CrowdStrike has raised its full-year outlook and reported impressive fiscal third-quarter results despite the lingering effects of the global tech outage experienced in July, which impacted the company's share prices early Wednesday. The cybersecurity firm now projects adjusted earnings per share for fiscal 2025 to fall between $3.74 and $3.76, increased from earlier forecasts of $3.61 to $3.65.
Estimated revenue is set at $3.92 billion to $3.93 billion, compared to the prior guidance of $3.89 billion to $3.9 billion. Current consensus on FactSet anticipates non-GAAP EPS at $3.70 and revenue of $3.91 billion. Chief Financial Officer Burt Podbere expressed optimism regarding the company's performance, highlighting a strong dollar-based gross retention rate, effective customer commitment packages prompting customers to opt for additional products or Flex dollars, robust adoption of the Falcon platform, growing module adoption rates, and a positive quarter-over-quarter growth trend in the pipeline.
However, Podbere pointed out that the company’s short-term visibility is limited due to challenges from the July 19 outage, which occurred during an update for Falcon sensors on Microsoft Windows systems. This incident has led to delays in outbound pipeline generation activities for several weeks, extended sales cycles for both new and existing clients, and potentially higher contraction levels.
To address these challenges, Podbere noted, “Recognizing our continued reduced visibility, we are maintaining our estimated impact of approximately $30 million to both net new annual recurring revenue and subscription revenue in the fourth quarter from our customer commitment packages.” On Wednesday, the stock experienced a 6.4% decline during premarket trading.
For the upcoming three-month period, CrowdStrike anticipates adjusted EPS between $0.84 and $0.86, with revenue expected to range from $1.03 billion to $1.04 billion. Analysts predict non-GAAP EPS at $0.86 and revenue of $1.03 billion. In the quarter ending on October 31, CrowdStrike reported adjusted earnings of $0.93 per share, an increase from $0.82 year-over-year, exceeding analyst expectations of $0.81.
Revenue rose by 29% year-over-year to $1.01 billion, surpassing analysts' estimates of $982.8 million. Subscription revenue also increased by 31% to reach $962.7 million, while professional services revenue dropped to $47.4 million from $52.6 million year prior. Annual recurring revenue (ARR) soared by 27% to $4.02 billion, which included $153 million added in net new ARR in the third quarter.
Podbere mentioned, “The July 19 incident resulted in near-term headwinds to net new ARR as we experienced extended sales cycles with both existing and prospective customers and one-time incentives offered through our customer commitment packages, which resulted in increased contraction and muted upsell rates.”.