Summary
CrowdStrike closed the first quarter of fiscal 2024 with revenue of $692.6 million, up 42% from $487.8 million a year earlier. The company swung to a GAAP profit, posting net income attributable to CrowdStrike of $0.5 million against a loss of $31.5 million in the prior-year quarter. Diluted earnings per share was $0.00, compared with a loss of $0.14. The operating loss narrowed to $19.5 million from $23.9 million. Interest income of $30.5 million helped push the company into a small profit, and that line compares with $1.5 million a year ago.
Gross profit rose 45% to $523.3 million. Total gross margin improved to 75.6% from 74.0%. Management pointed to a record non-GAAP subscription gross margin of 80% and non-GAAP professional services gross margin of 46% versus 43%. The GAAP operating margin was -2.8%, better than -4.9% in the prior-year quarter, though the company still runs at a loss on that basis. Stock-based compensation of $130.9 million remains the biggest gap between GAAP and non-GAAP results. Non-GAAP income from operations was $115.9 million versus $83.0 million. Non-GAAP net income attributable to CrowdStrike was $136.4 million versus $74.8 million, and non-GAAP diluted earnings per share was $0.57 versus $0.31.
Annual recurring revenue climbed 42% year over year to $2.73 billion as of April 30, 2023, with $174.2 million of net new ARR added in the quarter. Module adoption keeps deepening. Some 62% of subscription customers run five or more modules, 40% run six or more, and 23% run seven or more. The dollar-based net retention rate held above 120%. New products included Charlotte AI, a generative AI security analyst, plus Falcon Complete XDR and Falcon Insight for IoT. The company also announced a partnership with Abnormal Security and an expanded Google tie-up for a native endpoint detection and response offering on ChromeOS.
Operating cash flow came in at $300.9 million, up from $215.0 million. Capital expenditures rose to $62.3 million from $52.2 million, and free cash flow, a non-GAAP measure, reached $227.4 million versus $157.5 million. Deferred revenue was $2.4 billion, up 42% year over year, and remaining performance obligations stood at $3.3 billion, up 37.5%. Cash, cash equivalents and short-term investments totaled $2.93 billion. Backlog was roughly $912.0 million, and headcount reached 7,321 full-time employees.
Guidance points to more of the same. For the second quarter of fiscal 2024, CrowdStrike guided non-GAAP income from operations to $116.4 million to $123.8 million and non-GAAP net income attributable to CrowdStrike to $129.5 million to $137.0 million. Non-GAAP diluted net income per share is guided to $0.54 to $0.57 for the second quarter. For the full fiscal year 2024, the company guided non-GAAP income from operations to $498.9 million to $526.2 million, non-GAAP net income attributable to CrowdStrike to $562.8 million to $590.1 million, and non-GAAP diluted net income per share to $2.32 to $2.43. It did not provide the most directly comparable GAAP measures because certain items are out of its control or cannot be reasonably predicted.
The quarter carried a long list of risk disclosures. CrowdStrike flagged the difficulties of managing rapid growth and execution challenges, the risks tied to new product introductions such as defects, errors or vulnerabilities, and the length and unpredictability of sales cycles. Wider macro factors include a possible deterioration in economic conditions, inflation, geopolitical uncertainty, public health crises, and volatility in the banking and financial services sector. The company carries an accumulated deficit of $1.1 billion and expects to keep incurring operating losses as it invests in sales, marketing and research. Non-cancelable data center commitments totaled $265.0 million, purchase commitments reached $94.5 million, and the company has used $366.9 million of a $600.0 million AWS commitment. Management said its cash, short-term investments, operating cash flows, and a $750.0 million senior secured revolving credit facility should cover its needs for at least the next 12 months.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q1 FY2024 | Q4 FY2023 | QoQ | Q1 FY2023 | YoY |
|---|---|---|---|---|---|
| Revenue | $692.6M | $637.4M | +8.7% | $487.8M | +42.0% |
| Gross profit | $523.4M | $461.8M | +13.3% | $361.0M | +45.0% |
| Gross margin | 75.6% | 72.5% | +3.1 pp | 74.0% | +1.6 pp |
| Research & development | $179.1M | $191.8M | -6.7% | $123.4M | +45.1% |
| Sales & marketing | $281.1M | $246.4M | +14.1% | $193.5M | +45.3% |
| General & administrative | $82.6M | $85.0M | -2.8% | $68.0M | +21.6% |
| Total operating expenses | $542.8M | $523.3M | +3.7% | $384.9M | +41.0% |
| Operating income (loss) | -$19.5M | -$61.5M | +68.4% | -$23.9M | +18.5% |
| Operating margin | -2.8% | -9.7% | +6.8 pp | -4.9% | +2.1 pp |
| Net income (loss) | $499.0K | -$48.9M | +101.0% | -$30.4M | +101.6% |
| Net margin | 0.1% | -7.7% | +7.8 pp | -6.2% | +6.3 pp |
| Diluted EPS | $0.00 | -$0.21 | +$0.21 | -$0.14 | +$0.14 |
| Net retention rate | 120.0% | 120.0% | ±0.0 pp | 120.0% | ±0.0 pp |
Risks
Risk Factors cite volatile financial markets, bank failures, inflation, rising interest rates, supply chain challenges, and political turmoil that may cause customers to delay or cut security and IT operations spending, lengthen sales cycles, increase churn, and reduce demand. The text notes such pressures may fall disproportionately on cloud-based security solutions like CrowdStrike's, and specifically references the March 2023 Silicon Valley Bank failure as a lender under its credit agreement.
Risk Factors state rapid revenue growth may not be sustained. MD&A reports ARR year-over-year growth was 42% as of April 30, 2023 and 61% as of April 30, 2022, while net new ARR added for the three months ended April 30, 2023 was $174.2 million versus $190.5 million for the prior-year period.
Risk Factors describe intense competition from legacy antivirus providers, alternative endpoint security providers, network security vendors, and professional service providers, many with greater financial, technical, and sales resources. Competitive pricing pressure and bundling by larger competitors could reduce gross profits, margins, and market share.
Risk Factors state the sales cycle for the Falcon platform is long and unpredictable, especially with large enterprises and government entities, and uncertain economic conditions have led to additional budget scrutiny and longer sales cycles. MD&A notes revenue recognition is difficult to predict because of the length and unpredictability of the sales cycle.
MD&A states the dollar-based net retention rate was above 120% as of April 30, 2023, but notes success landing bigger deals with more modules and accelerating new customer acquisition create a natural trade off that may reduce the ability to expand business with existing customers in the near term. Risk Factors also warn customers have no obligation to renew and may renew for shorter terms.
Risk Factors state the vast majority of Falcon platform sales flow through channel partners, and the loss of a substantial number of partners or failure to train and motivate them could limit CrowdStrike's ability to market, sell, and distribute its platform.
Risk Factors state international customers accounted for approximately 31% of total revenue for the three months ended April 30, 2023, and approximately 30% for fiscal 2023, exposing CrowdStrike to regulatory, tax, foreign exchange, localization, and collection risks as it expands internationally.
Risk Factors emphasize dependence on key technical, sales, and management personnel, particularly President and CEO George Kurtz, and note intense competition for cybersecurity and cloud software engineers and experienced sales professionals. MD&A states headcount was 7,321 full-time employees as of April 30, 2023, increasing integration and retention demands.
Risk Factors state CrowdStrike had $750.0 million principal amount of indebtedness outstanding as of April 30, 2023, with restrictive covenants under its revolving facility and Senior Notes indenture, cross-default provisions, and variable-rate interest exposure that could limit operations or financing flexibility.
Risk Factors note growth depends in part on increasing sales to government organizations, which face unpredictable budgets, long sales cycles, FedRAMP certification maintenance costs, audits, and procurement disputes. Loss of FedRAMP certification would restrict sales to government customers.
MD&A describes Falcon Funds investments in early to late stage private companies. Risk Factors warn the capital markets for public offerings and acquisitions are dynamic, valuations of non-marketable equity investments are complex, and CrowdStrike could lose all or a substantial part of its investment or experience volatility in results.
MD&A states net new ARR generation is typically greater in the second half of the fiscal year, particularly the fourth quarter, and operating margin is typically lower in the first half due to payroll taxes, new hires, and annual sales and marketing events, which affects timing of operating cash flow.
SaaS KPIs
All quarters →Free Cash Flow Margin
Non-GAAP Operating Margin
Net New ARR
Annual Recurring Revenue (ARR)
Non-GAAP Subscription Gross Margin
Backlog
Dollar-Based Net Retention Rate
Module Adoption Rate (6+ modules)
Module Adoption Rate (7+ modules)
Module Adoption Rate (5+ modules)
Summary, forecast, risks and KPIs are extracted from CrowdStrike Holdings, Inc.'s SEC filings for Q1 FY2024 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 2, 2026.