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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
___________________________________________________________________________________________________
FORM 10-Q
___________________________________________________________________________________________________
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended April 30, 2021
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number: 001-38933
___________________________________________________________________________________________________
CROWDSTRIKE HOLDINGS, INC.
(Exact Name of Registrant as Specified in Its Charter)
___________________________________________________________________________________________________
Delaware45-3788918
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification Number)
150 Mathilda Place, Suite 300, Sunnyvale, California 94086
(Address of principal executive offices)
__________________________________________________________________________________________________
Registrant’s telephone number, including area code: (888512-8906
___________________________________________________________________________________________________
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading symbol(s)Name of each exchange on which registered
Class A common stock, par value $0.0005 per shareCRWDThe Nasdaq Stock Market LLC
(Nasdaq Global Select Market)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes    ☑  No   
Indicate by check mark whether the registrant has submitted electronically every interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files) Yes        No    
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company and emerging growth company in Rule 12b-2 of the Exchange Act.
Large Accelerated FilerAccelerated Filer
Non-accelerated Filer
Smaller reporting company
(Do not check if a smaller reporting company)Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.   
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes       No    
As of May 31, 2021, the number of shares of the registrant’s Class A common stock outstanding was 199,244,096, and the number of shares of the registrant’s Class B common stock outstanding was 26,566,522.



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CROWDSTRIKE HOLDINGS, INC.
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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this Quarterly Report on Form 10-Q other than statements of historical fact, including statements regarding our future operating results and financial position, our business strategy and plans and our objectives for future operations, are forward-looking statements. The words “believe,” “may,” “will,” “potentially,” “estimate,” “continue,” “anticipate,” “intend,” “could,” “would,” “project,” “plan,” “expect” and similar expressions that convey uncertainty of future events or outcomes are intended to identify forward-looking statements.
These forward-looking statements include, but are not limited to, statements concerning the following:
our future financial performance, including our expectations regarding our revenue, cost of revenue, gross profit or gross margin, operating expenses (including changes in sales and marketing, research and development, and general and administrative expenses), and our ability to achieve, and maintain, future profitability;
the impact of the COVID-19 pandemic on our operations, financial results, and liquidity and capital resources, including on customers, sales, expenses, and employees;
market acceptance of our cloud platform;
the effects of increased competition in our markets and our ability to compete effectively;
our ability to maintain the security and availability of our cloud platform;
our ability to maintain and expand our customer base, including by attracting new customers;
our ability to develop new solutions, or enhancements to our existing solutions, and bring them to market in a timely manner;
anticipated trends, growth rates and challenges in our business and in the markets in which we operate;
our business plan and our ability to effectively manage our growth and associated investments;
beliefs and objectives for future operations;
our relationships with third parties, including channel partners and technology alliance partners;
our ability to maintain, protect and enhance our intellectual property rights;
our ability to successfully defend litigation brought against us;
our ability to successfully expand in our existing markets and into new markets;
sufficiency of cash and cash equivalents to meet cash needs for at least the next 12 months;
our ability to expand internationally;
our ability to comply with laws and regulations that currently apply or become applicable to our business both in the United States and internationally;
our ability to develop, maintain, and improve our internal control over financial reporting;
instability in the global credit and financial markets;
our ability to successfully close and integrate acquisitions to contribute to our growth objectives; and
the attraction and retention of qualified employees and key personnel.
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These statements are based on our current plans, estimates and projections in light of information currently available to us. These forward-looking statements may be affected by risks, uncertainties and other factors discussed elsewhere in this Quarterly Report on Form 10-Q, including under “Risk Factors.” Furthermore, new risks and uncertainties emerge from time to time, and it is impossible for us to predict all risks and uncertainties or how they may affect us. If any of these risks or uncertainties occurs, our business, revenue and financial results could be harmed, and the trading price of our Class A common stock could decline. Forward-looking statements made in this Quarterly Report on Form 10-Q speak only as of the date on which such statements are made, and we undertake no obligation to update them in light of new information or future events, except as required by law.
We intend to announce material information to the public through the CrowdStrike Investor Relations website ir.crowdstrike.com, SEC filings, press releases, public conference calls, and public webcasts. We use these channels, as well as social media and our blog, to communicate with our investors, customers, and the public about our company, our offerings, and other issues. It is possible that the information we post on social media and our blog could be deemed to be material information. As such, we encourage investors, the media, and others to follow the channels listed above, including the social media channels listed on our investor relations website, and to review the information disclosed through such channels. Any updates to the list of disclosure channels through which we will announce information will be posted on the investor relations page on our website.
SUMMARY OF RISK FACTORS

Our business is subject to numerous risks and uncertainties, any one of which could materially adversely affect our business, results of operations, financial condition and growth prospects. Below is a summary of some of these risks. This summary is not complete, and should be read together with the entire section titled “Risk Factors” in this Quarterly Report on Form 10-Q, as well as the other information in this Quarterly Report on Form 10-Q and the other filings that we make with the SEC.
We have experienced rapid growth in recent periods, and if we do not manage our future growth, our business and results of operations will be adversely affected.
We have a history of losses and may not be able to achieve or sustain profitability in the future.
Our limited operating history makes it difficult to evaluate our current business and future prospects, and may increase the risk of your investment.
The COVID-19 pandemic could adversely affect global economic conditions and our business, operating results and future revenue.
If organizations do not adopt cloud-based SaaS-delivered endpoint security solutions, our ability to grow our business and results of operations may be adversely affected.
If we are unable to attract new customers, our future results of operations could be harmed.
If our customers do not renew their subscriptions for our products and add additional cloud modules to their subscriptions, our future results of operations could be harmed.
We face intense competition and could lose market share to our competitors, which could adversely affect our business, financial condition, and results of operations.
If our solutions fail or are perceived to fail to detect or prevent incidents or have or are perceived to have defects, errors, or vulnerabilities, our brand and reputation would be harmed, which would adversely affect our business and results of operations.
As a cybersecurity provider, we have been, and expect to continue to be, a target of cyberattacks. If our internal networks, systems, or data are or are perceived to have been breached, our reputation may be damaged and our financial results may be negatively affected.
Our business is focused on cloud-based data analytics, and cybersecurity, privacy, and other regulations may affect how we collect and process certain types of data.
We rely on third-party data centers, such as Amazon Web Services, and our own colocation data centers, to host and operate our Falcon platform, and any disruption of or interference with our use of these facilities may
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negatively affect our ability to maintain the performance and reliability of our Falcon platform, which could cause our business to suffer.
If we do not effectively expand and train our direct sales force, we may be unable to add new customers or increase sales to our existing customers, and our business will be adversely affected.
Our results of operations may fluctuate significantly, which could make our future results difficult to predict and could cause our results of operations to fall below expectations.
Claims by others that we infringe their proprietary technology or other intellectual property rights could result in significant costs and substantially harm our business, financial condition, results of operations, and prospects.
Future acquisitions, strategic investments, partnerships, or alliances could be difficult to identify and integrate, divert the attention of key management personnel, disrupt our business, dilute stockholder value and adversely affect our business, financial condition, and results of operations.
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PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
CrowdStrike Holdings, Inc.
Condensed Consolidated Balance Sheets
(in thousands, except per share data)
(unaudited)
April 30,January 31,
20212021
Assets
Current assets:
Cash and cash equivalents$1,684,997 $1,918,608 
Accounts receivable, net of allowance for doubtful accounts of $1.5 million and $1.2 million as of April 30, 2021 and January 31, 2021, respectively
211,233 239,199 
Deferred contract acquisition costs, current85,388 80,850 
Prepaid expenses and other current assets56,385 53,617 
Total current assets2,038,003 2,292,274 
Strategic investments8,165 2,500 
Property and equipment, net191,310 167,014 
Operating lease right-of-use assets36,683 36,484 
Deferred contract acquisition costs, noncurrent125,392 117,906 
Goodwill374,581 83,566 
Intangible assets, net88,851 15,677 
Other long-term assets18,186 17,112 
Total assets$2,881,171 $2,732,533 
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable3,468 12,065 
Accrued expenses49,627 51,117 
Accrued payroll and benefits79,099 71,907 
Operating lease liabilities, current9,333 8,977 
Deferred revenue786,793 701,988 
Other current liabilities54,445 17,499 
Total current liabilities982,765 863,553 
Long-term debt 738,400 738,029 
Deferred revenue, noncurrent235,198 209,907 
Operating lease liabilities, noncurrent31,458 31,986 
Other liabilities, noncurrent39,953 17,184 
Total liabilities2,027,774 1,860,659 
Commitments and contingencies (Note 10)
Stockholders’ Equity
Preferred stock, $0.0005 par value; 100,000 shares authorized as of April 30, 2021 and January 31, 2021; no shares issued and outstanding as of April 30, 2021 and January 31, 2021
  
Class A common stock, $0.0005 par value; 2,000,000 shares authorized as of April 30, 2021 and January 31, 2021; 199,142 shares and 195,039 shares issued and outstanding as of April 30, 2021 and January 31, 2021, respectively; Class B common stock, $0.0005 par value; 300,000 shares authorized as of April 30, 2021 and January 31, 2021; 26,601 shares and 28,685 shares issued and outstanding as of April 30, 2021 and January 31, 2021, respectively.
113 112 
Additional paid-in capital1,662,199 1,598,259 
Accumulated deficit(815,165)(730,116)
Accumulated other comprehensive income 2,117 2,319 
Total CrowdStrike Holdings, Inc. stockholders’ equity 849,264 870,574 
Non-controlling interest4,133 1,300 
Total stockholders’ equity 853,397 871,874 
Total liabilities and stockholders’ equity $2,881,171 $2,732,533 
The accompanying notes are an integral part of these condensed consolidated financial statements.
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CrowdStrike Holdings, Inc.
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)

Three Months Ended April 30,
20212020
Revenue
Subscription$281,228 $162,222 
Professional services21,615 15,856 
Total revenue302,843 178,078 
Cost of revenue
Subscription64,903 37,244 
Professional services13,602 9,651 
Total cost of revenue78,505 46,895 
Gross profit224,338 131,183 
Operating expenses
Sales and marketing135,131 88,138 
Research and development78,180 40,578 
General and administrative42,374 25,043 
Total operating expenses255,685 153,759 
Loss from operations(31,347)(22,576)
Interest expense(6,230)(143)
Other income (expense), net4,768 4,533 
Loss before provision for income taxes(32,809)(18,186)
Provision for income taxes50,062 1,036 
Net loss(82,871)(19,222)
Net income attributable to noncontrolling interest2,178  
Net loss attributable to CrowdStrike $(85,049)$(19,222)
Net loss per share attributable to CrowdStrike common stockholders, basic and diluted$(0.38)$(0.09)
Weighted-average shares used in computing net loss per share attributable to CrowdStrike common stockholders, basic and diluted224,153 213,129 
The accompanying notes are an integral part of these condensed consolidated financial statements.



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CrowdStrike Holdings, Inc.
Condensed Consolidated Statements of Comprehensive Loss
(in thousands)
(unaudited)

Three Months Ended April 30,
20212020
Net loss $(82,871)$(19,222)
Other comprehensive loss:
Foreign currency translation adjustments(202)(693)
Reversal of unrealized gain upon sale of debt securities, net of tax (1,320)
Other comprehensive loss(202)(2,013)
Less: Comprehensive income to noncontrolling interest2,178  
Total comprehensive loss attributable to CrowdStrike$(85,251)$(21,235)
The accompanying notes are an integral part of these condensed consolidated financial statements.
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CrowdStrike Holdings, Inc.
Condensed Consolidated Statements of Stockholders’ Equity
Three Months Ended April 30, 2021 and 2020
(in thousands)
(unaudited)

Common StockAdditional Paid-in CapitalAccumulated DeficitAccumulated Other Comprehensive IncomeNon-controlling InterestTotal Stockholders’ Equity
SharesAmount
Balances at January 31, 2021223,724 $112 $1,598,259 $(730,116)$2,319 $1,300 $871,874 
Issuance of common stock upon exercise of options769 1 3,753 — — — 3,754 
Issuance of common stock under RSU release1,193 — — — — — — 
Issuance of common stock related to early exercised options57 — — — — — — 
Vesting of early exercised options— — 797 — — — 797 
Stock-based compensation expense— — 53,646 — — — 53,646 
Capitalized stock-based compensation— — 1,733 — — — 1,733 
Fair value of replacement equity awards attributable to pre-acquisition service— — 4,011 — — — 4,011 
Net income (loss)— — — (85,049)— 2,178 (82,871)
Non-controlling interest— — — — 655 655 
Other comprehensive loss— — — — (202)— (202)
Balances at April 30, 2021225,743 $113 $1,662,199 $(815,165)$2,117 $4,133 $853,397 


Common StockAdditional Paid-in CapitalAccumulated DeficitAccumulated Other Comprehensive Income (Loss)Non-controlling InterestTotal Stockholders’ Equity
SharesAmount
Balances at January 31, 2020212,948 $106 $1,378,479 $(637,487)$1,009 $500 $742,607 
Issuance of common stock upon exercise of options2,056 2 6,391 — — — 6,393 
Issuance of common stock under RSU release501 — — — — —  
Vesting of early exercised options— — 873 — — — 873 
Stock-based compensation expense— — 23,638 — — — 23,638 
Capitalized stock-based compensation— — 377 — — — 377 
Net loss— — — (19,222)— — (19,222)
Non-controlling interest — — — — — 500 500 
Other comprehensive loss— — — — (2,013)— (2,013)
Balances at April 30, 2020215,505 $108 $1,409,758 $(656,709)$(1,004)$1,000 $753,153 


The accompanying notes are an integral part of these condensed consolidated financial statements.
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CrowdStrike Holdings, Inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
Three Months Ended April 30,
20212020
Operating activities
Net loss $(82,871)$(19,222)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization11,955 8,202 
Loss on disposal of fixed assets19  
Amortization of intangible assets2,417 103 
Amortization of deferred contract acquisition costs24,376 13,451 
Non-cash operating lease cost2,180 2,283 
Provision for bad debts274 149 
Stock-based compensation expense54,362 23,638 
Gain on sale of debt securities, net (1,347)
Accretion of marketable securities purchased at a premium  578 
Non-cash interest expense595 151 
Change in fair value of strategic investments(4,356) 
Changes in operating assets and liabilities
Accounts receivable31,466 20,651 
Deferred contract acquisition costs(36,400)(22,563)
Prepaid expenses and other assets(769)5,332 
Accounts payable(10,562)4,736 
Accrued expenses and other current liabilities29,229 (1,095)
Accrued payroll and benefits5,969 648 
Operating lease liabilities(2,555)(2,975)
Deferred revenue109,376 64,805 
Other liabilities12,828 1,052 
Net cash provided by operating activities147,533 98,577 
Investing activities
Purchases of property and equipment(25,796)(9,694)
Capitalized internal-use software and website development(4,434)(1,882)
Purchase of strategic investments(1,309) 
Business acquisition, net of cash acquired(353,407) 
Purchases of marketable securities (84,904)
Proceeds from sales of marketable securities 639,586 
Maturities of marketable securities 91,605 
Net cash (used in) provided by investing activities(384,946)634,711 
Financing activities
Payment of debt issuance costs related to revolving line of credit(219) 
Payment of debt issuance costs related to Senior Notes(1,581) 
Proceeds from issuance of common stock upon exercise of stock options3,754 6,393 
Capital contributions from non-controlling interest holders655 500 
Net cash provided by financing activities2,609 6,893 
Effect of foreign exchange rates on cash and cash equivalents1,193 12 
Net (decrease) increase in cash and cash equivalents(233,611)740,193 
Cash and cash equivalents, beginning of period1,918,608 264,798 
Cash and cash equivalents, end of period$1,684,997 $1,004,991 
Supplemental disclosure of cash flow information:
Interest paid$11 $ 
Income taxes paid, net of refunds received1,385 353 
Supplemental disclosure of non-cash investing and financing activities:
Net increase (decrease) in property and equipment included in accounts payable and accrued expenses4,294 (723)
Vesting of early exercised stock options797 873 
Equity consideration for acquisitions4,011  
Operating lease liabilities arising from obtaining operating right of-use assets 2,591  
The accompanying notes are an integral part of these condensed consolidated financial statements.
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CrowdStrike Holdings, Inc.
Notes to Unaudited Condensed Consolidated Financial Statements
1.    Description of Business and Basis of Presentation
Business
CrowdStrike Holdings, Inc. (the “Company”) was formed on November 7, 2011. The Company provides a leading cloud-delivered solution for next-generation endpoint and cloud workload protection that offers 19 cloud modules and its Falcon platform via a software as a service (“SaaS”) subscription-based model that spans multiple security markets, including corporate workload security, security and vulnerability management, managed security services, IT operations management, threat intelligence services, identity protection and log management. The Company is headquartered in Sunnyvale, California. The Company conducts its business in the United States, as well as locations internationally, including in Australia, Germany, India, Israel, Romania, and the United Kingdom.
Basis of Presentation
The accompanying condensed consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP have been condensed or omitted, and accordingly the balance sheet as of January 31, 2021, and related disclosures, have been derived from the audited consolidated financial statements at that date but do not include all of the information required by U.S. GAAP for complete consolidated financial statements. These unaudited condensed consolidated financial statements have been prepared on the same basis as the Company’s annual consolidated financial statements and, in the opinion of management, reflect all normal recurring adjustments that are necessary for the fair statement of the Company’s condensed consolidated financial information. The results of operations for the three months ended April 30, 2021 are not necessarily indicative of the results to be expected for the year ending January 31, 2022 or for any other interim period or for any other future year.
2.    Summary of Significant Accounting Policies
Principles of Consolidation
The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.
Certain information and footnote disclosures normally included in the financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to the applicable required disclosures and regulations of the SEC. Therefore, the accompanying interim unaudited condensed consolidated financial statements and related financial information should be read in conjunction with Item 8, “Financial Statements and Supplementary Data” included in the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2021, filed with the SEC on March 18, 2021.
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported and disclosed in the Company’s condensed consolidated financial statements and accompanying notes. These estimates are based on information available as of the date of the condensed consolidated financial statements. On a regular basis, management evaluates these estimates and assumptions. Actual results may differ from these estimates and such difference could be material to the Company’s condensed consolidated financial statements.

Estimates and assumptions used by management include, but are not limited to, revenue recognition, the allowance for doubtful accounts, the carrying value and the useful lives of long-lived assets, the fair values of financial instruments and strategic investments, the period of benefit for deferred contract acquisition costs, the discount rate used for operating leases, the recognition and disclosure of contingent liabilities, income taxes, stock-based compensation, the fair value of assets acquired and liabilities assumed for business combinations, and the accounting for the Senior Notes.
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Due to the Coronavirus (“COVID-19”) pandemic, there has been uncertainty and disruption in the global economy and financial markets. The Company is not aware of any specific event or circumstance that would require a material update to its estimates or judgments or an adjustment of the carrying value of its assets or liabilities as of April 30, 2021. While there was not a material impact to the Company’s condensed consolidated financial statements as of and for the three months ended April 30, 2021, these estimates may change, as new events occur and additional information is obtained, as well as other factors related to COVID-19 that could result in material impacts to the Company’s condensed consolidated financial statements in future reporting periods.
Concentration of Credit Risk and Geographic Information
The Company generates revenue from the sale of subscriptions to access its cloud platform and professional services. The Company’s sales team, along with its channel partner network of system integrators and value-added resellers (collectively, “channel partners”), sells the Company’s services worldwide to organizations of all sizes.
Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash, cash equivalents, marketable securities, accounts receivable, and strategic investments. The Company’s cash is placed with high-credit-quality financial institutions and issuers, and at times exceed federally insured limits. The Company limits its concentration of risk in cash equivalents and marketable securities by diversifying its investments among a variety of industries and issuers. The Company has not experienced any credit loss relating to its cash equivalents, marketable securities, and strategic investments. The Company performs periodic credit evaluations of its customers and generally does not require collateral. As of April 30, 2021, the Company did not have any marketable securities.
Channel partners or direct customers who represented 10% or more of the Company’s accounts receivable were as follows:
April 30,January 31,
20212021
Channel partner A(1)
9 %10 %
Customer A(1)
 %17 %
__________________________________
(1)Channel Partner A and Customer A are controlled by the same company.
There were no channel partners or direct customers who represented 10% or more of the Company’s total revenue during the three months ended April 30, 2021 and April 30, 2020.
Significant Accounting Policies
The Company’s significant accounting policies are described in the Company’s Annual Report on Form 10-K for the year ended January 31, 2021. There have been no significant changes to these policies that have had a material impact on the Company’s condensed consolidated financial statements and related notes for the three months ended April 30, 2021.

Recently Adopted Accounting Pronouncements
In December 2019, the Financial Accounting Standards Board (the “FASB”) issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, which enhances and simplifies various aspects of the income tax accounting guidance, including requirements such as tax basis step-up in goodwill obtained in a transaction that is not a business combination, ownership changes in investments, and interim-period accounting for enacted changes in tax law. The Company adopted this guidance on February 1, 2021, which did not have a material effect on its condensed consolidated financial statements.
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3.    Fair Value Measurements and Marketable Securities
The Company follows ASC 820, Fair Value Measurements, with respect to marketable securities that are measured at fair value on a recurring basis. Under the standard, fair value is defined as the exit price, or the amount that would be received to sell an asset or a liability in an orderly transaction between market participants as of the measurement date. The standard also establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use in valuing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the factors market participants would use in valuing the asset or liability developed based upon the best information available in the circumstances.
The hierarchy is broken down into three levels as follows:
Level 1    Assets and liabilities whose values are based on unadjusted quoted market prices for identical assets and liabilities in active markets
Level 2    Assets and liabilities whose values are based on quoted prices in markets that are not active or inputs that are observable for substantially the full term of the asset or liability
Level 3    Assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement
Categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.
The Company’s fair value hierarchy for its financial assets and liabilities that are measured at fair value on a recurring basis are as follows:
April 30, 2021January 31, 2021
Level 1Level 2Level 3TotalLevel 1Level 2Level 3Total
(in thousands)(in thousands)
Assets
Cash equivalents (1)
Money market funds$429,502 $ $ $429,502 $ $ $ $ 
Total assets$429,502 $ $ $429,502 $ $ $ $ 
__________________________________
(1)Included in “Cash and cash equivalents” on the condensed consolidated balance sheets.
There were no transfers between the levels of the fair value hierarchy during the periods presented.
As of April 30, 2021 and January 31, 2021, there were no marketable securities held by the Company.
The following summarizes the changes in strategic investments:
April 30,January 31,
20212021
(in thousands)
Total initial cost$3,809 $2,500 
Unrealized gain due to changes in fair value4,356  
Carrying value$8,165 $2,500 

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4.    Balance Sheet Components
Prepaid Expenses and Other Current Assets
Prepaid expenses and other current assets consisted of the following:
April 30,
2021
January 31,
2021
(in thousands)
Prepaid expenses$23,924 $23,072 
Prepaid software licenses20,164 20,596 
Other current assets6,994 4,566 
Prepaid hosting services5,303 5,383 
Prepaid expenses and other current assets$56,385 $53,617 
Property and Equipment, Net
Property and equipment, net consisted of the following:
April 30,
2021
January 31,
2021
(in thousands)
Data center and other computer equipment$165,251 $146,220 
Capitalized internal-use software and website development46,269 44,358 
Leasehold improvements19,455 19,733 
Purchased software3,548 3,211 
Furniture and equipment6,498 6,498 
Construction in process50,837 35,528 
291,858 255,548 
Less: Accumulated depreciation and amortization(100,548)(88,534)
Property and equipment, net$191,310 $167,014 
Construction in process mainly includes data center equipment purchased that has not yet been placed in service. As of April 30, 2021, $41.6 million of data center equipment was purchased but not yet been placed into service.
Depreciation and amortization expense of property and equipment was $12.0 million and $8.2 million during the three months ended April 30, 2021 and April 30, 2020, respectively.
There was no impairment of website and internal-use software during the three months ended April 30, 2021 and April 30, 2020. The Company capitalized $6.2 million and $2.3 million in website and internal-use software during the three months ended April 30, 2021 and April 30, 2020. Amortization expense associated with website and internal-use software totaled $2.5 million and $1.9 million during the three months ended April 30, 2021 and April 30, 2020, respectively. The net book value of capitalized website and internal-use software was $23.7 million and $20.1 million as of April 30, 2021 and January 31, 2021, respectively.
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Intangible Assets, Net
Total intangible assets, net consisted of the following:
April 30, 2021Weighted-Average
Remaining 
Useful
Life
Gross Carrying AmountAccumulated AmortizationNet Amount
(in thousands)(in months)
Developed technology$82,431 $3,309 $79,122 90
Customer relationships9,097 871 8,226 80
Other acquired intangible assets1,727 224 1,503 47
Total$93,255 $4,404 $88,851 

January 31, 2021Weighted-Average
Remaining 
Useful
Life
Gross Carrying AmountAccumulated AmortizationNet Amount
(in thousands)(in months)
Developed technology$14,513 $2,193 $12,320 56
Customer relationships3,769 649 3,120 54
Other acquired intangible assets399 162 237 185
Total$18,681 $3,004 $15,677 
Amortization of developed technology, customer relationships, and other acquired intangible assets are recorded within cost of revenue, sales and marketing expense, and research and development expense, respectively, in the condensed consolidated statements of operations. Amortization expense of intangible assets was $2.4 million and $0.1 million during the three months ended April 30, 2021 and April 30, 2020, respectively.
The estimated aggregate future amortization expense of intangible assets as of April 30, 2021 is as follows:
Total
(in thousands)
Fiscal 2022 (remaining nine months) $9,951 
Fiscal 202313,199 
Fiscal 202412,500 
Fiscal 202512,416 
Fiscal 202611,329 
Thereafter29,456 
Total amortization expense$88,851 
The developed technology, customer relationships, and other acquired intangible assets are amortized over their estimated useful lives, generally on a straight-line basis for periods ranging from 2 to 20 years.
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Goodwill
Goodwill during the three months ended April 30, 2021 consisted of the following:
Amounts
(in thousands)
Goodwill as of January 31, 2021$83,566 
Goodwill acquired(1)
291,156 
Foreign currency translation(141)
Goodwill as of April 30, 2021$374,581 
__________________________________
(1)Goodwill acquired resulted from the acquisition of Humio. Refer to Note 12 for additional information.
Accrued Expenses
Accrued expenses consisted of the following:
April 30,
2021
January 31,
2021
(in thousands)
Web hosting services$13,390 $14,187 
Other accrued expenses12,387 11,372 
Accrued purchases of property and equipment9,026 4,570 
Accrued interest expense6,312 687 
Accrued marketing6,093 14,592 
Accrued legal and accounting2,419 5,709 
Accrued expenses$49,627 $51,117 
Accrued Payroll and Benefits
Accrued payroll and benefits consisted of the following:
April 30,
2021
January 31,
2021
(in thousands)
Accrued commissions$24,479 $32,300 
Employee Stock Purchase Plan24,308 10,969 
Accrued payroll and related expenses17,737 16,528 
Accrued bonuses12,575 12,110 
Accrued payroll and benefits$79,099 $71,907 

In April 2020, the Company began deferring payment on its share of payroll taxes owed, as permitted by the CARES Act through December 31, 2020. As of April 30, 2021 and January 31, 2021, the Company had deferred $5.1 million of payroll taxes in other current liabilities and $5.1 million of payroll taxes in other liabilities, noncurrent on the condensed consolidated balance sheet.
5. Debt
Secured Revolving Credit Facility
In April 2019, the Company entered into a Credit Agreement with Silicon Valley Bank and other lenders, to provide a revolving line of credit of up to $150.0 million, including a letter of credit sub-facility in the aggregate amount of $10.0 million, and a swingline sub-facility in the aggregate amount of $10.0 million.
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On January 4, 2021, the Company amended and restated its existing credit agreement (the “A&R Credit Agreement” and the facility thereunder the “Revolving Facility”) among CrowdStrike, Inc., as borrower, CrowdStrike Holdings, Inc., as guarantor, and Silicon Valley Bank and the other lenders party thereto, providing the Company with a revolving line of credit of up to $750.0 million, including a letter of credit sub-facility in the aggregate amount of $100.0 million, and a swingline sub-facility in the aggregate amount of $50.0 million. The Company also has the option to request an incremental facility of up to an additional $250.0 million from one or more of the lenders under the A&R Credit Agreement. The A&R Credit Agreement is guaranteed by all of the Company’s material domestic subsidiaries. The A&R Credit Agreement extended the maturity date of April 19, 2022 to January 2, 2026. Under the A&R Credit Agreement, revolving loans may be either Eurodollar Loans or Alternate Base Rate (“ABR”) Loans. Outstanding Eurodollar Loans incur interest at the Eurodollar Rate, which is defined as LIBOR (or any successor thereto), subject to a 0.00% LIBOR floor, plus a margin between 1.50% and 2.00%, depending on the Company’s senior secured leverage ratio. Outstanding ABR Loans incur interest at the highest of (a) the Prime Rate, as published by the Wall Street Journal, (b) the federal funds rate in effect for such day plus 0.50%, and (c) the Eurodollar Rate plus 1.00%, in each case plus a margin between (0.25)% and 0.25%, depending on the senior secured leverage ratio. The Company will be charged a commitment fee of 0.15% to 0.25% per year for committed but unused amounts, depending on the senior secured leverage ratio. The financial covenants require the Company to maintain a minimum consolidated interest coverage ratio of 3.00:1.00, a maximum senior secured leverage ratio of 3.00:1.00 (through January 31, 2023), and a maximum total leverage ratio of 5.50:1.00 stepping down to 3.50:1.00 over time. The Company was in compliance with the financial covenants as of April 30, 2021.
The A&R Credit Agreement is secured by substantially all of the Company’s current and future consolidated assets, property and rights, including, but not limited to, intellectual property, cash, goods, equipment, contractual rights, financial assets, and intangible assets of the Company and certain of its subsidiaries. The A&R Credit Agreement contains customary covenants limiting the Company’s ability and the ability of its subsidiaries to, among other things, dispose of assets, undergo a change in control, merge or consolidate, make acquisitions, incur debt, incur liens, pay dividends, repurchase stock, and make investments, in each case subject to certain exceptions.
No amounts were outstanding under the A&R Credit Agreement as of April 30, 2021 and January 31, 2021.
Senior Notes
On January 20, 2021, the Company issued $750.0 million in aggregate principal amount of 3.00% Senior Notes maturing in February 2029. The Senior Notes are guaranteed by the Company’s subsidiary, CrowdStrike, Inc. and will be guaranteed by each of the Company’s existing and future domestic subsidiaries that becomes a borrower or guarantor under the A&R Credit Agreement. The Senior Notes were issued at par and bear interest at a rate of 3.00% per annum. Interest payments are payable semiannually on February 15 and August 15 of each year, commencing on August 15, 2021. The Company may voluntarily redeem the Senior Notes, in whole or in part, 1) at any time prior to February 15, 2024 at (a) 100.00% of their principal amount, plus a “make whole” premium or (b) with the net cash proceeds received from an equity offering at a redemption price equal to 103.00% of the principal amount, provided the aggregate principal amount of all such redemptions does not exceed 40% of the original aggregate principal amount of the Senior Notes; 2) at any time on or after February 15, 2024 at a prepayment price equal to 101.50% of the principal amount; 3) at any time on or after February 15, 2025 at a prepayment price equal to 100.75% of the principal amount; and 4) at any time on or after February 15, 2026 at a prepayment price equal to 100.00% of the principal amount; in each case, plus accrued and unpaid interest, if any, to but excluding, the date of redemption.
The net proceeds from the debt offering were $738.0 million after deducting underwriting commissions of $9.4 million and $2.6 million of issuance costs, which were paid as of April 30, 2021. The debt issuance costs are being amortized to interest expense using the effective interest method over the term of the Senior Notes. Interest expense related to contractual interest expense, amortization of debt issuance costs and accretion of debt discount was $6.0 million during the three months ended April 30, 2021.
In certain circumstances involving a change of control event, the Company will be required to make an offer to repurchase all or, at the holder’s option, any part, of each holder’s notes of that series at 101% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, to, but excluding, the repurchase date.
The indenture governing the Senior Notes (the “Indenture”) contain covenants limiting the Company’s ability and the ability of its subsidiaries to create liens on certain assets to secure debt; grant a subsidiary guarantee of certain debt without also providing a guarantee of the Senior Notes; declare dividends; and consolidate or merge with or into, or sell or otherwise dispose of all or substantially all of its assets to, another person. These covenants are subject to a number of limitations and exceptions. Certain of these covenants will not apply during any period in which the notes are rated investment grade by Fitch Ratings, Inc. (“Fitch”), Moody’s Investors Service, Inc. (“Moody’s”) and Standard & Poor’s Ratings Services (“S&P”).
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As of April 30, 2021, the Company was in compliance with all of its financial covenants under the Indenture associated with the Senior Notes.
Based on the trading prices of the Senior Notes, the fair value of the Senior Notes as of April 30, 2021 was approximately $743.6 million. While the Senior Notes are recorded at cost, the fair value of the Senior Notes was determined based on quoted prices in markets that are not active; accordingly, the Senior Notes is categorized as Level 2 for purposes of the fair value measurement hierarchy.
6. Income Taxes
The Company recognized an income tax expense of $50.1 million and $1.0 million for the three months ended April 30, 2021 and April 30, 2020, respectively. The tax expense for the three months ended April 30, 2021 was primarily attributable to the intercompany sale of intellectual property and pre-tax foreign earnings. The Company’s effective tax rates of (143.1)% and (5.7)% for the three months ended April 30, 2021 and April 30, 2020, respectively, differ from the U.S. statutory tax rate primarily due to U.S. losses for which there is no benefit and the tax impact from the intercompany sale of intellectual property from Humio.
The Company has a full valuation allowance on its U.S. federal and state and its U.K. deferred tax assets. As a result, consistent with the prior year, the Company does not record a tax benefit on these losses because it is more likely than not that the benefit will not be realized.
The balance of gross unrecognized tax benefits was $51.1 million and $24.4 million as of April 30, 2021 and January 31, 2021, respectively. The increase was primarily due to establishing an uncertain tax position associated with the intercompany sale of intellectual property. As of April 30, 2021 and January 31, 2021, approximately $23.0 million and $0.6 million, respectively of the unrecognized tax benefits including interest and penalties would affect the Company’s effective tax rate if favorably resolved. Given the uncertainty of the timing of resolving the issue, the Company is unable to estimate the range of possible changes to the balance of our unrecognized tax benefits within the next 12 months.
In accordance with the guidance on the accounting for uncertainty in income taxes, for all U.S. and other tax jurisdictions, the Company recognize potential liabilities for anticipated tax audit issues based on the Company’s estimate of whether, and the extent to which, additional taxes and interest will be due. If the Company’s estimate of income tax liabilities proves to be less than the ultimate assessment, a further charge to expense would be required. If events occur and the payment of these amounts ultimately proves to be unnecessary, the reversal of the liabilities would result in tax benefits being recognized in the period when the Company determines the liabilities are no longer necessary. The Company include interest and penalties related to unrecognized tax benefits within the provision for income taxes in the condensed consolidated statements of operations. Accrued interest and penalties are included within other liabilities, noncurrent in the condensed consolidated balance sheet.
7.    Leases
Operating Leases
The Company has entered into non-cancelable operating lease agreements with various expiration dates through fiscal 2027. Certain lease agreements include options to renew or terminate the lease, which are not reasonably certain to be exercised and therefore are not factored into the determination of lease payments.
Cash paid for amounts included in the measurement of operating lease liabilities was $2.9 million and $2.4 million for the three months ended April 30, 2021 and April 30, 2020, respectively. Operating lease liabilities arising from obtaining operating right-of-use assets was $2.6 million and none for the three months ended April 30, 2021 and April 30, 2020, respectively.
As of April 30, 2021, the weighted-average remaining lease term is 3.9 years, and the weighted-average discount rate is 5.6%.
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The component of lease costs was as follows:
April 30, 2021April 30, 2020
(in thousands)
Lease cost
Operating lease cost$2,766 $2,283 
Short-term lease cost496 493 
Variable lease cost849 836 
Total lease cost$4,111 $3,612 
There was no sublease income for the three months ended April 30, 2021 or April 30, 2020. As of April 30, 2021, the Company has not entered into any non-cancelable operating leases with a term greater than 12 months that have not yet commenced.
The maturities of the Company’s non-cancelable operating lease liabilities are as follows:
April 30, 2021
(in thousands)
Fiscal 2022 (remaining nine months)$7,279 
Fiscal 202311,578 
Fiscal 202411,539 
Fiscal 202510,421 
Fiscal 20264,412 
Thereafter428 
Total operating lease payments45,657 
Less: imputed interest(4,866)
Present value of operating lease liabilities$40,791 
8.    Stock-Based Compensation
Stock Incentive Plan
In May 2019, the Company’s board of directors adopted, and the stockholders approved the CrowdStrike Holdings, Inc. 2019 Equity Incentive Plan (the “2019 Plan”) with the purpose of granting stock-based awards to employees, directors, officers and consultants, including stock options, restricted stock awards, restricted stock units and performance-based restricted stock units. A total of 8,750,000 shares of Class A common stock were initially available for issuance under the 2019 Plan. The Company’s compensation committee administers the 2019 Plan. The number of shares of the Company’s common stock available for issuance under the 2019 Plan is subject to an annual increase on the first day of each fiscal year beginning on February 1, 2020, equal to the lesser of: (i) two percent (2.0%) of outstanding shares of the Company’s capital stock as of the last day of the immediately preceding fiscal year or (ii) such other amount as the Company’s board of directors may determine.
The 2011 Plan was terminated on June 10, 2019, which was the business day prior to the effectiveness of the Company’s registration statement on Form S-1 used in connection with the Company’s IPO, and stock-based awards are no longer granted under the 2011 Plan. Any shares underlying stock options that expire or terminate or are forfeited or repurchased under the 2011 Plan will be automatically transferred to the 2019 Plan.
Stock Options
The Company records compensation expense for employee stock options based on the estimated fair value of the options on the date of grant using the Black-Scholes option-pricing model with the assumptions included in the table below. The expected term represents the period that the Company’s share-based awards are expected to be outstanding. The expected term assumptions were determined based on the vesting terms, exercise terms, and contractual lives of the options. The expected stock price volatility is based upon comparable public company data. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant for the estimated option life.
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The fair value of each option was estimated on the date of grant using the following assumptions during the period:
Three Months Ended
April 30, 2021
Expected term (in years)
3.8 - 5.6
Risk-free interest rate
0.6 - 1.0%
Expected stock price volatility
36.1 - 37.1%
Dividend yield %
There were no stock options granted during the three months ended April 30, 2020.
The following table is a summary of stock option activity for the three months ended April 30, 2021:
Number of
Shares
Weighted-Average
Exercise Price
Per Share
(in thousands)
Options outstanding at January 31, 20216,646 $8.24 
Granted93 $3.19 
Exercised(769)$4.88 
Canceled(58)$11.48 
Options outstanding at April 30, 20215,912 $8.57 
Options vested and expected to vest at April 30, 20215,912 $8.57 
Options exercisable at April 30, 20213,232 $5.59 
Options outstanding include 409,281 options that were unvested as of April 30, 2021.
The aggregate intrinsic value of options vested and exercisable was $655.9 million and $711.4 million as of April 30, 2021 and January 31, 2021, respectively. The weighted-average remaining contractual term of options vested and exercisable was 6.3 years and 6.4 years as of April 30, 2021 and January 31, 2021, respectively.
The weighted-average grant date fair values of all options granted was $180.08 per share during the three months ended April 30, 2021. The total intrinsic value of all options exercised was $154.4 million and $111.2 million during the three months ended April 30, 2021 and April 30, 2020, respectively.
The aggregate intrinsic value of stock options outstanding as of April 30, 2021 and January 31, 2021 was $1.2 billion and $1.4 billion, respectively, which represents the excess of the fair value of the Company’s common stock over the exercise price of the options multiplied by the number of options outstanding. The weighted-average remaining contractual term of stock options outstanding was 6.8 years and 7.0 years as of April 30, 2021 and January 31, 2021, respectively.
Total unrecognized stock-based compensation expense related to unvested options was $30.6 million as of April 30, 2021. This expense is expected to be amortized on a straight-line basis over a weighted-average vesting period of 1.6 years. Total unrecognized stock-based compensation expense related to unvested options was $24.3 million as of January 31, 2021. This expense is expected to be amortized on a straight-line basis over a weighted-average vesting period of 1.7 years.
Early Exercise of Employee Options
The 2011 Stock Plan allows for the early exercise of stock options for certain individuals as determined by the Board of Directors. The consideration received for an early exercise of an option is a deposit of the exercise price and the related dollar amount is recorded as a liability for early exercise of unvested stock options in the condensed consolidated balance sheets. This liability is reclassified to additional paid-in capital as the awards vest. If a stock option is early exercised, the unvested shares may be repurchased by the Company in case of employment termination or for any reason, including death and disability, at the price paid by the purchaser for such shares. There were no issued shares of common stock related to early exercised stock options for the three months ended April 30, 2021 or April 30, 2020. As of April 30, 2021, the number of shares of common stock related to
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early exercised stock options subject to repurchase was 458,280 shares for $4.6 million. As of January 31, 2021, the number of shares of common stock related to early exercised stock options subject to repurchase was 548,028 shares for $5.4 million. Common stock purchased pursuant to an early exercise of stock options is not deemed to be outstanding for accounting purposes until those shares vest. The Company includes unvested shares subject to repurchase in the number of shares outstanding in the condensed consolidated statements of stockholders’ equity.
Restricted Stock Units
Restricted Stock Units (“RSUs”) granted under the 2019 Plan are generally subject to only service-based vesting condition. The service-based vesting condition is generally satisfied based on one of three vesting schedules: (i) vesting of one-fourth of the RSUs on the first “Company vest date” (defined as March 20, June 20, September 20, or December 20) on or following the one-year anniversary of the vesting commencement date with the remainder of the RSUs vesting in twelve equal quarterly installments thereafter, subject to continued service, (ii) vesting in sixteen equal quarterly installments beginning on December 20, 2018, subject to continued service, or (iii) vesting in eight equal quarterly installments beginning on December 20, 2022, subject to continued service. The valuation of such RSUs is based solely on the fair value of the Company’s stock price on the date of grant.
Expense for RSUs that have a service-based vesting condition only are being amortized on a straight-line basis. Expense for RSUs that have both a service-based and a performance-based vesting condition are being amortized under the accelerated attribution method. Total unrecognized stock-based compensation expense related to unvested RSUs was $496.4 million as of April 30, 2021. This expense is expected to be amortized (subject to acceleration or straight-line basis) over a weighted-average vesting period of 2.5 years.
Performance-based Stock Units
Performance-based stock units (“PSUs”) granted under the 2019 Plan are generally subject to both a service-based vesting condition and a performance-based vesting condition. PSUs will vest upon the achievement of specified performance targets and subject to continued service through the applicable vesting dates. The compensation cost is recognized over the requisite service period when it is probable that the performance condition will be satisfied.
Expense for PSUs are being amortized under the accelerated attribution method and may be adjusted over the vesting period based on interim estimates of performance against pre-set objectives. Total unrecognized stock-based compensation expense related to unvested PSUs was $89.2 million as of April 30, 2021. This expense is expected to be amortized over a weighted-average vesting period of 1.7 years.
The following table is a summary of RSU and PSU activities for the three months ended April 30, 2021:
Number of
Shares
Weighted-
Average Grant
Date Fair Value
Per Share
(in thousands)
RSUs and PSUs outstanding at January 31, 20218,449 $59.27 
Granted976 $199.35 
Vested(1,193)$53.21 
Performance adjustment (1)
153 $58.15 
Forfeited(111)$81.63 
RSUs and PSUs outstanding at April 30, 2021
8,274 $76.34 
RSUs and PSUs expected to vest at April 30, 20218,274 $76.34 
__________________________________
(1)Performance adjustment represents adjustments in shares outstanding due to the actual achievement of performance based awards, the achievement of which was based upon predefined financial performance targets.
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Employee Stock Purchase Plan
In May 2019, the board of directors adopted, and the stockholders approved the CrowdStrike Holdings, Inc. 2019 Employee Stock Purchase Plan (“ESPP”), which became effective on June 10, 2019, which was the business day prior to the effectiveness of the Company’s registration statement on Form S-1 used in connection with the Company’s IPO. A total of 3,500,000 shares of Class A common stock were initially reserved for issuance under the ESPP. The Company’s compensation committee administers the ESPP. The number of shares of common stock available for issuance under the ESPP is subject to an annual increase on the first day of each fiscal year beginning on February 1, 2020, equal to the lesser of: (i) one percent (1%) of outstanding shares of the Company’s capital stock as of the last day of the immediately preceding fiscal year or (ii) such other amount as its board of directors may determine.
The ESPP provides for consecutive offering periods that will typically have a duration of approximately 24 months in length and is comprised of four purchase periods of approximately six months in length. The offering periods are scheduled to start on the first trading day on or after June 11 and December 11 of each year. The first offering period commenced on June 11, 2019 and is scheduled to end on the first trading day on or before June 10, 2021.
The ESPP provides eligible employees with an opportunity to purchase shares of the Company’s Class A common stock through payroll deductions of up to 15% of their eligible compensation. A participant may purchase a maximum of 2,500 shares of common stock during a purchase period. Amounts deducted and accumulated by the participant are used to purchase shares of common stock at the end of each six-month purchase period. The purchase price of the shares shall be 85% of the lower of the fair market value of the Class A common stock on (i) the first trading day of the applicable offering period and (ii) the last trading day of each purchase period in the related offering period. Participants may end their participation at any time during an offering period and will be paid their accrued contributions that have not yet been used to purchase shares of common stock. Participation ends automatically upon termination of employment. The ESPP allows for up to one increase in contribution during each purchase period. If an employee elects to increase his or her contribution, the Company treats this as an accounting modification. The pre- and post-modification fair values are calculated on the date of the modification, and the incremental expense is then amortized over the remaining purchase period. Incremental expense as a result of such modification was $2.5 million for the three months ended April 30, 2021.
Employee payroll contributions ultimately used to purchase shares are reclassified to stockholders’ equity on the purchase date. ESPP employee payroll contributions accrued at April 30, 2021 and January 31, 2021 totaled $24.3 million and $11.0 million are included within accrued payroll and benefits in the condensed consolidated balance sheets.
The following table summarizes the assumptions used in the Black-Scholes option-pricing model to determine fair value of the Company’s common shares to be issued under the ESPP for the offering periods beginning in June 2019:
Three Months Ended
April 30, 2021
Expected term (in years)
0.5 - 2.0
Risk-free interest rate
0.1 - 2.0%
Expected stock price volatility
30.1 - 54.3%
Dividend yield %
Stock-Based Compensation Expense
Stock-based compensation expense included in the condensed consolidated statements of operations is as follows:
Three Months Ended April 30,
20212020
(in thousands)
Subscription cost of revenue$4,285 $1,995 
Professional services cost of revenue2,028 971 
Sales and marketing17,414 8,687 
Research and development17,801 4,900 
General and administrative12,834 7,085 
Total stock-based compensation expense$54,362 $23,638 
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9.    Revenue, Deferred Revenue and Remaining Performance Obligations
The following table summarizes the revenue from contracts by type of customer:
Three Months Ended April 30,
20212020
Amount% RevenueAmount% Revenue
(in thousands, except percentages)
Channel Partners$227,055