CrowdStrike Holdings Inc (“CrowdStrike”) reported notable Q2 2025 results, achieving $964 million in revenue, which marks a 32% year-over-year increase. Despite facing operational challenges due to the Channel File 291 incident in July, the company demonstrated financial resilience with a net income of $47 million, showing a significant 454.92% growth year-over-year. Management remains optimistic, evidencing sustained customer trust and a strong sales pipeline, with ending Annual Recurring Revenue (ARR) hitting $3.86 billion, a 32% year-over-year growth. CEO George Kurtz emphasized the actions taken post-incident, reinforcing commitment to security and ensuring long-term trust with stakeholders, as the company maneuvers through a critical adaptive phase.
Key Performance Indicators
Revenue
963.87M
QoQ: 4.65% | YoY:31.74%
Gross Profit
726.47M
75.40% margin
QoQ: 4.37% | YoY:32.40%
Operating Income
13.66M
QoQ: 96.91% | YoY:188.84%
Net Income
47.01M
QoQ: 9.79% | YoY:454.92%
EPS
0.19
QoQ: 5.56% | YoY:433.71%
Revenue Trend
Margin Analysis
Key Insights
**Total Revenue:** $964 million (up 32% YoY, up 4.65% QoQ)
**Subscription Revenue:** $918 million (up 33% YoY)
**Gross Profit:** $726 million (gross profit margin of 75.4%)
**Net Income:** $47 million (up 454.92% YoY)
**EPS:** $0.19 (up 433.71% YoY)
Financial Highlights
Revenue Performance:
- Total Revenue: $964 million (up 32% YoY, up 4.65% QoQ)
- Subscription Revenue: $918 million (up 33% YoY)
- Gross Profit: $726 million (gross profit margin of 75.4%)
Profitability:
- Net Income: $47 million (up 454.92% YoY)
- EPS: $0.19 (up 433.71% YoY)
- Operating Income: $13.66 million (operating margin of 1.4%)
Cash Flow:
- Free Cash Flow: $272 million (44% growth YoY)
- Cash at End of Period: $4.04 billion
Balance Sheet:
- Total Assets: $7.20 billion
- Total Liabilities: $4.31 billion
- Total Stockholders' Equity: $2.85 billion
Valuation Ratios:
- Price to Earnings Ratio: 301.08
- Price to Sales Ratio: 58.74
- Forward Price to Earnings Ratio: 54.20
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
963.87M
31.74%
4.65%
Gross Profit
726.47M
32.40%
4.37%
Operating Income
13.66M
188.84%
96.91%
Net Income
47.01M
454.92%
9.79%
EPS
0.19
433.71%
5.56%
Key Financial Ratios
currentRatio
1.9
grossProfitMargin
75.4%
operatingProfitMargin
1.42%
netProfitMargin
4.88%
returnOnAssets
0.65%
returnOnEquity
1.65%
debtEquityRatio
0.28
operatingCashFlowPerShare
$1.34
freeCashFlowPerShare
$1.12
priceToBookRatio
19.85
priceEarningsRatio
301.08
Net Income vs. Revenue
Expense Breakdown
Management Commentary
Operational Resilience and Transparency:
George Kurtz stated, "The July 19 incident starts a new chapter for CrowdStrike... our commitment is to make sure this never happens again."
Future of the Falcon Platform:
Kurtz highlighted enhancements following the incident: "...we've already implemented the following actions to build a more resilient Falcon platform..."
Customer Commitment Post-Incident:
"...customers have expressed a desire to do more business with us, citing trust and confidence in our performance, with many acknowledging how we safeguarded their organizations, despite recent challenges."
"The enduring trust that prospects, customers, and the market have in CrowdStrike is demonstrated by our Q2 performance."
— George Kurtz
"The Falcon platform is firmly rooted, with replacement requiring a multi-vendor costly and time-consuming process."
— George Kurtz
Forward Guidance
Management anticipates total revenue for FY 2025 to reach between $3,890 million and $3,902 million, reflecting a growth rate of 27-28% YoY. The emphasis on customer commitment packages may result in temporarily muted upsell dollar values in the near term, with management estimating a $60 million impact due to extended contract terms. The long-term perspective remains optimistic, targeting a range of $10 billion in ending ARR by FY 2031.
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
CRWD Focus
75.40%
1.42%
1.65%
301.08%
SPLK
76.70%
-7.52%
1.62%
-71.28%
ADBE
87.90%
35.50%
10.60%
31.74%
PLTR
81.00%
15.50%
3.31%
107.65%
ZS
77.50%
-8.97%
-2.97%
-308.26%
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
CrowdStrike's robust Q2 results reflect resilience amid operational challenges, with strong margins and consistent growth trajectories positioning the company favorably within the cybersecurity landscape. The management's commitment to enhancing the Falcon platform and the focus on customer engagement strategies places CrowdStrike well in navigating post-incident recovery. Investors should remain aware of the company's substantial growth potential but also keep an eye on competition and industry trends that may reshape market dynamics.
Key Investment Factors
Growth Potential
CrowdStrike's ARR growth of 32% year-over-year indicates robust demand for their cybersecurity solutions, especially in cloud security and identity solutions which have surpassed $1 billion in ARR, growing more than 85%. This promising segment will drive future growth and open up new revenue streams.
Profitability Risk
Risks include potential litigation after the July 19 incident affecting customer perceptions and operational disruption. Additionally, competition in the cloud security market remains fierce, particularly with emerging vendors using AI and automation.
Financial Position
CrowdStrike maintains strong liquidity with $4.04 billion in cash, supporting ongoing investments and R&D. A total debt of $791 million against strong equity highlights a manageable leverage profile.
SWOT Analysis
Strengths
Strong brand recognition in the cybersecurity market
Diverse and growing product portfolio with 28 Falcon modules
High gross profit margin of 75%
Solid cash reserves for investments
Weaknesses
Current operating margin remains low at 1.4%
Heavy reliance on subscription revenue may impact cash flows during economic downturns
Opportunities
Growth in cloud security and identity protection beyond traditional EDR
Significant expansion potential in federal and enterprise segments
Increased demand for integrated cybersecurity solutions
Threats
Intense competition from both established players and new entrants
Potential reputational damage following the July 19 incident could deter new customers
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