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CrowdStrike Holdings, Inc. (CRWD)·Q2 2026 Earnings Summary

Executive Summary

  • Q2 FY26 delivered reacceleration ahead of plan: record net new ARR of $221.1M, ending ARR of $4.66B (+20% YoY), total revenue of $1.17B (+21% YoY), and non-GAAP diluted EPS of $0.93, all above guided metrics .
  • Profitability and cash generation were strong: non-GAAP operating income reached a record $255.0M (22% margin) and free cash flow was $283.6M (24% margin); cash and equivalents hit a record $4.97B .
  • Guidance raised for FY26: revenue, non-GAAP operating income, non-GAAP net income, and non-GAAP EPS were all increased; tax rate lowered to 21%, providing a ~$0.03 EPS benefit in Q2; Q3 FY26 introduced with revenue $1.208–$1.218B and EPS $0.93–$0.95 .
  • Strategic catalysts: intent to acquire Onum to supercharge Next-Gen SIEM data pipelines; continued AI-native platform innovation (Charlotte AI expansion, Signal GA); “Flex” licensing driving faster multi-module consolidation and reflex expansions .
  • Back-half outlook: management assumes at least 40% YoY net new ARR growth in H2 FY26 and high-single-digit sequential NNARR growth from Q2→Q3; temporary ARR-to-revenue separation persists (~$10–$15M per quarter) due to partner programs .

What Went Well and What Went Wrong

What Went Well

  • Record net new ARR and acceleration arrived a quarter early; CEO highlighted “exceptional Q2” with >1,000 Falcon Flex customers and >100 re-flexes validating consolidation momentum .
  • Strong multi-product momentum: Next-Gen SIEM ending ARR >$430M (+>95% YoY), identity >$435M (+>21% YoY), cloud >$700M (+>35% YoY), and “fab three” combined >$1.56B ARR (+>40% YoY) .
  • Cash strength and profitability: record non-GAAP operating income of $255.0M (22% margin), record operating cash flow of $332.8M, record free cash flow of $283.6M (24% margin) .
  • Quote: “Reacceleration a quarter ahead of our expectations… highlights CrowdStrike as the leader in cybersecurity consolidation” — George Kurtz .

What Went Wrong

  • GAAP profitability impacted by outage-related and strategic plan costs: GAAP net loss of $77.7M; Q2 included $35.7M of July 19 Incident-related costs and $38.4M strategic charges; CFO noted ~$29M FCF impact .
  • Subscription Gross Margin modestly lower YoY: GAAP subscription GM 77% (vs 78% Q2 FY25), non-GAAP 80% (vs 81% Q2 FY25), reflecting mix and investments .
  • Continued temporary ARR-to-revenue separation from CCP/partner programs led to a wider pro services range and ~$10–$15M per quarter revenue impact expected through Q4 FY26 .

Financial Results

Revenue, EPS, Margins vs prior periods and estimates

MetricQ4 FY2025Q1 FY2026Q2 FY2026
Total Revenue ($USD)$1,058.538M $1,103.434M $1,168.952M
YoY Revenue Growth (%)+25% +20% +21%
GAAP Diluted EPS ($)($0.37) ($0.44) ($0.31)
Non-GAAP Diluted EPS ($)$1.03 $0.73 $0.93
Total Non-GAAP Gross Margin (%)78% 78% 78%
Non-GAAP Subscription Gross Margin (%)80% 80% 80%
Non-GAAP Operating Margin (%)21% 18% 22%
S&P Global Revenue Consensus ($USD)$1,035,410,680*$1,105,264,120*$1,150,181,540*
S&P Global Primary EPS Consensus Mean ($)$0.85939*$0.65993*$0.82998*

Values retrieved from S&P Global*

Revenue Breakdown

Revenue ComponentQ4 FY2025Q1 FY2026Q2 FY2026
Subscription ($USD)$1,008.316M $1,050.768M $1,102.945M
Professional Services ($USD)$50.222M $52.666M $66.007M

KPIs and Cash Flow

KPIQ4 FY2025Q1 FY2026Q2 FY2026
Ending ARR ($USD)$4.24B $4.44B $4.66B
Net New ARR ($USD)$224.3M $193.8M $221.1M
Flex customers (#)—>820 total to date >1,000 milestone; >100 re-flexes
Module adoption (≥6/≥7/≥8)67%/48%/21% (5+/6+/7+/8+) 48%/32%/22% (6+/7+/8+) 48%/33%/23% (6+/7+/8+)
Next-Gen SIEM ending ARR—Triple-digit growth (no figure) >$430M; >95% YoY
Identity ending ARR——>$435M; >21% YoY
Cloud ending ARR——>$700M; >35% YoY
Cash from Operations ($USD)$345.722M $384.107M $332.832M
Free Cash Flow ($USD)$239.837M $279.415M $283.616M
Cash & Cash Equivalents ($USD)$4.323B $4.614B $4.972B

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Total Revenue ($USD)Q3 FY26—$1,208.0–$1,218.0M New
Non-GAAP Operating Income ($USD)Q3 FY26—$256.0–$262.0M New
Non-GAAP Net Income ($USD)Q3 FY26—$238.1–$242.8M New
Non-GAAP Diluted EPS ($)Q3 FY26—$0.93–$0.95 (21% tax, 257M shares) New
Total Revenue ($USD)FY26$4,743.5–$4,805.5M $4,749.5–$4,805.5M Raised (low end)
Non-GAAP Operating Income ($USD)FY26$970.8–$1,010.8M $1,000.1–$1,040.1M Raised
Non-GAAP Net Income ($USD)FY26$878.7–$909.7M $922.4–$954.0M Raised
Non-GAAP Diluted EPS ($)FY26$3.44–$3.56 (22.5% tax, 256M shares) $3.60–$3.72 (21% tax, 256M shares) Raised; tax rate cut to 21%
Non-GAAP Tax Rate (%)FY2622.5% 21.0% Lowered

Notes:

  • CFO assumptions: high single-digit sequential NNARR Q2→Q3; at least 40% YoY NNARR for H2 FY26; ending ARR >22% growth for FY26; revenue impact from CCP/partner programs ~$10–$15M per quarter through Q4 .
  • Q3 cash payments expected ~$51M for outage-related costs; Q4 FY26 FCF margin targeted at 27% and >30% for FY27 full year .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 FY25, Q1 FY26)Current Period (Q2 FY26)Trend
AI/technology initiativesCharlotte AI Detection Triage GA; multi-AI partnerships; strong AI-native posture Charlotte embedded across Falcon; Charlotte grew >85% QoQ; Signal GA announced earlier in Aug Accelerating adoption/embedding
Next-Gen SIEMTriple-digit ARR growth; displacing legacy SIEM; Adversary OverWatch for SIEM Ending ARR >$430M; >95% YoY; Onum acquisition to supercharge data pipelines Strong expansion; enhanced data stack
Identity securityPrivileged Access launched (Q1); customer demand for next-gen PAM Next-Gen Identity Protection ARR >$435M (+>21% YoY); addressing AI agents/NHI Expanding scope/TAM
Cloud securityStrong net new and total ARR acceleration; Cloud Data Protection added Cloud ending ARR >$700M (+>35% YoY); runtime protection emphasis Robust growth; consolidation
Licensing model (Flex)$3.2B total account deal value; rapid deployment; reflexes at 39% of flex base >1,000 Flex customers; nearly 10% re-flex rate; avg utilization >75% Faster consolidation; bigger, longer deals
Regional/macroQ1 revenue mix ~67% US / 33% International; strength across geographies Both US and EMEA YoY growth accelerating vs Q1 Improving breadth
Regulatory/legal/outageDOJ/SEC info requests (Q1); July 19 Incident costs impacted cash Q3 cash payments ~$51M for outage costs; Q2 had $35.7M related costs Cost tail subsiding into Q4

Management Commentary

  • Strategic message: “Our reacceleration is driven largely by AI necessitated demand for the Falcon platform and stellar execution… highlights CrowdStrike leading the way in cybersecurity” — George Kurtz .
  • Platform vision: “Driving adoption of the Falcon platform as the operating system of cybersecurity is our next gen SIEM” .
  • Onum acquisition: “Onum is both the pipeline and the filter… streaming high-quality filtered data directly into the platform to drive autonomous cybersecurity at scale” — George Kurtz .
  • Profitability/cash: “We exceeded our expectations across all guided metrics… record Q2 cash flow from operations of $333 million and record Q2 free cash flow of $284 million” — Burt Podbere .
  • Outlook: “Our guidance now assumes back half net new ARR will grow at least 40% versus last year” — George Kurtz .

Q&A Highlights

  • Flex & reflex mechanics: Reflex purchases occur when Flex credits are consumed; reflexes drive net new ARR and accelerate consolidation; demand planning replaces module-by-module selling .
  • ARR-to-revenue divergence: Temporary separation due to CCP-related partner program amortization (ASC 606), ~$10–$15M per quarter through Q4 .
  • SIEM competition: Frequent displacements of Splunk/QRadar; pricing disruptive (no charge for CrowdStrike-generated data ingest) .
  • Identity strategy: Next-gen identity and PAM as consolidation alternatives; customers seeking modern, integrated solutions .
  • Cloud runtime protection: Emphasis on workload runtime; consolidation across CNAPP/CSPM/ASPM/CDR/container security .
  • Federal: Not yet large but opportunity building; certifications in place; patient approach .

Estimates Context

  • Q2 FY26 beat vs S&P consensus: revenue $1,168.952M vs $1,150.181M*, EPS $0.93 vs $0.82998*; prior quarters also beat revenue/EPS .
  • Estimate participation: 44 revenue estimates, 46 EPS estimates for Q2 FY26; target price consensus $531.45 with 47 estimates*.
MetricQ4 FY2025Q1 FY2026Q2 FY2026
Revenue Actual ($USD)$1,058,538,000 $1,103,434,000 $1,168,952,000
Revenue Consensus ($USD)$1,035,410,680*$1,105,264,120*$1,150,181,540*
EPS Actual (Primary/Non-GAAP Diluted) ($)$1.03 $0.73 $0.93
EPS Consensus ($)$0.85939*$0.65993*$0.82998*
# of EPS Estimates42*43*46*
# of Revenue Estimates41*42*44*

Values retrieved from S&P Global*

Implication: Street will likely raise FY26 non-GAAP EPS/revenue given the beat and raised FY26 guide; note EBITDA consensus/actual variances are less useful for CRWD given non-GAAP focus.

Key Takeaways for Investors

  • Consolidation flywheel: Flex licensing is accelerating multi-module adoption and driving reflexes; expect continued NNARR acceleration in H2 FY26 and into FY27 per management .
  • Next-Gen SIEM momentum with Onum: SIEM ARR growth and pipeline should benefit from Onum’s in-pipeline detection and lower ingestion costs; watch displacement pace vs legacy incumbents .
  • Identity and Cloud expansion: Identity (>21% YoY ARR growth) and Cloud (>35% YoY ARR growth) are key growth vectors, reinforced by AI-agent security needs and runtime focus .
  • Profitability trajectory: Non-GAAP op margin expanded to 22%; management reiterates Q4 FY26 FCF margin 27% and >30% FY27; cost tail from July 19 Incident expected to subside after Q3 .
  • Guidance underpinning: H2 NNARR +≥40% YoY assumption and wider pro services range reflect pipeline strength and CCP effects; monitor ARR-to-revenue separation (~$10–$15M/quarter) through Q4 .
  • Risk checks: GAAP losses reflect ongoing non-GAAP adjustments (stock comp, outage costs, strategic charges); track regulatory inquiries and outage-related payments cadence .
  • Near-term trading: Positive catalysts include raised FY26 guide, Q3 guide above Q2 actuals, Onum acquisition, and AI-native narrative; watch Q3 NNARR progression against “high single-digit sequential” assumption .