CrowdStrike (NASDAQ: CRWD) stock is plummeting in Friday's trading, down 8.5% as with a peak drop of 15.4% earlier in the session.
The decline follows a problematic update that triggered system locks for hardware using Microsoft's Windows operating system, causing massive global IT outages. This issue has impacted hundreds of millions of computers worldwide, disrupting operations for hospitals, airlines, stores, and other businesses.
CrowdStrike, a leading provider of cloud-based endpoint protection services, had been performing well before this incident.
The company’s AI-powered cybersecurity platform attracted new customers and increased spending from existing clients, leading to a 33% sales increase and a 63% rise in non-GAAP (adjusted) earnings per share in the last quarter. However, the recent outage could hinder new customer acquisition and strain relationships with existing clients. It may also expose the company to legal liabilities.
Despite the pullback, CrowdStrike's stock is still up roughly 20% year-to-date and 101% over the last year. Long-term investors might see the current dip as a buying opportunity, given the entrenched nature of CrowdStrike's platform and high switching costs.
Nonetheless, the company's near-term performance and brand management will likely be closely scrutinized due to this significant setback.
The decline follows a problematic update that triggered system locks for hardware using Microsoft's Windows operating system, causing massive global IT outages. This issue has impacted hundreds of millions of computers worldwide, disrupting operations for hospitals, airlines, stores, and other businesses.
CrowdStrike, a leading provider of cloud-based endpoint protection services, had been performing well before this incident.
The company’s AI-powered cybersecurity platform attracted new customers and increased spending from existing clients, leading to a 33% sales increase and a 63% rise in non-GAAP (adjusted) earnings per share in the last quarter. However, the recent outage could hinder new customer acquisition and strain relationships with existing clients. It may also expose the company to legal liabilities.
Despite the pullback, CrowdStrike's stock is still up roughly 20% year-to-date and 101% over the last year. Long-term investors might see the current dip as a buying opportunity, given the entrenched nature of CrowdStrike's platform and high switching costs.
Nonetheless, the company's near-term performance and brand management will likely be closely scrutinized due to this significant setback.