CrowdStrike more than doubles revenue in first earnings report

Cybersecurity vendor's share price soars

CrowdStrike's share price has soared after the vendor announced it more than doubled revenue in Q1.

The cybersecurity pin-up, announcing its first results as a public company, saw sales rise 103 per cent to $96.1m during the period ending 30 April 2019. Losses narrowed to $25.8m.

CrowdStrike said that recurring revenue grew faster than overall sales, climbing 116 per cent to $86m.

On an earnings call, transcribed by Seeking Alpha, CrowdStrike CEO George Kurtz said the vendor is continuing to displace "fossilised" traditional antivirus vendors.

"Any of the legacy vendors we continue to take share from, and I think it's a recognition of customers that are trying to transition to a true cloud architecture," he said.

"I think it's just a recognition that traditional legacy players are not really capable of dealing with advanced threats. Customers are looking for something different, more prudently in a cloud-based architecture to match their needs as they migrate other technologies into the cloud."

Kurtz said that CrowdStrike is now looking to target customers outside of its typical enterprise space "including smaller organisations as well as acquiring customers in the federal government vertical".

He added that the vendor is also broadening its scope by focusing not just on end-points, but on servers, virtualised and cloud environments, IoT devices and containers.

CrowdStrike's results impressed investors, with its share price rocketing over 17 per cent when the NASDAQ market opened, giving it a valuation of $16.7bn.

Kurtz was asked by an analyst how likely it would be for a traditional AV vendor or a start-up to replicate CrowdStrike's product, claiming that would be incredibly difficult.

"Well, there's a lot of core IP that we've built into the technology and we started in 2011, as the first cloud-native end-point security vendor.

"Obviously there's a lot of lessons learned between now and then.

"More importantly, anyone coming into the space would really have a low margins and has to go through a painful process of margin migration upwards. Obviously, you've seen we've gone through this, but a lot of it really is based upon the core IP that we've built, which is very unique."