CrowdStrike (CRWD) to Report Q3 Earnings: What's in Store?

CrowdStrike Holdings CRWD is scheduled to report third-quarter fiscal 2024 results after market close on Nov 28.

The company anticipates third-quarter revenues in the band of $775.4-$778 million. The Zacks Consensus Estimate is pegged at $777.2 million, indicating an improvement of 33.8% from the year-ago quarter's reported figure.

CrowdStrike expects non-GAAP earnings of approximately 74 cents per share, which coincides with the Zacks Consensus Estimate. The consensus mark for the bottom line suggests an improvement of 85% from the year-ago quarter’s non-GAAP earnings of 40 cents per share.

The company’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 20.1%.

Let’s see how things are shaping up for this announcement.

CrowdStrike Price and EPS Surprise CrowdStrike Price and EPS Surprise

CrowdStrike price-eps-surprise | CrowdStrike Quote

Factors to Consider

CrowdStrike’s third-quarter fiscal 2024 results are likely to reflect the benefits of the continued solid demand for its products, given the healthy environment of the global security market. The increasing number of people logging into employers' networks has triggered a greater need for security and might have spurred the demand for CRWD’s products in the fiscal third quarter. A strong pipeline of deals indicates the same.

Stellar revenue growth in subscriptions might have contributed significantly to the third-quarter top line. Further, the increasing number of net new subscription customers may have acted as a tailwind.

Our third-quarter estimate for Subscription revenues is pegged at $733.2 million, indicating a year-over-year improvement of 34%. Revenues from the Professional Services segment are likely to increase 27.5% year over year to $42.7 million in the third quarter.

Moreover, CrowdStrike’s collaboration with Amazon Web Services (“AWS”) is an upside, benefiting the company from its products’ availability on the AWS platform. The expansion in the volume of transactions through Amazon’s AWS Marketplace, growth in co-selling opportunities with AWS salesforce and the uptake of AWS service integrations are likely to have contributed to CRWD’s earnings in the to-be-reported quarter.

However, elevated expenses for enhancing sales and marketing capabilities and increased investments in research and development are likely to have weighed on the company’s fiscal third-quarter bottom line.

What Our Model Says

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. However, that’s not the case here.

Though CRWD currently carries a Zacks Rank #2, it has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks With the Favorable Combination

Per our model, Micron Technology MU, Snowflake SNOW and Marvell Technology MRVL have the right combination of elements to post an earnings beat in their upcoming releases.

Micron carries a Zacks Rank #3 and has an Earnings ESP of +26.69% at present. The company is scheduled to report first-quarter fiscal 2024 results on Dec 20. Its earnings surpassed the Zacks Consensus Estimate twice in the trailing four quarters while missing on two occasions, the average negative surprise being 67.7%. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Micron’s first-quarter earnings is pegged at a loss of $1.02 per share, wider than the year-ago quarter’s loss of 4 cents. The consensus mark for revenues is pegged at $4.43 billion, suggesting a year-over-year increase of 8.5%.

Snowflake has a Zacks Rank #2 and an Earnings ESP of +67.33% at present. The company is slated to report third-quarter fiscal 2024 results on Nov 29. SNOW’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 244.5%.

The Zacks Consensus Estimate for third-quarter earnings is pegged at 16 cents per share, suggesting an increase of 45.5% from the year-ago quarter’s earnings of 11 cents. Snowflake’s quarterly revenues are estimated to grow 27.6% year over year to $710.5 million.

Marvell carries a Zacks Rank #3 and has an Earnings ESP of +0.18% at present. The company is scheduled to report third-quarter fiscal 2024 results on Nov 30. Its earnings beat the Zacks Consensus Estimate thrice in the preceding four quarters while missing on one occasion, with the average surprise being 1.7%.

The Zacks Consensus Estimate for Marvell’s third-quarter earnings is pegged at 40 cents per share, indicating a year-over-year decline of 29.8%. It is estimated to report revenues of $1.4 billion, which suggests a decrease of approximately 8.9% from the year-ago quarter.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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