Summary
CrowdStrike reported FY2027 first quarter revenue of $1.39 billion, up 25.6% from the prior-year quarter. Gross profit rose 27.9% to $1.04 billion, and gross margin expanded to 75.3%, up 1.4 percentage points. The company posted a GAAP operating loss of $30.6 million, an $88.1 million improvement from the prior-year quarter. Net income was $27.8 million, compared with a loss in the prior-year quarter. Diluted EPS was $0.11, up $0.53 from the prior-year quarter. Operating margin was -2.2%, up 8.6 percentage points from the prior-year quarter. That is the headline: the business is scaling revenue faster than costs, and GAAP profitability has arrived.
Cash generation was a clear strength. Operating cash flow, a GAAP measure, was $590.9 million, up 53.8%. Capital expenditures were $97.6 million, up 13.8%. Free cash flow, a non-GAAP measure, was $468.5 million, compared with $279.4 million in the prior-year quarter. Deferred revenue rose 25.2% to $4.72 billion. Remaining performance obligations rose 29.4% to $8.80 billion. Those forward-looking metrics suggest the demand pipeline remains solid. Annual recurring revenue reached $5.51 billion, up 24% year over year. Net new ARR was $255.8 million, a Q1 record. Module adoption rates were 51% for six or more modules, 35% for seven or more, and 25% for eight or more as of April 30, 2026.
Non-GAAP results show the same direction. Non-GAAP income from operations was $325.7 million, compared with $201.1 million in the prior-year quarter. Non-GAAP net income attributable to CrowdStrike was $283.4 million, compared with $184.7 million. Non-GAAP diluted EPS was $1.10, compared with $0.73. The company also announced a four-for-one stock split, with trading expected to begin on a split-adjusted basis on July 2, 2026. Management tied the quarter to AI security demand, pointing to Project QuiltWorks with OpenAI and Anthropic, the Charlotte AI AgentWorks Ecosystem with AWS, NVIDIA, and OpenAI, and Agentic MDR. CrowdStrike expanded FedRAMP High authorization, launched Falcon Data Security, and formed partnerships with IBM, Intel, and Schwarz Digits.
Guidance was raised. For the second quarter of fiscal 2027, CrowdStrike guided non-GAAP income from operations to $345.6 million to $349.1 million, non-GAAP net income attributable to CrowdStrike to $300.7 million to $303.4 million, and non-GAAP diluted EPS to $1.16 to $1.17. For the full fiscal year 2027, the company guided non-GAAP income from operations to $1,452.3 million to $1,480.3 million, non-GAAP net income to $1,263.1 million to $1,285.2 million, and non-GAAP diluted EPS to $4.88 to $4.96. ARR guidance is $5,792.6 million to $5,794.6 million for the second quarter and $6,531.7 million to $6,555.5 million for the full fiscal year. The company raised its FY27 net new ARR growth guidance by 520 basis points at the midpoint, to 27.7% at the midpoint.
Risks remain. The July 19 Incident continues to drive legal and professional services expenses. Management said the incident has caused delays in creating sales opportunities, longer sales cycles, and delays in customer purchasing decisions. Customer commitment packages have led to increased contraction, elongated subscription terms, and decreased upsell dollar values. Those factors could pressure future metrics. The company also faces intense competition, execution challenges from rapid growth, and integration risk from acquisitions. CrowdStrike completed the Seraphic and SGNL acquisitions during the quarter. It had purchase commitments of $2.6 billion as of April 30, 2026, with remaining terms in excess of 12 months. Backlog was approximately $4.0 billion as of April 30, 2026. The quarter was strong, but the risk list is not short.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q1 FY2027 | Q4 FY2026 | QoQ | Q1 FY2026 | YoY |
|---|---|---|---|---|---|
| Revenue | $1.39B | $1.31B | +6.1% | $1.10B | +25.6% |
| Gross profit | $1.04B | $993.7M | +5.0% | $814.3M | +28.1% |
| Gross margin | 75.3% | 76.1% | -0.8 pp | 73.8% | +1.5 pp |
| Research & development | $408.3M | $356.4M | +14.6% | $334.1M | +22.2% |
| Sales & marketing | $488.7M | $463.6M | +5.4% | $439.6M | +11.2% |
| General & administrative | $177.0M | $159.9M | +10.7% | $165.2M | +7.1% |
| Total operating expenses | $1.07B | $979.9M | +9.6% | $938.9M | +14.4% |
| Operating income (loss) | -$30.6M | $13.8M | -322.0% | -$124.7M | +75.5% |
| Operating margin | -2.2% | 1.1% | -3.3 pp | -11.3% | +9.1 pp |
| Net income (loss) | $46.0M | $61.5M | -25.2% | -$111.0M | +141.4% |
| Net margin | 3.3% | 4.7% | -1.4 pp | -10.1% | +13.4 pp |
| Diluted EPS | $0.11 | $0.25 | -$0.14 | -$0.44 | +$0.55 |
Risks
The July 19 Incident continues to adversely affect business, sales, customer and partner relations, reputation, and financial condition. MD&A states it caused delays in creating sales opportunities and longer sales cycles, including delays in customer purchasing decisions, and that sales cycles may be elongated in future periods.
The company is party to securities litigation, derivative litigation, and consumer class actions related to the July 19 Incident, and has received governmental inquiries. Authorities may impose undertakings, injunctive relief, consent decrees, or penalties, and the company cannot reasonably estimate the possible loss or range of loss.
Customer commitment packages introduced after the July 19 Incident have included discounting, additional modules, professional services, flexible payment terms, or subscription period extensions. MD&A states these have resulted, and are expected to continue to result, in increased contraction due to elongated subscription terms and decreased upsell dollar values.
Sales cycles are long and unpredictable, especially for large enterprises and government entities, and revenue recognition is difficult to predict. The filing states the July 19 Incident has caused longer sales cycles and delays in customer purchasing decisions, with further elongation possible in future periods.
Customers have no obligation to renew subscriptions after terms of generally one to three years, and may renew for shorter periods, fewer cloud modules, fewer endpoints, or smaller contract values. MD&A also notes that if customers do not fully utilize subscriptions, including under Falcon Flex, contraction may increase.
The market is intensely competitive and fragmented across legacy antivirus, alternative endpoint, network security, cloud security, identity security, professional services, and SIEM vendors. Many competitors have greater resources and broader offerings, which may result in price reductions, fewer orders, reduced revenue and gross margins, and loss of market share.
The cybersecurity market is changing rapidly due to AI, and competitors may more successfully incorporate AI into their products, gain or leverage superior access to AI technologies, and achieve higher market acceptance of AI solutions. This could weaken CrowdStrike's competitive position and revenue growth.
Future success depends on attracting, retaining, and motivating key technical, sales, and management personnel, including CEO George Kurtz. Competition for cybersecurity, cloud, and sales talent is intense, and stock price volatility or vesting of equity awards may impair retention.
The Falcon platform relies on third-party data centers, primarily AWS, and company colocation facilities. Service interruptions, capacity constraints, renegotiation or termination of AWS arrangements on less favorable terms, or failure of redundancy and disaster recovery could harm customer trust and results.
The company has experienced rapid revenue growth and expects continued broad investment. If it fails to effectively attract and integrate employees, improve the Falcon platform, expand infrastructure, or enhance systems and controls, growth management could impair platform quality and competitive position.
Tax obligations may increase due to the One Big Beautiful Bill Act, OECD Pillar Two global minimum tax, and existing or proposed digital services taxes. These changes could adversely affect the provision for income taxes, net income, and cash flows.
The Senior Notes indenture contains restrictive covenants and debt service obligations. If cash flows are insufficient or the company breaches covenants, it could face liquidity problems, default, acceleration of principal and interest, or inability to refinance on favorable terms.
International customers represented approximately 34% of total revenue for the three months ended April 30, 2026. International operations expose the company to currency fluctuations, tax and regulatory changes, data localization requirements, trade restrictions, and geopolitical instability.
Future growth depends in part on sales to government organizations, which are subject to budgetary uncertainty, long sales cycles, evolving certification and supply chain requirements, audits, bid protests, and political changes. Failure to maintain certifications such as FedRAMP would restrict government sales.
SaaS KPIs
All quarters →Free Cash Flow Margin
Non-GAAP Operating Margin
Net New ARR
Free Cash Flow
Annual Recurring Revenue (ARR)
Backlog
Summary, forecast, risks and KPIs are extracted from CrowdStrike Holdings, Inc.'s SEC filings for Q1 FY2027 (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.