CrowdStrike Holdings Inc. today beat expectations with better-than-expected results thanks to increased adoption of its cloud-native cybersecurity tools as enterprises look to secure remote workers during the COVID-19 pandemic.

The company, which consulting and investigation services in addition to its cloud-based security tools, reported a fiscal first-quarter profit before certain costs such as stock compensation of 2 cents per share on revenue of $178.1 million, up 85% year-over-year. Wall Street had been looking for a loss of 6 cents per share on revenue of $165.41 million.

CrowdStrike Chief Executive George Kurtz (pictured) spoke of the company’s strong momentum, saying that an “increasing number” or organizations had recognized the merits of its cloud-native Falcon security platform. It’s used by organizations to protect cloud environments, servers, employee devices and other endpoints from hackers.

“Cybersecurity is mission-critical and in the quarter our customers continued to prioritize their cybersecurity investments,” Kurtz said. “With both security administrators and end-users working from home, we believe the rapid shift to a remote workforce has helped increase our leadership.”

The quarter marked the first time that CrowdStrike has achieved adjusted operating profitability. Moreover, the company generated a record positive cash flow from operations of $98.6 million, in addition to a free cash flow of $87 million.

Subscription revenue, always a key metric for investors looking for a steady income stream, shot up 89% from a year ago, to $162.2 million. Annual recurring revenue meanwhile rose 88%, to $686.1 million.

The company said it added 830 net new subscription customers during the quarter, bringing its total to 6,261 at the end of April, up 105% from a year ago.

Although many were expecting CrowdStrike to perform well due to the COVID-19 pandemic, which has created more demand for digital endpoint protection, the doubling of its revenue during the quarter is almost unheard of, Constellation Research Inc.’s Holger Mueller told SiliconANGLE.

“Despite doubling its revenues between the first and second quarters, CrowdStrike still reported a loss, which begs the question of what level the vendor needs to reach to break even,” Mueller said. “Future quarters will show that, but for now investors expect CrowdStrike to keep doing well.”

CrowdStrike announced a new release of its Falcon platform during the quarter, adding better support for Microsoft Corp.’s Azure Cloud and Google LLC’s cloud platform. The improved cloud support, unveiled at the RSA Security conference, came via upgrades to Discover, Falcon’s monitoring module, which enable it to be used inside Azure and Google Cloud deployments.

CrowdStrike said it expects its hot streak to continue, forecasting second-quarter revenue of $185.8 million to $190.3 million. Wall Street had earlier forecast second quarter revenue of just $173.09 million.

CrowdStrike’s stock was up almost 6% in after-hours trading.

Photo: CrowdStrike