Pardew endured a long and hard season on Tyneside, only avoiding relegation by five points as Newcastle finished 16th in the Premier League.
Their final placing represented a huge step-down from fifth in the 2011-12 season, and this despite having brought in a succession of talented players from France over the course of the campaign.
But managing director Derek Llambias stressed a need for stability as he said Pardew would continue following talks with owner Mike Ashley.
"Everyone connected with the club was disappointed to finish where we did last season, particularly on the back of such a fantastic year prior to that," Llambias told the club's official website.
"Our discussions on Wednesday were very constructive and we pinpointed a number of factors that contributed to a season which fell below expectations.
"We are now looking forward and are entirely focussed on the forthcoming campaign, with the expectation of at least a top-10 finish in the Premier League.
"There has been a great deal of speculation in recent weeks but our desire, as we announced back in September, is to bring long-term stability to this club. It's up to us all now to work closely as a team to ensure next season sees us competing in the top half of the table again.
"We would all like to thank the fans for their continued support and assure them we remain committed to providing affordable football at St. James' Park."
- Sports & Recreation
- Derek Llambias