CrowdStrike CEO George Kurtz underscored the resilience of the cybersecurity firm during an earnings call, following a significant software glitch that caused a global outage and affected millions of systems. Despite the crisis, which resulted in a 27% drop in the company's shares and is estimated to have cost Fortune 500 companies over $5 billion, CrowdStrike reported a strong financial performance for its fiscal second quarter. The company generated $969.3 million in revenue, marking a 32% year-over-year increase, and net income rose to $46.7 million, up from $8.5 million in the previous year.
The July 19 outage, which took down over 8 million Windows-connected systems worldwide, including critical infrastructure at airports and hospitals, was described by Kurtz as "the most challenging event in our company history." In response to the incident, CrowdStrike slightly lowered its annual revenue forecast to between $3.89 billion and $3.9 billion, down from the $3.95 billion analysts expected. Despite this adjustment, the forecast suggests that the company has largely retained its customer base, with Kurtz asserting that the firm’s market opportunity remains intact.
CrowdStrike has implemented "customer commitment packages" to incentivize clients to use more of its products and commit to longer subscriptions. These initiatives are expected to have a combined impact of approximately $60 million on the company’s subscription and professional services revenue for the rest of fiscal 2025. The company also continues to secure significant deals, including an eight-figure contract with a major enterprise software firm and a seven-figure agreement with a leading generative AI company.
Looking ahead, CFO Burt Podbere acknowledged that the fallout from the outage, such as longer deal negotiation timelines due to increased scrutiny, will likely persist into next year. However, both Kurtz and Podbere remain optimistic about CrowdStrike’s future, with Kurtz emphasizing that the company’s business prospects are as strong today as they were before the incident.
The outage has also drawn attention to Microsoft’s role, with Delta Air Lines, one of the most impacted companies, seeking $500 million in damages from both Microsoft and CrowdStrike. The full extent of the legal risks remains uncertain, but CrowdStrike's leadership is confident that the firm will recover and continue to grow, leveraging the lessons learned from this challenging period.
The July 19 outage, which took down over 8 million Windows-connected systems worldwide, including critical infrastructure at airports and hospitals, was described by Kurtz as "the most challenging event in our company history." In response to the incident, CrowdStrike slightly lowered its annual revenue forecast to between $3.89 billion and $3.9 billion, down from the $3.95 billion analysts expected. Despite this adjustment, the forecast suggests that the company has largely retained its customer base, with Kurtz asserting that the firm’s market opportunity remains intact.
CrowdStrike has implemented "customer commitment packages" to incentivize clients to use more of its products and commit to longer subscriptions. These initiatives are expected to have a combined impact of approximately $60 million on the company’s subscription and professional services revenue for the rest of fiscal 2025. The company also continues to secure significant deals, including an eight-figure contract with a major enterprise software firm and a seven-figure agreement with a leading generative AI company.
Looking ahead, CFO Burt Podbere acknowledged that the fallout from the outage, such as longer deal negotiation timelines due to increased scrutiny, will likely persist into next year. However, both Kurtz and Podbere remain optimistic about CrowdStrike’s future, with Kurtz emphasizing that the company’s business prospects are as strong today as they were before the incident.
The outage has also drawn attention to Microsoft’s role, with Delta Air Lines, one of the most impacted companies, seeking $500 million in damages from both Microsoft and CrowdStrike. The full extent of the legal risks remains uncertain, but CrowdStrike's leadership is confident that the firm will recover and continue to grow, leveraging the lessons learned from this challenging period.