01—Abstract
Summary
Summary of the 10-Q filed July 19, 2019. Cited figures are marked; the original filing is the authoritative source.
CrowdStrike Holdings, Inc. reported its first quarterly report as a public company, covering the period ending April 30, 2019.
The company demonstrated substantial top-line growth, with total revenue more than doubling year-over-year to $96.1 milliona, driven primarily by a 116% increase in subscription revenue. This growth was fueled by a significant expansion in its customer base, which grew by 105% to 3,059 subscription customers. Despite the strong revenue growth, CrowdStrike continued to operate at a loss, with a net loss of $26.0 million for the quarter.
However, the operating loss decreased year-over-year, and the company also saw improvements in its gross margin, which rose to 70% from 59% in the prior year's comparable period. This improvement was attributed to increased operational efficiencies and optimized channel partner programs. The company also reported positive cash flow from operations of $1.4 millionb for the quarter, a notable improvement from the prior year's negative cash flow.
Key financial highlights include an Annual Recurring Revenue (ARR) of $364.6 millionc, up 114% year-over-year, and a dollar-based net retention rate consistently above 100%, indicating strong customer expansion. The company's significant investments in sales and marketing and research and development are expected to continue driving growth, but also contribute to ongoing operating losses. The period also saw the company successfully close its Initial Public Offering (IPO) shortly after the quarter's end, providing a substantial capital infusion to support its growth initiatives.
02—Key points
Key Highlights
- Total revenue surged by 103% to $96.1 million, driven by a 116% increase in subscription revenue.
- The number of subscription customers more than doubled, growing by 105% to 3,059.
- Annual Recurring Revenue (ARR) increased by 114% to $364.6 million.
- Gross margin improved significantly to 70% from 59% in the prior year's comparable period.
- The company reported a net loss of $25.98 million, a decrease from the $33.62 million net loss in the prior year's comparable period.
- CrowdStrike had $92.99 million in cash and cash equivalents and $82.07 million in marketable securities as of April 30, 2019.
- The company closed its Initial Public Offering (IPO) on June 14, 2019, raising $659.1 million in net proceeds.
03—One dollar
Follow one dollar
For each $1.00 of revenue in Q1 FY2020, CrowdStrike Holdings, Inc. lost $0.27.
- Revenue$96.1M100.0%
- Cost of revenue−$29.3M30.5%
- Gross profit$66.8M69.5%
- Operating costs−$92.6M96.4%
- Operating income−$25.8M26.8%
- Interest, other & tax−$202,0000.2%
- Net income−$26.0M27.0%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2020filed July 19, 2019Financial Statements
Q1 FY2020 against Q1 FY2019
| Line item | Q1 FY2020Q1 FY2019 | Change |
|---|---|---|
| Revenue | $96.08M$47.29M | +103.2% |
| Cost of Revenue | $29.27M$19.39M | +50.9% |
| Gross Profit | $66.80M$27.89M | +139.5% |
| R&D Expenses | $23.88M$17.61M | +35.5% |
| Operating Expenses | $92.58M$61.01M | +51.7% |
| Operating Income | -$25.77M-$33.11M | +22.2% |
| Interest Expense | $1K$192K | −99.5% |
| Net Income | -$25.98M-$33.62M | +22.7% |
| EPS (Basic) | $-0.14$-0.19 | +28.6% |
| Shares Outstanding (Basic) | 188.82M174.46M | +8.2% |
05—Questions
Frequently Asked Questions
What was CrowdStrike's revenue performance in this quarter?
CrowdStrike reported a significant increase in total revenue, growing by 103% year-over-year to $96.1 million. Subscription revenue was the primary driver, increasing by 116% to $86.0 million, while professional services revenue also grew by 34% to $10.1 million.
Is CrowdStrike profitable?
No, CrowdStrike reported a net loss of $25.98 million for the three months ended April 30, 2019. While the company is experiencing rapid revenue growth, it continues to invest heavily in sales, marketing, and research and development, which contributes to its ongoing losses. However, the net loss decreased from $33.62 million in the same period last year.
How is CrowdStrike growing its customer base?
CrowdStrike demonstrated strong customer acquisition, increasing its subscription customer base by 105% to 3,059 customers as of April 30, 2019. This growth is supported by a 'land-and-expand' sales strategy, which involves activating additional modules and endpoints for existing customers, and a focus on acquiring new customers across various market segments.
What is the company's financial position regarding cash and debt?
As of April 30, 2019, CrowdStrike had $93.0 million in cash and cash equivalents and $82.1 million in marketable securities, indicating a healthy liquidity position. The company also entered into a $150 million revolving credit facility in April 2019. It's important to note that the IPO, which closed shortly after this reporting period, significantly bolstered its cash position.
06—Continue