CrowdStrike, a cybersecurity software maker, recently reported strong fiscal second-quarter results that beat LSEG consensus. The company’s earnings per share came in at $1.04 adjusted compared to the expected 97 cents, while revenue reached $963.9 million against the anticipated $959 million. Despite these positive numbers, CrowdStrike’s shares slipped 4% in extended trading following the announcement of reduced full-year guidance. The company’s revenue grew 32% year over year in the quarter that ended on July 31, recording a net income of $47 million or 19 cents per share.
On July 19, CrowdStrike issued a flawed content configuration update for its Falcon sensor, causing millions of computers running Microsoft Windows operating systems to crash. This resulted in various disruptions such as flight cancelations, delayed package deliveries, and postponed medical appointments. To make matters worse, administrators had to manually reboot affected computers, leading to significant inconveniences and financial losses for various organizations. Consequently, investors pushed down CrowdStrike’s share price, with shareholders filing lawsuits against the company.
Financial Guidance Revision
In light of the global outage, CrowdStrike revised its full-year guidance, forecasting adjusted net earnings of 80 to 81 cents per share on $979.2 million to $984.7 million in revenue. For the 2025 fiscal year, the company now expects $3.61 to $3.65 in adjusted earnings per share and $3.89 billion to $3.90 billion in revenue, representing a decline from its previous forecast. The updated guidance includes a negative subscription revenue impact of $30 million in each quarter, as well as professional services revenue in the high-single-digit millions of dollars for the second half of the fiscal year due to incentives for a customer commitment package.
Before the earnings report, CrowdStrike’s stock was up approximately 4% for the year, while the S&P 500 index had gained 17% during the same period. The company’s executives are set to discuss the results with analysts on a conference call to address the implications of the global outage on its financial performance. It remains to be seen how CrowdStrike will navigate the aftermath of the incident and regain the trust of both investors and customers amidst the ongoing legal challenges and financial repercussions.
CrowdStrike’s strong second-quarter results were overshadowed by the adverse effects of the global outage, leading to a decline in share price and revised full-year guidance. The company’s response to the incident and its ability to address the concerns of stakeholders will be critical in shaping its future financial performance and reputation in the cybersecurity sector.