What Happened?
Shares of cybersecurity company CrowdStrike (NASDAQ: CRWD) fell 5.5% in the afternoon session after the company reported mixed first quarter 2025 (Q1 FY-26) results: its revenue guidance for next quarter slightly missed and its full-year revenue guidance was just in line with Wall Street's estimates.
On the other hand, CrowdStrike beat convincingly on operating profit. Looking ahead, guidance was solid. The company's EPS guidance for next quarter topped analysts' expectations, and its full-year EPS guidance slightly exceeded Wall Street's estimates as well.
Overall, this was a mixed quarter and not enough for the high expectations around the stock (as evidenced by the 52-week high right before reporting and a 40+% stock price appreciation year-to-date before the print).
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What The Market Is Telling Us
CrowdStrike’s shares are very volatile and have had 20 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 11 months ago when the stock dropped 14.7% following a global technology outage. The outage was caused by a faulty update deployed by CrowdStrike to computers running the Microsoft Windows operating system.
CrowdStrike clarified that the issue wasn't caused by "a security incident or cyberattack."
CEO George Kurtz noted on the social media platform X (formerly called Twitter) that "the issue has been identified, isolated, and a fix has been deployed."
However, the issue had far-reaching consequences, affecting systems in industries delivering critical services, including hospitals, banks, and airports.
CRWD stock's decline suggested markets might be struggling to understand the long-term implications of the issue, especially as it relates to CrowdStrike maintaining its dominance in the highly competitive cybersecurity space, which often permits little to no room for mistakes.
Wedbush analyst Dan Ives provided insights on how this might play out, adding, "It could create opportunity for some competitive displacements, but this will take time to determine the path of CIOs and companies looking ahead and related legal actions related to this outage."
CrowdStrike is up 33% since the beginning of the year, and at $461.84 per share, it is trading close to its 52-week high of $488.76 from June 2025. Investors who bought $1,000 worth of CrowdStrike’s shares 5 years ago would now be looking at an investment worth $4,812.
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