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CrowdStrike (CRWD) to Report Q2 Earnings: What's in Store?

CrowdStrike's (CRWD) Q2 results are likely to reflect benefits from solid demand for its security solutions amid the pandemic, continuous addition of...

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This story originally appeared on Zacks

CrowdStrike Holdings CRWD is set to report second-quarter fiscal 2022 results on Aug 31.

- Zacks

The company anticipates second-quarter fiscal 2022 revenues in the range of $318.3 million to $324.4 million. The Zacks Consensus Estimate for the same is pegged at $324.0 million, indicating an improvement of 62.8% from the year-ago quarter.

The company expects non-GAAP earnings between 7 cents and 9 cents per share. The Zacks Consensus Estimate for non-GAAP earnings stands at 9 cents per share, suggesting a significant improvement of 200% year over year.

The company’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 170.4%.

 

CrowdStrike Holdings Inc. Price and EPS Surprise CrowdStrike Holdings Inc. Price and EPS Surprise

CrowdStrike Holdings Inc. price-eps-surprise | CrowdStrike Holdings Inc. Quote

Factors to Note

CrowdStrike’s second-quarter results are likely to reflect benefits from continued solid demand for its products, given the healthy environment of the global security market.

Stellar revenue growth in subscription might have contributed significantly to the to-be-reported quarter’s top line. Increasing number of net new subscription customers may have acted as a tailwind as well.

Increasing number of people logging into employers' networks has triggered a greater need for security. This trend might have spurred demand for CrowdStrike’s products in the second quarter. A strong pipeline of deals indicates the same.

The recent acquisition of Humio is likely to have strengthened CrowdStrike’s capabilities. This, in turn, may have attracted new customers.

The company’s collaboration with Amazon's AMZN AWS is positive. The company has been benefiting from its products’ availability on the AWS platform. Expansion in volume of transactions through the AWS Marketplace, growth in the co-selling opportunities with AWS salesforce, and the uptake of AWS service integrations are likely to have contributed to the company’s earnings performance in the quarter to be reported.

However, management noted that generation of cash flows are typically the lowest in the second quarter due to expenses, seasonality of new hires and the midyear ESPP purchase.

What Our Model Unveils

Our proven model does not conclusively predict an earnings beat for CrowdStrike this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.

CrowdStrike currently has Zacks Rank #3 and an Earnings ESP of 0.00%.

Stocks With Favorable Combinations

Here are some companies, which per our model, have the right combination of elements to post an earnings beat in their upcoming releases:

Lululemon Athletica LULU has an Earnings ESP of +3.06% and a Zacks Rank #2 currently. You can see the complete list of today’s Zacks #1 Rank stocks here.

RH RH has an Earnings ESP of +2.43% and a Zacks Rank #2 currently.



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