Executive Summary
CrowdStrike Holdings Inc reported significant financial achievements for Q3 2025, surpassing $1 billion in revenue for the first time, driven by strong subscription sales growth and a noteworthy 27% year-over-year increase in Annual Recurring Revenue (ARR) to $4.02 billion. Management emphasized the resilience of customer trust post-incident and highlighted the effectiveness of the Falcon Flex subscription model in driving adoption and retention across its platform. Despite some headwinds from past operational challenges, the company demonstrated robust operational metrics, resulting in a free cash flow margin of 23%. Strategic initiatives, including the recent acquisition of Adaptive Shield, are expected to bolster CrowdStrike's competitive position in the cybersecurity market.
Key Performance Indicators
QoQ: -507.99% | YoY:-1 861.71%
QoQ: -135.78% | YoY:-163.09%
QoQ: -136.05% | YoY:-162.27%
Key Insights
Revenue increased by 29% YoY to $1.01 billion, with subscription revenue growing 31% YoY. Gross profit margin was maintained at 78%, reflecting efficient cost management despite rising operational expenses, which grew to $591.7 million. Net loss of approximately $16.8 million was mostly attributed to past incident-related expenses. ARR reached $4.02 billion, indicating strong retention with a gross retention rate of over 97% and net retention at 115%. Management indicated that Falcon Flex custom...
Financial Highlights
Revenue increased by 29% YoY to $1.01 billion, with subscription revenue growing 31% YoY. Gross profit margin was maintained at 78%, reflecting efficient cost management despite rising operational expenses, which grew to $591.7 million. Net loss of approximately $16.8 million was mostly attributed to past incident-related expenses. ARR reached $4.02 billion, indicating strong retention with a gross retention rate of over 97% and net retention at 115%. Management indicated that Falcon Flex customers on average adopted over nine modules, evidencing deepening customer engagement.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
1.01B |
28.52% |
4.80% |
| Gross Profit |
755.09M |
27.76% |
3.94% |
| Operating Income |
-55.72M |
-1 861.71% |
-507.99% |
| Net Income |
-16.82M |
-163.09% |
-135.78% |
| EPS |
-0.07 |
-162.27% |
-136.05% |
Key Financial Ratios
operatingProfitMargin
-5.52%
operatingCashFlowPerShare
$1.33
freeCashFlowPerShare
$1.01
priceEarningsRatio
-1083.29
Management Commentary
Trust and Retention: ‘We grew ending ARR more than 27% year-over-year and maintained stable gross retention rates.’ – George Kurtz
Platform Adoption: ‘Our Falcon Flex subscription model is supercharging Falcon platform adoption.’ – George Kurtz
Innovation: ‘CrowdStrike is leading the future of AI-powered cybersecurity. Our innovation disrupts legacy markets and creates new categories.’ – George Kurtz
‘CrowdStrike is now firmly rooted as the organization's cybersecurity data platform of choice.’
— George Kurtz
‘As expected, the July 19th incident resulted in near-term headwinds to net new ARR.’
— Burt Podbere
Forward Guidance
Management remains optimistic about continuing ARR growth, targeting $10 billion by the end of FY 2031, supported by strong demand for the Falcon Flex model and the recent acquisition of Adaptive Shield. The guidance for Q4 2025 anticipates total revenue of $1,028.7 million to $1,035.4 million, reflecting a year-over-year growth of approximately 22%, despite projected headwinds from ongoing customer commitment packages impacting net ARR.