CrowdStrike Soars After Earnings Beat and Market Share Gains

(Bloomberg) — CrowdStrike Holdings Inc. gave a forecast for revenue and profit in the current quarter that far surpassed Wall Street’s expectations, crediting a single-platform strategy that has allowed it to gain market share. The stock soared in extended trading.

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The cybersecurity company said it expects earnings per share of 89 cents to 90 cents in the first quarter, beating the average analyst forecasts for 82 cents. It sees revenue of $902.2 million to $905.8 million, also surpassing estimates.

The Austin, Texas-based company’s earnings beat comes at a time of extreme volatility for cybersecurity stocks. High-profile cybersecurity attacks have created new demand opportunities for some security firms while others have largely missed out. In stark contrast to CrowdStrike, Palo Alto Networks Inc. plunged in February after cutting its revenue forecast for the year, saying customers were facing cybersecurity “spending fatigue.”

CrowdStrike shares surged 26% in extended trading in New York. If the gains hold, shares will open at a record on Wednesday morning in New York. Other cybersecurity companies including SentinelOne Inc., Fortinet Inc. and Palo Alto Networks also gained.

In the fourth quarter, CrowdStrike reported adjusted earnings of 95 cents a share, beating estimates of 83 cents. Quarterly revenue also exceeded estimates, hitting $845.3 million.

Chief Executive Officer George Kurtz credited the “exceptionally strong” results to the company’s strategy of offering its security products on a single platform. Unlike rival Palo Alto, he said, CrowdStrike’s products are “all on one platform, one agent and one integrated workflow.” Kurtz noted on a call with investors that an unnamed financial services firm had replaced its Palo Alto cloud products “in a large seven-figure deal.”

CrowdStrike also announced that it had agreed to buy Flow Security, a firm that runs a cloud-data protection platform.

(Updates with CEO comments starting in sixth paragraph)

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