CrowdStrike Reports Second Quarter Fiscal Year 2024 Financial Results
- Achieves GAAP profitability for the second sequential quarter and delivers record non-GAAP net income
- Ending ARR grows 37% year-over-year to reach
$2.93 billion , adding$196 million in net new ARR - Delivers record Q2 cash flow from operations of
$245 million and record Q2 free cash flow of$189 million
“CrowdStrike delivered strong growth at scale, exceeding our guidance across both top and bottom line metrics in the second quarter,” said
Commenting on the company's financial results,
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 ofJuly 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 toCrowdStrike 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 toCrowdStrike , diluted, was$0.03 , compared to a loss of$0.21 in the second quarter of fiscal 2023. Non-GAAP net income attributable toCrowdStrike was$180.0 million , compared to$85.9 million in the second quarter of fiscal 2023. Non-GAAP net income attributable toCrowdStrike 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 was
$3.17 billion as ofJuly 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, 2023 1.
- 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 Customers’ 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.
Financial Outlook
Guidance for non-GAAP financial measures excludes stock-based compensation expense, amortization expense of acquired intangible assets (including purchased patents), amortization of debt issuance costs and discount, mark-to-market adjustments on deferred compensation liabilities, legal reserve and settlement charges or benefits, losses (gains) and other income from strategic investments, acquisition-related expenses (credits), net, and losses (gains) from deferred compensation assets. The company has not provided the most directly comparable GAAP measures because certain items are out of the company's control or cannot be reasonably predicted. Accordingly, a reconciliation for non-GAAP income from operations, non-GAAP net income attributable to
|
|
Q3 FY24 Guidance |
|
Full Year FY24 Guidance |
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Total revenue |
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|
|
|
Non-GAAP income from operations |
|
|
|
|
Non-GAAP net income attributable to |
|
|
|
|
Non-GAAP net income per share attributable to |
|
|
|
|
Weighted average shares used in computing Non-GAAP net income per share attributable to common stockholders, diluted |
244 million |
|
243 million |
These statements are forward-looking and actual results may differ materially as a result of many factors. Refer to the Forward-Looking Statements safe harbor below for information on the factors that could cause the company's actual results to differ materially from these forward-looking statements.
Conference Call Information
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Time: |
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Pre-registration link for dial-in access: |
register.vevent.com/register/BI3592a7206f534543a68aa46399f9c6c8 |
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Webcast: |
Forward-Looking Statements
This press release contains forward-looking statements that involve risks and uncertainties, including statements regarding CrowdStrike’s future growth, and future financial and operating performance, including CrowdStrike’s financial outlook for the third quarter fiscal 2024, fiscal year 2024, and beyond. There are a significant number of factors that could cause actual results to differ materially from statements made in this press release, including: risks associated with managing CrowdStrike’s rapid growth; CrowdStrike’s ability to identify and effectively implement necessary changes to address execution challenges; CrowdStrike’s limited experience with new product and subscription and support introductions and the risks associated with new products and subscription and support offerings, including the risk of defects, errors, or vulnerabilities;
Additional risks and uncertainties that could affect CrowdStrike’s financial results are included in the filings
You should not rely on these forward-looking statements, as actual outcomes and results may differ materially from those contemplated by these forward-looking statements as a result of such risks and uncertainties. All forward-looking statements in this press release are based on information available to
Use of Non-GAAP Financial Information
Channels for Disclosure of Information
Definition of Module Adoption Rates
1. Beginning in the fourth quarter of fiscal 2023, module adoption rates are calculated by taking the total number of customers with five or more, six or more, and seven or more modules, respectively, divided by the total number of subscription customers (excluding Falcon Go customers). Falcon Go customers are defined as customers who have subscribed with the Falcon Go bundle, a package designed for organizations with 100 endpoints or less.
Reports Referenced and Disclaimers
2. Frost & Sullivan Frost Radar™: Cloud Workload Protection Platform, 2023
3. Gartner, Voice of the Customer for Managed Detection and Response Services, Peer Contributors,
4. The Forrester Wave™: External Threat Intelligence Service Providers, Q3 2023
Gartner and Peer Insights™ are trademarks of Gartner, Inc. and/or its affiliates. All rights reserved.
Gartner Peer Insights content consists of the opinions of individual end users based on their own experiences, and should not be construed as statements of fact, nor do they represent the views of Gartner or its affiliates. Gartner does not endorse any vendor, product or service depicted in this content nor makes any warranties, expressed or implied, with respect to this content, about its accuracy or completeness, including any warranties of merchantability or fitness for a particular purpose.
The Gartner content described herein, (the "Gartner Content") represent(s) research opinion or viewpoints published, as part of a syndicated subscription service, by Gartner, Inc. ("Gartner"), and are not representations of fact. Gartner Content speaks as of its original publication date (and not as of the date of this press release) and the opinions expressed in the Gartner Content are subject to change without notice.
About
Powered by the CrowdStrike Security Cloud and advanced artificial intelligence, the CrowdStrike Falcon® platform delivers better outcomes to customers through rapid and scalable deployment, superior protection and performance, reduced complexity and immediate time-to-value.
CrowdStrike Falcon leverages a single lightweight-agent architecture with integrated cloud modules spanning multiple security markets, including corporate workload security, managed security services, security and vulnerability management, IT operations management, threat intelligence services, identity protection and log management.
For more information, please visit: ir.crowdstrike.com.
|
Condensed Consolidated Statements of Operations (in thousands, except per share amounts) (unaudited) |
|||||||||||||||
|
|
Three Months Ended |
|
Six Months Ended |
||||||||||||
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||||||
|
Revenue |
|
|
|
|
|
|
|
||||||||
|
Subscription |
$ |
689,972 |
|
|
$ |
506,199 |
|
|
$ |
1,341,147 |
|
|
$ |
966,021 |
|
|
Professional services |
|
41,654 |
|
|
|
28,954 |
|
|
|
83,059 |
|
|
|
56,966 |
|
|
Total revenue |
|
731,626 |
|
|
|
535,153 |
|
|
|
1,424,206 |
|
|
|
1,022,987 |
|
|
Cost of revenue |
|
|
|
|
|
|
|
||||||||
|
Subscription (1)(2) |
|
153,306 |
|
|
|
120,087 |
|
|
|
295,406 |
|
|
|
228,029 |
|
|
Professional services (1) |
|
29,611 |
|
|
|
20,480 |
|
|
|
56,741 |
|
|
|
39,370 |
|
|
Total cost of revenue |
|
182,917 |
|
|
|
140,567 |
|
|
|
352,147 |
|
|
|
267,399 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
Gross profit |
|
548,709 |
|
|
|
394,586 |
|
|
|
1,072,059 |
|
|
|
755,588 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
Operating expenses |
|
|
|
|
|
|
|
||||||||
|
Sales and marketing (1)(2)(4) |
|
282,916 |
|
|
|
224,766 |
|
|
|
564,023 |
|
|
|
418,298 |
|
|
Research and development (1)(3)(4) |
|
179,362 |
|
|
|
137,864 |
|
|
|
358,427 |
|
|
|
261,263 |
|
|
General and administrative (1)(2)(3)(4)(5) |
|
101,804 |
|
|
|
80,263 |
|
|
|
184,438 |
|
|
|
148,217 |
|
|
Total operating expenses |
|
564,082 |
|
|
|
442,893 |
|
|
|
1,106,888 |
|
|
|
827,778 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
Loss from operations |
|
(15,373 |
) |
|
|
(48,307 |
) |
|
|
(34,829 |
) |
|
|
(72,190 |
) |
|
Interest expense(6) |
|
(6,444 |
) |
|
|
(6,335 |
) |
|
|
(12,831 |
) |
|
|
(12,633 |
) |
|
Interest income |
|
36,638 |
|
|
|
7,727 |
|
|
|
67,159 |
|
|
|
9,234 |
|
|
Other income (expense)(7)(8) |
|
(1,734 |
) |
|
|
3,380 |
|
|
|
(1,504 |
) |
|
|
5,085 |
|
|
Income (loss) before provision for income taxes |
|
13,087 |
|
|
|
(43,535 |
) |
|
|
17,995 |
|
|
|
(70,504 |
) |
|
Provision for income taxes |
|
4,611 |
|
|
|
4,778 |
|
|
|
9,020 |
|
|
|
8,218 |
|
|
Net income (loss) |
|
8,476 |
|
|
|
(48,313 |
) |
|
|
8,975 |
|
|
|
(78,722 |
) |
|
Net income attributable to non-controlling interest |
|
4 |
|
|
|
972 |
|
|
|
12 |
|
|
|
2,086 |
|
|
Net income (loss) attributable to |
$ |
8,472 |
|
|
$ |
(49,285 |
) |
|
$ |
8,963 |
|
|
$ |
(80,808 |
) |
|
Net income (loss) per share attributable to |
|
|
|
|
|
|
|
||||||||
|
Basic |
$ |
0.04 |
|
|
$ |
(0.21 |
) |
|
$ |
0.04 |
|
|
$ |
(0.35 |
) |
|
Diluted |
$ |
0.03 |
|
|
$ |
(0.21 |
) |
|
$ |
0.04 |
|
|
$ |
(0.35 |
) |
|
Weighted-average shares used in computing net income (loss) per share attributable to |
|
|
|
|
|
|
|
||||||||
|
Basic |
|
237,911 |
|
|
|
232,554 |
|
|
|
237,174 |
|
|
|
231,850 |
|
|
Diluted |
|
242,144 |
|
|
|
232,554 |
|
|
|
241,383 |
|
|
|
231,850 |
|
|
____________________________ |
|
|
(1) |
Includes stock-based compensation expense as follows (in thousands): |
|
|
Three Months Ended |
|
Six Months Ended |
||||||||
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||
|
Subscription cost of revenue |
$ |
10,132 |
|
$ |
7,271 |
|
$ |
19,098 |
|
$ |
13,849 |
|
Professional services cost of revenue |
|
5,745 |
|
|
3,502 |
|
|
10,375 |
|
|
6,503 |
|
Sales and marketing |
|
51,442 |
|
|
40,567 |
|
|
87,181 |
|
|
67,277 |
|
Research and development |
|
46,985 |
|
|
40,043 |
|
|
91,366 |
|
|
74,079 |
|
General and administrative |
|
50,473 |
|
|
40,167 |
|
|
87,613 |
|
|
72,336 |
|
Total stock-based compensation expense |
$ |
164,777 |
|
$ |
131,550 |
|
$ |
295,633 |
|
$ |
234,044 |
|
(2) |
Includes amortization of acquired intangible assets, including purchased patents, as follows (in thousands): |
|
|
Three Months Ended |
|
Six Months Ended |
||||||||
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||
|
Subscription cost of revenue |
$ |
3,581 |
|
$ |
3,427 |
|
$ |
7,161 |
|
$ |
6,852 |
|
Sales and marketing |
|
446 |
|
|
648 |
|
|
977 |
|
|
1,297 |
|
General and administrative |
|
75 |
|
|
29 |
|
|
138 |
|
|
43 |
|
Total amortization of acquired intangible assets |
$ |
4,102 |
|
$ |
4,104 |
|
$ |
8,276 |
|
$ |
8,192 |
|
(3) |
Includes acquisition-related expenses (credits), net as follows (in thousands): |
|
|
Three Months Ended |
|
Six Months Ended |
||||||||||
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||||
|
Research and development |
$ |
— |
|
|
$ |
— |
|
$ |
371 |
|
|
$ |
— |
|
General and administrative |
|
(3 |
) |
|
|
— |
|
|
(73 |
) |
|
|
301 |
|
Total acquisition-related expenses (credits), net |
$ |
(3 |
) |
|
$ |
— |
|
$ |
298 |
|
|
$ |
301 |
|
(4) |
Includes mark-to-market adjustments on deferred compensation liabilities as follows (in thousands): |
|
|
Three Months Ended |
|
Six Months Ended |
||||||||
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||
|
Sales and marketing |
$ |
32 |
|
$ |
— |
|
$ |
35 |
|
$ |
— |
|
Research and development |
|
13 |
|
|
— |
|
|
14 |
|
|
— |
|
General and administrative |
|
7 |
|
|
— |
|
|
7 |
|
|
— |
|
Total mark-to-market adjustments on deferred compensation liabilities |
$ |
52 |
|
$ |
— |
|
$ |
56 |
|
$ |
— |
|
(5) |
Includes legal reserve and settlement charges as follows (in thousands): |
|
|
Three Months Ended |
|
Six Months Ended |
||||||||
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||
|
General and administrative |
$ |
2,097 |
|
$ |
— |
|
$ |
2,097 |
|
$ |
— |
|
Total legal reserve and settlement charges |
$ |
2,097 |
|
$ |
— |
|
$ |
2,097 |
|
$ |
— |
|
(6) |
Includes amortization of debt issuance costs and discount as follows (in thousands): |
|
|
Three Months Ended |
|
Six Months Ended |
||||||||
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||
|
Interest expense |
$ |
547 |
|
$ |
547 |
|
$ |
1,093 |
|
$ |
1,093 |
|
Total amortization of debt issuance costs and discount |
$ |
547 |
|
$ |
547 |
|
$ |
1,093 |
|
$ |
1,093 |
|
(7) |
Includes gains and other income from strategic investments as follows (in thousands): |
|
|
Three Months Ended |
|
Six Months Ended |
||||||||
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||
|
Other income, net |
$ |
8 |
|
$ |
1,943 |
|
$ |
24 |
|
$ |
4,172 |
|
Total gains and other income from strategic investments |
$ |
8 |
|
$ |
1,943 |
|
$ |
24 |
|
$ |
4,172 |
|
(8) |
Includes gains on deferred compensation assets as follows (in thousands): |
|
|
Three Months Ended |
|
Six Months Ended |
||||||||
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||
|
Other income, net |
$ |
52 |
|
$ |
— |
|
$ |
56 |
|
$ |
— |
|
Total gains on deferred compensation assets |
$ |
52 |
|
$ |
— |
|
$ |
56 |
|
$ |
— |
|
Condensed Consolidated Balance Sheets (in thousands) (unaudited) |
|||||||
|
|
|
|
|
||||
|
Assets |
|
|
|
||||
|
Current assets: |
|
|
|
||||
|
Cash and cash equivalents |
$ |
3,167,215 |
|
|
$ |
2,455,369 |
|
|
Short-term investments |
|
— |
|
|
|
250,000 |
|
|
Accounts receivable, net of allowance for credit losses |
|
539,463 |
|
|
|
626,181 |
|
|
Deferred contract acquisition costs, current |
|
197,111 |
|
|
|
186,855 |
|
|
Prepaid expenses and other current assets |
|
146,597 |
|
|
|
121,862 |
|
|
Total current assets |
|
4,050,386 |
|
|
|
3,640,267 |
|
|
Strategic investments |
|
59,541 |
|
|
|
47,270 |
|
|
Property and equipment, net |
|
561,587 |
|
|
|
492,335 |
|
|
Operating lease right-of-use assets |
|
46,179 |
|
|
|
39,936 |
|
|
Deferred contract acquisition costs, noncurrent |
|
261,574 |
|
|
|
260,233 |
|
|
|
|
430,697 |
|
|
|
430,645 |
|
|
Intangible assets, net |
|
79,139 |
|
|
|
86,889 |
|
|
Other long-term assets |
|
31,355 |
|
|
|
28,965 |
|
|
Total assets |
$ |
5,520,458 |
|
|
$ |
5,026,540 |
|
|
Liabilities and Stockholders’ Equity |
|
|
|
||||
|
Current liabilities: |
|
|
|
||||
|
Accounts payable |
$ |
37,073 |
|
|
$ |
45,372 |
|
|
Accrued expenses |
|
122,419 |
|
|
|
137,884 |
|
|
Accrued payroll and benefits |
|
138,471 |
|
|
|
168,767 |
|
|
Operating lease liabilities, current |
|
16,133 |
|
|
|
13,046 |
|
|
Deferred revenue |
|
1,894,005 |
|
|
|
1,727,484 |
|
|
Other current liabilities |
|
21,362 |
|
|
|
16,519 |
|
|
Total current liabilities |
|
2,229,463 |
|
|
|
2,109,072 |
|
|
Long-term debt |
|
741,750 |
|
|
|
741,005 |
|
|
Deferred revenue, noncurrent |
|
613,637 |
|
|
|
627,629 |
|
|
Operating lease liabilities, noncurrent |
|
32,688 |
|
|
|
29,567 |
|
|
Other liabilities, noncurrent |
|
32,820 |
|
|
|
31,833 |
|
|
Total liabilities |
|
3,650,358 |
|
|
|
3,539,106 |
|
|
Commitments and contingencies |
|
|
|
||||
|
Stockholders’ Equity |
|
|
|
||||
|
Common stock, Class A and Class B |
|
119 |
|
|
|
118 |
|
|
Additional paid-in capital |
|
2,976,375 |
|
|
|
2,612,705 |
|
|
Accumulated deficit |
|
(1,139,200 |
) |
|
|
(1,148,163 |
) |
|
Accumulated other comprehensive income (loss) |
|
913 |
|
|
|
(1,019 |
) |
|
|
|
1,838,207 |
|
|
|
1,463,641 |
|
|
Non-controlling interest |
|
31,893 |
|
|
|
23,793 |
|
|
Total stockholders’ equity |
|
1,870,100 |
|
|
|
1,487,434 |
|
|
Total liabilities and stockholders’ equity |
$ |
5,520,458 |
|
|
$ |
5,026,540 |
|
|
Condensed Consolidated Statements of Cash Flows (in thousands) (unaudited) |
|||||||
|
|
Six Months Ended |
||||||
|
|
2023 |
|
2022 |
||||
|
Operating activities |
|
|
|
||||
|
Net income (loss) |
$ |
8,975 |
|
|
$ |
(78,722 |
) |
|
Adjustments to reconcile net loss to net cash provided by operating activities: |
|
|
|
||||
|
Depreciation and amortization |
|
56,184 |
|
|
|
34,146 |
|
|
Amortization of intangible assets |
|
8,276 |
|
|
|
8,192 |
|
|
Amortization of deferred contract acquisition costs |
|
112,877 |
|
|
|
77,554 |
|
|
Non-cash operating lease costs |
|
6,331 |
|
|
|
4,524 |
|
|
Stock-based compensation expense |
|
295,633 |
|
|
|
234,044 |
|
|
Deferred income taxes |
|
(352 |
) |
|
|
1,604 |
|
|
Non-cash interest expense |
|
1,531 |
|
|
|
1,366 |
|
|
Change in fair value of strategic investments |
|
— |
|
|
|
(4,128 |
) |
|
Changes in operating assets and liabilities, net of impact of acquisitions |
|
|
|
||||
|
Accounts receivable, net |
|
86,718 |
|
|
|
(50,728 |
) |
|
Deferred contract acquisition costs |
|
(122,007 |
) |
|
|
(108,940 |
) |
|
Prepaid expenses and other assets |
|
(26,338 |
) |
|
|
(10,938 |
) |
|
Accounts payable |
|
(2,982 |
) |
|
|
794 |
|
|
Accrued expenses and other liabilities |
|
4,935 |
|
|
|
5,723 |
|
|
Accrued payroll and benefits |
|
(30,161 |
) |
|
|
245 |
|
|
Operating lease liabilities |
|
(6,475 |
) |
|
|
(4,704 |
) |
|
Deferred revenue |
|
152,528 |
|
|
|
314,831 |
|
|
Net cash provided by operating activities |
|
545,673 |
|
|
|
424,863 |
|
|
Investing activities |
|
|
|
||||
|
Purchases of property and equipment |
|
(102,681 |
) |
|
|
(118,339 |
) |
|
Capitalized internal-use software and website development costs |
|
(25,975 |
) |
|
|
(13,235 |
) |
|
Purchases of strategic investments |
|
(12,177 |
) |
|
|
(7,825 |
) |
|
Purchases of intangible assets |
|
(500 |
) |
|
|
(700 |
) |
|
Proceeds from maturities and sales of short-term investments |
|
250,000 |
|
|
|
— |
|
|
Purchases of deferred compensation investments |
|
(876 |
) |
|
|
— |
|
|
Net cash used provided by (used in) investing activities |
|
107,791 |
|
|
|
(140,099 |
) |
|
Financing activities |
|
|
|
||||
|
Proceeds from issuance of common stock upon exercise of stock options |
|
4,125 |
|
|
|
4,919 |
|
|
Proceeds from issuance of common stock under the employee stock purchase plan |
|
45,432 |
|
|
|
34,445 |
|
|
Capital contributions from non-controlling interest holders |
|
8,088 |
|
|
|
3,963 |
|
|
Net cash provided by financing activities |
|
57,645 |
|
|
|
43,327 |
|
|
|
|
|
|
||||
|
Effect of foreign exchange rates on cash, cash equivalents and restricted cash |
|
1,083 |
|
|
|
(4,330 |
) |
|
|
|
|
|
||||
|
Net increase in cash, cash equivalents and restricted cash |
|
712,192 |
|
|
|
323,761 |
|
|
|
|
|
|
||||
|
Cash, cash equivalents and restricted cash, beginning of period |
|
2,456,924 |
|
|
|
1,996,633 |
|
|
Cash, cash equivalents and restricted cash, end of period |
$ |
3,169,116 |
|
|
$ |
2,320,394 |
|
|
GAAP to Non-GAAP Reconciliations (in thousands, except percentages) (unaudited) |
|||||||||||||||
|
|
Three Months Ended |
|
Six Months Ended |
||||||||||||
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||||||
|
GAAP subscription revenue |
$ |
689,972 |
|
|
$ |
506,199 |
|
|
$ |
1,341,147 |
|
|
$ |
966,021 |
|
|
GAAP professional services revenue |
|
41,654 |
|
|
|
28,954 |
|
|
|
83,059 |
|
|
|
56,966 |
|
|
GAAP total revenue |
$ |
731,626 |
|
|
$ |
535,153 |
|
|
$ |
1,424,206 |
|
|
$ |
1,022,987 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP subscription gross profit |
$ |
536,666 |
|
|
$ |
386,112 |
|
|
$ |
1,045,741 |
|
|
$ |
737,992 |
|
|
Stock based compensation expense |
|
10,132 |
|
|
|
7,271 |
|
|
|
19,098 |
|
|
|
13,849 |
|
|
Amortization of acquired intangible assets |
|
3,581 |
|
|
|
3,427 |
|
|
|
7,161 |
|
|
|
6,852 |
|
|
Non-GAAP subscription gross profit |
$ |
550,379 |
|
|
$ |
396,810 |
|
|
$ |
1,072,000 |
|
|
$ |
758,693 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP subscription gross margin |
|
78 |
% |
|
|
76 |
% |
|
|
78 |
% |
|
|
76 |
% |
|
Non-GAAP subscription gross margin |
|
80 |
% |
|
|
78 |
% |
|
|
80 |
% |
|
|
79 |
% |
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP professional services gross profit |
$ |
12,043 |
|
|
$ |
8,474 |
|
|
$ |
26,318 |
|
|
$ |
17,596 |
|
|
Stock based compensation expense |
|
5,745 |
|
|
|
3,502 |
|
|
|
10,375 |
|
|
|
6,503 |
|
|
Non-GAAP professional services gross profit |
$ |
17,788 |
|
|
$ |
11,976 |
|
|
$ |
36,693 |
|
|
$ |
24,099 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP professional services gross margin |
|
29 |
% |
|
|
29 |
% |
|
|
32 |
% |
|
|
31 |
% |
|
Non-GAAP professional services gross margin |
|
43 |
% |
|
|
41 |
% |
|
|
44 |
% |
|
|
42 |
% |
|
|
|
|
|
|
|
|
|
||||||||
|
Total GAAP gross margin |
|
75 |
% |
|
|
74 |
% |
|
|
75 |
% |
|
|
74 |
% |
|
Total Non-GAAP gross margin |
|
78 |
% |
|
|
76 |
% |
|
|
78 |
% |
|
|
77 |
% |
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP sales and marketing operating expenses |
$ |
282,916 |
|
|
$ |
224,766 |
|
|
$ |
564,023 |
|
|
$ |
418,298 |
|
|
Stock based compensation expense |
|
(51,442 |
) |
|
|
(40,567 |
) |
|
|
(87,181 |
) |
|
|
(67,277 |
) |
|
Amortization of acquired intangible assets |
|
(446 |
) |
|
|
(648 |
) |
|
|
(977 |
) |
|
|
(1,297 |
) |
|
Mark-to-market adjustments on deferred compensation liabilities |
|
(32 |
) |
|
|
— |
|
|
|
(35 |
) |
|
|
— |
|
|
Non-GAAP sales and marketing operating expenses |
$ |
230,996 |
|
|
$ |
183,551 |
|
|
$ |
475,830 |
|
|
$ |
349,724 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP sales and marketing operating expenses as a percentage of revenue |
|
39 |
% |
|
|
42 |
% |
|
|
40 |
% |
|
|
41 |
% |
|
Non-GAAP sales and marketing operating expenses as a percentage of revenue |
|
32 |
% |
|
|
34 |
% |
|
|
33 |
% |
|
|
34 |
% |
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP research and development operating expenses |
$ |
179,362 |
|
|
$ |
137,864 |
|
|
$ |
358,427 |
|
|
$ |
261,263 |
|
|
Stock based compensation expense |
|
(46,985 |
) |
|
|
(40,043 |
) |
|
|
(91,366 |
) |
|
|
(74,079 |
) |
|
Acquisition-related expenses |
|
— |
|
|
|
— |
|
|
|
(371 |
) |
|
|
— |
|
|
Mark-to-market adjustments on deferred compensation liabilities |
|
(13 |
) |
|
|
— |
|
|
|
(14 |
) |
|
|
— |
|
|
Non-GAAP research and development operating expenses |
$ |
132,364 |
|
|
$ |
97,821 |
|
|
$ |
266,676 |
|
|
$ |
187,184 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP research and development operating expenses as a percentage of revenue |
|
25 |
% |
|
|
26 |
% |
|
|
25 |
% |
|
|
26 |
% |
|
Non-GAAP research and development operating expenses as a percentage of revenue |
|
18 |
% |
|
|
18 |
% |
|
|
19 |
% |
|
|
18 |
% |
|
GAAP to Non-GAAP Reconciliations (continued) (in thousands, except per share amounts) (unaudited) |
|||||||||||||||
|
|
Three Months Ended |
|
Six Months Ended |
||||||||||||
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||||||
|
GAAP general and administrative operating expenses |
$ |
101,804 |
|
|
$ |
80,263 |
|
|
$ |
184,438 |
|
|
$ |
148,217 |
|
|
Stock based compensation expense |
|
(50,473 |
) |
|
|
(40,167 |
) |
|
|
(87,613 |
) |
|
|
(72,336 |
) |
|
Acquisition-related credits (expenses) |
|
3 |
|
|
|
— |
|
|
|
73 |
|
|
|
(301 |
) |
|
Amortization of acquired intangible assets |
|
(75 |
) |
|
|
(29 |
) |
|
|
(138 |
) |
|
|
(43 |
) |
|
Mark-to-market adjustments on deferred compensation liabilities |
|
(7 |
) |
|
|
— |
|
|
|
(7 |
) |
|
|
— |
|
|
Legal reserve and settlement charges |
|
(2,097 |
) |
|
|
— |
|
|
|
(2,097 |
) |
|
|
— |
|
|
Non-GAAP general and administrative operating expenses |
$ |
49,155 |
|
|
$ |
40,067 |
|
|
$ |
94,656 |
|
|
$ |
75,537 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP general and administrative operating expenses as a percentage of revenue |
|
14 |
% |
|
|
15 |
% |
|
|
13 |
% |
|
|
14 |
% |
|
Non-GAAP general and administrative operating expenses as a percentage of revenue |
|
7 |
% |
|
|
7 |
% |
|
|
7 |
% |
|
|
7 |
% |
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP loss from operations |
$ |
(15,373 |
) |
|
$ |
(48,307 |
) |
|
$ |
(34,829 |
) |
|
$ |
(72,190 |
) |
|
Stock based compensation expense |
|
164,777 |
|
|
|
131,550 |
|
|
|
295,633 |
|
|
|
234,044 |
|
|
Amortization of acquired intangible assets |
|
4,102 |
|
|
|
4,104 |
|
|
|
8,276 |
|
|
|
8,192 |
|
|
Acquisition-related expenses (credits), net |
|
(3 |
) |
|
|
— |
|
|
|
298 |
|
|
|
301 |
|
|
Mark-to-market adjustments on deferred compensation liabilities |
|
52 |
|
|
|
— |
|
|
|
56 |
|
|
|
— |
|
|
Legal reserve and settlement charges |
|
2,097 |
|
|
|
— |
|
|
|
2,097 |
|
|
|
— |
|
|
Non-GAAP income from operations |
$ |
155,652 |
|
|
$ |
87,347 |
|
|
$ |
271,531 |
|
|
$ |
170,347 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP operating margin |
|
(2 |
)% |
|
|
(9 |
)% |
|
|
(2 |
)% |
|
|
(7 |
)% |
|
Non-GAAP operating margin |
|
21 |
% |
|
|
16 |
% |
|
|
19 |
% |
|
|
17 |
% |
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP net income (loss) attributable to |
$ |
8,472 |
|
|
$ |
(49,285 |
) |
|
$ |
8,963 |
|
|
$ |
(80,808 |
) |
|
Stock based compensation expense |
|
164,777 |
|
|
|
131,550 |
|
|
|
295,633 |
|
|
|
234,044 |
|
|
Amortization of acquired intangible assets |
|
4,102 |
|
|
|
4,104 |
|
|
|
8,276 |
|
|
|
8,192 |
|
|
Acquisition-related expenses (credits), net |
|
(3 |
) |
|
|
— |
|
|
|
298 |
|
|
|
301 |
|
|
Amortization of debt issuance costs and discount |
|
547 |
|
|
|
547 |
|
|
|
1,093 |
|
|
|
1,093 |
|
|
Mark-to-market adjustments on deferred compensation liabilities |
|
52 |
|
|
|
— |
|
|
|
56 |
|
|
|
— |
|
|
Legal reserve and settlement charges |
|
2,097 |
|
|
|
— |
|
|
|
2,097 |
|
|
|
— |
|
|
Gains and other income from strategic investments attributable to |
|
(4 |
) |
|
|
(972 |
) |
|
|
(12 |
) |
|
|
(2,086 |
) |
|
Gains on deferred compensation assets |
|
(52 |
) |
|
|
— |
|
|
|
(56 |
) |
|
|
— |
|
|
Non-GAAP net income attributable to |
$ |
179,988 |
|
|
$ |
85,944 |
|
|
$ |
316,348 |
|
|
$ |
160,736 |
|
|
Weighted-average shares used in computing basic net income (loss) per share attributable to |
|
237,911 |
|
|
|
232,554 |
|
|
|
237,174 |
|
|
|
231,850 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP basic net income (loss) per share attributable to |
$ |
0.04 |
|
|
$ |
(0.21 |
) |
|
$ |
0.04 |
|
|
$ |
(0.35 |
) |
|
GAAP to Non-GAAP Reconciliations (continued) (in thousands, except per share amounts) (unaudited) |
|||||||||||||
|
|
Three Months Ended |
|
Six Months Ended |
||||||||||
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||||
|
GAAP diluted net income (loss) per share attributable to |
$ |
0.03 |
|
$ |
(0.21 |
) |
|
$ |
0.04 |
|
$ |
(0.35 |
) |
|
Stock-based compensation |
|
0.68 |
|
|
0.55 |
|
|
|
1.22 |
|
|
0.98 |
|
|
Amortization of acquired intangible assets |
|
0.02 |
|
|
0.02 |
|
|
|
0.03 |
|
|
0.03 |
|
|
Acquisition-related expenses, net |
|
— |
|
|
— |
|
|
|
— |
|
|
— |
|
|
Amortization of debt issuance costs and discount |
|
— |
|
|
— |
|
|
|
— |
|
|
— |
|
|
Mark-to-market adjustments on deferred compensation liabilities |
|
— |
|
|
— |
|
|
|
— |
|
|
— |
|
|
Legal reserve and settlement charges |
|
0.01 |
|
|
— |
|
|
|
0.01 |
|
|
— |
|
|
Adjustment to fully diluted earnings per share (1) |
|
— |
|
|
— |
|
|
|
0.01 |
|
|
0.02 |
|
|
Gains and other income from strategic investments attributable to |
|
— |
|
|
— |
|
|
|
— |
|
|
(0.01 |
) |
|
Gains on deferred compensation assets |
|
— |
|
|
— |
|
|
|
— |
|
|
— |
|
|
Non-GAAP diluted net income per share attributable to |
$ |
0.74 |
|
$ |
0.36 |
|
|
$ |
1.31 |
|
$ |
0.67 |
|
|
|
|
|
|
|
|
|
|
||||||
|
Weighted-average shares used in diluted net income (loss) per share attributable to |
|
|
|
|
|
|
|
||||||
|
GAAP |
|
242,144 |
|
|
232,554 |
|
|
|
241,383 |
|
|
231,850 |
|
|
Non-GAAP |
|
242,144 |
|
|
238,727 |
|
|
|
241,383 |
|
|
238,674 |
|
|
______________________________________________________ |
|
(1) For periods in which we had diluted non-GAAP net income per share attributable to |
|
GAAP to Non-GAAP Reconciliations (continued) (in thousands, except percentages) (unaudited) |
|||||||||||||||
|
|
Three Months Ended |
|
Six Months Ended |
||||||||||||
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
||||||||
|
GAAP net cash provided by operating activities |
$ |
244,781 |
|
|
$ |
209,906 |
|
|
$ |
545,673 |
|
|
$ |
424,863 |
|
|
Purchases of property and equipment |
|
(40,417 |
) |
|
|
(66,128 |
) |
|
|
(102,681 |
) |
|
|
(118,339 |
) |
|
Capitalized internal-use software and website development costs |
|
(15,073 |
) |
|
|
(8,021 |
) |
|
|
(25,975 |
) |
|
|
(13,235 |
) |
|
Purchases of deferred compensation investments |
|
(586 |
) |
|
|
— |
|
|
|
(876 |
) |
|
|
— |
|
|
Free cash flow |
$ |
188,705 |
|
|
$ |
135,757 |
|
|
$ |
416,141 |
|
|
$ |
293,289 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP net cash provided by (used in) investing activities |
$ |
41,760 |
|
|
$ |
(79,149 |
) |
|
$ |
107,791 |
|
|
$ |
(140,099 |
) |
|
GAAP net cash provided by financing activities |
$ |
49,737 |
|
|
$ |
38,759 |
|
|
$ |
57,645 |
|
|
$ |
43,327 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP net cash provided by operating activities as a percentage of revenue |
|
33 |
% |
|
|
39 |
% |
|
|
38 |
% |
|
|
42 |
% |
|
Purchases of property and equipment as a percentage of revenue |
|
(6 |
)% |
|
|
(12 |
)% |
|
|
(7 |
)% |
|
|
(12 |
)% |
|
Capitalized internal-use software and website development costs as a percentage of revenue |
|
(2 |
)% |
|
|
(1 |
)% |
|
|
(2 |
)% |
|
|
(1 |
)% |
|
Purchases of deferred compensation investments as a percentage of revenue |
|
— |
% |
|
|
— |
% |
|
|
— |
% |
|
|
— |
% |
|
Free cash flow margin |
|
26 |
% |
|
|
25 |
% |
|
|
29 |
% |
|
|
29 |
% |
Explanation of Non-GAAP Financial Measures
In addition to determining results in accordance with
Other companies, including companies in CrowdStrike’s industry, may calculate similarly titled non-GAAP measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of CrowdStrike’s non-GAAP financial measures as tools for comparison.
Investors are encouraged to review the related GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures and not rely on any single financial measure to evaluate CrowdStrike’s business.
Non-GAAP Subscription Gross Profit and Non-GAAP Subscription Gross Margin
Non-GAAP Income from Operations
Non-GAAP Net Income Attributable to
The company defines non-GAAP net income attributable to
Non-GAAP Net Income per Share Attributable to CrowdStrike Common Stockholders, Diluted
Free Cash Flow
Free cash flow is a non-GAAP financial measure that
Explanation of Operational Measures
Annual Recurring Revenue
ARR is calculated as the annualized value of CrowdStrike’s customer subscription contracts as of the measurement date, assuming any contract that expires during the next 12 months is renewed on its existing terms. To the extent that
Magic Number
Magic Number is calculated by performing the following calculation for the most recent four quarters and taking the average: annualizing the difference between a quarter’s Subscription Revenue and the prior quarter’s Subscription Revenue, and then dividing the resulting number by the previous quarter’s Non-GAAP Sales & Marketing Expense. Magic Number = Average of previous four quarters: ((Quarter Subscription Revenue – Prior Quarter Subscription Revenue) x 4) / Prior Quarter Non-GAAP Sales & Marketing Expense.
Free Cash Flow Rule of 40
Free cash flow rule of 40 is calculated by taking the current quarter total revenue year over year growth rate percentage and summing it with the current quarter free cash flow margin percentage.
View source version on businesswire.com: https://www.businesswire.com/news/home/20230830966636/en/
Investor Relations Contact
investors@crowdstrike.com
669-721-0742
Press Contact
press@crowdstrike.com
216-409-5055
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