Analyst Lauds ‘Cybersecurity Gold Standard’ CrowdStrike’s Beat-And-Raise Q3: Retail Shrugs Off Stock Slump

Shares of cybersecurity company CrowdStrike, Inc. ($CRWD) fell sharply early Wednesday as traders reacted negatively to its fiscal-year 2025 third-quarter results.

Austin, Texas-based CrowdStrike reported an increase in its third-quarter non-GAAP earnings per share (EPS) from $0.82 in 2024 to $0.93 in 2025. This far exceeded the consensus estimate of $0.81 per share.

Revenue climbed 29% year-over-year (YoY) to $1.01 billion, also surpassing the average analysts’ estimate of $982.8 million.

Annual recurring revenue (ARR), a key operational metrics for subscription-based software-as-a-service companies, was up 27% YoY to $4.02 billion as of Oct. 31. This included $153 million in net new ARR

The non-GAAP subscription gross margin edged down sequentially from 81% to 80%.

CrowdStrike ended the quarter with cash and cash-equivalents of $4.26 billion.

CEO George Kurtz said, “With over 97% gross retention, customers remain committed to the technological superiority of the Falcon platform and the benefits of cybersecurity consolidation.”

The company guided fourth-quarter revenue to $1.029 billion-$1.035 billion and non-GAAP EPS to $0.84-$0.86. The outlook compares to the consensus estimates of $1.03 billion and $0.86, respectively.

It upped its full-year guidance from $3.89 billion-$3.90 billion to $3.92 billion-$3.93 billion, and non-GAAP EPS guidance from $3.61-$3.65 to $3.74-$3.76.

Following the results, the stock snagged a series of price target hikes ranging between $5 and $100, the Fly reported.

Wedbush’s Daniel Ives lifted the price target for the stock from $330 to $390, while maintaining an ‘Outperform’ rating. The analyst lauded the slight beat on ARR and net new ARR, adding that one-third of the company’s customers have adopted its Falcon Flex model with an average of over 9 modules helping drive larger deals.

“"While the company will face some lingering headwinds over the next 12 months as a consequence of the IT outage, it does not change our CrowdStrike as CRWD remains the gold standard for cybersecurity with the outage only representing a dark chapter for the company in the multi-year growth story," Ives said.

As of 10:43 a.m. ET, CrowdStrike’s stock was down 5.27% to $345.09. For the year-to-date period, the stock is up nearly 43%.

CRWD sentiment and message volume November 27, 2024, as of 10:43 am ET | Source: Stocktwits

Retailers on the Stocktwits platform largely ignored the negative stock reaction and stayed ‘extremely bullish’ (94) on the stock, with message volume remaining ‘extremely high.”

Users on the platform said they were adding the stock to take advantage of the post-earnings weakness.