CrowdStrike Misses Its Mark

Wall Street continues to punish software stocks that don’t blow expectations out of the water. And today’s victim was CrowdStrike. 😱

The cybersecurity company reported Q3 adjusted earnings of $0.40 per share vs. the $0.31 expected. Revenues of $581 million also topped the $574 million expected. Additionally, its annual recurring revenue (ARR) of $2.34 billion rose 54% YoY, with $198 million in net new ARR added in Q3.

However, ARR growth was below expectations. CEO George Kurtz said, “Increased macroeconomic headwinds elongated sales cycles with smaller customers and caused some larger customers to pursue multi-phase subscription start dates, which delays ARR recognition until future quarters.”  💬

In other words, its customers feel skittish about the economy, reducing or delaying demand. And with the economy expected to remain vulnerable, many expect those headwinds to persist.

As a result, investors sent $CRWD shares down 17% to their lowest level since August 2020. 👍

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Microsoft’s Cloud Business Rocks On

One of today’s biggest earnings announcements came from Microsoft, which beat on earnings but missed revenue expectations.

The tech giant’s adjusted earnings per share (EPS) of $3.32 beat the $2.29 expected. Revenues fell short of the $52.94 billion expected at $52.75 billion. 📝

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Earnings Recap – 01/05/23

Most of this week’s earnings reports came today. Unfortunately for the bulls, the bad news outweighed the good. 👎

Let’s recap what the biggest movers had to say.

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