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CrowdStrike shares jump 11% on record second-quarter results, raised outlook

CrowdStrike beat fiscal Q2 estimates and raised guidance, with shares up 11% after hours, citing AI-driven security demand.

AI News Feed · 2026-08-27 08:56

The company reported adjusted earnings of 31 cents per share on revenue of $1.47 billion for the quarter ended July 31, topping analyst expectations of 29 cents per share on $1.44 billion in revenue. Revenue jumped 26% from $1.17 billion a year earlier. Founder and Chief Executive George Kurtz called it "the best quarter in CrowdStrike's history" in the earnings release.

"The Mythos moment translated into mass-market acceptance that AI adoption needs security, and that's CrowdStrike," Kurtz said. "Every enterprise will run on AI, and securing it is the largest market opportunity in our history."

CrowdStrike's annual recurring revenue rose 25% year over year to $5.84 billion, including record net new annual recurring revenue of approximately $333 million, up 51% from a year earlier and well above the company's June guidance of $284 million to $286 million. Accounts running on Falcon Flex, CrowdStrike's flexible licensing arrangement introduced in 2024, carried more than $2.29 billion of total ARR, with their annual recurring revenue growing 101%. Subscription revenue was $1.4 billion, up 27%.

The company posted unadjusted net income of $5.3 million, or 1 cent per share, compared with a net loss of $70.2 million, or 7 cents per share, in the same quarter last year. Operating cash flow of $530.3 million and free cash flow of $377.4 million were both second-quarter records. Cash and equivalents grew to $5.01 billion. Per-share figures reflect a four-for-one stock split completed in July.

For the third quarter, CrowdStrike forecast revenue of $1.523 billion to $1.529 billion and adjusted earnings of 31 cents per share. Full-year revenue guidance was raised to $5.991 billion to $6.011 billion, with adjusted earnings of $1.25 to $1.26 per share, topping analyst estimates of $5.93 billion and $1.23 per share. The company also lifted its net new annual recurring revenue growth target for the year by 630 basis points to 34% at the midpoint.

The surge in demand comes as Anthropic's release of its advanced Mythos model, capable of exploiting previously unknown software vulnerabilities, has upended the cyber industry in recent months and sparked demand for new security tools.

Okta Inc., which also reported its July quarter Tuesday, beat expectations as well, with shares jumping more than 19% in late trading. Okta posted adjusted earnings of $1.05 per share on revenue of $805 million, up 11% year over year, exceeding analyst projections of 96 cents per share on $792.1 million. The company raised its full-year revenue and earnings guidance, and announced the planned acquisition of identity threat detection company Permiso Security Inc. for just under $200 million, due to close before the end of October.

Strong results from both companies underscore surging demand for security tools driven by enterprise deployment of AI agents. CrowdStrike's stock is up more than 61% this year, and its shares have reached all-time highs.