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CrowdStrike (CRWD) Beats on Q2 Earnings and Revenue Estimates
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CrowdStrike Holdings (CRWD - Free Report) reported second-quarter fiscal 2023 non-GAAP earnings of 36 cents per share, beating the Zacks Consensus Estimate of 28 cents. The bottom line improved from the year-ago quarter’s figure of 11 cents.
The company added $218.1 million to its net new annual recurring revenues (“ARR”), taking the total ARR to $2.14 billion as of Jul 31, 2022, up 59% year over year.
Top-Line Details
CrowdStrike’s fiscal second-quarter revenues of $535.2 million surged 58% year over year and surpassed the consensus mark of $517.1 million. Subscription revenues jumped 60% year over year to $506.2 million.
The company added 1,741 net new subscription customers during the reported quarter. It had a total of 19,686 subscription customers as of Jul 31, 2022, reflecting year-over-year growth of 51%.
CrowdStrike’s subscription customers, who adopted five or more cloud modules, soared to 59%, those with six or more cloud modules rose to 36%, and those with seven or more cloud modules jumped to 20% as of Jul 31, 2022.
Revenues from professional services climbed 32.5% year over year to $29 million.
Operating Details
CrowdStrike’s non-GAAP gross margin remained flat on a year-over-year basis at 76%. The non-GAAP subscription gross margin remained flat at 78% on a year-over-year basis.
Total non-GAAP operating expenses, as a percentage of revenues, were 60% compared with the prior-year quarter’s 66%.
The non-GAAP operating income was $87.3 million compared with $35.3 million in the year-ago quarter. The non-GAAP operating margin for the quarter was 16%, up 600 basis points year over year.
Balance Sheet & Cash Flow
As of Jul 31, 2022, cash and cash equivalents were $2.32 billion compared with $2.15 billion as of Apr 30, 2022. CrowdStrike had long-term debt of $740.3 million.
During the fiscal second quarter, CRWD generated operating and free cash flows of $209.9 million and $108.5 million, respectively. It generated free cash flow of $135.8 million compared with $73.6 million in the year-ago quarter. During the first half of fiscal 2023, the company generated operating cash flow of $424.9 million.
Outlook
Buoyed by the stellar second-quarter performance, CrowdStrike raised its guidance for fiscal 2023. The company’s management currently estimates its revenues in the band of $2,223-$2,232 million compared with the previously projected band of $2,190.5-$2,205.8 million. The company now anticipates non-GAAP earnings in the band of $1.31-$1.33 per share, up from the prior range of $1.18-$1.22 per share.
The non-GAAP operating income for full fiscal 2023 is now projected in the range of $321.8-$328.5 million, higher than the previous band of $306.5-$317.8 million.
For the third quarter, CrowdStrike anticipates revenues between $569.1 million and $575.9 million. For the bottom line, the company expects to report non-GAAP earnings per share between 30 cents and 32 cents.
The non-GAAP operating income is expected in the band of $72.7-$77.7 million.
Zacks Rank & Stocks to Consider
CrowdStrike currently carries a Zacks Rank #3 (Hold). Shares of CRWD have declined 5.2% year to date (“YTD”).
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CrowdStrike (CRWD) Beats on Q2 Earnings and Revenue Estimates
CrowdStrike Holdings (CRWD - Free Report) reported second-quarter fiscal 2023 non-GAAP earnings of 36 cents per share, beating the Zacks Consensus Estimate of 28 cents. The bottom line improved from the year-ago quarter’s figure of 11 cents.
The company added $218.1 million to its net new annual recurring revenues (“ARR”), taking the total ARR to $2.14 billion as of Jul 31, 2022, up 59% year over year.
Top-Line Details
CrowdStrike’s fiscal second-quarter revenues of $535.2 million surged 58% year over year and surpassed the consensus mark of $517.1 million. Subscription revenues jumped 60% year over year to $506.2 million.
The company added 1,741 net new subscription customers during the reported quarter. It had a total of 19,686 subscription customers as of Jul 31, 2022, reflecting year-over-year growth of 51%.
CrowdStrike Price, Consensus and EPS Surprise
CrowdStrike price-consensus-eps-surprise-chart | CrowdStrike Quote
CrowdStrike’s subscription customers, who adopted five or more cloud modules, soared to 59%, those with six or more cloud modules rose to 36%, and those with seven or more cloud modules jumped to 20% as of Jul 31, 2022.
Revenues from professional services climbed 32.5% year over year to $29 million.
Operating Details
CrowdStrike’s non-GAAP gross margin remained flat on a year-over-year basis at 76%. The non-GAAP subscription gross margin remained flat at 78% on a year-over-year basis.
Total non-GAAP operating expenses, as a percentage of revenues, were 60% compared with the prior-year quarter’s 66%.
The non-GAAP operating income was $87.3 million compared with $35.3 million in the year-ago quarter. The non-GAAP operating margin for the quarter was 16%, up 600 basis points year over year.
Balance Sheet & Cash Flow
As of Jul 31, 2022, cash and cash equivalents were $2.32 billion compared with $2.15 billion as of Apr 30, 2022. CrowdStrike had long-term debt of $740.3 million.
During the fiscal second quarter, CRWD generated operating and free cash flows of $209.9 million and $108.5 million, respectively. It generated free cash flow of $135.8 million compared with $73.6 million in the year-ago quarter. During the first half of fiscal 2023, the company generated operating cash flow of $424.9 million.
Outlook
Buoyed by the stellar second-quarter performance, CrowdStrike raised its guidance for fiscal 2023. The company’s management currently estimates its revenues in the band of $2,223-$2,232 million compared with the previously projected band of $2,190.5-$2,205.8 million. The company now anticipates non-GAAP earnings in the band of $1.31-$1.33 per share, up from the prior range of $1.18-$1.22 per share.
The non-GAAP operating income for full fiscal 2023 is now projected in the range of $321.8-$328.5 million, higher than the previous band of $306.5-$317.8 million.
For the third quarter, CrowdStrike anticipates revenues between $569.1 million and $575.9 million. For the bottom line, the company expects to report non-GAAP earnings per share between 30 cents and 32 cents.
The non-GAAP operating income is expected in the band of $72.7-$77.7 million.
Zacks Rank & Stocks to Consider
CrowdStrike currently carries a Zacks Rank #3 (Hold). Shares of CRWD have declined 5.2% year to date (“YTD”).
Some better-ranked stocks from the broader Computer and Technology sector are Clearfield (CLFD - Free Report) , Silicon Laboratories (SLAB - Free Report) and Taiwan Semiconductor (TSM - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Clearfield's fourth-quarter fiscal 2022 earnings has been revised upward by 10 cents to 80 cents per share over the past 60 days. For fiscal 2022, earnings estimates have moved 36 cents north to $3.13 per share in the past 60 days.
Clearfield’s earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 33.9%. Shares of CLFD have soared 40.6% YTD.
The Zacks Consensus Estimate for Silicon Laboratories’ third-quarter 2022 earnings has increased 22.9% to $1.02 per share over the past 60 days. For 2022, earnings estimates have moved 20.5% up to $4.41 per share in the past 60 days.
Silicon Laboratories’ earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 63.6%. Shares of SLAB have decreased 37.4% YTD.
The Zacks Consensus Estimate for Taiwan Semiconductor's third-quarter 2022 earnings has been revised a penny southward to $1.69 per share over the past 30 days. For 2022, earnings estimates have moved 37 cents north to $6.30 per share in the past 60 days.
TSM's earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 3.9%. Shares of the company have decreased 31.2% YTD.