CrowdStrike Reports Third Quarter Fiscal Year 2025 Financial Results
CrowdStrike Holdings, Inc. (Nasdaq: CRWD) today announced financial results for the third quarter fiscal year 2025, ended October 31, 2024. “CrowdStrike surpassed $4 billion in ending ARR in the qua...
- Surpasses $4 billion ending ARR milestone, grows 27% year-over-year to reach $4.02 billion
- Exceeds $1 billion quarterly total revenue milestone, grows 29% year-over-year to reach $1.01 billion
- Delivers cash flow from operations of $326 million and free cash flow of $231 million, achieving a free cash flow rule of 51
AUSTIN, Texas: CrowdStrike Holdings, Inc. (Nasdaq: CRWD) today announced financial results for the third quarter fiscal year 2025, ended October 31, 2024.
“CrowdStrike surpassed $4 billion in ending ARR in the quarter - the fastest and only pure play cybersecurity software company to reach this reported milestone - as our single platform approach and trailblazing innovation continue to resonate at-scale,” said George Kurtz, Founder and CEO. “With over 97% gross retention, customers remain committed to the technological superiority of the Falcon platform and the benefits of cybersecurity consolidation. Accelerating module adoption and customers embracing our transformational Falcon Flex subscription model give us confidence in CrowdStrike’s bright future as cybersecurity’s AI platform of record.”
Commenting on the company’s financial results, Burt Podbere, CrowdStrike’s chief financial officer, added, “Our third quarter results reflect our focused execution and financial discipline, which drove a strong finish and quarter-over-quarter increase in pipeline, despite expected headwinds from the July 19th incident. We saw incredible success with our customer commitment packages as customers embraced the program and chose to deepen their relationship with CrowdStrike.”
Third Quarter Fiscal 2025 Financial Highlights
- Revenue: Total revenue was $1,010.2 million, a 29% increase, compared to $786.0 million in the third quarter of fiscal 2024. Subscription revenue was $962.7 million, a 31% increase, compared to $733.5 million in the third quarter of fiscal 2024.
- Annual Recurring Revenue (ARR) grew 27% year-over-year to $4.02 billion as of October 31, 2024, of which $153.0 million was net new ARR added in the quarter.
- Subscription Gross Margin: GAAP subscription gross margin was 78% for the third quarter of both fiscal 2025 and 2024. Non-GAAP subscription gross margin was 80% for the third quarter of both fiscal 2025 and 2024.
- Income/Loss from Operations: GAAP loss from operations was $55.7 million, compared to income of $3.2 million in the third quarter of fiscal 2024. Non-GAAP income from operations was $194.9 million, compared to $175.7 million in the third quarter of fiscal 2024.
- Net Income/Loss Attributable to CrowdStrike: GAAP net loss attributable to CrowdStrike was $16.8 million, compared to income of $26.7 million in the third quarter of fiscal 2024. GAAP net loss per share attributable to CrowdStrike, diluted, was $0.07, compared to income of $0.11 in the third quarter of fiscal 2024. Non-GAAP net income attributable to CrowdStrike was $234.3 million, compared to $199.2 million in the third quarter of fiscal 2024. Non-GAAP net income attributable to CrowdStrike per share, diluted, was $0.93, compared to $0.82 in the third quarter of fiscal 2024.
- Cash Flow: Net cash generated from operations was $326.1 million, compared to $273.5 million in the third quarter of fiscal 2024. Free cash flow was $230.6 million, compared to $239.0 million in the third quarter of fiscal 2024.
- Cash and Cash Equivalents was $4.26 billion as of October 31, 2024.
Recent Highlights
- CrowdStrike’s module adoption rates grew to 66%, 47%, 31%, and 20% for five or more, six or more, seven or more, and eight or more modules, respectively, as of October 31, 20241.
- Named a Leader in the 2024 Gartner Magic Quadrant™ for Endpoint Protection Platforms2 for the fifth consecutive time, positioned furthest right for Completeness of Vision and highest for Ability to Execute among all vendors evaluated.
- Received the highest scores among evaluated vendors for Core Endpoint Protection and Managed Security Services Use Cases in the 2024 Gartner® Critical Capabilities for Endpoint Protection Platforms (EPP) report3, for the second consecutive time.
- Recognized as a Frost Radar™ Leader in Cloud Workload Protection Platforms4 for the Second Consecutive Year.
- Acknowledged as a Leader in the 2024 GigaOm Radar Report for Cloud-Native Application Protection Platforms (CNAPPs)5.
- Positioned as a Leader in The Forrester Wave™: Attack Surface Management Solutions, Q3 20246.
- Named a Major Player in the IDC MarketScape: Worldwide Security Information and Event Management (SIEM) for Enterprise 2024 Vendor Assessment report7.
- Unveiled a series of new and enhanced offerings during the eighth annual Fal.Con cybersecurity conference. Announcements included Endpoint Security; Cloud Security; Identity Protection; Next-Gen SIEM; Exposure Management; Charlotte AI and Falcon for IT innovations; Project Kestrel, a revolutionary new user experience and CrowdStrike Financial Services.
- Acquired Adaptive Shield, a leader in SaaS security, making CrowdStrike the only cybersecurity vendor to provide unified, end-to-end protection against identity-based attacks across the entire modern cloud ecosystem.
- Received new ISO/IEC 27001:2022 certification for newer products made generally available, including Falcon Next-Gen SIEM, Charlotte AI and Falcon for IT.
- Expanded Cybersecurity Startup Accelerator with AWS and NVIDIA to support the next generation of global cloud security companies.
- Announced a strategic partnership with Fortinet to unify best-in-class endpoint and firewall protection.
- Partnered with Omnissa to deliver real-time threat detection and automated remediation for Virtual Desktop Infrastructure (VDI) and physical desktop environments while improving customers’ digital work experience and productivity.
- Established new strategic partnerships with CardinalOps, Nagomi and Veriti to deliver intelligence-led threat defense across the enterprise.
- Extended partnership with 1Password to simplify security for 150,000 customers, with a focus on small and midsize businesses (SMBs).
- Announced the expansion of the CrowdStrike Marketplace, a one-stop destination for the world-class ecosystem of CrowdStrike-compatible security products.
Financial Outlook
CrowdStrike is providing the following guidance for the fiscal fourth quarter of fiscal 2025 (ending January 31, 2025) and full fiscal year 2025 (ending January 31, 2025).
Guidance for non-GAAP financial measures excludes stock-based compensation expense, amortization expense of acquired intangible assets (including purchased patents), amortization of debt issuance costs and discount, mark-to-market adjustments on deferred compensation liabilities, legal reserve and settlement charges or benefits, July 19 Incident related costs and (recoveries), net, acquisition-related provision (benefit) for income taxes, losses (gains) and other income from strategic investments, acquisition-related expenses (credits), net, and losses (gains) from deferred compensation assets. The company has not provided the most directly comparable GAAP measures because certain items are out of the company's control or cannot be reasonably predicted. Accordingly, a reconciliation for non-GAAP income from operations, non-GAAP net income attributable to CrowdStrike, and non-GAAP net income per share attributable to CrowdStrike common stockholders is not available without unreasonable effort.
| Q4 FY25 |
| Full Year FY25 | |
Guidance | Guidance | |||
Total revenue | $1,028.7 - $1,035.4 million |
| $3,923.8 - $3,930.5 million | |
Non-GAAP income from operations | $184.0 - $189.0 million |
| $804.4 - $809.4 million | |
Non-GAAP net income attributable to CrowdStrike | $210.9 - $215.8 million |
| $937.5 - $942.6 million | |
Non-GAAP net income per share attributable to CrowdStrike common stockholders, diluted | $0.84 - $0.86 |
| $3.74 - $3.76 | |
Weighted average shares used in computing non-GAAP net income per share attributable to common stockholders, diluted | 252 million |
| 251 million |
These statements are forward-looking and actual results may differ materially as a result of many factors. Refer to the Forward-Looking Statements safe harbor below for information on the factors that could cause the company's actual results to differ materially from these forward-looking statements.
Conference Call Information
CrowdStrike will host a conference call for analysts and investors to discuss its earnings results for the third quarter of fiscal 2025 and outlook for its fiscal fourth quarter and fiscal year 2025 today at 2:00 p.m. Pacific time (5:00 p.m. Eastern time). A recorded webcast of the event will also be available for one year on the CrowdStrike Investor Relations website ir.crowdstrike.com.
Date: | November 26, 2024 | |
Time: | 2:00 p.m. Pacific time / 5:00 p.m. Eastern time | |
Webcast link: | crowdstrike-fiscal-third-quarter-2025-results-conference-call.open-exchange.net/registration |
Forward-Looking Statements
This press release contains forward-looking statements that involve risks and uncertainties, including statements regarding CrowdStrike’s future growth, and future financial and operating performance, including CrowdStrike’s financial outlook for the fourth quarter fiscal 2025, fiscal year 2025, and beyond. There are a significant number of factors that could cause actual results to differ materially from statements made in this press release, including: risks associated with the content configuration update CrowdStrike released on July 19, 2024 for its Falcon sensor that resulted in system crashes for certain Windows systems (the “July 19 Incident”); risks associated with managing CrowdStrike’s rapid growth; CrowdStrike’s ability to identify and effectively implement necessary changes to address execution challenges; risks associated with new products and subscription and support offerings, including the risk of defects, errors, or vulnerabilities; CrowdStrike's ability to respond to an intensely competitive market; length and unpredictability of sales cycles; CrowdStrike’s ability to attract new and retain existing customers; CrowdStrike’s ability to successfully integrate acquisitions; the failure to timely develop and achieve market acceptance of new products and subscriptions as well as existing products and subscriptions and support; CrowdStrike’s ability to collaborate and integrate its products with offerings from other parties to deliver benefits to customers; industry trends; rapidly evolving technological developments in the market for security products and subscription and support offerings; and general market, political, economic, and business conditions, including those related to a deterioration in macroeconomic conditions, inflation, geopolitical uncertainty and conflicts, public health crises, and volatility in the banking and financial services sector.
Additional risks and uncertainties that could affect CrowdStrike’s financial results are included in the filings CrowdStrike makes with the Securities and Exchange Commission (“SEC”) from time to time, particularly under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” including CrowdStrike’s most recently filed Annual Report on Form 10-K, most recently filed Quarterly Report on Form 10-Q, and subsequent filings.
You should not rely on these forward-looking statements, as actual outcomes and results may differ materially from those contemplated by these forward-looking statements as a result of such risks and uncertainties. All forward-looking statements in this press release are based on information available to CrowdStrike as of the date hereof, and CrowdStrike does not assume any obligation to update the forward-looking statements provided to reflect events that occur or circumstances that exist after the date on which they were made.
Use of Non-GAAP Financial Information
CrowdStrike believes that the presentation of non-GAAP financial information provides important supplemental information to management and investors regarding financial and business trends relating to CrowdStrike’s financial condition and results of operations. For further information regarding these non-GAAP measures, including the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures, please refer to the financial tables below, as well as the “Explanation of Non-GAAP Financial Measures” section of this press release.
Channels for Disclosure of Information
CrowdStrike intends to announce material information to the public through the CrowdStrike Investor Relations website ir.crowdstrike.com, SEC filings, press releases, public conference calls, and public webcasts. CrowdStrike uses these channels, as well as social media and its blog, to communicate with its investors, customers, and the public about the company, its offerings, and other issues. It is possible that the information CrowdStrike posts on social media and its blog could be deemed to be material information. As such, CrowdStrike encourages investors, the media, and others to follow the channels listed above, including the social media channels listed on CrowdStrike’s investor relations website, and to review the information disclosed through such channels. Any updates to the list of disclosure channels through which CrowdStrike will announce information will be posted on the investor relations page on CrowdStrike’s website.
Definition of Module Adoption Rates
1. | Module adoption rates are calculated by taking the total number of customers with five or more, six or more, seven or more, and eight or more modules, respectively, divided by the total number of subscription customers (excluding Falcon Go customers). Falcon Go customers are defined as customers who have subscribed with the Falcon Go bundle, a package designed for organizations with 100 endpoints or less. |
Reports Referenced and Disclaimers
2. | Gartner, Magic Quadrant for Endpoint Protection Platforms, Evgeny Mirolyubov, Franz Hinner, 23 September 2024 | |
3. | Gartner, Critical Capabilities for Endpoint Protection Platforms, Evgeny Mirolyubov, Franz Hinner, Satarupa Patnaik, Deepak Mishra, Chris Silva, 28 October 2024 | |
4. | 2024 Frost Radar™: Global Cloud Workload Protection Platform (CWPP) | |
5. | GigaOm Radar for Cloud-Native Application Protection Platforms (CNAPPs), 29 October 2024 | |
6. | The Forrester Wave™: Attack Surface Management Solutions, Q3 2024 | |
7. | IDC MarketScape: Worldwide Security Information and Event Management (SIEM) for Enterprise 2024 Vendor Assessment, September 2024, IDC #US51541324 |
GARTNER is a registered trademark and service mark of Gartner and Magic Quadrant is a registered trademark of Gartner, Inc. and/or its affiliates in the U.S. and internationally and are used herein with permission. All rights reserved. Gartner does not endorse any vendor, product or service depicted in its research publications, and does not advise technology users to select only those vendors with the highest ratings or other designation. Gartner research publications consist of the opinions of Gartner’s research organization and should not be construed as statements of fact. Gartner disclaims all warranties, expressed or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose.
The Gartner content described herein (the “Gartner Content”) represents research opinion or viewpoints published, as part of a syndicated subscription service, by Gartner, Inc. ("Gartner"), and is not a representation of fact. Gartner Content speaks as of its original publication date (and not as of the date of this earnings presentation), and the opinions expressed in the Gartner Content are subject to change without notice.
About CrowdStrike Holdings
CrowdStrike (Nasdaq: CRWD), a global cybersecurity leader, has redefined modern security with the world’s most advanced cloud-native platform for protecting critical areas of enterprise risk – endpoints and cloud workloads, identity, and data.
Powered by the CrowdStrike Security Cloud and world-class AI, the CrowdStrike Falcon® platform leverages real-time indicators of attack, threat intelligence, evolving adversary tradecraft, and enriched telemetry from across the enterprise to deliver hyper-accurate detections, automated protection and remediation, elite threat hunting, and prioritized observability of vulnerabilities.
Purpose-built in the cloud with a single lightweight-agent architecture, the Falcon platform delivers rapid and scalable deployment, superior protection and performance, reduced complexity, and immediate time-to-value.
CrowdStrike: We stop breaches.
For more information, please visit: ir.crowdstrike.com
© 2024 CrowdStrike, Inc. All rights reserved. CrowdStrike and CrowdStrike Falcon are marks owned by CrowdStrike, Inc. and are registered in the United States and other countries. CrowdStrike owns other trademarks and service marks and may use the brands of third parties to identify their products and services.
CROWDSTRIKE HOLDINGS, INC. | ||||||||||||||||
Condensed Consolidated Statements of Operations | ||||||||||||||||
(in thousands, except per share amounts) | ||||||||||||||||
(unaudited) | ||||||||||||||||
| Three Months Ended October 31, |
| Nine Months Ended October 31, | |||||||||||||
| 2024 |
| 2023 |
| 2024 |
| 2023 | |||||||||
Revenue |
|
|
|
|
|
|
| |||||||||
Subscription | $ | 962,735 |
|
| $ | 733,463 |
|
| $ | 2,753,164 |
|
| $ | 2,074,610 |
| |
Professional services |
| 47,443 |
|
|
| 52,551 |
|
|
| 141,922 |
|
|
| 135,610 |
| |
Total revenue |
| 1,010,178 |
|
|
| 786,014 |
|
|
| 2,895,086 |
|
|
| 2,210,220 |
| |
Cost of revenue |
|
|
|
|
|
|
| |||||||||
Subscription (1)(2) |
| 216,301 |
|
|
| 159,830 |
|
|
| 605,868 |
|
|
| 455,236 |
| |
Professional services (1) |
| 38,786 |
|
|
| 35,174 |
|
|
| 111,623 |
|
|
| 91,915 |
| |
Total cost of revenue |
| 255,087 |
|
|
| 195,004 |
|
|
| 717,491 |
|
|
| 547,151 |
| |
|
|
|
|
|
|
|
| |||||||||
Gross profit |
| 755,091 |
|
|
| 591,010 |
|
|
| 2,177,595 |
|
|
| 1,663,069 |
| |
|
|
|
|
|
|
|
| |||||||||
Operating expenses |
|
|
|
|
|
|
| |||||||||
Sales and marketing (1)(2)(4)(6) |
| 408,267 |
|
|
| 286,186 |
|
|
| 1,113,852 |
|
|
| 850,209 |
| |
Research and development (1)(2)(3)(4)(6) |
| 275,602 |
|
|
| 196,072 |
|
|
| 761,759 |
|
|
| 554,499 |
| |
General and administrative (1)(2)(3)(4)(5)(6) |
| 126,945 |
|
|
| 105,589 |
|
|
| 337,113 |
|
|
| 290,027 |
| |
Total operating expenses |
| 810,814 |
|
|
| 587,847 |
|
|
| 2,212,724 |
|
|
| 1,694,735 |
| |
|
|
|
|
|
|
|
| |||||||||
Income (loss) from operations |
| (55,723 | ) |
|
| 3,163 |
|
|
| (35,129 | ) |
|
| (31,666 | ) | |
Interest expense(7) |
| (6,587 | ) |
|
| (6,503 | ) |
|
| (19,647 | ) |
|
| (19,334 | ) | |
Interest income |
| 52,201 |
|
|
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