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CrowdStrike Holdings, Inc. (CRWD)·Q4 2025 Earnings Summary

Executive Summary

  • Q4 FY25 delivered durable top-line growth and operating leverage: revenue $1.06B (+25% y/y) and non-GAAP EPS $1.03, with ending ARR at $4.24B (+23% y/y) and net new ARR of $224.3M, all above company guidance ranges .
  • Platform consolidation and Falcon Flex accelerated module adoption (67%/48%/32%/21% using 5+/6+/7+/8+ modules), while gross retention held at 97%, underpinning guidance for reacceleration of net new ARR in 2H FY26 .
  • Guidance introduced for FY26: revenue $4.74–$4.81B, non-GAAP EPS $3.33–$3.45; Q1 FY26 revenue $1.10–$1.11B, non-GAAP EPS $0.64–$0.66; methodology change adds a 22.5% non-GAAP tax rate (midpoint EPS impacts of -$0.19 for Q1 and -$0.98 for FY26) .
  • Stock catalysts: clear beat vs prior Q4 guidance, improving 2H FY26 trajectory (ARR/margins/FCF), AI-native SOC narrative (Charlotte AI) and hyperscaler marketplace momentum (>$1B AWS Marketplace sales), offset by near-term GAAP loss (tax/incident costs) and lower professional services margin .

What Went Well and What Went Wrong

What Went Well

  • Platform consolidation and Flex momentum: “Falcon Flex is a game changer,” with accounts adopting Flex adding >$1B of in-quarter deal value; customers with 5+ modules reached 67% (6+/7+/8+: 48%/32%/21%) .
  • Strong strategic growth vectors: Cloud Security ARR >$600M (+45% y/y), Next-Gen SIEM >$330M (+115% y/y), Identity >$370M; management positioning Falcon as the “AI-native SOC” with Charlotte AI driving measurable SOC efficiency .
  • Execution and retention underpinning the beat: Q4 revenue and non-GAAP EPS exceeded internal guidance; gross retention 97% and improving visibility to net new ARR reacceleration in 2H FY26 .
    • Quote: “Everyone loves a comeback story and that's exactly what we've started experiencing in Q4… The results tell our story.” — George Kurtz .

What Went Wrong

  • GAAP loss despite strong non-GAAP profits: Q4 GAAP net loss -$92.3M (diluted -$0.37) driven by $49.9M acquisition-related tax expense and $21M incident-related costs; non-GAAP EPS was $1.03 .
  • Professional services margin pressure: Q4 GAAP PS gross margin fell to 12% (from 33% y/y); non-GAAP PS gross margin 32% (from 46% y/y) .
  • Free cash flow margin compressed: Q4 FCF $239.8M (23% margin) vs 33% a year ago; management also flagged additional cash headwinds in Q1 FY26 from outage-related costs and flexible terms .

Financial Results

P&L, Cash Flow, and ARR (oldest → newest)

MetricQ2 FY25Q3 FY25Q4 FY25
Total Revenue ($USD Millions)$963.9 $1,010.2 $1,058.5
Subscription Revenue ($USD Millions)$918.3 $962.7 $1,008.3
GAAP Diluted EPS ($)$0.19 -$0.07 -$0.37
Non-GAAP Diluted EPS ($)$1.04 $0.93 $1.03
Non-GAAP Operating Margin (%)24% 19% 21%
Subscription Gross Margin – Non-GAAP (%)81% 80% 80%
Free Cash Flow ($USD Millions)$272.2 $230.6 $239.8
Ending ARR ($USD Billions)$3.86 $4.02 $4.24
Net New ARR ($USD Millions)$217.6 $153.0 $224.3

Revenue Mix

MetricQ2 FY25Q3 FY25Q4 FY25
Subscription Revenue ($USD Millions)$918.3 $962.7 $1,008.3
Professional Services Revenue ($USD Millions)$45.6 $47.4 $50.2
Total Revenue ($USD Millions)$963.9 $1,010.2 $1,058.5

Key Performance Indicators

KPIQ4 FY25
Gross Retention (%)97%
Dollar-Based Net Retention (%)112%
Module Adoption (% of subs customers): 5+ / 6+ / 7+ / 8+67% / 48% / 32% / 21%
Cash & Cash Equivalents ($USD Billions)$4.32
Total Non-GAAP Gross Margin (%)78%
Free Cash Flow ($USD Millions) and Margin (%)$239.8; 23%

Strategic Solution Metrics (select disclosures)

  • Cloud Security: ending ARR >$600M, +45% y/y .
  • Next-Gen SIEM: ending ARR >$330M, +115% y/y .
  • Identity Protection: ending ARR >$370M .
  • Combined Cloud/Identity/SIEM ending ARR >$1.3B; note discrepancy in growth commentary: “growing nearly 15% y/y” earlier vs “growing nearly 50% y/y” later in the call .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Total RevenueQ1 FY26N/A$1,100.6–$1,106.4M Initial
Non-GAAP Income from OperationsQ1 FY26N/A$173.1–$180.0M Initial
Non-GAAP Net IncomeQ1 FY26N/A$162.1–$167.5M Initial
Non-GAAP Diluted EPSQ1 FY26N/A$0.64–$0.66 (22.5% non-GAAP tax) Initial (methodology update)
Diluted Shares (Non-GAAP)Q1 FY26N/A254M Initial
Total RevenueFY26N/A$4,743.5–$4,805.5M Initial
Non-GAAP Income from OperationsFY26N/A$944.2–$985.1M Initial
Non-GAAP Net IncomeFY26N/A$851.2–$883.0M Initial
Non-GAAP Diluted EPSFY26N/A$3.33–$3.45 (22.5% non-GAAP tax) Initial (methodology update)
Diluted Shares (Non-GAAP)FY26N/A256M Initial
Non-GAAP Tax Rate AssumptionFY26+N/A22.5% (midpoint EPS impact: -$0.19 Q1, -$0.98 FY26) New methodology

Context vs prior guidance: Q4 FY25 had been guided to revenue $1,028.7–$1,035.4M and non-GAAP EPS $0.84–$0.86; actuals were $1,058.5M and $1.03, above both ranges .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q2 & Q3 FY25)Current Period (Q4 FY25)Trend
AI/Charlotte AIIntroduced AI-native positioning; continued AI investment and platform innovation .Charlotte AI “agentic analyst” driving SOC time savings; >100 Q4 Charlotte deals; AI outcomes narrative front and center .Strengthening adoption and ROI signaling .
Falcon Flex modelFlex introduced as transformational subscription model; customers embracing CCPs (post-July incident) .Flex “game changer,” >$1B in Q4 Flex deal value; 5+/6+/7+/8+ module adoption at 67%/48%/32%/21% .Accelerating consolidation and larger, longer deals .
Cloud Security (CWP/CNAPP)Cloud/Identity/SIEM combined >$1B ARR (Q2), continued momentum .Cloud ARR >$600M (+45% y/y); runtime protection advantage; 8-figure displacement in FS .Strong growth with competitive wins .
Next-Gen SIEMNamed IDC MarketScape Major Player; strong interest from GSIs .SIEM ARR >$330M (+115% y/y); 7-figure airline win displacing legacy SIEM .Hypergrowth and ecosystem pull .
Identity ProtectionEmphasized rising identity attack surface; Adaptive Shield acquisition (Q3) .Identity ARR >$370M; hospital system win replacing bolt-on competitor .Continued expansion with broadened scope (SaaS posture) .
Exposure ManagementEmerging area noted at Fal.Con (Q3) .Now meaningful contributor with LoS to ~$300M ARR; capability to fully replace legacy VM tools .Rapidly scaling attach via Flex .
Hyperscaler marketplacesLifetime $1B with CDW; marketplace GTM emphasis (Q2) .>$1B annual AWS Marketplace sales; >$150M in Google Marketplace; strong partner flywheel .Expanding route-to-market and deal velocity .
Retention/NRR97% gross retention; CCPs to mitigate incident impacts (Q3) .Gross retention 97%; DBNR 112% (noisy given Flex/CCP); churn in line .Stable retention; NRR to improve with 2H deployments .

Management Commentary

  • Strategy: “We are cybersecurity's AI-native agentic platform that stops the breach… Our platform wins: 7 modules are each now individually over $300 million in ending ARR.” — George Kurtz .
  • Business model durability: “We achieved fourth quarter results above all guided metrics… strong customer retention, accelerating module adoption… give us confidence… to deliver long-term profitable growth.” — Burt Podbere .
  • Demand and consolidation: “Consolidation, cost reduction and automation are now the accepted enterprise and federal priorities… For our customers, Falcon has quickly become their AI-native SOC.” — George Kurtz .
  • 2H FY26 setup: “We expect net new ARR reacceleration as well as operating margin and free cash flow margin expansion in the second half of FY '26.” — Burt Podbere .

Q&A Highlights

  • Flex value creation: Customers consume Flex ahead of demand plans; example transportation company consolidated multiple vendors and increased ARR by 67% under Flex .
  • Segment dynamics and CCP: Identity/Cloud adoption accelerated within CCP; burn-off in 2H FY26 should support upsell/renewal opportunities .
  • NRR and upsell: DBNR 112% influenced by larger, longer Flex deals; management prioritizes strategic platform standardization over managing to NRR optics .
  • AI pricing/usage: Charlotte AI attached broadly via Flex; power users include L3 analysts due to effective prompting and workflow integration .
  • Exposure Management: Now capable of full replacements (agent + network scanning), unlocking competitive takeouts in VM/ASM .
  • Marketplaces: >$1B on AWS Marketplace in a year; expanding internationally and across hyperscalers (GCP) .
  • Profitability cadence: FY26 non-GAAP op margin guided ~21% at high end with 2H expansion; return to GAAP profitability in Q4 FY26 anticipated .

Estimates Context

  • S&P Global consensus estimates for Q4 FY25 were unavailable at the time of retrieval due to provider limits; as a result, a consensus vs. actual comparison is not included here. Values from S&P Global could not be retrieved at this time.
  • Versus company guidance (from Q3): Q4 revenue ($1,058.5M) and non-GAAP diluted EPS ($1.03) were above the guided ranges ($1,028.7–$1,035.4M; $0.84–$0.86), implying a clean beat relative to internal outlook .

Actuals vs Prior Q4 Guidance

MetricQ4 FY25 Guidance (from Q3)Q4 FY25 ActualResult
Total Revenue ($USD Millions)$1,028.7–$1,035.4 $1,058.5 Above range
Non-GAAP Income from Operations ($USD Millions)$184.0–$189.0 $217.3 Above range
Non-GAAP Net Income ($USD Millions)$210.9–$215.8 $260.9 Above range
Non-GAAP Diluted EPS ($)$0.84–$0.86 $1.03 Above range
Diluted Shares (Non-GAAP) (M)252 253.3 Slightly higher

Guidance Details (Current)

MetricQ1 FY26FY26
Revenue ($USD Millions)$1,100.6–$1,106.4 $4,743.5–$4,805.5
Non-GAAP Op Income ($USD Millions)$173.1–$180.0 $944.2–$985.1
Non-GAAP Net Income ($USD Millions)$162.1–$167.5 $851.2–$883.0
Non-GAAP Diluted EPS ($)$0.64–$0.66 (22.5% non-GAAP tax) $3.33–$3.45 (22.5% non-GAAP tax)
Diluted Shares (M)254 256

Methodology update: new 22.5% non-GAAP tax rate from FY26 onward (midpoint EPS impact: -$0.19 in Q1, -$0.98 in FY26) .

Key Takeaways for Investors

  • Clean beat vs Q4 guidance with robust net new ARR ($224M) and stable 97% gross retention supports confidence in 2H FY26 reacceleration and margin lift .
  • Falcon Flex and AI-native SOC strategy are driving larger, longer multi-module deals and accelerated deployment; module adoption metrics continue to set records .
  • Strategic vectors (Cloud, Next-Gen SIEM, Identity) are scaling rapidly (notably SIEM +115% y/y), with credible competitive replacements across legacy vendors .
  • Marketplaces and GSI ecosystems are material growth levers (> $1B AWS Marketplace sales; GSI business near $1B, >40% y/y), aiding deal velocity and size .
  • Near-term optics: GAAP losses (tax/incident costs) and PS margin pressure, plus FCF headwinds in Q1 FY26, but management guides for 2H operating and FCF margin expansion and return to GAAP profitability in Q4 FY26 .
  • Methodology change (22.5% non-GAAP tax rate) mechanically lowers FY26 EPS versus prior calculation methods but improves comparability going forward .
  • Execution on consolidation and AI outcomes remains the narrative that moves the stock; track Flex burn/renewals, 2H ARR/FCF cadence, and continued hyperscaler momentum .