CrowdStrike (CRWD) will report Q4 (Jan) results today after the close. There is a call scheduled to follow at 5:00pm ET.

Current S&P CapitalIQ consensus calls for adjusted EPS of $0.20 and revs to grow 56% yr/yr to $412.38 mln.

CRWD expects adjusted EPS between $0.19-0.21 and revs of $406.41-412.41 mln for the quarter. 

Peer Zscaler (ZS) experienced a sharp sell-off despite beating earnings and revenue estimates in JanQ. This has investors worried that an appetite for high-multiple stocks may still not exist. CRWD trades at 17x forward sales, this is a discount to ZS, which trades at 21x.

That said, CRWD's valuation is still expensive. Especially in the current rising interest rate environment.

The canary in the coal mine has been revenue. Revenue growth has been cooling off as CRWD begins lapping more challenging comps. Remember, FY21 saw multiple periods of 80+% growth. on the back of that growth, FY22 has been more mild at around 65%.

An important metric to watch is the annual recurring revenue (ARR). In Q3 (Oct), ARR grew 67% yr/yr and 13% sequentially. This represents a slight slowdown from prior quarters.

Investors will also want CRWD to come in with upbeat FY23 revenue guidance. The conflict in Eastern Europe also places a heightened focus on protecting against cyber attacks which could get “baked in” to the guide.

TECHS:

It feels as though we’ve come a long way since everyone and their brother was amped that Nancy Pelosi was riding calls on CRWD. Since those days, CRWD has struggled to return to all-time highs reached in November. To further exacerbate this issue, the stock is still trading nearly 40% lower.

CRWD has an solid history of beating earnings estimates. CRWD has never never missed since going public in 2019. They tend to outperform by mid-single-digits, so it would not surprise us to see another similarly-sized beat in Q4.

Shares are down roughly 15% YTD. An upbeat Q4 results could be the spark that ignites an upward trend.

RESULTS:

CrowdStrike beats by $0.10, beats on revs; guides AprQ EPS above consensus, revs above consensus; guides FY23 EPS above consensus, revs above consensus

Reports Q4 (Jan) earnings of $0.30 per share, $0.10 better than the S&P Capital IQ Consensus of $0.20; revenues rose 62.7% year/year to $431.01 mln vs the $412.38 mln S&P Capital IQ Consensus.

  • Annual recurring revenue (ARR) increased 65% yr/yr to $1.73 bln, of which $216.9 was net new ARR added in the quarter, an all-time high.

  • Non-GAAP subscription gross margin was 79%, compared to 80% in the fourth quarter of fiscal 2021.

  • Added 1,638 net new subscription customers in the quarter for a total of 16,325 subscription customers as of January 31, 2022, representing 65% growth yr/yr.

  • Co issues upside guidance for Q1 (Apr), sees EPS of $0.22-0.24, excluding non-recurring items, vs. $0.18 S&P Capital IQ Consensus; sees Q1 revs of $458.9-465.4 mln vs. $440.75 mln S&P Capital IQ Consensus.

  • Co issues upside guidance for FY23, sees EPS of $1.03-1.13, excluding non-recurring items, vs. $0.94 S&P Capital IQ Consensus; sees FY23 revs of $2.133-2.163 bln vs. $2.01 bln S&P Capital IQ Consensus.

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