Key Takeaways:
- Revenue rose 26% to $1.47 billion, beating consensus
- ARR climbed 25% to $5.84 billion as of July 31
- Shares jumped more than 10% after hours on record quarter
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CrowdStrike shares soar 10% after record Q2 revenue of $1.47 billion
CrowdStrike reported fiscal second-quarter revenue of $1.47 billion, up 26% year over year, in what Chief Executive George Kurtz called the company's best quarter ever.
"The Mythos moment translated into mass-market acceptance that AI adoption needs security," Kurtz said in a statement. "Every enterprise will run on AI, and securing it is the largest market opportunity in our history."
Net income came in at $322.9 million, up from $237.4 million a year earlier and above the $302 million FactSet consensus. Annual recurring revenue grew 25% from a year earlier to $5.84 billion as of July 31, while the company posted record free cash flow and new net ARR, according to Chief Financial Officer Burt Podbere.
The results were driven by demand for AI security after Anthropic introduced Claude Mythos, an AI model designed to find and exploit software vulnerabilities. Concerns over such models have pushed cybersecurity to the center of enterprise technology spending, benefiting CrowdStrike's Falcon platform, which uses machine learning to detect threats across endpoints, identity and data. The Falcon Flex subscription model, which lets customers adopt new modules without separate contracts, has accelerated platform consolidation, with accounts using Flex representing nearly $2 billion in ending ARR in the prior quarter.
Shares rose more than 10% in after-hours trading Wednesday, extending a gain of more than 60% so far this year. The stock has climbed 83.3% over the past 12 months, outpacing the Zacks Security industry's 71.3% advance and peers including Qualys, Okta and Check Point Software. The rally has pushed CrowdStrike's forward price-to-sales multiple to 29.4 times, well above the industry's 17.2 times.
For the fiscal third quarter, CrowdStrike guided to annual recurring revenue of up to $6.19 billion, above the $5.79 billion analysts expected, according to FactSet. The company also raised its full-year fiscal 2027 forecast for ARR and total revenue.
The guidance raise points to management's expectation that AI-driven security demand will accelerate. Investors will watch the fiscal third-quarter earnings call in late November for updated margins as CrowdStrike steps up research and development and sales spending.
This article is for informational purposes only and does not constitute investment advice.
