CRWD - Earnings call transcript Q4 2019 | CrowdStrike Holdings, Inc.

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Operator

Ladies and gentlemen, thank you for standing by and welcome to the CrowdStrike Holdings Fourth Quarter and Fiscal Year 2020 Financial Results Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions]

I will now hand the conference over to your speaker today, Maria Riley, Investor Relations for CrowdStrike.

Maria Riley

you participation thank and afternoon, for today. your Good are President of and me and on Executive Kurtz, call the Officer. Financial Co-Founder With Chief George Officer Podbere, Chief Burt CrowdStrike and

XXXX. of this of Reform like get we that forward-looking made as within are These regarding including started, statements historical would our Act objectives meaning conference Before performance, to the future are that of call our forward-looking this the plans, I represent certain Litigation outlook note statements facts, of call. Private those Securities not during statements and the expected only date

or While and we based forward-looking any statements We result and undertake uncertainties. are are any on differ could are a of we we have and the information, results otherwise. including affect and to reports the could Further believe events do actual these to time, our not results in section reasonable, the alter factors SEC statements that on disclaim update information forward-looking or because filings SEC. from with we Company's Risk expressly statements that Company's current risks the in time new quarterly with obligation the as to materially whether the future annual expectations make Factors made and file subject financial titled included is other

or found financial Form the Investor we versus available non-GAAP which discussed website call GAAP today. be X-K on will this is use currently with financial and be schedule on our ir.crowdstrike.com otherwise SEC discussion Relations press unless in measures revenue, filed A of excluding our release, results at Also, why all stated, a may on non-GAAP non-GAAP. our showing measures reconciliation

call George the turn over to will I begin. to Now,

George Kurtz

staying thank and is healthy. you, us Thank everyone you all We joining hope today. for Maria,

with are everyone coronavirus. the affected thoughts by Our

is our globe. customers top partners health all and of colleagues, the safety around Our priority ensuring and the

includes them, necessary remotely. this to hosting help call implemented safeguards protect have which We

and today summarizing I cover to key points. ground of lot three by will a have We start

my dynamics the We multi-year the this the year cloud the are shift in took is industry XX-year career. competitive seismic by have seen being the technologies. a that with consolidation the First, last believe place driven of of along landscape to trend as best I beginning

customers increasingly their of and choice. choosing Second, are partners cloud and platform as security CrowdStrike partner

As to that a and result, start to are more discretionary over private Cybersecurity workload new modules the cybersecurity public $X sector. not a of remote also we organizations. million. customers environment landing both ARR increasing a the regardless third, is with protecting workforce. with purchase bigger And the for mission Endpoint critical number or spending is is essential of and security

remote know impact a macroeconomy easily rapidly deployed is at differently conduct cybersecurity shift the their positioned scale unfolding is and to meet the our forcing lightweight time, that cloud native to real With it frictionless to platform, our CrowdStrike uniquely the needs. is in to and go-to-market While engine, coronavirus from business we agent companies workforce. our is

quarter in at these our with results expectations. the delivered exceptional CrowdStrike detail. Across we and discuss let's Now board, our into topics record another exceeding results well get more

off revenue we year. margins a flow CrowdStrike our quarter XXX%, improved in was and at we scale, million in which number revenue of for historic new subscription end net delivered the growth, growth a added year the During The XX% we customers achieved year-over-year, record net increased new achieving positive ARR of for exceptional which subscription total high and fourth $XX the by our the above XX% free guidance. topped quarter and cash significantly growth

believe revenue of last the $XXX one and XX%, fastest SaaS Subscription at We in revenue up million over cloud robust even year ARR, We go-to-market million. our companies to our and of growing making leadership category scale. ended faster, the commitment growing the engine. this year our up stopping $XXX year results in our relentless security breaches, at million, to speak up frictionless $XXX to XX% XX% us grew reach

is the by of CrowdStrike the this execution possible made of team. exceptional All

We would about their like to CrowdStriker be amazing customers. to our I and for an opportunities. together and personally have every future accomplished or I company everything with protecting dedication more thank couldn't pleased more empowering unwavering excited we've our

has shift The including workloads an containers greenfield technologies opportunities. seismic cloud with created and cloud to massive environment native

distracted these increase Broadcom our trying as an offerings, mission, workforce pipeline, in their overall are retooling While and our and among Symantec, rationalizing customers our partners. an customer with technologies, platform customers or with CrowdStrike's their to acquired clearly began contributed both engagement brand resonating to integrating saw dynamics on-prem competitors and Furthermore, in integrate expansion we increased and an adoption acceleration believe inquiries have our partners. We partner. are in

better front, have in the to left More market. for partner they seen significant protect the United alternatives launched and we of segments abandons Symantec replacement Several abroad specifically as are Symantec on large searching demand States customers who partners campaigns. the as look have

with robust are price solutions them to compelling put closely together collaborating at We points.

was a of these next and their be our little One in customers existing will Symantec of away migrating of overlap base. several and our between that found that the we thousand year partners very from prospects there customer list submitted

operations, skills protect and time leverage resources. operations system protect this record XXX% an and up them customers enhanced performance. gap Falcon are to X,XXX more new are new to breaches add and increase efficacy and at are customers. a net They organizations platform strategic the number now customer turning CISOs ways net added a is which CIOs quarter to QX, This workloads, customers. consecutive year year-over-year. to free eighth we in for our for while automation increasingly in XXX also is We array than to looking reducing cost. bridge looking simplify restore security their This of help stop base These doubled our up to the same of their partner and

more new from momentum. with this had we hear metrics. in enterprise customers, gaining day Our the we are than and more $X platform new modules last number and than it customers we've of QX greater landing with this starting year. conversations quarter see of ARR prospects in many of strategy we doubled million Within compared we customers, partners every out the with and bigger our is And to

all saw modules the average Additionally, customers quarter across every new in we number this fiscal increase year. past of

within existing to also base. expand We adoption continued our module customer

with quarter, or those customer more This of more one-third customers four once base. modules grew adopted modules and again all our five of that to percentage or increased the subscription cloud

it of increases our and adopt value customer believe workloads, modules As relationship span with strengthens that more our wide customers a customer. strategic the array we

provided Let value me how strategic to the Falcon customer. the customer platform the few a share examples into wins demonstrate and translated customer that immediate power

the first lackluster company team leading a by customer and was and is operating endpoint frustrated to where at volume to win across limited product anti-virus support. online of insufficient the we marketplace The top functionality systems fidelity security The autonomous alerts positives, of large remediate this displaced due with an customer vendor. incumbent's triage that next-gen false on

and their looking business. the assets. competitive the takeoff rollout encompassed this from EDR opportunity the and legacy to enterprise servers the lead next-gen cloud one players protect won against for customer's workstations initially to both phase was organization marketplace, this a and a that and in for CrowdStrike the While "crushed" In came platform AWS AV the words,

new operations customer this by value and with and EDR X quickly powered single Additionally, this beyond six CrowdStrike functions which of threat intelligence. included consolidating Falcon our our for and RFP this for the agent IT AV, next-gen Expanding adopted modules realized platform initial still AI Discover intelligence graph. provides the customer

Additionally, opportunity to we still further the production into the have environment. expand AWS

how for Windows, on EDR and they the update constrained ATP I on The using posture, platform the and ATP the CrowdStrike manufacturer team. resource was This as Because not streamline vendors to a its and one system's environment as new the newer solution. resource not AV. ineffective vendors with the helped their gap. XXXX of versions enhance you Global customer was percentage next of will two previously the patchwork burden latest large could well bridge an customer's security their next-gen of service Falcon operating This share build security of and showcases disparate security was

vendor the security required level features. alerts in on visibility provide reach resulted advanced Additionally, and or to process not the This remediation to user often did remediation team provide users the a EDR out cumbersome, manual directly.

security EDR's called with all and comprehensive up With revaluation in contract and one year this the modules internal three They with on Falcon them replaced vendor's solutions customer the providing left freeing adopted their environment platform resources. seven a next-gen endpoint in off visibility kicked CrowdStrike. and protection and

evaluate protection better looking also legacy This viewed will full chose and global reputation with with its because next leader The and large are quickly. a its gain stack was win I endpoint across we CrowdStrike share environments visibility manufacturer customer market to deploying complex to environment. of security consolidate across as the you

During solution The fell over quickly to XX,XXX production the the one the to they than deploy their quickly a productivity major of more customer failed saved existing customer and to losses. contain manufacturing malicious line rushed weekend the down facilities. deploy and shutting the in CrowdStrike process, endpoints international ability millions identify their activity victim to to at adversary. able and legacy vendor sales solution The was

value by provided streamlining customer by Beyond additional security a remediating value this the immediate breach, the stack. significantly realized

they platform and legacy seven considerably eliminated visibility security tools Falcon and their With posture. the improved

platform and threat Splunk Splunk modules The and were and competitive false ultimately positive of with Spotlight, to alerts autonomous multiple platform. Splunk low final as platform would consolidating and is chose with of of customer CrowdStrike upgrades. ongoing integrated intelligence. rate including on other the the the single Discover the kicked its next-gen next-gen for Splunk. for maintenance operations IT you agent. using use, well They were off Falcon of win Falcon difficulty extra a ease as across that adopted solutions frustrated an like evaluation share vendor fidelity I

our processes skills advantage. enable to now all customers bridge performance increase gap Each time our helps week. data over and graph And endpoint network increases cloud private and provide more public, To agent are geographies of end smarter with visibility at of that our summarize, environments, power the time and driven to security threat force multiplier, ability stopping X it and threat long-term our easily and efficacy immediate real we realize diverse graph value workloads gets and workload proven single per crowdsourced predictive a cloud-native the costs. data size mode new reduce customers In events hybrid end, security platform as joining agents, we lightweight which our our the industries, and our consolidate to deployed scale across trillion is breaches, because all our to customers winning of that consumes. across competitive and across AI

the would I I over relates a the current impact comments the from few Before call to as to turn on the Burt, environment coronavirus make it like to outbreak.

a approximately a a ensure do our inception several CrowdStrike the basis the On remote XX% of Company We nimble. given have remotely. are to workforce, disruption implemented these is was expect and measures regular dispersed lead work family designed we built to remote From to company to accommodate thrive that of in we of workforce with the measures highly a safety our a workflow. employees geographically and to not

the experienced close environment, coronavirus. in the an As ability in not point to demand to we at to due our it relates this have time business impact

would situation As call an this many in is agree, are the and macroeconomic of uncertain we on environment fluid. you

facets key investors However, business are four to important there our we are to remember. to believe that

an First, compliance business and it provides mission critical adversaries. resiliency and economy, is while on has impact as the to meets cyber requirements. remain will not will organizations it having security stop essential and global coronavirus Cyber

already situation, at In difficult and are without customers the endpoints and relief to plan to in the crisis our coronavirus existing to of community, cycle. worry adversaries cloud. exploit as for launched the allows a to threats, e-criminals phishing about big. protect further search to to fear escalate will a try our seen stay new coronavirus I procurement times know new but onboard up campaigns office the workers of days. number quickly customers the we've imagine, customers to allow they whether This of that or using surge we've adversaries aid public's and XX home, launch To ahead attacks. will We the remote prey having in nation-state on it's enable CrowdStrike these

program have use need. Prevent launched install a administrators time for we employees' company on Additionally, Falcon of home their to Prevent by home been These received customers that systems. free-of-charge allows well their in Falcon programs

native to best we those and native platform. buy and irrespective Because cloud physical solved exponentially. grows allows easily new endpoints workloads protect of a employees newly their will XX,XXX is their everywhere threat are move physical and to workforce scale fleets will user rushed as protected organizations cloud one outside up put are laptops even be employees laptops platform associated note not as mobile offices, deploy, security The with new and need spin their CrowdStrike's and to large cloud They real-time of To is devices for security is with their landscape remote Falcon. manage infrastructure, security provision workforce with while a where Falcon that remote that customers customers does remotely Second, located. require I offline. recently it of challenges in rapidly workload workloads our and ensuring enterprise every perspective, this when such by protecting at of

are on that protection also only provides the hardware highest CrowdStrike cost, agents, for operations. organizations streamlines with when to customers they security that visibility, times pressured reduces a but operating not level routinely CrowdStrike save of cost reduce will look Third, return investment. three them platform their one the and saving consolidates This and with exactly some and money helps customers is how

we expertise with ability have significantly time do not In short and virtualize Complete, may from across Complete as them fully force Fourth, resources is offering, do zones their XX home security it increase managed the our time all Falcon customers be teams enables or when customers X their on resources operations protect multiplier staffed or Falcon to broaden protection by when a working and endpoint they security customer to a security so. a basis. for

in environment. elements in significant gives these critical While the organizations, security we happen are we fact macroeconomy, unable any the believe that is us to and will predict to what mission advantages

includes environment more in near We which are term. aligning customers of digital resources reach marketing shifting current light our to our the investment for toward the channel

meet our Sales Global Carpenter, prospects all continue and that XXX Zoom. CrowdStrike's are believe tour as Mike will future. I engine, innovate, which and and XXX President view emerge emerging by as success XXX our Additionally, fundamental of term, And look platform with endpoint like kicking powerful offerings international new combination It and stronger this during cloud in frictionless companies Operations when via ever native off a trial customer to position than short is of our the before. channels and trial-to-pay of we remotely focus and in-app we past the well AWS customers such the go-to-market on times we us of the Field days XXX the as where includes Marketplace best well as platform

focus customer to driving over We will our lead continue and on expanding competition. the success

Burt. that the With over turn I to will call

Burt Podbere

George, everyone. you, good Thank and afternoon

net records outstanding ARR, remarks new reminder, business, quick except of quarter another non-GAAP. free numbers unless mentioned today during noted with a customers in and the flow. in As cash including delivered areas We new multiple otherwise all my revenue strength are net

The We growth. consecutive within by growth year-over-year contraction XX% setting for we record customer year-over-year a $XX.X acquisition $XXX.X expansion XX% to in business, our strong ARR was the fourth coupled logo new and another new ARR representing quarter base. million. net churn and reach with new in low existing driven million quarter in ARR, added growth quarter, the for In fourth delivered

strategy for FY pleased with best-in-class with with and very have and been of continued have we retention We our and 'XX. the seen land rate QX expand success gross our XX%

existing a XXX% based beginning the at measure we dollar net period intended XX-month customer the the expansion retention to over set year. benchmark is subscriptions of rate, in Our which exceeded

'XX, end at 'XX of FY at Net XXX% FY to XXX% compares end which and in in XXX% retention 'XX. of the FY as of the came

QX. to For FY the net in QX in interim and in 'XX XXX% XXX% QX, quarters retention was XXX%

you As quarter. in FY 'XX to that expansion we had contributed percentage outsized that QX in XX may retention recall points an deal net our of

within the this expanded was as the have smaller than once FY expected. in we of QX we year While again prior account impact 'XX,

modules two are an As also accelerated our are with we dynamics bigger business seeing as which with the further in strong strategy mentioned, to trade-off the for favor. healthy land positive more a QX expansions long-term these We new in the in view and business, George we in in have logo developments competitive our acceleration our trends on very term. but they landscape seeing success indicators shifted and as natural near

XX% year Moving to reach over grew total to P&L, the last Subscription million. $XXX.X of of year QX over last to revenue XX% million. grew reach QX $XXX.X revenue

East revenue from in with X% other investments and and XX% reach from XX% from margins. SaaS of terms leverage the on US, and of and continued Europe, Africa as In model from X% remain platform. global customers a derived markets. growth operating was benefits Middle and cloud in We of breakdown, focused In fourth quarter long-term markets, sustainable QX scale, Asia-Pacific the approximately compelling our geographic recognize business even in to we increased our we building

margin gross year Fourth from XX% XX% to quarter improved ago. non-GAAP a

or gross non-GAAP million point last basis revenue QX margin non-GAAP expenses XX%, operating a XX% subscription $XX.X versus of of Total Our quarter million $XXX.X or increase of XXX year were increased XXX% from revenue. last in the year. to fourth

our with economics and an non-GAAP focus represents strong Number. a consider we efficiently million. which on unit to a efficiency. is sales of which is X.X, we loss why including a and in priority, very our operating marketing Scaling ended of business reported Magic In We improvement Magic be we top Number our $X.X QX,

the quarter. margin top our strong line our we expanding gross profile business, growth, and operating in approach disciplined As in to investing continued a result of drove leverage rapid

basis. QX of fifth on dollar loss operating improving operating non-GAAP a margin points margin Our both consecutive percentage improved and quarter a non-GAAP our year-over-year. represents XX

of a generating We or per maintaining remain to balance have net and achieving growth million proven disciplined in committed loss EPS to of leverage. loss fiscal in thoughtful and investing average which a million $X.XX weighted share common top basis, $XX.X calculate was was history million on net XXXX shares The $X.XX operating a to QX $X.X a in line between Non-GAAP fourth shares period. per and QX fiscal the quarter million of in QX year. non-GAAP or XXXX XX.X shares QX last share used compares XXX.X

quarter cash execution million the in reflecting to was led flow. cash now operations operating flow $XXX.X million, was strong $XX.X securities from equivalents increased collections. sheet. positive balance Cash, $XX.X this strong growth to and and free cash and Turning positive to marketable Cash flow leverage, improved our deferred revenue million

moving our I guidance, several to Before will modeling provide points.

given of as and as is to full to expect experiencing positive First, QX mind kick-off to operating see This operating that in see in factors sales expect we we would in free quarter companies, noted QX. cash the free software are and cash year new negative hires see free impact. guidance we previously the and taxes, and expect with RSA. And in new QXs our we like net generation and cash events will for we half cash flow operating second biggest the be to to for year. seasonal the seasonality maintaining timing you in including flow year you'd flow cash and We these impact the operating ARR typical and from annual a payroll of margin first the step-up keep have enterprise moving seasonality also

We in employee July stock XXXX. implemented our of purchase plan

saw cash $X first in we as a free 'XX QX of benefit flow of the approximately FY made million approximately million 'XX $X we purchase. result, QX decrease of and of to a As a net FY in

purchases and to summary, in million million and with QX per In benefits in offset reflected we see QX into employee expect and million Looking net $XX QX QX. of 'XX, benefit QX $XX FY and for expect approximately the to between we both corresponding for quarter $XX outflows currently QX. from and this accrue contributions in

full for year fiscal Moving XXXX. to quarter our first and guidance the

optimistic our continue for demand the about to remain offerings. We

increasing landscape, We combined cloud threat have our favorable proliferation with remote an workforce. a powerful secular growing including and the dynamic trends fueling growth, workloads competitive a of

is the believe full closely the to the macroeconomy prudent impact environment, monitor today. guidance we on and coronavirus still of appropriately know we unfolding from is While what we continue our business the based

rate be with driver revenue total range subscription million, of to reflecting is growth. of growth year-over-year For million expected in revenue the $XXX.X QX XX% XX% dominant of a to being to $XXX.X the

to be and million of $XX.X non-GAAP $XX.X the million be non-GAAP net the loss expect We to in to in from of range operations loss to million range million. $XX.X $XX.X

loss of shares weighted in average basic share, net non-GAAP used Utilizing $XXX.X diluted and million. computing, per

range net $X.XX loss expect to $X.XX. diluted per basic We in and share of the non-GAAP

XXXX, $XXX.X $XX.X For XX% from to of the currently total to million, rate over growth $XX.X loss be million expect and XX% full year. Non-GAAP of XXXX operations $XXX.X in we million. fiscal between a range reflecting be year revenue the million to the is fiscal expected to

Additionally, quarter to our of fiscal we in fourth to at the continue expect non-GAAP continuing in the operating achieve aggressively invest to market breakeven opportunity. income time XXXX same while year

million. We expect $X.XX. and share, $X.XX million between loss non-GAAP to range loss to of $XX.X we of million, $XX.X and per net the net fiscal loss non-GAAP be computing in non-GAAP diluted share be expect average shares to used per net in weighted $XXX.X Utilizing basic XXXX

and we to and resources the believe the forward strong we the reporting business today pleased over long are continue capacity are term. have results We with the driving

now and take I questions. will George your

Operator

Instructions] first [Operator J.P. you. Thank is ahead. Morgan. Please question Sterling with Auty go from Our

Sterling Auty

thanks. Hi Yeah, guys.

remote your some is of process sales perhaps not. finer it, but sure the implementation put I So impacted? we're and are I'm that even to a customers CrowdStrike specifically want point, you is And the wondering amid there concern in, processes upon touched just while COVID-XX used to more any make maybe the situation working I how

those So of in sales of terms some mitigate you how cycles? factors do

George Kurtz

of we've Well, for make a pointed we we to working need Sure. many as remotely as Thanks, get and customers. but done hold years the can that job Sterling. out, sure you good mentioned we

there's fully and are our working Number and able been been big one, in I get lots remotely things think home that first Zoom couple able business think of by sales and folks front are and this to of just fans we're doing in remote. actually are meetings increase to there by that XX% of to around We've we've them. users our our we've as I home move people a been able of and operation working to favor. in actually are

So from our combined work of team I whether we've the inside perspective, digital out, advertising, that it's the and it's team, we've sales think a job sales with digital field trial-to-pay or reaching done the good plus inside motion. whether to we continue sales

that at we've people their to So sort where of actually think been cases I and home day busy have able in operationalized during and machine from been focus. we they fully keep are standpoint, the many have the

So, remote we get the business have have of that and leveraging meetings technology our are customers. those place taken we to first all to

Sterling Auty

one then for you Burt. And Great. follow-up

not been You in seeing? higher mentioned out COVID-XX have make is to if actually light that into we're sure, that you're had guidance the prudent this the would of seeing. just again guidance pandemic what broken But

Burt Podbere

Hey, Thanks. Sterling.

just reiterate, We derisked our coronavirus. probably is based to we know on it's but that what as situation. fluid we've we believe guidance today, So including a our know, guidance, appropriately we prudent do believe

change our ability we business. in to As today, haven't close of seen a

abundance at. But caution, of light our like be and talked prudent Our the we're out of at our of to want in theaters where and pipeline we We've levels. current is guidance. to macro situation derisked we leaders record we and sales the

Operator

so you much. Thank

from Our Barclays. Saket next with Kalia question is

Saket Kalia

example. angle. questions hearing George, taking maybe a customer you. displacement from Hey, competitive just to the Hey, I my for different with here. for ask about Thanks the start here But Symantec, Definitely I opportunities competitors like Burt. guess George. want opportunity to with

prepared I actually to rather others channel opportunity share touched channel your really are remarks, the of not So the customer you it there. there think disruption? share grow actual -- on Symantec the your of out is while but an share but in like seeing

George Kurtz

strong They that deployed And well Well particularly abandon prepared inbounds thanks, of workloads mentioned Symantec Symantec there from there. and realize partners. are the customers from way, are as as many our the absolutely in partners and to in we that a or to of partners easily today's as many the a workforce Saket. looking base environment from as that to be channel. seeing demanding lot many, come demand customers on-premise is customer move the remote cloud Broadcom their solutions us remarks, are I a can out frictionless There's their

market hard set be with the someone are with they of certainly And environment looking to solve -- and a want systems obviously to leader make just we've customers on-premise it's and it's whether traditional up remote to who we except are a it's any evolve And reseller, taken sure it's remotely. of. partner can service program today's have, of given and service problem. So number their their they whether care continued these workforce, to things our and that partners managed whether a and mature nature provider, that

seen to and actually organizations we're position out to provisioned perfect definitely at home. workforce And do an remote who uptick their in we've So are the being I rolled in that. think workers

Saket Kalia

and for thought. I greater nice my us cash magnitude of most job faster follow-up Maybe Makes you, sense. hitting think, flow, positive operating than for Burt,

flow do Are continues revenue? there you cash the vis-a-vis sort As any scale, continues of to cash about recurring of flow think business to as how ARR free respect either have cash thumb or of kind to revenue about flow or us that with grow? that base think rules operating you

Burt Podbere

Hi, Saket.

of remark most me you than cash hitting let about faster thought. flow just your on positive comment First

the just on comment thing want a that is I the quarter. we the that did first think to fact have strong that I outlook in performance

related had and the leverage we quarter. gross had had strong that, to that also operating things we margins, other collections of The kind strong in we strong

cash it flow than positive thought. we So to originally all reaching contributed

we're that quarters going quarterly some cash where to cash flow have the a I specifically there world As year. think to we want the On hey, it though, reiterate negative going basis just to flow, are free the be with be to your -- I future, fact as think that, it how said we comment goes do goes about to we've positive next in QX. to

think So it as from business well about the as as flow cash is ARR. in we both seasonality,

to is that With with see to the QX, dip a going consistent on QX fact respect ARR, which what we're had going historically. commented seen to we we've

position. So million credit we're balance facility as about up, going got right feel that with end to our think we we're to flow and respect an well. in spot on as we additional we $XXX cash the $XXX have of we think now a million cash really about and sheet good where We've as

cash. So combined available we've in billion over $X

good a So spot. here as where in a good pretty the see I remarked. that from And we've cash going I've just I we're got think on we flow handle think

Operator

Thank you. Brad Zelnick next Suisse. Credit question is And our with from

Brad Zelnick

on COVID-XX time. year. in My you business, to onto know because hate keep headlines so Thank nice it I wanted as to businesses, congratulations a impact screens mean to finish question, this, of the Great. piling all but I I and I to specifically, much relates about ask real our small and the to really passing are the the

thinking, How market this at about economy whether seeing etc. of We sectors right the just it'd if really lodging hurting be getting to this change investing down seems It does for obliterated, all, growth your certain airlines, point? at now. are restaurants, be

George Kurtz

prepared investment the And with you successful. and businesses that at encourages coming out, seen and our happening. I just what's been the for an changes and us think market, sales it they motion very just for smaller in to to they your We've seen in acceleration because trial-to-pay uptick obviously way, our fact, it not are thank Well, -- organizations we've definitely don't all. comments in an come we've try SMB

time, drivers need for seen is think to big continue same they still a running. the traditional to many that by And ransomware. is I as signature obliterated at based just Obviously, with so the that it's them. COVID-XX There And use we've AV. one been serious small of ransomware keep they businesses just situation have

value the job been with helping same for, organizations, provide that think I deal with In a very migrate So to that basically corporate I market problem struggling successful running, helping it in think with not just have issue we're of and Falcon run as to the we've Complete, they away been company And in we've human outcome open. security. in the keeping now them for looking the kind time personnel done a able keep and deal see as to SMB absolute from are it's an at companies good cases, they with multiplier. many home actually our worry with in deal force have the because the about and up don't and a they're

there. to we continue So invest

up and way and perspective, do can't we're foundational going continue without it in I from we them their They can't security think can. is really support it. running businesses element. a any to to They keep a

Brad Zelnick

to we how Thanks to for very ARR point were of that Can you it seasonality QX in seasonality like looks Thanks. much, George. -- all remarks at finer about you exceptional QX, think the year? about from throughout we about a be talked if in And what maybe what at QX. here should Burt, might ago? least your if put prepared we talking otherwise Burt. one in maybe And we ARR a to COVID, month expect as think

Burt Podbere

Sure.

including we guide but know taking everything, guided you QX, consideration feel guide. into don't we as ARR, talk about revenue appropriately the do for we've to in coronavirus. We So, that

I see think in there periods. with that we in the what being see fairly consistent in is and seen QX an uptick dip ARR that likely about to through consistent with periods is as prior go the the Again then -- we've seasonality prior we year. we're

Operator

Thank you.

Fishbein SunTrust. Joel with from comes question next Our

Joel Fishbein

everybody on Good have a a and congrats again question after noon quarter. quick Fed. I on great

know it Fed premature, going hear George, to out. that didn't in how you this be Then I I for love adopting follow-up have but is and the how CrowdStrike? a it really the call little ramp that's might I'd Fed a environment, quickly Just Burt.

George Kurtz

government, It's the out you hacks acquisition increasingly local adopting our And concern and have been help CrowdStrike Fed well. persistent certainly the that threats going and over threat those at is the many XXX% the Fed technology to level Fed to out there. in year-over-year. protect and are various up. federal Customer that seek there, on government Sure. guidance pieces calling against is state, at part understand in when look really of operation. And look up general, the our just Fed overall is you

got XX we the So FedRAMP the just it's business that. last time small guess still we while continue short a us to grow ago a months for a or and over as certification relatively I so back,

state these been CrowdStrike So governments that's a their in expand out is of overall then the critical small They to that local, big and great a or you as we've got market operation. real for ransomware CrowdStrike us. customers. some some of part And us. municipalities Again the a adopt and that has larger of state even for many states are continue issue

Joel Fishbein

message Thanks, Burt, quick And follow-up guys you. growing, fast. for George. The very, very look, are been you real has

a at clip. customers big very gaining You're fast

cash investors necessary the go companies you levers more cash to So there. things positive maybe one south? quarter this what out can make flow of confidence you just pull event for yourselves that and flow concern if and a think south, positive, in talk about aren't is do the profitable shown things did actually give that you I if go there little bit of

George Kurtz

Joel. Thanks, Yeah. Yeah.

a cash reminder, sheet million we've And a moment, is the similarly, free I and as have strong cash two on we've been cash, last credit million. the flow question $XXX really at on earlier of an said that got right. balance and for balance an positive $XXX quarters. facility additional So, what equivalents sheet we

that's to a us respect economics. in or to up macro an south dialed We've environment unit to we from if got in. got this, south to great continue business very perspective, believe opened continue even our go see we've We've go We with that still after opportunities got competitors. things to go the

to withstand spot So the able really being terms in environment. we're downturn any a continued in good in of

for consecutive that And leverage. the of good news seen improving is quarters we've several us

going to we when is even not as continued we're our continue environment. So stray there in downturn a macroeconomic the at from to unit looking invest, economics

Operator

you. Thank

Alex Our Needham. Henderson next question from is with

Alex Henderson

much. very you Thank Great.

versus guys are wanted To The I purposes? be of question Just count for would evaluation what things of side extent have things. a side pricing around demand the seen or of in I your adding you help salespeople the customers to that at line well actions security you this extent taking us Burt, product much. against back backdrop of that rate. going was environment. particular you're spending in your taking to added the broadly the be seeing question that your what freezes of would other are very things? rate and quick if sales differential a share companies freeze? pretty that of side profitable, become us security for and to were the bookkeeping, you to more Can the your I give still what that assume ask broad what between and you was one really aggressive invest, really And they out spending helpful. sense just to marketing the that assume and exempt any -- be staffing continue If could decision from up that you available in you thank any And understanding then they're relative implement

Burt Podbere

Thanks, Alex.

about First share. of on your question all comment

With hire from. available would more that use continuing valuation going purposes sales XXX to be to in heads, there we're million group Yeah, to to shares. environment I respect that's be in to we So look for the this for going basically, is sure. at invest the

all we're to strong we're said going advantage back the we're obviously that investing want I to current been going of unit be take to continue all economics, prudently. But again We're I've our the point having landscape. along, going do going to that, unnatural. and not of So that's take anything advantage to go making that which is to

I to And we're in continue that to turn over after model with go the reps. the it that, I'll in think good competitive so landscape, I spot place think sales With George. to

George Kurtz

perspective, security going we it's to think obviously and industries hierarchy at is the compliance without a for others, data whether privacy than put it you we a that. the the impacted be cyber need companies is even going many It's I many, security to of it around of government and be going And is mission equivalent are can't corporate day but perspective, in critical basic they're needs And it. other need government mandate from more able large fundamental, still or Alex. to it's globe. end have to thanks, Well, state shelter, the when general, there any a they're live And look that in security. great. or not in of federal need Okay, a it's to to right at purchase companies large

or they and time pressure part solution in very that CrowdStrike, help think and to what security And they offering them we I all what on we their We them in where and count, need. return help their when big people a environment on consolidate a for their today's we're them tremendous better head obviously have going companies, on be do of the that help these a times and to perfect come together, investment. is compelling optimize spend it's hardware optimize software putting that cost again to of three show we can is I have. think there

Operator

Thank you.

question next Our from comes Gur Talpaz with Stifel.

Gur Talpaz

alluded strong first Thanks Falcon in Complete. on questions. here George, for congrats really great. shift a a quarter Well, you to off, Okay, taking for here. my demand

of you about I weeks, past think today, the of how that's the especially nature Complete the enterprise? around in conversation face large few think all the over within happened the do

George Kurtz

could that X compelling any to When kind off amazing that in Complete, us because corporate at up because their organizations we adoption so originally I whether Complete or expertise have the the Well, to to Thanks come remediate what we is never charging about very we organization Gur. we're warranty in on a And many when look them. everyone return for reasonably thank Falcon to in the hands, but be for in efficiency no operations compelling. -- broad first offer be might and we able you're had by with many, have technology we care idea globe it's anything we're and be it to able enterprise is for customers space. large their around been And use what offering SMB, they the with not triage do the of enterprise originally close Falcon think a of we the that Tier reduce what question. do.XX you, the when the space, And issues and sized X your overall take enterprise their the so have would to you so the don't cost. in automation, we that be constructed is increase to doing corporate whether you're enterprise or SMB, very, looking able to even

SMB a a for enterprise. has small a force is really whether it's the very widely it it been and So to adopted all them large multiplier really way

Gur Talpaz

you case? And the maybe gross despite rise in really growth gross again nice Non-GAAP inputs volumes. to I helpful. us think here rise then here at you very as And an you. as one at in and cloud Can walk customers land? through to transaction continue in just then, I given for That's why customer more [indiscernible] margin importantly, see them increase Burt, you that's the land now the seen think have margins

Burt Podbere

thanks and your questions. Gur for Thanks,

with same public it the mean expansion. module it's So be with to continues private and Two, and story operational the gross clouds. respect I efficiencies respect improvements using both side, to margins, the to on

in the a after years throughout to terms our other are virtually that is margin. margin why pure is the key gross first sold customer, Those module every some expanded. few been after drivers gross they've has the As module we and of of add new last modules seeing consistent

middle margin see anticipate standpoint we gross band. basis. that from forward, and And in gross the term gross margin that going stay XX%-plus our of think we're non-GAAP I now we're the the and of in we about to it right a terms I non-GAAP going that long margin going think of the within In over us how long-term projections

to well. So continue that we've we're been doing those do things going to

new bring side, combined the in want two our things continue On to to where Those optimization us to to into lead go. we're platform. modules going will we

Operator

right. All

Maria Riley

Yeah. Operator?

Operator

Yes.

Maria Riley

next the take can We question.

Operator

ma'am. you, Thank

Nowinski from Davidson. Andrew D.A. Our with is next question

Andrew Nowinski

Congrats you. a Thank Great. great on quarter.

me. for questions two Just

inadequately cloud-centric customers that So are these is running offering they home. that help it's realizing how from still companies hub-and-spoke and what great architectures yet, to to that hear from you're programs not CIOs we're are legacy prepared are hearing that quickly work resource And are.

they uptick from So in companies office, which do soon, when you their trigger that hopefully is spending the could to work think toward these people start infrastructure? returning as transforming an

George Kurtz

the Well, is And yes. thanks Andy. answer

we've spending. I has our going look many in taken protected, transform but definitely do way be implemented right. And to plans, think to everyone never business, seen would see again, we life, you're which think us won't agree, at you of you place, hopefully it's what the if home and I working from emergency if people everyone need emergency Zoom implemented still on it

it signature kind easy they work. what -- doesn't how So think something wide leveraging just think we files are we management endpoints, quickly do out whole doesn't I very those how And eyes update, or with is, to pushing network see figured open. is and it's I their I in seamless, overloading the it their of communicate by own even through of terms what VPNs have through go they things, like CrowdStrike think it's

is believe this only not is see going it the plan, and in people's uptick resiliency I to to do be going go an remote away. we'll part So not workforce of

work. the VPN and and back emergency So architecture see to immediately. see problem solve that to they spending to relief through mother look overall overall that. they not realize trying But business ship CIOs to they're their in at for we're are and their jam have this We going going then going going resiliency, to is just everything to

work in overall technologies. to of fundamentally security consume You'll architecture. way technologies, fit Trust change people think were their see including more and which I more And and perfect it's the do Zero going

Andrew Nowinski

Thanks, that to Amazon more via in to an seen this same are to Thanks. infrastructure? look forced if on-premise then was to adapt infrastructure maintain the trying remote channel workforce, you've to push wondering uptick as George. vein, companies And more Great. companies as AWS an I versus

George Kurtz

with partnership perspective, add It just the use cycle down cuts when deal. sales And the is by And ARR step great in XX% up from our we the marketplace were an AWS XX%. got QX we just a marketplace AWS yes. quick answer We've almost a AWS. quarter-over-quarter with

remote, of not The end a procurement negotiated. amazing been for pretty And an around, the the people is channel it's for think they are as terms So are much them. channel at I us. as great it's day,

You can by And right overall doesn't just buy get environment, a environment. and to in cloud. deal their the AWS can on and into still way have done their it used they it quickly on-prem it very in the use slots be

So it's great been us. for channel a really

Operator

questions you. limit your interest of to And in and please the one. gentlemen, Thank ladies time

question Matt Hedberg Our next from with Capital. is RBC

Matthew Hedberg

reasons you Congrats the of of results. can do on George, times Hey CrowdStrike number a why well in uncertainty. guys. highlighted

us really I consider. to it's think helpful for

spend? is a that them but of customers you One into give also can glimpse CIOs not ability on product security comes And keep I or sort save or way your shift, to only us money. saying from most you Prevent additional what safe them point, And Insight, of mind new their about CSOs attach are now your beyond share if are share perspective? excited a about guess right from what

George Kurtz

that. Well footprint where CIOs and consolidate particular right their in every Almost you from it conversation the are and large will anything true today involves platform. level when Company deal reduce complexity and CIOs, a into I tell cost was, the wasn't to CSOs, where as CIO the looking to can we for at and the are Sure. started slot absolutely but that we CIO. we

AV the like and with as piece, beyond things are next-gen you looking they out EDR this. So have real response. just Discover And for time we pointed

amount We've RSA. added at a automation of tremendous

how We deploy They the is patches, CrowdStrike system leveraging basically seeing want we're team health. there. to IT the great IT increasingly, can back be You technology, excited because can to And which the bring and you and might have security being from pull team we're emergency and money. the you but we data, showed keeping we been selling they ops the always the get want, at giving save security time consolidation technologies. they what overall which them and about the solving basically efficiency is they an we're outcome, need, customers team same what gets need breached,

that's So offering. you compelling wrap that incredibly an all together,

and at really release about the different seven out. the broader like very consolidation, come ones this the technologies coverage rapidly have one able of in Spotlight, And calls out pick some been six, we've Things prior talked that of to new some and in five, module consolidate we've end liking it. adoption I've seen the we and earnings QX, of the customers up

it's So what Spotlight mean me I Tell two that though. are IT adoption. to I that, back across can continue here a strong whether patch, systems Falcon and we module gems come me the one-two the Discover Discover, and real with the automate combination. board, These have great to leverage. go, it's X, my team you help

Matthew Hedberg

guys. done, Well George. helpful, Super

Operator

Thank you.

next with Sandler. question Our from Rob Piper comes Owens

Rob Owens

Thanks. Great. your drill you a commentary little your Want and next you to to down both some quarter hiring of hiring hire fiscal question. playing and bit you how for ability in guys And plans the potentially. taking thanks see have company, add you And year? around color a as are and my out remote to virtually this changed the this

George Kurtz

part Company, overall started we first the I employees. Since with was the that's big we the when XX started and we were a thesis people the Rob. Yeah. what best Thanks, wherever launch of needed they had

how basis cutting been plans able we've certainly to up I will that And handling on have we It's able they've the of latest that. period any data events So with people change Herculean. remote to very there, need hiring. short able when environment been people. our continue grow X the using get in been of scale lots we've the to places. teams make out don't as in with think trillion we in the in we we've do company, been best We environment a believe very a just you're best at work, to our figure edge to with have competitive a stressful time technologies different weekly people but in And to science able industry. is what a do and the greatest out I

really very and going important can't are CrowdStrike the to the I have protected. hire customers folks our to to those it's make enough people So best to the around and great continue sure about at say globe we're people

Operator

Thank Gregg our you. question with from And Mizuho. comes last Moskowitz

Gregg Moskowitz

you XX-year notice like you Thank to when remarks George, not the career someone prepared your on taking the it's your competitive right. best for this over you've All landscape yet in was I'm interest take encountered say changes spoke around question. activity in few yourselves post any hard in? and that But the whether of around past months surging that seen level not in the the you've displacement wondering integration. actually rate is kicked Symantec Broadcom-Symantec or is

George Kurtz

Well thanks, Gregg.

a is Again, as or these going we'll they out and to both. we've running you. everything run with And said, get out have move start said pick cases now. when not coming but and I on compression come maybe the one think a then I hit of up, of year suit they've terms out, we're Symantec not over to that it's now ransom seen may of They're basically coming the up to and many ultimately support. list with [indiscernible]. named of and really your cases, they've while we'll has some renewal the past someone part just we'll us okay, to license, some to accelerated in in something run that us. other In who happy been In what they're be to things pieces just

So both. it a Gregg, of bit -- little it's really

Operator

President Thank would like his our final Kurtz, and I George Chief today. this Executive for call you. to the Q&A remarks. concludes back turn for to Officer And

George Kurtz

to with are it's environment affected We interest so thanks this please our time and Thank your to much you speaking stay Obviously, Well, we all today. very and next folks you you prayers right. trying hearts certainly out all go and virus. and All a the forward appreciate quarter. by of for safe. your to look that

Operator

And that, gentlemen, in ladies and program. today’s you we thank participating with for

day. wonderful disconnect. now a may You Have

CrowdStrike (CRWD) 19 Mar 202019 Q4 Earnings call transcript