CrowdStrike Reports Record Quarter as AI Security Demand Fuels 26% Revenue Growth

CrowdStrike's quarter shows AI is a cybersecurity tailwind, not a threat

Shares of CrowdStrike jumped 10% after the company delivered another beat-and-raise quarter, cementing our thesis that cybersecurity has become one of the most critical investment priorities for companies in a post-Mythos world. Revenue in CrowdStrike's fiscal 2027 second quarter increased 26% year over year to $1.47 billion, exceeding the $1.44 billion consensus estimate, according to LSEG. Adjusted earnings per share (EPS) increased 35% to $0.31 in the quarter ended July 31, ahead of the $0.29 estimate, LSEG data showed. CRWD 1Y mountain CrowdStrike 1-year performance The stock had pulled back heading into the print -- falling in seven of the past sessions dating back to its record close of $225.53 on Aug. 13 -- but was still up roughly 61% for the year before its after-hours move. Fellow cybersecurity firm Okta also reported strong results after the bell, with shares jumping roughly 20% following a raise in guidance. The one-two punch of these knockout reports should also lift shares of Palo Alto Networks , which reports earnings next Tuesday. Bottom line Earlier this year, the bears thought advances in AI models could disintermediate CrowdStrike. Instead, AI has become a major accelerant for the business, and it's more than just talk. It's shown up in the numbers. "The Mythos moment translated into mass-market acceptance that AI adoption needs security, and that's CrowdStrike," founder and CEO George Kurtz said in the company's earnings release, referring to Anthropic's limited preview of its Claude Mythos AI model back in April that highlighted critical vulnerabilities at companies that humans had missed for years. "Every enterprise will run on AI, and securing it is the largest market opportunity in our history," Kurtz said. Arguably the most important metric in every CrowdStrike earnings report is its net new annual recurring revenue (NNARR), which represents the quarter-over-quarter change in ARR and measures how much new recurring business was added during the quarter. Why we own it Cybersecurity is a must-have for companies in the digital age. Led by co-founder and CEO George Kurtz, CrowdStrike is among the best, along with fellow Club member Palo Alto Networks . The company specializes in endpoint protection through its AI-native platform called Falcon. Competitors: Palo Alto Networks, Fortinet , SentinelOne , Microsoft Portfolio weighting: 3.62% Most recent buy: Feb. 3, 2026 Initiation date: March 24, 2026 Expectations were high into the print -- with investors anticipating an acceleration in demand for cybersecurity solutions to thwart the growing threat of cyberattacks -- and CrowdStrike delivered. The company's NNARR of $333 million was above the Street's $284 million estimate. It also surpassed the tougher investors' estimate of about $310 million that Jefferies analysts highlighted in a preview note this week. The $333 million in NNARR was up about 51% year over year, a sharp acceleration from 32% growth in the prior quarter. The company's agentic security platform delivered great results as enterprises looked to protect against rogue AI agents. Cloud Security quarter-end ARR increased more than 29% year over year, while LogScale Next-Gen Security Information and Event Management (SIEM) ARR grew 60% and Next-Gen Identity ARR increased 33%. Key customer wins during the quarter included an unnamed frontier lab that significantly grew with CrowdStrike with an eight-figure ARR deal using CrowdStrike's flexible licensing model (Flex) to maintain cost visibility while scaling Falcon Cloud Security across its data center infrastructure. It's important to note that frontier labs are turning to CrowdStrike for their cybersecurity solutions because even the creators of AI realize they need to protect AI with outside vendors. Another win was with a European car maker that replaced its next-gen Endpoint Detection and Response, legacy SIEM, and legacy vulnerability management product with an eight-figure net-new Falcon Flex. In addition to the strong results, the company said it ended the quarter with a record pipeline. Some of this momentum can be attributed to Project Quiltworks, the coalition it formed in April to "assess, prioritize, and continuously remediate the wave of vulnerabilities in production code now being discovered by frontier AI models." CrowdStrike said that its Quiltworks partners have collaborated on nearly $400 million of total contract value pipeline to date. CrowdStrike's annual customer and product conference, Fal.Con, begins next Monday, Aug. 31, and runs through Sept. 3. On its call with investors, management said the conference sold out in early August and is its largest pipeline-generation event of the year. The company will hold an investor briefing event on Sept. 2. We see more gains ahead for CrowdStrike because the proliferation of AI agents means more need for best-in-class cybersecurity solutions. We are raising our price target to $230 from $220 while keeping a 2 rating on the stock, given the sharp after-hours move and a roughly 100% rally from its April lows. Guidance For its full fiscal year 2027, CrowdStrike management hiked its outlook. Total revenue is expected to be in the range of roughly $5.991 billion to $6.011 billion. This midpoint of about $6 billion is above the $5.928 billion expectation, according to LSEG. It's also a raise from the company's prior outlook of $5.914 billion to $5.958 billion. Adjusted EPS is forecast to be between $1.25 and $1.26. That's up from its prior outlook of $1.22 to $1.24. It's also slightly above the $1.23 expectation, according to LSEG. Annual Recurring Revenue (ARR) is expected to be in the range of roughly $6.603 billion to $6.612 billion. That's a raise from its prior guide of $6.532 billion to $6.556 billion. The new guide is also solidly above the $6.544 billion expectation, according to FactSet. For its fiscal 2027 third quarter, CrowdStrike also issued a solid outlook. Total revenue is expected to be between $1.523 billion and $1.529 billion, ahead of the $1.515 billion consensus, according to LSEG. Adjusted EPS is expected to be $0.31, matching estimates compiled by LSEG. ARR is expected to be between $6.184 billion and $6.188 billion, also ahead of the $6.125 billion expected, according to FactSet. This outlook also implies a strong NNARR of $346 million. (Jim Cramer's Charitable Trust is long CRWD. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.

CrowdStrike pops 11% on record second quarter as 'Mythos moment' drives AI cyber wave

* CrowdStrike topped fiscal second-quarter estimates and boosted guidance as artificial intelligence threats boost security demand. * CEO George Kurtz said it was "the best quarter in CrowdStrike's history." * CrowdStrike and its peers have hit new highs on skyrocketing demand for AI security tools. In this article * CRWD Follow your favorite stocksCREATE FREE ACCOUNT George Kurtz, CEO and founder of CrowdStrike, speaks to the Economic Club of New York in New York City, U.S., Oct. 23, 2025. Brendan McDermid | Reuters CrowdStrike popped more than 11% in extended trading after the cybersecurity company topped Wall Street's fiscal second-quarter estimates and boosted guidance as artificial intelligence threats mount. * Earnings per share: 31 cents adjusted vs. 29 cents expected * Revenue: $1.47 billion vs. $1.44 billion expected Revenue jumped 26% in Q2 from $1.17 billion a year ago, with CEO George Kurtz calling it "the best quarter in CrowdStrike's history" in the earnings release. "The Mythos moment translated into mass-market acceptance that AI adoption needs security, and that's CrowdStrike," he said. "Every enterprise will run on AI, and securing it is the largest market opportunity in our history." Annual recurring revenue rose 25% year over year to $5.84 billion, which included record net new annual recurring revenue of $333 million, the company said. Net income totaled $5.3 million, or 1 cent per share, compared to a net loss of $70.2 million, a loss of 7 cents per share, a year ago. Read more CNBC tech news Agentic AI is driving demand for security tools to protect companies from proliferating threats. The demand has powered shares of CrowdStrike and its competitors to all-time highs, with the stock up more than 61% this year. CrowdStrike lifted its full-year revenue outlook to between $5.99 billion and $6.01 billion and adjusted earnings per share between $1.25 and $1.26. That topped a $5.93 billion revenue estimate and a $1.23 EPS estimate from analysts. For the third quarter, the company forecasted between $1.52 billion and $1.53 billion in revenue and adjusted EPS of 31 cents per share, which were roughly in line with estimates. Stock Chart IconStock chart icon CrowdStrike stock chart Choose CNBC as your preferred source on Google and never miss a moment from the most trusted name in business news.

CrowdStrike Is 'Cybersecurity's Infrastructure Layer' For AI Era: CEO George Kurtz

The cybersecurity giant is seeing surging demand for AI security along with massive deal growth from its Falcon Flex subscription model, Kurtz said Wednesday. CrowdStrike has all the right elements to position its comprehensive Falcon platform as the go-to way to secure the usage of AI and agentic tools going forward, CrowdStrike co-founder and CEO George Kurtz said Wednesday. Speaking with Wall Street analysts during CrowdStrike's quarterly call, Kurtz said it's becoming increasingly clear that the cybersecurity giant is ahead of rivals when it comes to providing advanced security in the AI era -- particularly in the wake of Anthropic's disclosure of details about its Claude Mythos cyber model earlier this year. [Related: CrowdStrike's Daniel Bernard: Frontier AI Requires Cybersecurity's 'Greatest Mobilization' Ever] Kurtz made the comments as CrowdStrike released financial results for the second quarter of its fiscal 2027, ended July 31, which surpassed Wall Street expectations. "In this threat landscape, CrowdStrike stands out," he said. "Ever since Mythos, we've seen growth in our business not measured by meetings or calls, but measured by ARR." As one example, Kurtz said that CrowdStrike continues to see huge traction for its AI detection and response (AIDR) offering, Falcon AIDR. Annual recurring revenue (ARR) growth for Falcon AIDR "nearly tripled" by the end of July 31 compared to the prior quarter sequentially, "as customers embrace our frictionless approach to AI visibility and security," he said. In concert with other fast-growing offerings including Falcon Next-Gen SIEM, Falcon Next-Gen Identity Security and Falcon Exposure Management -- as well as a continued re-acceleration in demand for core Falcon endpoint security -- CrowdStrike is now exceedingly well-positioned for meeting customer and partner needs amid the AI rush, Kurtz said. "Taken together, the Falcon platform is cybersecurity's infrastructure layer for AI adoption," he said during the call Wednesday. CrowdStrike is also seeing massive deal growth from its Falcon Flex subscription model, Kurtz said. Falcon Flex aims to enable partners to rapidly package up and deploy the dozens of tools CrowdStrike now offers on its platform, while providing improved agility and cost savings for customers. Ending ARR from customers that have adopted Falcon Flex surpassed $2.29 billion during the company's fiscal second quarter, representing growth of 101 percent year over year, according to Kurtz. Flex is "the commercial harness to enable customer success in the agentic era," he said, adding that the company has now "kicked Falcon Flex activity into high gear with our Flex-first go-to-market strategy." During the quarter, each of the company's 10 largest deals involved Flex while CrowdStrike added more than 935 new Flex customers, Kurtz said. CrowdStrike's partner base is also continuing to play a central role in the company's momentum, including around the AI security push, Kurtz said. He pointed to the company's frontier AI security initiative, Project QuiltWorks, which is focused on working with partners to enable protection against AI-discovered vulnerabilities. CrowdStrike has increasingly been expanding the initiative to more partners since it launched in April, most recently with the announcement earlier this month that Project QuiltWorks is now open to a broad set of MSPs and other partners. "To date, our QuiltWorks partners are collaborating with us on nearly $400 million of total contract value pipeline," Kurtz said. In other partner-related milestones, CrowdStrike's global system integrator business grew nearly 50 percent as of its latest quarter, year over year, driven largely by Next-Gen SIEM and vulnerability management, while the company is seeing "significant traction in the SMB space" through MSSP partnerships, Kurtz said. Partners that are continuing to see massive momentum with CrowdStrike include Defensive Networks, according to Ben Ferguson, executive vice president and CTO at El Segundo, Calif.-based Defensive Networks. Defensive Networks is "one of the top implementation partners in the world" for the cybersecurity vendor, Ferguson said, and "CrowdStrike is, bidirectionally, our most strategic partnership." Ultimately, "a lot of that it comes down to, they're just the efficacy leader in that space, in system security," he said. "And not only that -- they've always had a gap between them and the competition, but they are running away with it as well. So I can't say enough great things about CrowdStrike." For CrowdStrike's fiscal second quarter, total revenue grew 26 percent year over year to reach $1.47 billion, beating the Wall Street analyst consensus estimate by $30 million. The company also raised its full fiscal year guidance Wednesday. The company also reported non-GAAP net income of 31 cents per diluted share, surpassing analyst expectations by 2 cents per diluted share.

CrowdStrike Q2 FY27 slides: record ARR growth, AI security drives adoption By Investing.com

CrowdStrike Holdings (NASDAQ:CRWD) presented its fiscal second-quarter 2027 financial results on August 26, 2026, showcasing what executives described as the company's strongest quarter to date. The cybersecurity platform provider reported record net new annual recurring revenue and operating income, driven by accelerating demand for AI-focused security products. Shares surged 10.38% in after-hours trading to $208.81, following the strong results and raised full-year guidance. The presentation highlighted how the company is capitalizing on growing enterprise concerns about AI-related security threats, with its Falcon platform positioning itself as what CEO George Kurtz called "cybersecurity's infrastructure layer for AI adoption." Quarterly Performance Highlights CrowdStrike's Q2 FY27 results demonstrated significant momentum across key financial metrics, with growth accelerating for the fifth consecutive quarter. The following summary captures the company's performance across critical business indicators. The company achieved ending ARR of $5.84 billion, representing 25% year-over-year growth, while net new ARR reached a record $333 million -- up 51% from the prior year. Total revenue climbed to $1.47 billion, a 26% increase, with subscription revenue growing 27% to $1.40 billion. Profitability metrics showed even stronger expansion. Non-GAAP operating income reached $372 million with a 25% margin, up 46% year-over-year and expanding margins by 350 basis points. Diluted earnings per share of $0.31 beat analyst expectations of $0.29, marking 34% growth. Free cash flow hit a record $377 million with a 26% margin, growing 33% year-over-year. The detailed quarterly comparison illustrates the scale of CrowdStrike's financial expansion across all major metrics. Platform Strategy & Expanding Market Opportunity CrowdStrike's presentation emphasized its comprehensive platform approach, built around what it calls an "Agentic Security Platform" that now spans 33 distinct modules. The architecture centers on a single lightweight sensor that avoids hardware requirements, data silos, and operational friction while maintaining cloud-first and AI-native capabilities. The company outlined a substantial and growing total addressable market, currently estimated at $149 billion for calendar year 2026. This market spans ten major security segments, with managed services representing the largest opportunity at $26 billion, followed by security and IT operations, cloud security, and endpoint security at $23 billion, $23 billion, and $22 billion respectively. Looking forward, CrowdStrike projects its addressable market will more than double to $325 billion by calendar year 2030, driven by organic category growth, the company's product roadmap, and expanding cloud security opportunities. A key element of the company's value proposition is platform consolidation. CrowdStrike demonstrated how its Falcon platform replaces point products from dozens of competitors across ten security categories, including endpoint, cloud, identity, SIEM, threat intelligence, data protection, exposure management, and the emerging AI security segment. Industry Recognition & Competitive Position CrowdStrike's market leadership received third-party validation through its seventh consecutive recognition as a Leader in the 2026 Gartner Magic Quadrant for Endpoint Protection. Notably, the company was positioned highest for Ability to Execute and furthest right in Completeness of Vision for the fourth consecutive year. This positioning places CrowdStrike ahead of major competitors including Microsoft, SentinelOne, Palo Alto Networks, and others in the endpoint security market, reinforcing its competitive differentiation in a crowded field. Customer Adoption & Platform Expansion The presentation highlighted strong platform adoption metrics that demonstrate customer stickiness and expansion. More than half of subscription customers now utilize six or more modules, with 35% using seven or more and 26% deploying eight or more modules. This multi-module adoption is critical to CrowdStrike's land-and-expand strategy, as customers consolidate security tools onto the Falcon platform. The company's Falcon Flex commercial model has been instrumental in accelerating this trend. Specific platform modules showed exceptional growth rates. The combined ending ARR from Cloud Security, LogScale Next-Gen SIEM, and Next-Gen Identity exceeded $2.18 billion, growing more than 39% year-over-year. Cloud Security reached over $905 million in ARR with 29% growth, while LogScale Next-Gen SIEM demonstrated the strongest expansion at over $695 million with 60% growth. Next-Gen Identity contributed over $585 million in ARR, growing 33% year-over-year. The Falcon Flex commercial model proved particularly successful, with ending ARR from Flex accounts reaching $2.29 billion -- a remarkable 101% year-over-year increase. The company now has over 2,900 Flex customers and over 630 Re-Flex customers. Conversion to Flex from standard contracts generates an average ARR uplift of more than 40%, while customers completing their first Re-Flex see a 25% uplift and those with two or more Re-Flexes show a 53% increase versus their initial Flex contract. Profitability & Cash Flow Performance Beyond revenue growth, CrowdStrike demonstrated significant operating leverage and margin expansion. The company's non-GAAP profitability metrics showed strong improvement across subscription gross profit, operating income, earnings per share, and free cash flow. Subscription gross profit reached $1.14 billion with an 81% margin, up 28% year-over-year with a 90 basis point margin expansion. Operating income of $372 million represented a 25% margin, expanding 350 basis points from the prior year. Free cash flow of $377 million achieved a 26% margin, up 140 basis points year-over-year. Forward Guidance & Long-Term Model CrowdStrike raised its full-year fiscal 2027 guidance, reflecting confidence in sustained momentum. The company now expects full-year revenue between $5.991 billion and $6.011 billion, with non-GAAP diluted earnings per share of $1.25 to $1.26. For the third quarter, CrowdStrike guided to revenue of $1.523 billion to $1.529 billion and adjusted EPS of approximately $0.31. The company expects annual recurring revenue to reach $6.603 billion to $6.612 billion by fiscal year-end. Looking further ahead, CrowdStrike outlined its target operating model for full-year fiscal 2029, projecting significant margin expansion as the business scales. The company targets subscription gross margins of 82-85%, operating margins of 28-32%, and free cash flow margins of 34-38% by FY29. These targets assume consistent macroeconomic conditions and exclude potential M&A activity. Key Takeaways & Strategic Priorities The presentation concluded with a comprehensive summary of the quarter's achievements and strategic focus areas. Beyond the financial metrics, CrowdStrike emphasized three core themes: securing the AI revolution, unlocking adoption through Falcon Flex, and establishing itself as the cybersecurity infrastructure layer for AI adoption. The company noted that endpoint ending ARR growth accelerated for the fourth consecutive quarter, while AI Detection and Response (AIDR) ending ARR nearly tripled quarter-over-quarter. The quarter also delivered record net new ARR from the combined Cloud, Next-Gen Identity, and Next-Gen SIEM modules. Market Reaction & Investor Implications The strong results and raised guidance drove significant investor enthusiasm, with shares jumping more than 10% in after-hours trading to $208.81. This move brought the stock near the top of its 52-week range of $85.68 to $227.50, representing a substantial recovery and validation of the company's platform strategy. The combination of accelerating revenue growth, expanding profitability, strong free cash flow generation, and increasing platform adoption suggests CrowdStrike is successfully executing on its vision to consolidate the fragmented cybersecurity market. The company's positioning around AI security -- both protecting AI deployments and using AI for detection and response -- appears to be resonating with enterprise customers facing evolving threat landscapes. However, investors should note that the stock's valuation near 52-week highs may limit near-term upside and increase sensitivity to any execution missteps. The company also faces intense competition across multiple security categories and must continue demonstrating that its platform approach delivers superior economics and security outcomes compared to best-of-breed point solutions. The raised guidance and long-term margin targets signal management's confidence in sustained growth and improving unit economics as the platform scales. With a projected addressable market more than doubling by 2030, CrowdStrike appears well-positioned to capture share in an expanding security landscape driven by cloud adoption, AI deployment, and increasingly sophisticated cyber threats. 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