CrowdStrike’s business continues to expand, but CRWD’s valuation already looks elevated

CrowdStrike shares came under pressure following the release of strong quarterly results. The key question is why investors began taking profits, whether the company’s current valuation remains justified, and what prospects still lie ahead for CRWD.

CrowdStrike Holdings, Inc. (NASDAQ: CRWD) released strong Q1 2027 financial results, coming in slightly ahead of market expectations. Revenue increased by 26% year-on-year to 1.39 billion USD, while non-GAAP EPS reached 1.10 USD, compared with consensus expectations of approximately 1.07 USD. The company also delivered a notable improvement in profitability, with its non-GAAP operating margin expanding to 24%, compared with 18% a year earlier.

The subscription-based business model remains the primary source of strength. Annual recurring revenue (ARR) reached 5.51 billion USD, increasing by 24% year-on-year, while net new ARR rose by 32% to 255.8 million USD. The figures indicate that demand for the Falcon platform remains resilient and that customers continue to expand their use of CrowdStrike’s products.

Cash flow generation also remained strong. Free cash flow increased to 468.5 million USD, with the free cash flow margin improving to 34%, compared with 25% a year earlier. At the GAAP level, the company also returned to profitability, reporting net income of 27.8 million USD, compared with a net loss of 104.3 million USD a year earlier.

Management provided confident guidance and raised its full-year targets for revenue, ARR, and non-GAAP EPS. However, the market reaction was negative. The shares declined following the results, as investors had already priced in strong business growth and now expect not merely solid performance, but a consistent ability to exceed expectations.

This article examines CrowdStrike Holdings, explains its business model, and provides a fundamental analysis of CrowdStrike’s latest results. It also presents a technical analysis of CRWD shares based on current market dynamics, forming the basis for the forecast for CRWD stock in 2026.

About CrowdStrike Holdings, Inc.

CrowdStrike Holdings, Inc., founded in 2011, is a US-based cybersecurity company. It is known for providing cloud-based solutions that protect against cyberattacks, information security threats, and e-commerce fraud.

On 12 June 2019, CrowdStrike went public on the NASDAQ exchange under the CRWD ticker symbol. Its share price surged by 70% on the first day of trading, closing at 58 USD.

The company’s flagship product is the CrowdStrike Falcon platform. This cloud-based cybersecurity solution utilises artificial intelligence (AI), machine learning, and big data analytics to detect, neutralise, and prevent cyber threats in real time.

Key business segments of CrowdStrike Holdings, Inc.

CrowdStrike Holdings’ key lines of business include:

• Endpoint security: CrowdStrike Falcon provides security for electronic devices, including computers, servers, and mobile devices. It helps detect and prevent unauthorised intrusions such as viruses, ransomware, and other malicious software.
• Incident management and response: the company provides services for the rapid response to security incidents and detailed investigations of cyberattacks. This enables organisations to address the consequences of data breaches or system compromises.
• Threat intelligence: CrowdStrike provides information analytics and cyber threat data, helping organisations better understand attack sources, trends, and existing vulnerabilities.
• Cloud protection: the company’s solutions secure data and infrastructure across cloud environments, including platforms such as AWS, Microsoft Azure, and Google Cloud.

CrowdStrike Holdings, Inc.’s main revenue streams

The main revenues reported by CrowdStrike include:

• Software as a Service (SaaS) subscription: CrowdStrike’s primary revenue stream comes from subscriptions to the CrowdStrike Falcon platform. This allows clients to flexibly use its cloud-based solutions, paying for access based on the number of protected devices or other parameters.
• Professional services: the company also earns from consulting, incident management, and security system audits.

CrowdStrike Holdings, Inc. Q2 2025 financial results

CrowdStrike Holdings delivered strong results for Q2 fiscal 2025. Below are the key figures compared to the same period last year:

• Revenue: 963.90 million USD (+32%)
• Net income: 260.76 million USD (+44%)
• Earnings per share: 1.04 USD (+40%)
• Gross margin: 75.37% (+133 basis points)
• Subscription revenue: 918.30 million USD (+33%)
• Professional services revenue: 45.60 million USD (+10%)

Compared to the previous year, the company demonstrated solid growth in revenue, profitability, and subscription revenue, confirming the strong demand for CrowdStrike’s cybersecurity solutions. Clients’ subscriptions to the company’s services remain its primary revenue stream.

Following the software incident, CrowdStrike’s management revised its 2024 revenue forecast downwards. Annual revenue was projected to range between 3.89 and 3.90 billion USD, lower than the previous forecast of 3.97–4.00 billion USD. Adjusted EPS was expected to be between 3.61 and 3.65 USD, down from the prior estimate of 3.88 USD. The company’s management explained the downward revision due to a potential negative impact from the payment of 60 million USD in compensation to clients related to the outage.

CrowdStrike Holdings, Inc. Q3 2025 financial results

On 26 November 2024, CrowdStrike Holdings, Inc. released its report for Q3 of fiscal 2025, which ended on 31.10.2024. Below is a summary of the report’s key data:

• Revenue: 1.01 billion USD (+29%)
• Net income: 234.25 million USD (+18)
• Earnings per share: 0.93 USD (+13)
• Gross margin: 74.75% (–79 bps)
• Subscription revenue: 962.73 million USD (+31%)
• Professional services revenue: 47.44 million USD (–9%)

In the Q3 FY2025 report, CrowdStrike’s management highlighted strong growth across key financial indicators. Notably, the incident, caused by a faulty software update that affected Microsoft Windows systems worldwide and led to significant disruptions, did not have a severe impact on the company’s revenue or profit.

Given the increased demand for cybersecurity solutions, management remains confident in CrowdStrike’s long-term growth trajectory. The revenue forecast for Q4 FY2025 has been raised to 1.02–1.03 billion USD, with income expected to be between 210.90 and 215.80 million USD.

CEO George Kurtz reaffirmed that the company remains focused on AI-driven cybersecurity innovations and on expanding its product portfolio. CrowdStrike is also expected to maintain strong momentum in attracting and retaining clients through the continued development of cloud security and personal data protection solutions.

CrowdStrike Holdings, Inc. Q4 2025 financial results

On 4 March, CrowdStrike Holdings, Inc. released its report for Q4 fiscal 2025, which ended on 31.01.2024. Below are its key highlights:

• Revenue: 1.06 billion USD (+25%)
• Net income: 260.95 million USD (+10%)
• Earnings per share: 1.03 USD (+8%)
• Gross margin: 74.12% (–121 bps)
• Subscription revenue: 1.00 billion USD (+26%)
• Professional services revenue: 50.22 million USD (+2%)

In comments on the report, CEO George Kurtz highlighted a 23% increase in annual recurring revenue (ARR) to 4.24 billion USD, including a record 223.90 million USD of new net ARR. Kurtz said, “CrowdStrike had a great Q4, ending an amazing year.” He emphasised that the introduction of AI in cybersecurity is becoming critical, with leak prevention requiring a platform initially built on such technologies.

CFO Burt Podbere highlighted the company’s stability, reporting 31% annual growth in subscription revenue, an operating cash flow of 1.38 billion USD, and a free cash flow of 1.07 billion USD. He said, “These results underscore our operating discipline and position us well to deliver quality services to clients and shareholders.”

CrowdStrike anticipates significant growth in the 2026 fiscal year, driven by demand for the Falcon platform and expanding market opportunities. In Q1 FY2026, which ends on 30 April 2025, revenue is projected to grow by 25% to 1.05 billion USD. Operating profit is expected to range between 252.80 million USD and 258.10 million USD, with diluted EPS between 0.98 USD and 0.99 USD. For the full fiscal year, revenue growth may reach 23-24%, between 4.63 billion USD and 4.67 billion USD, and operating profit is projected to be between 1.09 billion USD and 1.13 billion USD, with EPS between 4.27 USD and 4.40 USD.

CrowdStrike Holdings, Inc. Q1 2026 financial results

On 3 June, CrowdStrike Holdings, Inc. published its report for Q1 of fiscal year 2026, which ended on 30 April 2025. Key figures are as follows:

• Revenue: 1.10 billion USD (+20%)
• Net profit: 184.70 million USD (–6%)
• Earnings per share: 0.73 USD (–7%)
• Gross margin: 73.80% (–177 bps)
• Subscription segment revenue: 1.05 billion USD (+20%)
• Professional services segment revenue: 52.66 million USD (+8%)

CrowdStrike Holdings’ Q1 FY2026 financial results demonstrate steady growth and support a positive outlook for investors in the cybersecurity sector. Annual recurring revenue (ARR) reached 4.44 billion USD, up 22% year-on-year. The customer retention rate of 97% underscores the enduring value of the AI-powered, cloud-based Falcon platform, which continues to strengthen the company’s position as a leader in cyber threat protection.

The Falcon Flex subscription model delivered significant growth, with total deal value reaching 3.2 billion USD across more than 820 accounts – six times higher than the previous year. This offering is driving broader adoption of the platform’s modules: 48% of customers now use six or more modules, 32% use seven or more, and 22% use eight or more.

The company’s results demonstrated strong liquidity. Operating cash flow reached a record 384 million USD, while free cash flow stood at 279 million USD. These funds will support a 1 billion USD share repurchase program approved by the board of directors, reflecting management’s confidence in the company’s long-term stability and financial strength. At current share prices, the company could repurchase approximately 3% of its outstanding capital. The cash reserves of 4.61 billion USD provide financial flexibility for further investments and strategic initiatives.

The quarter also included a record-breaking major deal with a Fortune 100 healthcare company that had previously used Microsoft solutions and experienced a security breach. The CrowdStrike team rapidly deployed over 46,000 sensors, stopped the attack, and migrated the client to the Falcon platform – including Falcon Complete Identity, Falcon Cloud Security, LogScale Next-Gen SIEM, and Charlotte AI modules – replacing more than three previous vendors and reducing the number of agents by 75%.

The Q2 FY2026 forecast guided to revenue in the range of 1.145–1.152 billion USD (up 17–18% year-on-year) and non-GAAP EPS of 0.82–0.84 USD. For the full fiscal year, revenue is expected at 4.74–4.80 billion USD (up 23–25%), with non-GAAP EPS projected at 3.44–3.56 USD, pointing to potential margin improvement in the second half of the year. Growth in net new ARR is also expected to accelerate, supported by the success of Falcon Flex and the company’s strong competitive advantages.

The incident of 19 July 2024, caused by an incorrect update to the Falcon sensor, affected the company’s financial performance, leading to losses of 39.7 million USD and raising the likelihood of reputational risks. Nevertheless, strategic partnerships with Microsoft (NASDAQ: MSFT), Alphabet (NASDAQ: GOOG), and NVIDIA (NASDAQ: NVDA), together with ongoing market consolidation around the CrowdStrike platform, reinforce the company’s position.

For investors, the report confirmed the company’s resilient business model, supported by strong cash flow, a flexible product offering, and a strategic share buyback program, making CrowdStrike Holdings an attractive investment opportunity in the cybersecurity sector.

CrowdStrike Holdings, Inc. Q2 2026 financial results

On 27 August, CrowdStrike Holdings, Inc. released its report for Q2 FY2026, which ended on 31 July 2025. The key figures are as follows:

• Revenue: 1.17 billion USD (+21% year-on-year)
• Net income: 237.40 million USD (+7% year-on-year)
• Earnings per share (EPS): 0.93 USD (+6% year-on-year)
• Gross margin: 73.46% (–191 bps)
• Subscription revenue: 1.10 billion USD (+20% year-on-year)
• Professional services revenue: 66.00 million USD (+45% year-on-year)

In Q2 FY2026, the company delivered strong results: revenue reached 1.17 billion USD, up 21% year-on-year and 6% higher than in the previous quarter. This exceeded analyst expectations on both revenue and earnings, with adjusted EPS at 0.93 USD versus forecasts of around 0.83–0.91 USD. Subscriptions remained the primary revenue driver at approximately 1.10 billion USD (94% of total revenue), while professional services contributed about 66 million USD. Growth was slightly faster than in the prior quarter, primarily driven by the acceleration of the subscription business (Annual Recurring Revenue, ARR).

Total ARR reached 4.66 billion USD, an increase of 20% year-on-year, while net new ARR for the quarter came in at a record 221 million USD. Management highlighted the acceleration in new subscription growth and expects this metric to increase at a rate of at least 40% year-on-year in the second half of the fiscal year.

The subscription business demonstrated strong gross margins – 77% under GAAP and 80% under non-GAAP. The overall adjusted gross margin was about 78%. The non-GAAP operating margin stood at 22%, slightly below last year’s level, with operating profit on this measure at 255 million USD. On a GAAP basis, the company reported an operating loss of 113 million USD, driven by one-off expenses related to last year’s Falcon outage as well as elevated personnel and stock-based compensation costs. Cash flow remained robust: free cash flow totalled 284 million USD, representing around 24% of revenue.

In the outlook for Q3 FY2026, revenue was projected in the range of 1.208–1.218 billion USD, slightly below analyst consensus (around 1.23 billion USD), while adjusted EPS was projected at 0.93–0.95 USD, ahead of market expectations. Management did not provide precise guidance on free cash flow for the quarter but expects to achieve a margin of around 27% in Q4 and above 30% in FY2027. For the full fiscal year 2026, revenue was projected at 4.749–4.806 billion USD and adjusted EPS at 3.60–3.72 USD. Management also highlighted that new subscription growth was expected to accelerate in the second half of the year.

CrowdStrike Holdings, Inc. Q3 2026 financial results

On 2 December, CrowdStrike Holdings, Inc. released its financial results for Q3 of fiscal year 2026, which ended on 31 October 2025. The key figures are as follows:

• Revenue: 1.23 billion USD (+22%)
• Net income: 245.40 million USD (+29%)
• Earnings per share: 0.96 USD (+26%)
• Gross margin: 74.96% (+21 bps)
• Subscription revenue: 1.17 billion USD (+21%)
• Professional services revenue: 65.50 million USD (+38%)

CrowdStrike’s Q3 FY2026 report was strong and slightly ahead of market expectations. Revenue grew 22% year-on-year to 1.23 billion USD, exceeding the consensus estimate of roughly 1.21–1.22 billion USD. Adjusted earnings per share (non-GAAP EPS) reached 0.96 USD, above expectations of 0.94 USD. Non-GAAP operating income rose to 264.6 million USD, with an operating margin of 21% (up 1 p.p. year-on-year), while non-GAAP net income totalled 245.4 million USD. This indicates that, on an adjusted basis, the business is already consistently profitable while sustaining double-digit revenue growth.

Key subscription metrics also improved: annual recurring revenue (ARR) reached 4.92 billion USD (+23% y/y), while quarterly net new ARR was a record 265 million USD (+73% y/y), reflecting strong demand for the Falcon platform and continued cross-selling of modules to existing clients.

From a cash-flow perspective, the quarter was solid: operating cash flow totalled 398 million USD, free cash flow was 296 million USD, and cash and equivalents on the balance sheet reached 4.8 billion USD.

On a GAAP basis, the company still reported a small net loss (–34 million USD), mainly due to substantial stock-based compensation expenses and residual costs related to the Windows update incident in July 2024. However, these items are largely non-cash and one-off and therefore do not detract from the company’s strong non-GAAP and cash performance.

Management issued a confident outlook: for Q4 FY2026, the company expects revenue of 1.29–1.30 billion USD and non-GAAP EPS of 1.09–1.11, both above current analyst estimates. The full-year guidance was raised to revenue of 4.80–4.81 billion USD and non-GAAP EPS of 3.70–3.72.

In its commentary, the company highlighted growing demand for AI-integrated cybersecurity solutions and the ongoing expansion of Falcon’s capabilities, which it believes will support further ARR and revenue growth.

CrowdStrike Holdings, Inc. Q1 2027 financial results

On 3 June, CrowdStrike Holdings, Inc. released its Q1 FY 2027 financial results for the quarter ended 30 April 2026. Below are the key figures:

• Revenue: 1.39 billion USD (+26%)
• ARR: 5.51 billion USD (+24%)
• Net new ARR: 255.8 million USD (+32%)
• Non-GAAP net income: 278.0 million USD (+48%)
• Non-GAAP earnings per share: 1.10 USD (+51%)
• Free cash flow: 468.5 million USD (+68%)

CrowdStrike delivered results that came in slightly ahead of expectations for Q1 of the 2027 financial year. Revenue increased by 26% year-on-year to 1.39 billion USD, compared with consensus estimates of 1.36 billion USD, while non-GAAP EPS reached 1.10 USD against expectations of 1.07 USD. Profitability also improved, with non-GAAP operating income rising to 325.7 million USD and operating margin expanding to 24%, compared with 18% a year earlier.

The subscription business remains a key strength. Subscription revenue increased by 26% to 1.32 billion USD, while ARR reached 5.51 billion USD, rising by 24% year-on-year. Net new ARR totalled 255.8 million USD, representing 32% year-on-year growth. The figures indicate that demand for the Falcon platform remains resilient and that customers continue to expand their use of CrowdStrike’s products.

Cash flow generation also remained strong. Operating cash flow reached a record 590.9 million USD, while free cash flow increased to 468.5 million USD. Free cash flow margin improved to 34%, compared with 25% a year earlier. For a company that continues to grow rapidly, the result is encouraging.

Management’s guidance further reinforced the positive impression from the report. For Q2 of the 2027 financial year, CrowdStrike expects revenue of 1.436–1.442 billion USD and non-GAAP EPS of 1.16–1.17 USD. The company also raised its full-year outlook, now expecting revenue of 5.91–5.96 billion USD, ARR of 6.53–6.56 billion USD, and non-GAAP EPS of 4.88–4.96 USD. Such guidance points to continued demand growth for cybersecurity solutions, AI tools, and the Falcon platform.

Analysis of key valuation multiples for CrowdStrike Holdings, Inc.

Below are the key valuation multiples for CrowdStrike Holdings, Inc., based on the Q1 2027 financial year results, calculated at a share price of 644 USD using non-GAAP metrics, as the company remains loss-making on a GAAP basis.

Valuation multiples analysis for CRWD – conclusion

CrowdStrike demonstrates solid profitability, strong cash flow generation, and a healthy balance sheet. However, even after taking these strengths into account, the shares remain very expensive. Elevated P/E, EV/EBITDA, EV/EBIT, and Forward P/E multiples indicate that the market has already priced in very strong expectations for the company’s future growth.

As a result, CrowdStrike remains a high-quality but very expensive growth stock. The investment case is based on the assumption that the company will continue to increase revenue, profitability, and free cash flow at a rapid pace. If such growth is sustained, the market may continue to support a substantial valuation premium.

Expert forecasts for CrowdStrike Holdings, Inc. stock for 2025

• Barchart: 34 out of 50 analysts assigned a Strong Buy rating, 3 assigned a Moderate Buy rating, 11 rated the shares as Hold, and 2 assigned a Strong Sell rating. The upper price target is 825 USD, and the lower bound is 413 USD.
• MarketBeat: 36 out of 51 analysts assigned a Buy rating, 13 recommended Hold, and 2 recommended Sell. The upper price target is 825 USD, and the lower bound is 368 USD.
• TipRanks: 30 out of 38 analysts assigned a Buy rating, 7 recommended Hold, and 1 recommended Sell. The upper price target is 825 USD, and the lower bound is 413 USD.
• Stock Analysis: 31 out of 54 analysts assigned a Strong Buy rating, 11 assigned a Buy rating, and 12 rated the shares as Hold. The upper price target is 850 USD, and the lower bound is 413 USD.

CrowdStrike Holdings, Inc. stock price forecast for 2026

On the weekly chart, CrowdStrike Holdings shares are trading above the 200-period moving average, indicating that the long-term uptrend remains dominant. Before the release of the quarterly results, the Stochastic indicator was in overbought territory, suggesting the likelihood of a corrective decline in CRWD shares, which subsequently materialised following the earnings release.

As of 11 June, the Stochastic indicator remains between the 80 and 20 levels, suggesting that the correction has most likely not yet concluded. However, rather than extending the previous decline, the correction may transition into a consolidation phase, followed by a resumption of the upward trend within the broader long-term uptrend. Based on the current price structure of CrowdStrike Holdings shares, the potential scenarios for CRWD in 2026 are as follows:

The primary forecast for CrowdStrike Holdings shares assumes an advance towards resistance at 780 USD. A breakout above that level is then expected, with the next upside target at 905 USD, as identified using Fibonacci levels.

The alternative forecast for CrowdStrike Holdings stock assumes a continuation of the corrective decline towards support at 570 USD. The correction is expected to conclude near that level, followed by a resumption of the uptrend with a target at 780 USD.

Risks of investing in CrowdStrike Holdings, Inc.

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Investing in CrowdStrike Holdings shares carries certain risks, including the ones listed below:

• Competition in the cybersecurity market: the cybersecurity sector is competitive, with players such as Palo Alto Networks and Zscaler offering similar solutions. If competitors implement innovations at a greater pace, offer lower prices, or combine services more effectively, CrowdStrike could lose market share, which could affect its share price.
• Software failures: the incident on 19 July, caused by an error in the Falcon platform update, was a serious test of CrowdStrike’s reputation. A recurrence of such an event poses risks to revenue growth and could affect CrowdStrike’s ability to secure major contracts, particularly in the public and financial sectors.
• Macroeconomic and geopolitical uncertainty: an economic downturn or budget cuts for businesses could reduce spending on cybersecurity, even if it is considered a critical need. Additionally, geopolitical issues, such as trade restrictions or sanctions affecting CrowdStrike’s international operations, may slow growth in key markets.
• Post-acquisition integration problems: CrowdStrike is actively growing through acquisitions. If integration efforts fail, revenue growth may stall as resources are redirected to resolve these issues.
• Market saturation: as cybersecurity becomes essential for many organisations, the total addressable market could contract if the sector reaches saturation. Should CrowdStrike fail to innovate or expand into new segments, revenue growth is likely to slow.

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