Shares Of Crowdstrike Tumble As Revenue Slows

CrowdStrike, the cybersecurity firm, released its first-quarter earnings results for fiscal year 2024 on Wednesday, surpassing consensus estimates for both revenue and earnings. However, the company's shares experienced a decline of over 11% in after-hours trading due to a slowdown in revenue growth.

‍

For the quarter ending April 30, CrowdStrike reported adjusted earnings per share of 57 cents, exceeding the expected 51 cents. The company's revenue reached $692.6 million, surpassing the estimated $676.4 million.

‍

Although CrowdStrike achieved a year-over-year revenue increase of 42%, it was slower compared to the 61% growth reported in the same quarter last year. The company also achieved a profit of $500,000, or breakeven per share, in contrast to the $31.5 million loss, or 14 cents per share, from a year ago.

‍

For the current quarter, CrowdStrike provided guidance of $717.2 million to $727.4 million in revenue, compared to a consensus range of $698 million to $742 million.

‍

During an investor call, CEO George Kurtz expressed satisfaction with exceeding the guidance in both revenue and earnings, highlighting the achievement of GAAP profitability early in the company's existence as a public entity. Kurtz also emphasized CrowdStrike's use of generative artificial intelligence models, considering it a democratizing force in cybersecurity.

‍

Chief Financial Officer Burt Podbere noted that the company's slower hiring contributed to its profitability, but it remained uncertain whether this level of profitability could be sustained as hiring increased.

‍

CrowdStrike's annual recurring revenue for the quarter reached $2.73 billion, reflecting a 42% year-over-year increase. However, net new annual recurring revenue was $174.2 million for the quarter, down from $190.5 million in the same quarter last year.

‍

CrowdStrike offers a comprehensive portfolio of cloud-based cybersecurity solutions, covering various aspects from corporate servers to employee laptops and Internet of Things devices.

‍

With the escalating tensions in cross-strait relations, cybersecurity concerns have gained significant attention from investors and the general public. Recent warnings from Microsoft about state-sponsored cyber attackers infiltrating critical infrastructure in the U.S. and Guam have further emphasized the importance of cybersecurity. CrowdStrike researchers have contributed to efforts in understanding and defending against these threats, collaborating on a National Security Agency bulletin related to the attack. Public-private partnerships have been highlighted as essential in addressing cybersecurity challenges.

‍

‍