By Rizwan Sayed
INDIA: CrowdStrike Holdings, a global cybersecurity leader, has announced its financial results for the second quarter of fiscal year 2024, ending July 31, 2023. The company reported a 37% YoY increase in total revenue, reaching $731.6 million, with subscription revenue growing by 36% YoY to $690.0 million. CrowdStrike’s Annual Recurring Revenue (ARR) also increased by 37% YoY to $2.93 billion. The company’s GAAP subscription gross margin was 78%, while non-GAAP subscription gross margin was 80%. CrowdStrike’s CEO, George Kurtz, attributed the strong growth to the AI-powered Falcon platform’s unique capabilities across cloud, identity, and next-gen SIEM businesses. The company also achieved new milestones for both GAAP and non-GAAP profitability in the second quarter.
CrowdStrike’s module adoption rates increased to 63%, 41%, and 24% for five or more, six or more, and seven or more modules, respectively, as of July 31, 2023. The company was also named the 2023 US ISV Partner of the Year by Amazon Web Services (AWS) and recognized as a cloud security leader in Frost & Sullivan’s 2023 Frost RadarTM: Cloud Workload Protection Platform. CrowdStrike was also named a Customers’ Choice in the 2023 Gartner Peer InsightsTM Voice of the Customer for Managed Detection and Response Service report and a leader in The Forrester WaveTM: External Threat Intelligence Service Providers, Q3 2023 report.
In addition, CrowdStrike received the Best Enterprise Security Solution and Best Managed Detection and Response Service awards in the 2023 SC Awards and the Best Endpoint Security award in the SC Awards Europe 2023. The company also unveiled new Falcon Cloud Security innovations, including ‘1-Click XDR’ to automatically identify and secure unmanaged cloud assets, and launched CrowdStrike Counter Adversary Operations, bringing together market-leading threat intelligence, threat hunters, and artificial intelligence.
Overall, CrowdStrike’s strong Q2 FY2024 results demonstrate the company’s continued growth and success in the cybersecurity market.
“CrowdStrike delivered strong growth at scale, exceeding our guidance across both top and bottom line metrics in the second quarter,” said George Kurtz, CrowdStrike’s president, chief executive officer, and co-founder. “The AI-powered Falcon platform’s native capabilities across our cloud, identity, and next-gen SIEM businesses are unique in the market, in aggregate contributing well over half a billion dollars in ending ARR. Our platform strategy sets us apart from the competition, resulting in high win rates as customers rapidly embrace Falcon to consolidate vendors, lower TCO, and achieve better security outcomes.”
Commenting on the company’s financial results, Burt Podbere, CrowdStrike’s chief financial officer, added, “Our relentless focus on execution and operational excellence drove strong profitable growth at scale and new milestones for both GAAP and non-GAAP profitability in the second quarter. We achieved our target model range for non-GAAP operating margin for the first time in company history, well ahead of our planned timeline, and now expect to exit the year with a fourth-quarter non-GAAP operating margin within our target model. Beyond fiscal 2024, we expect to sustainably deliver non-GAAP operating margin within the target model on an annual basis.”
Second Quarter Fiscal 2024 Financial Highlights
- Revenue: Total revenue was $731.6 million, a 37% increase, compared to $535.2 million in the second quarter of fiscal 2023. Subscription revenue was $690.0 million, a 36% increase, compared to $506.2 million in the second quarter of fiscal 2023.
- Annual Recurring Revenue (ARR) increased 37% year-over-year and grew to $2.93 billion as of July 31, 2023, of which $196.2 million was net new ARR added in the quarter.
- Subscription Gross Margin: GAAP subscription gross margin was 78%, compared to 76% in the second quarter of fiscal 2023. Non-GAAP subscription gross margin was 80%, compared to 78% in the second quarter of fiscal 2023.
- Income/Loss from Operations: GAAP loss from operations was $15.4 million, compared to $48.3 million in the second quarter of fiscal 2023. Non-GAAP income from operations was $155.7 million, compared to $87.3 million in the second quarter of fiscal 2023.
- Net Income/Loss Attributable to CrowdStrike: GAAP net income attributable to CrowdStrike was $8.5 million, compared to a loss of $49.3 million in the second quarter of fiscal 2023. GAAP net income per share attributable to CrowdStrike, diluted, was $0.03, compared to a loss of $0.21 in the second quarter of fiscal 2023. Non-GAAP net income attributable to CrowdStrike was $180.0 million, compared to $85.9 million in the second quarter of fiscal 2023. Non-GAAP net income attributable to CrowdStrike per share, diluted, was $0.74, compared to $0.36 in the second quarter of fiscal 2023.
- Cash Flow: Net cash generated from operations was $244.8 million, compared to $209.9 million in the second quarter of fiscal 2023. Free cash flow was $188.7 million, compared to $135.8 million in the second quarter of fiscal 2023.
- Cash and Cash Equivalents were $3.17 billion as of July 31, 2023.
Recent Highlights
- CrowdStrike’s module adoption rates increased to 63%, 41%, and 24% for five or more, six or more, and seven or more modules, respectively, as of July 31, 20231.
- Received the 2023 US ISV Partner of the Year award from Amazon Web Services (AWS).
- Named a cloud security leader in Frost & Sullivan’s 2023 Frost Radar™: Cloud Workload Protection Platform2.
- Recognized as a Customer’s choice in the 2023 Gartner Peer Insights™ Voice of the Customer for Managed Detection and Response Service report3.
- Named a leader in The Forrester Wave™: External Threat Intelligence Service Providers, Q3 2023 report4.
- Recognized as the Best Enterprise Security Solution and Best Managed Detection and Response Service in the 2023 SC Awards and Best Endpoint Security winner in the SC Awards Europe 2023.
- Announced that CrowdStrike Falcon® Identity Protection won the 2023 CRN Tech Innovator award as the best solution in the Identity and Access Management category.
- Received highest level certification in Spanish National Cryptologic Center (CCN) STIC Products and Services Catalog (CPSTIC).
- Unveiled new Falcon Cloud Security innovations, including ‘1-Click XDR’ to automatically identify and secure unmanaged cloud assets.
- Announced the launch of CrowdStrike Counter Adversary Operations, bringing together market-leading threat intelligence, threat hunters, and artificial intelligence.
- Released the CrowdStrike 2023 Threat Hunting Report, which revealed a massive increase in identity-based intrusions and growing expertise by adversaries targeting the cloud.
