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CrowdStrike Holdings (CRWD - Free Report) reported third-quarter fiscal 2023 non-GAAP earnings of 40 cents per share, beating the Zacks Consensus Estimate of 32 cents. The bottom line improved from the year-ago quarter’s figure of 17 cents.
The company added $198.1 million to its net new annual recurring revenues (ARR), taking the total ARR to $2.34 billion as of Oct 31, 2022, up 54% year over year.
Top-Line Details
CrowdStrike’s fiscal third-quarter revenues of $580.9 million surged 53% year over year and surpassed the consensus mark of $574.7 million. Subscription revenues jumped 53.3% year over year to $547.4 million.
The company added 1,460 net new subscription customers during the reported quarter. It had a total of 21,146 subscription customers as of Oct 31, 2022, reflecting year-over-year growth of 44%.
CRWD’s subscription customers, who adopted five or more cloud modules, soared to 60%, those with six or more cloud modules rose to 36%, and those with seven or more cloud modules jumped to 21% as of Oct 31, 2022.
Revenues from professional services climbed 45.7% year over year to $33.5 million.
CrowdStrike’s non-GAAP gross margin contracted 100 basis points (bps) on a year-over-year basis at 75%. The non-GAAP subscription gross margin contracted 100 bps to 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 63%.
The non-GAAP operating income was $89.7 million compared with $50.7 million in the year-ago quarter. The non-GAAP operating margin for the quarter was 15%, up 200 bps year over year.
Balance Sheet & Cash Flow
As of Oct 31, 2022, cash and cash equivalents were $2.47 billion compared with $2.32 billion as of Jul 31, 2022. CrowdStrike had long-term debt of $740.6 million.
During the fiscal third quarter, CRWD generated operating and free cash flows of $242.9 million and $174.1 million, respectively. During the first nine months of fiscal 2023, the company generated operating and free cash flow of $667.7 million and $467.4 million.
Outlook
Buoyed by the stellar third-quarter performance, CrowdStrike raised its guidance for fiscal 2023. Although the company’s management still expects revenues in the band of $2,223-$2,232 million, it now anticipates non-GAAP earnings in the band of $1.49-$1.52 per share, up from the prior range of $1.31-$1.33 per share.
The non-GAAP operating income for full fiscal 2023 is now projected in the range of $347.2-$353.8 million, higher than the previous band of $321.8-$328.5 million.
For the fourth quarter, CrowdStrike anticipates revenues between $619.1 million and $628.2 million. For the bottom line, the company expects to report non-GAAP earnings per share between 42 cents and 45 cents.
The non-GAAP operating income is expected in the band of $87.2-$93.7 million.
Zacks Rank & Stocks to Consider
CrowdStrike currently carries a Zacks Rank #3 (Hold). Shares of CRWD have lost 36.5% in the past year.
The Zacks Consensus Estimate for Celestica’s fourth-quarter 2022 earnings has increased by 9 cents to 53 cents per share over the past 60 days. For 2022, earnings estimates have moved 16 cents up to $1.86 per share in the past 60 days.
CLS' earnings beat the Zacks Consensus Estimate in all the preceding four quarters, the average surprise being 11.8%. Shares of the company have moved up 6.1% in the past year.
The Zacks Consensus Estimate for Fabrinet's second-quarter fiscal 2023 earnings has been revised 16 cents northward to $1.89 per share over the past 30 days. For fiscal 2023, earnings estimates have improved 7.6% to $7.48 per share in the past 30 days.
FN’s earnings beat the Zacks Consensus Estimate in three of the preceding four quarters, missing once, the average surprise being 5.4%. Shares of the company have gained 16.1% in the past year.
The Zacks Consensus Estimate for Zscaler's first-quarter fiscal 2023 earnings has been revised 7 cents north to 26 cents per share over the past 90 days. For fiscal 2023, earnings estimates have moved south by a penny to $1.17 per share in the past 30 days.
ZS' earnings beat the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 28.6%. Shares of the company have declined 61.1% in the past year.
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CrowdStrike (CRWD) Beats Q3 Earnings & Revenue Estimates
CrowdStrike Holdings (CRWD - Free Report) reported third-quarter fiscal 2023 non-GAAP earnings of 40 cents per share, beating the Zacks Consensus Estimate of 32 cents. The bottom line improved from the year-ago quarter’s figure of 17 cents.
The company added $198.1 million to its net new annual recurring revenues (ARR), taking the total ARR to $2.34 billion as of Oct 31, 2022, up 54% year over year.
Top-Line Details
CrowdStrike’s fiscal third-quarter revenues of $580.9 million surged 53% year over year and surpassed the consensus mark of $574.7 million. Subscription revenues jumped 53.3% year over year to $547.4 million.
The company added 1,460 net new subscription customers during the reported quarter. It had a total of 21,146 subscription customers as of Oct 31, 2022, reflecting year-over-year growth of 44%.
CRWD’s subscription customers, who adopted five or more cloud modules, soared to 60%, those with six or more cloud modules rose to 36%, and those with seven or more cloud modules jumped to 21% as of Oct 31, 2022.
Revenues from professional services climbed 45.7% year over year to $33.5 million.
CrowdStrike Price, Consensus and EPS Surprise
CrowdStrike price-consensus-eps-surprise-chart | CrowdStrike Quote
Operating Details
CrowdStrike’s non-GAAP gross margin contracted 100 basis points (bps) on a year-over-year basis at 75%. The non-GAAP subscription gross margin contracted 100 bps to 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 63%.
The non-GAAP operating income was $89.7 million compared with $50.7 million in the year-ago quarter. The non-GAAP operating margin for the quarter was 15%, up 200 bps year over year.
Balance Sheet & Cash Flow
As of Oct 31, 2022, cash and cash equivalents were $2.47 billion compared with $2.32 billion as of Jul 31, 2022. CrowdStrike had long-term debt of $740.6 million.
During the fiscal third quarter, CRWD generated operating and free cash flows of $242.9 million and $174.1 million, respectively. During the first nine months of fiscal 2023, the company generated operating and free cash flow of $667.7 million and $467.4 million.
Outlook
Buoyed by the stellar third-quarter performance, CrowdStrike raised its guidance for fiscal 2023. Although the company’s management still expects revenues in the band of $2,223-$2,232 million, it now anticipates non-GAAP earnings in the band of $1.49-$1.52 per share, up from the prior range of $1.31-$1.33 per share.
The non-GAAP operating income for full fiscal 2023 is now projected in the range of $347.2-$353.8 million, higher than the previous band of $321.8-$328.5 million.
For the fourth quarter, CrowdStrike anticipates revenues between $619.1 million and $628.2 million. For the bottom line, the company expects to report non-GAAP earnings per share between 42 cents and 45 cents.
The non-GAAP operating income is expected in the band of $87.2-$93.7 million.
Zacks Rank & Stocks to Consider
CrowdStrike currently carries a Zacks Rank #3 (Hold). Shares of CRWD have lost 36.5% in the past year.
Some better-ranked stocks from the broader Computer and Technology sector are Celestica (CLS - Free Report) , Fabrinet (FN - Free Report) and Zscaler (ZS - Free Report) . While Celestica flaunts a Zacks Rank #1 (Strong Buy), Fabrinet and Zscaler carry a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Celestica’s fourth-quarter 2022 earnings has increased by 9 cents to 53 cents per share over the past 60 days. For 2022, earnings estimates have moved 16 cents up to $1.86 per share in the past 60 days.
CLS' earnings beat the Zacks Consensus Estimate in all the preceding four quarters, the average surprise being 11.8%. Shares of the company have moved up 6.1% in the past year.
The Zacks Consensus Estimate for Fabrinet's second-quarter fiscal 2023 earnings has been revised 16 cents northward to $1.89 per share over the past 30 days. For fiscal 2023, earnings estimates have improved 7.6% to $7.48 per share in the past 30 days.
FN’s earnings beat the Zacks Consensus Estimate in three of the preceding four quarters, missing once, the average surprise being 5.4%. Shares of the company have gained 16.1% in the past year.
The Zacks Consensus Estimate for Zscaler's first-quarter fiscal 2023 earnings has been revised 7 cents north to 26 cents per share over the past 90 days. For fiscal 2023, earnings estimates have moved south by a penny to $1.17 per share in the past 30 days.
ZS' earnings beat the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 28.6%. Shares of the company have declined 61.1% in the past year.