CrowdStrike CEO George Kurtz speaks on the Wall Street Journal Tech Live conference in Laguna Beach, California, on October 21, 2019.
Martina Albertazzi | Bloomberg |
CrowdStrike Shares fell 4% in prolonged trading on Wednesday after the cybersecurity software maker reported strong second-quarter results but reduced its full-year forecast following a worldwide power outage.
Here’s how the corporate performed in comparison with the LSEG consensus:
- Earnings per share: $1.04 adjusted versus 97 cents expected
- Revenue: $963.9 million versus expected $959 million
CrowdStrike’s revenue rose 32% 12 months over 12 months within the quarter ended July 31, based on a opinionThe company reported net income of $47 million, or 19 cents per share, in comparison with $8.47 million, or 3 cents per share, in the identical quarter last 12 months.
Annual recurring revenue was $3.86 billion, just above the StreetAccount consensus of $3.85 billion.
On July 19, CrowdStrike distributed a faulty content configuration update for its Falcon sensor to computers with Microsoft Windows operating systems, with the intent of gathering data on latest attacks. The bug caused thousands and thousands of computers to crash, leading to flight cancellations, delayed package deliveries, and rescheduled doctor’s appointments. Administrators needed to manually restart affected computers.
CEO George Kurtz apologized to customers and partners and announced that the corporate had implemented an answer. In the meantime, investors pushed down CrowdStrike’s share price. Shareholders have filed suit against the corporate and Delta Air LinesTravelers, which estimated $380 million in lost revenue and $170 million in costs in consequence of the incident, announced it will seek damages. Travelers has also filed class motion lawsuits against CrowdStrike.
“All customers are looking for some kind of discount,” wrote BTIG’s Gray Powell and Trevor Rambo, who rate CrowdStrike shares with a hold advice, in an Aug. 23 note.
In terms of guidance, CrowdStrike forecast adjusted net income of 80 cents to 81 cents per share on revenue of $979.2 million to $984.7 million.
For fiscal 2025, CrowdStrike now expects adjusted earnings per share of $3.61 to $3.65 and revenue of $3.89 billion to $3.90 billion, below management’s June forecast of adjusted earnings per share of $3.93 to $4.03 and revenue of $3.98 billion to $4.01 billion.
The full-year revenue forecast features a negative impact of $30 million in subscription revenue in each quarter and skilled services revenue within the high single-digit thousands and thousands for the second half of the fiscal 12 months as a consequence of incentives for a customer retention package, the statement said. The adjusted forecast excludes costs related to the outage, CrowdStrike said.
“I will always be aware of the magnitude of the July 19 incident, and I will ensure that something like this never happens again,” Kurtz said in a conference call with analysts. “The days following the incident were some of the most difficult of my career because I deeply empathized with what our customers were experiencing.”
Before CrowdStrike released its earnings report, the corporate’s stock had risen about 4% this 12 months, while the S&P 500 index had gained 17% over the identical period.
