CrowdStrike (CRWD) Q1 Earnings Report Preview: What To Look For

Kayode Omotosho /
2024/06/03 3:01 am EDT

Cybersecurity company CrowdStrike (NASDAQ:CRWD) will be announcing earnings results tomorrow afternoon. Here's what investors should know.

CrowdStrike met analysts' revenue expectations last quarter, reporting revenues of $845.3 million, up 32.6% year on year. It was a solid quarter for the company. CrowdStrike beat slightly on revenue and ARR but very convincingly on operating profit. Keeping with that theme, while forward guidance for next quarter and the full year were only slightly above expectations, non-GAAP EPS guidance was more convincingly ahead, showing better-than-expected profitability.

Is CrowdStrike a buy or sell going into earnings? Read our full analysis here, it's free.

This quarter, analysts are expecting CrowdStrike's revenue to grow 30.6% year on year to $904.8 million, slowing from the 42% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.89 per share.

CrowdStrike Total Revenue

The majority of analysts covering the company have reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. CrowdStrike has a history of exceeding Wall Street's expectations, beating revenue estimates every single time over the past two years by 2.1% on average.

Looking at CrowdStrike's peers in the cybersecurity segment, some have already reported their Q1 results, giving us a hint as to what we can expect. SentinelOne delivered year-on-year revenue growth of 39.7%, beating analysts' expectations by 2.9%, and Varonis reported revenues up 6.2%, in line with consensus estimates. SentinelOne traded down 13.4% following the results while Varonis's stock price was unchanged.

Read our full analysis of SentinelOne's results here and Varonis's results here.

Valuation multiples for many growth stocks have not yet reverted to their early 2021 highs, but the market was optimistic at the end of 2023 thanks to cooling inflation. The start of 2024 has been a different story as mixed signals have led to market volatility, and while some of the cybersecurity stocks have fared somewhat better, they have not been spared, with share prices down 5.7% on average over the last month. CrowdStrike's stock price was unchanged during the same time and is heading into earnings with an average analyst price target of $399.4 (compared to the current share price of $315).

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