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Why CrowdStrike Stock Skyrocketed Today

Evan Niu, CFA, The Motley Fool

What happened

Shares of CrowdStrike (NASDAQ: CRWD) have skyrocketed today, up by 14% as of 12:20 p.m. EDT, after the company reported first-quarter earnings results. This was CrowdStrike's first earnings report as a public company after its IPO last month.

So what

Total revenue in the first quarter more than doubled to $96.1 million, including subscription revenue of $86 million. Annual recurring revenue (ARR) jumped 114% to $364.6 million, and subscription gross margin expanded to 72% as reported under generally accepted accounting principles (GAAP). That all translated into an adjusted net loss of $22.1 million, or $0.47 per share. Both top- and bottom-line results were in line with analyst expectations, and slightly ahead of the outlook that the cybersecurity company provided in its prospectus.

Hand pointing to cloud icon with a padlock in the middle

In a statement, CEO George Kurtz said:

We are pleased with the strong start to the year. We achieved 103% year-over-year revenue growth in the first quarter, which is consistent with the preliminary results that we shared in our IPO prospectus. As the pioneer of cloud native endpoint security, CrowdStrike provides the only endpoint protection platform built from the ground up to stop breaches, while reducing security sprawl with its single-agent architecture. Our continued innovation strengthens our category leadership in the Security Cloud and positions us as the fundamental endpoint platform for the future.

Now what

Guidance was what really impressed investors. CrowdStrike is forecasting fiscal second-quarter revenue of $103 million to $104 million, well above the consensus estimate of $96.6 million in sales. That should translate into a non-GAAP net loss of $30 million to $30.5 million, or $0.23 to $0.24 per share. The market was bracing for $0.29 per share in adjusted losses.

For full-year fiscal 2020, revenue should be $430.2 million to $436.4 million, again easily topping analyst expectations of $408 million. The outlook calls for an adjusted net loss for the year of $103.2 million to $105.9 million, or $0.70 to $0.72 per share.


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Evan Niu, CFA has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.