for the third quarter of fiscal 2025 increased by $82.1 million or 4.6%, with comparable company growth of 4.0% driven by strong non-furniture and furniture sales[86] - For the first thirty-nine weeks of fiscal 2025, net revenues increased by $200.4 million or 3.8%, with company comp growth of 3.7%[95] - Pottery Barn, the largest brand, experienced comparable brand revenue growth of 1.3%, supported by large-ticket items and improved store inventory availability[87] - The Williams Sonoma brand saw a significant brand comp growth of 7.3%, driven by strength in kitchen products, particularly electrics and cookware[89] - The retail channel achieved a comp growth of 8.5%, while the e-commerce channel saw a comp growth of 1.9% in the third quarter of fiscal 2025[86] - Emerging brands, including Rejuvenation, Mark and Graham, and GreenRow, delivered double-digit brand comp growth on a combined basis[89] Financial Performance - Gross profit for the third quarter of fiscal 2025 was $867.7 million, a 6.1% increase from $817.6 million in the same quarter of fiscal 2024, with a gross margin of 46.1% compared to 45.4%[104] - For the first thirty-nine weeks of fiscal 2025, gross profit increased by $81.5 million, or 3.4%, totaling $2.5 billion, while gross margin decreased to 45.8% from 46.0%[105] - Selling, general and administrative (SG&A) expenses for the third quarter of fiscal 2025 were $548.6 million, a 7.0% increase from $512.5 million in the same quarter of fiscal 2024, with SG&A as a percentage of net revenues rising to 29.1%[108] - SG&A expenses for the first thirty-nine weeks of fiscal 2025 increased by $43.6 million, or 2.9%, totaling $1.56 billion, while SG&A as a percentage of net revenues decreased to 28.6% from 28.9%[109] - The effective tax rate for the first thirty-nine weeks of fiscal 2025 was 25.4%, up from 24.2% in the same period of fiscal 2024, primarily due to lower excess tax benefits from stock-based compensation[110] Cash Flow and Investments - The company ended the third quarter of fiscal 2025 with $884.7 million in cash and cash equivalents and generated operating cash flow of $718.0 million[90] - The company invested $178.5 million in capital expenditures and returned $792.3 million to stockholders through stock repurchases and dividends in the first thirty-nine weeks of fiscal 2025[90] - Net cash provided by operating activities for the first thirty-nine weeks of fiscal 2025 was $718.0 million, a decrease from $726.7 million in the same period of fiscal 2024[122] - Net cash used in investing activities for the first thirty-nine weeks of fiscal 2025 was $179.7 million, compared to $154.0 million in the same period of fiscal 2024, primarily for technology and supply chain enhancements[123] - Net cash used in financing activities for the first thirty-nine weeks of fiscal 2025 was $870.1 million, a decrease from $1.0 billion in the same period of fiscal 2024, mainly due to reduced stock repurchases[124] Economic and Market Conditions - The tariff rate has increased from 14% in May 2025 to 29% as of the report date, potentially impacting costs for imported materials and finished goods[92] - The company remains focused on returning to growth, enhancing customer service, and driving earnings despite challenges from the macroeconomic environment[92] - Inflation has been experienced due to supply chain disruptions, increased shipping and transportation costs, and rising labor costs, but the impact on financial statements has been immaterial to date[132] - The company acknowledges the potential future impact of inflation on its financial condition and results of operations[132] Foreign Currency Exposure - The majority of inventory purchases are made in U.S. dollars, minimizing foreign currency impact during Q3 fiscal 2025 and Q3 fiscal 2024[130] - Foreign operations in Canada, Australia, the UK, and parts of Asia and Europe expose the company to foreign currency exchange rate fluctuations, but the impact has been immaterial[131] - A hypothetical 10% change in foreign currency exchange rates would not materially affect the company's financial statements[131] Credit Facilities - As of November 2, 2025, the company held $884.7 million in cash and cash equivalents, with $64.2 million held by international subsidiaries[117] - The company amended its credit facility in June 2025, increasing the unsecured revolving line of credit to $600 million, with the option to increase it by up to $250 million[118]

Financial Performance - The Company reported net sales of $394.6 million for Q2 fiscal 2026, a decrease of 12.8% compared to $452.5 million in Q2 fiscal 2025[99] - Gross profit for Q2 fiscal 2026 was $59.9 million, representing a gross profit margin of 15.2%, down from 18.9% in the same period last year[102] - Adjusted EBITDA for the second quarter of fiscal 2026 was $39.6 million, or 10.0% of net sales, down from $60.2 million, or 13.3% of net sales, in the same quarter of the prior fiscal year[117] - Net income for the three months ended October 31, 2025, was $6.1 million, compared to $27.7 million for the same period in the prior year[119] - Adjusted EPS per diluted share for the three months ended October 31, 2025, was $0.76, compared to $2.08 for the same period in the prior year[119] - Adjusted EBITDA for the first six months of fiscal 2026 was $81.9 million, or 10.3% of net sales, down from $123.1 million, or 13.5% of net sales, in the same period of the prior fiscal year[117] Expenses and Charges - The Company incurred $1.5 million in pre-tax restructuring charges during Q2 fiscal 2026, related to workforce reductions and facility closures[97] - General and administrative expenses increased by 20.4% in Q2 fiscal 2026, primarily due to expenses associated with the pending Merger and digital transformation initiatives[104] - The effective income tax rates for the three- and six-month periods ended October 31, 2025, were 31.5% and 27.6%, compared to 21.9% and 23.5% in the prior year periods[105] Market Conditions - Builder sales decreased by 19.7% in Q2 fiscal 2026 compared to the same period last year, reflecting challenges in the new construction market[100] - Remodeling sales decreased by 7.0% in Q2 fiscal 2026, driven by lower in-store traffic and a shift towards more affordable products[99] - The unemployment rate increased to 4.4% as of September 2025, impacting consumer sentiment and spending[101] - The company expects a softer repair and remodel market and a decline in larger ticket remodel purchases for the remainder of fiscal 2026[120] Cash Flow and Debt - Cash and cash equivalents totaled $52.1 million at October 31, 2025, representing a $3.9 million increase from April 30, 2025[125] - Total long-term debt (including current maturities) was $370.8 million as of October 31, 2025[125] - Cash provided by operations in the first six months of fiscal 2026 was $44.3 million, down from $52.7 million in the same period of the prior year[125] - Cash flow from operations and accumulated cash are expected to be sufficient to support working capital requirements and fund capital expenditures for the remainder of fiscal 2026[133] - Cash flow from operations is expected to be sufficient to support working capital requirements and service existing debt obligations for the remainder of fiscal 2026[133] Strategic Initiatives - The Company entered into a Merger Agreement with MasterBrand on August 5, 2025, which is expected to affect its operational focus[91] - The company will continue to invest in digital transformation and automation during fiscal 2026[121] - The company will not be providing or updating previously issued financial guidance due to the proposed merger[122] - The company has authorized an additional stock repurchase program of up to $125 million, although it does not currently expect to repurchase additional shares due to the terms of the merger agreement[132] Tariff Impact - The Company estimates that the unmitigated tariff impact represents approximately 4-4.5% of annualized net sales, with variations by product category[92]