CrowdStrike Holdings Inc., specializing in cybersecurity, posted a net loss of $110.2 million in the first quarter of the current fiscal year, compared to a profit of $42.8 million in the previous year. This corresponds to a decrease of 44 cents per share, compared to an increase of 17 cents in the same quarter of the previous year. The cause is ongoing costs from a severe software glitch in July 2023, the consequences of which continue to impact the company.
On the revenue side, CrowdStrike increased by 20 percent to 1.10 billion dollars, driven by growth in the subscription segment (+20% to 1.05 billion dollars). Nevertheless, revenue slightly fell short of analyst expectations of 1.11 billion. Adjusted earnings per share (Adjusted EPS) reached 73 cents, exceeding the market expectation of 66 cents, according to FactSet data.
The so-called Customer Commitment Program (CCP), which CrowdStrike launched last year to retain customers with free product usage following the outage, is particularly burdensome. This measure continues to weigh on margins: In the first quarter alone, it impacted revenue by $11 million. CFO Burt Podbere expects the effect to be between $10 and $15 million in each of the remaining quarters.
For the current second quarter, CrowdStrike expects revenue of $1.14 to $1.15 billion – below the market expectations of $1.16 billion. In terms of adjusted earnings per share, the forecast is slightly above the consensus (81 cents) at 82 to 84 cents. For the entire year, management expects revenue between $4.74 and $4.81 billion and an adjusted EPS between $3.44 and $3.56 – here too, the forecast is close to market expectations.
The stock reacted with disappointment to the subdued outlook and lost 6 percent in after-hours trading to $461.23. The previous day, it had marked a new 52-week high at $491.20.
The management does not foresee a return to sustainable growth before fall, also because special costs related to the incident continue to incur – including $38.7 million for general administration and $537,000 in the research & development field.
