Cybersecurity platform provider CrowdStrike (NASDAQ: CRWD) reported Q4 CY2025 results topping the market’s revenue expectations, with sales up 23.3% year on year to $1.31 billion. Guidance for next quarter’s revenue was better than expected at $1.36 billion at the midpoint, 0.6% above analysts’ estimates. Its non-GAAP profit of $1.12 per share was 1.6% above analysts’ consensus estimates.
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CrowdStrike (CRWD) Q4 CY2025 Highlights:
- Revenue: $1.31 billion vs analyst estimates of $1.30 billion (23.3% year-on-year growth, 0.6% beat)
- Adjusted EPS: $1.12 vs analyst estimates of $1.10 (1.6% beat)
- Adjusted Operating Income: $325.8 million vs analyst estimates of $317.2 million (25% margin, 2.7% beat)
- Revenue Guidance for Q1 CY2026 is $1.36 billion at the midpoint, roughly in line with what analysts were expecting
- Adjusted EPS guidance for the upcoming financial year 2027 is $4.84 at the midpoint, in line with analyst estimates
- Operating Margin: -0.5%, up from -8.1% in the same quarter last year
- Free Cash Flow Margin: 28.8%, up from 24% in the previous quarter
- Annual Recurring Revenue: $5.25 billion (23.8% year-on-year growth, beat)
- Market Capitalization: $97.02 billion
Company Overview
Known for detecting the massive SolarWinds hack in 2020 that compromised numerous government agencies, CrowdStrike (NASDAQ: CRWD) provides cloud-based cybersecurity solutions that protect endpoints, cloud workloads, identity, and data through its Falcon platform.
Revenue Growth
A company’s long-term performance is an indicator of its overall quality. Any business can have short-term success, but a top-tier one grows for years. Thankfully, CrowdStrike’s 40.6% annualized revenue growth over the last five years was incredible. Its growth surpassed the average software company and shows its offerings resonate with customers, a great starting point for our analysis.
Long-term growth is the most important, but within software, a half-decade historical view may miss new innovations or demand cycles. CrowdStrike’s annualized revenue growth of 25.5% over the last two years is below its five-year trend, but we still think the results suggest healthy demand. 
This quarter, CrowdStrike reported robust year-on-year revenue growth of 23.3%, and its $1.31 billion of revenue topped Wall Street estimates by 0.6%. Company management is currently guiding for a 23.4% year-on-year increase in sales next quarter.
Looking further ahead, sell-side analysts expect revenue to grow 21.7% over the next 12 months, a deceleration versus the last two years. Despite the slowdown, this projection is noteworthy and suggests the market is baking in success for its products and services.
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Annual Recurring Revenue
While reported revenue for a software company can include low-margin items like implementation fees, annual recurring revenue (ARR) is a sum of the next 12 months of contracted revenue purely from software subscriptions, or the high-margin, predictable revenue streams that make SaaS businesses so valuable.
CrowdStrike’s ARR punched in at $5.25 billion in Q4, and over the last four quarters, its growth was impressive as it averaged 22.1% year-on-year increases. This performance aligned with its total sales growth and shows that customers are willing to take multi-year bets on the company’s technology. Its growth also makes CrowdStrike a more predictable business, a tailwind for its valuation as investors typically prefer businesses with recurring revenue. 
Customer Acquisition Efficiency
The customer acquisition cost (CAC) payback period represents the months required to recover the cost of acquiring a new customer. Essentially, it’s the break-even point for sales and marketing investments. A shorter CAC payback period is ideal, as it implies better returns on investment and business scalability.
CrowdStrike is very efficient at acquiring new customers, and its CAC payback period checked in at 29 months this quarter. The company’s rapid recovery of its customer acquisition costs indicates it has a highly differentiated product offering and a strong brand reputation. These dynamics give CrowdStrike more resources to pursue new product initiatives while maintaining the flexibility to increase its sales and marketing investments. 
Key Takeaways from CrowdStrike’s Q4 Results
It was good to see CrowdStrike expecting revenue growth to continue next year. We were also happy its annual recurring revenue narrowly outperformed Wall Street’s estimates. Zooming out, we think this was a decent quarter. The stock remained flat at $393.06 immediately after reporting.
Is CrowdStrike an attractive investment opportunity right now? What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here (it’s free).
