Cybersecurity Stock Increases Earnings

CrowdStrike Earnings Guidance Tops Estimates, Cybersecurity Stock Climbs By Investors Business Daily

Cybersecurity firm CrowdStrike Holdings (CRWD) swung to a profit in the first quarter while revenue topped estimates, the company said Tuesday. CrowdStrike earnings guidance also came in above expectations, sending shares up.

CrowdStrike stock gained 4% and was near 96 during after-hours trading on the stock market today.

Sunnyvale, Calif.-based CrowdStrike said it earned 2 cents an adjusted share, while revenue jumped 85% to $178.1 million. A year earlier, the cybersecurity firm lost 47 cents a share.

Analysts had projected a loss of 6 cents a share on revenue of $165.4 million for the quarter ended April 30.

CrowdStrike Earnings Guidance Tops Expectations

For the current quarter ending in July, CrowdStrike projected revenue of $188 million at the midpoint of its guidance. Analysts had projected $173.1 million.

The company said it expects a 1-cent loss vs. estimates of a 6-cent loss.

“With both security administrators and end-users working from home, we believe the rapid shift to a remote workforce has helped increase our leadership,” Founder and Chief Executive George Kurtz said in a written release. “We achieved 88% annual recurring revenue growth and 105% subscription customer growth year over year.”

In addition, the CrowdStrike initial public offering in June 2019 raised $659 million with shares priced at 34. CrowdStrike stock had jumped 90% this year amid the coronavirus emergency as companies instructed many employees to work from home.

IBD Computer Software Security Group Ranks No. 12

Heading into the CrowdStrike earnings report, the cybersecurity stock had a Relative Strength Rating of 96 out of a possible 99.

The company uses machine learning, one form of artificial intelligence, and a specialized database to detect malware on laptops, mobile phones and other devices that access corporate networks.

The IBD Computer-Software Security group ranks No. 12 out of 197 groups tracked by IBD. Zscaler (ZS) holds the group’s highest Relative Strength Rating, according to IBD Stock Checkup.