UPDATED 18:34 EDT / AUGUST 30 2022


Strong growth drives CrowdStrike earnings beat, revised outlook

Shares in CrowdStrike Holdings Inc. were flat in late trading despite the cybersecurity company reporting a solid earnings beat and a revised outlook thanks to continuing strong growth.

For its second quarter that ended July 31, CrowdStrike reported a profit before costs such as stock compensation of $85.9 million, or 36 cents per share, way up from $25.9 million, or 11 cents per share, in the same quarter of last year. Revenue jumped 58% from a year ago, to $532.2 million. Analysts had been expecting earnings per share of 28 cents on revenue of $516 million.

CrowdStrike’s metrics rose across the board, with annual recurring revenue increasing 59% year-over-year, to $2.14 billion as of July 31, including $218.1 million in net new ARR added in the quarter. Net cash generated from operations in the quarter was $209.9 million, nearly double the $108.5 million in the second quarter of fiscal 2022. Free cash flow was $135.8 million, up from $73.6 million.

Highlights in the quarter included CrowdStrike adding 1,741 net new subscriptions, bringing the total number of subscribed customers to 19,686 as of the end of July. Customers that have adopted five or more, six or more, or seven or more modules sat at 59%, 36% and 20%.

On the product front, CrowdStrike launched Falcon OverWatch Cloud Threat Hunting for finding hidden and advanced threats originating, operating, or persisting in cloud environments. The new service offers cloud-oriented indicators of attack for the control plane and detailed adversary tradecraft to observe and disrupt sophisticated cloud threats.

Other highlights in the quarter included new features for its Falcon extended defense and response platform and the general availability of the Falcon Identity Threat Protection module for its GovCloud-1 environment.

“As organizations respond to macroeconomic conditions, they are prioritizing investments and looking to standardize with a security partner they can trust to achieve better protection with less time, fewer resources and lower total cost of ownership,” George Kurtz (pictured), co-founder and chief executive officer of CrowdStrike, said in a statement. “Our ability to deliver immediate ROI and consolidate the security and IT stack significantly sets us apart from the competition.”

For its fiscal third quarter of 2023, CrowdStrike is predicting an adjusted profit of 30 to 32 cents a share on revenue of $569.1 million to $575.9 million. Analysts had predicted $569.2 million. For the full fiscal year 2023, CrowdStrike expects a profit of $1.31 to $1.33 a share on revenue of $2.223 billion to $2.232 billion.

After bouncing around a bit after the bell, CrowdStrike’s share price was down only a small fraction of a point.

Photo: CrowdStrike

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