Shares in CrowdStrike Holdings jumped on Thursday on January-quarter profit and revenue that handily beat estimates and fiscal 2023 guidance for CRWD stock that came in well above expectations. CrowdStrike reported fourth-quarter earnings after the market close on Wednesday.
Shares of Sunnyvale, Calif.-based CrowdStrike popped 12.5% to close at 191.02 on the stock market today.
CrowdStrike earnings came in at 30 cents a share, up 130% from a year earlier, on an adjusted basis. Also, revenue jumped 63% to $431 million. Analysts had projected CrowdStrike earnings of 20 cents on revenue of $411 million for the period ended Jan. 31.
A year earlier, the cybersecurity firm earned 13 cents a share on revenue of $265 million.
Key Financial Metric For CRWD Stock
Wall Street also focuses on annual recurring revenue, or ARR. It's a financial metric tied to subscription customer growth.
During the quarter, ARR increased 65% to $1.73 billion. That also topped estimates for 60% growth to $1.683 billion. From new customers, ARR rose to $217 million, topping estimates of $169 million.
"CrowdStrike reported arguably one of the strongest quarters ever, with net new ARR of $217 million," Wells Fargo analyst Andrew Nowinski said in a note to clients. "Management provided more transparency with regard to the components of ARR, reporting $106 million in ARR from Falcon deployments in the public cloud and $157 million in ARR from non-endpoint solutions. Finally, management said they have the strongest pipeline ever for Q1, setting the stage for another potential 50%-plus growth year."
For fiscal 2023, management forecast earnings of $1.08 per share and revenue in a range of $2.13 billion to $2.16 billion for CRWD stock. Further, analysts had projected earnings of 90 cents on revenue of $2 billion.
CrowdStrike Guidance Tops Wall Street Targets
"While we believe there is a fair bit of prudence in the (operating margin) guidance this also reflects increased go to market and R&D investments as CRWD looks to use its scale as a weapon and broaden its platform before any other next-gen endpoint vendors can catch it," Jefferies analyst Brent Thill said in a note.
Heading into the CrowdStrike earnings report, the cybersecurity stock had retreated 17% in 2022. It also owned a Relative Strength Rating of only 23 out of a best-possible 99, according to IBD Stock checkup.
The cybersecurity company uses machine learning, one form of artificial intelligence. It also uses a specialized database to detect malware on laptops, mobile phones and other devices that access corporate networks.
Also, CrowdStrike is building a broad, threat-detection cybersecurity platform. Called XDR, or extended detection and response, it monitors endpoints as well as web/email gateways, web application firewalls and cloud business workloads.
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Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on 5G wireless, artificial intelligence, cybersecurity and cloud computing.
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