CRWD Q3 FY21 Earnings Insights

Hi all,

I just wanted to share some numbers that I thought might be valuable to some of you on this forum. Crowdstrike is one of my largest holdings and I published a piece about it on Seeking Alpha just a few months ago. Of note, the below are non-GAAP unless otherwise stated.

Quarterly revenue was up 86% YoY compared to 84% last quarter and 85% the quarter prior. This is amazing and suggests that they are persisting with their momentum despite the passage of time and the headwinds one might expect from a COVID-related economic recession.

They obtained Gross Margins of 76%, the highest this figure has been (was 75% last 2 quarters and significantly up from 67% in Q4 FY20). The company is shooting for 75-80% subscription GM long-term.

R&D, S&M, and G&A all dropped 1% sequentially (as % of rev) to 20%, 40%, 8% respectively. Of note, CRWD has shared internal targets of 15-20%, 30-35%, and 7-9% on those three metrics, so only S&M is above projected long-term goal range by ~10%.

Operating margin is 8.1%, up from 3.9% sequentially! CRWD’s long-term goal is 20+%, and they are well on their way.
Net income was likewise up to 8% from 4% sequentially.

Operating cash flow and FCF have been positive for 5 consecutive quarters now. Free cash flow was 34% up from 16% sequentially and up from 6% this quarter last year.

CRWD gained 1186 new subscriptions customers this quarter, putting them at 8416 and up 85% YoY. This was their highest # of new customers gained quarterly even if you subtract the 64 from the acquisition of Preempt Security.

I like to look at YoY but also the last few quarters sequentially, so hope these #s may help give some perspective.

All in all, I am extremely impressed and continue to be very bullish CRWD as they prove to be an essential cybersec leader that is easy to adopt and very sticky with great management, strong execution, and realistic goals.

  • Rob W