CrowdStrike Holdings, Inc 10-Q for FY2021 Q1

CrowdStrike Holdings, Inc. (CRWD)

10-Q 2020-06-03 For: 2020-04-30

Added on April 09, 2026

About this 10-Q

CrowdStrike Holdings, Inc filed this 10-Q on June 3, 2020, covering the quarter ended April 30, 2020 (FY2021 Q1).

Headline figures

Quarter ended April 30, 2020, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $178.08M; up 85.3% from $96.08M a year earlier
Net loss: $19.22M; compared with a net loss of $25.98M a year earlier

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Title of each class of securities	Trading symbol(s)	Name of each national exchange and principal U.S. market for the securities
Class A common stock, par value $0.0005 per share	CRWD	The Nasdaq Stock Market LLC
			(Nasdaq Global Select Market)


Large Accelerated Filer	☐	Accelerated Filer	☐
Non-accelerated Filer	☑	Smaller reporting company	☐
(Do not check if a smaller reporting company)		Emerging growth company	☑


		Page No.
	PART I. FINANCIAL INFORMATION

Item 1.	Financial Statements (unaudited)
	Condensed Consolidated Balance Sheets as of April 30 , 20 20 and January 31, 2020	5
	Condensed Consolidated Statements of Operations for the Three Months Ended April 30, 2020 and April 30, 2019	6
	Condensed Consolidated Statements of Comprehensive Loss for the Three Months Ended April 30, 2020 and April 30, 2019	6
	Condensed Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders’ Equity (Deficit) for the Three Months Ended April 30, 2020 and April 30, 2019	8
	Condensed Consolidated Statements of Cash Flows for the Three Months Ended April 30, 2020 and April 30, 2019	9
	Notes to Condensed Consolidated Financial Statements	10
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	30
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	47
Item 4.	Controls and Procedures	47

	PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	49
Item 1A.	Risk Factors	49
Item 2.	Unregistered Shares of Equity Securities and Use of Proceeds	80
Item 3.	Defaults Upon Senior Securities	80
Item 4.	Mine Safety Disclosures	80
Item 5.	Other Information	80
Item 6.	Exhibits	81
	Signatures	82


	April 30,		January 31,
	2020		2020
Assets
Current assets:
Cash and cash equivalents	$	1,004,991	$	264,798
Marketable securities	—		647,266
Accounts receivable, net of allowance for doubtful accounts of $2.1 million and $1.1 million as of April 30, 2020 and January 31, 2020, respectively	144,187		164,987
Deferred contract acquisition costs, current	53,410		42,971
Prepaid expenses and other current assets	45,874		51,614
Total current assets	1,248,462		1,171,636
Strategic investments	1,000		1,000
Property and equipment, net	139,096		136,078
Operating lease right-of-use assets	35,738		—
Deferred contract acquisition costs, noncurrent	69,908		71,235
Goodwill	7,652		7,722
Intangible assets, net	419		527
Other assets	17,121		16,708
Total assets	$	1,519,396	$	1,404,906
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	6,528		$	1,345
Accrued expenses	26,396		30,355
Accrued payroll and benefits	37,458		36,810
Operating lease liabilities, current	6,673		—
Deferred revenue	465,569		412,985
Other current liabilities	13,020		11,601
Total current liabilities	555,644		493,096
Deferred revenue, noncurrent	170,404		158,183
Operating lease liabilities, noncurrent	32,907		—
Other liabilities, noncurrent	7,288		11,020
Total liabilities	766,243		662,299
Commitments and contingencies (Note 11)
Stockholders’ Equity
Preferred stock, $0.0005 par value; 100,000 shares authorized as of April 30, 2020 and January 31, 2020; no shares issued and outstanding as of April 30, 2020 and January 31, 2020	—		—
Class A common stock, $0.0005 par value; 2,000,000 shares authorized as of April 30, 2020 and January 31, 2020, respectively; 149,899 shares and 107,666 shares issued and outstanding as of April 30, 2020 and January 31, 2020, respectively; Class B common stock, $0.0005 par value; 300,000 shares authorized as of April 30, 2020 and January 31, 2020, respectively; 65,606 shares and 105,282 shares issued and outstanding as of April 30, 2020 and January 31, 2020, respectively	108		106
Additional paid-in capital	1,409,758		1,378,479
Accumulated deficit	(656,709)		(637,487)
Accumulated other comprehensive income (loss)	(1,004)		1,009
Total CrowdStrike Holdings, Inc. stockholders’ equity	752,153		742,107
Non-controlling interest	1,000		500
Total stockholders’ equity	753,153		742,607
Total liabilities and stockholders’ equity	$	1,519,396	$	1,404,906


	Three Months Ended April 30,
	2020		2019
Revenue
Subscription	$	162,222	$	85,990
Professional services	15,856		10,087
Total revenue	178,078		96,077

Cost of revenue
Subscription	37,244		23,691
Professional services	9,651		5,582
Total cost of revenue	46,895		29,273

Gross profit	131,183		66,804

Operating expenses
Sales and marketing	88,138		56,843
Research and development	40,578		23,875
General and administrative	25,043		11,861
Total operating expenses	153,759		92,579

Loss from operations	(22,576)		(25,775)
Interest expense	(143)		(1)
Other income, net	4,533		394

Loss before provision for income taxes	(18,186)		(25,382)

Provision for income taxes	(1,036)		(595)

Net loss	$	(19,222)	$	(25,977)

Net loss per share attributable to Class A and Class B common stockholders, basic and diluted	$	(0.09)	$	(0.55)

Weighted-average shares used in computing net loss per share attributable to Class A and Class B common stockholders, basic and diluted	213,129		47,205


☑			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


	Redeemable Convertible Preferred Stock				Common Stock						Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Income (Loss)		Non-controlling Interest	Total Stockholders’ Equity
	Shares	Amount		Shares	Amount

Balances at January 31, 2020	—	$	—	212,948	$	106	$	1,378,479	$	(637,487)	$	1,009	$	500	$	742,607
Issuance of common stock upon exercise of options	—	—		2,056	2		6,391		—		—		—		6,393
Issuance of common stock under RSU release	—	—		501	—		—		—		—		—		—


Vesting of early exercised options	—	—		—	—		873		—		—		—		873
Stock-based compensation expense	—	—		—	—		23,638		—		—		—		23,638
Capitalized stock-based compensation	—	—		—	—		377		—		—		—		377
Net loss	—	—		—	—		—		(19,222)		—		—		(19,222)
Non-controlling interest	—	—		—	—		—		—		—		500		500
Other comprehensive loss	—	—		—	—		—		—		(2,013)		—		(2,013)
Balances at April 30, 2020	—	$	—	215,505	$	108	$	1,409,758	$	(656,709)	$	(1,004)	$	1,000	$	753,153


	Redeemable Convertible Preferred Stock				Common Stock						Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Income (Loss)	Total Stockholders’ Deficit
	Shares	Amount		Shares	Amount

Balance at January 31, 2019	131,268	$	557,912	47,421	$	24	$	31,211	$	(519,126)	$	98	$	(487,793)
Cumulative effect of accounting change	—	—		—	—		—		23,418		—		23,418
Issuance of common stock upon exercise of options	—	—		706	—		1,510		—		—		1,510
Vesting of early exercised options	—	—		—	—		144		—		—		144
Stock-based compensation expense	—	—		—	—		3,752		—		—		3,752
Capitalized stock-based compensation	—	—		—	—		53		—		—		53
Net loss	—	—		—	—		—		(25,977)		—		(25,977)
Other comprehensive loss	—	—		—	—		—		—		(284)		(284)
Balance at April 30, 2019	131,268	$	557,912	48,127	$	24	$	36,670	$	(521,685)	$	(186)	$	(485,177)


	Three Months Ended April 30,
	2020		2019
Operating activities
Net loss	$	(19,222)	$	(25,977)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	8,202		4,873

Amortization of intangible assets	103		146
Amortization of deferred contract acquisition costs	13,451		7,345
Non-cash operating lease cost	2,283		—
Change in fair value of redeemable convertible preferred stock warrant liability	—		1,167
Provision for bad debts	149		(254)
Stock-based compensation expense	23,638		3,752
Gain on sale of debt securities, net	(1,347)		—
Amortization (accretion) of marketable securities purchased at a discount	578		(513)
Non-cash interest expense	151		(424)

Changes in operating assets and liabilities
Accounts receivable	20,651		5,375
Deferred contract acquisition costs	(22,563)		(8,471)
Prepaid expenses and other assets	5,332		(4,049)

Accounts payable	4,736		2,818
Accrued expenses and other current liabilities	(1,095)		(2,407)
Accrued payroll and benefits	648		(6,601)
Operating lease liabilities	(2,975)		—
Deferred revenue	64,805		24,812
Other liabilities	1,052		(177)
Net cash provided by operating activities	98,577		1,415
Investing activities
Purchases of property and equipment	(9,694)		(15,541)
Capitalized internal-use software	(1,882)		(1,984)

Purchases of marketable securities	(84,904)		(51,805)
Proceeds from sales of marketable securities	639,586		4,473
Maturities of marketable securities	91,605		68,995
Net cash provided by investing activities	634,711		4,138
Financing activities









Payments of deferred offering costs	—		(2,392)
Proceeds from issuance of common stock upon exercise of stock options	6,393		1,510


Capital contributions from non-controlling interest holders	500		—
Net cash provided by (used in) financing activities	6,893		(882)

Effect of foreign exchange rates on cash and cash equivalents	12		(86)
Net increase in cash and cash equivalents	740,193		4,585
Cash and cash equivalents, beginning of period	264,798		88,408
Cash and cash equivalents, end of period	$	1,004,991	$	92,993
Supplemental disclosure of cash flow information:
Interest paid	$	—	$	1
Income taxes paid	353		114
Supplemental disclosure of non-cash investing and financing activities:
Net (decrease) increase in deferred offering costs, accrued but not paid	—		(1,210)
Net (decrease) increase in property and equipment included in accounts payable and accrued expenses	(723)		(54)
Vesting of early exercised stock options	873		144


	April 30, 2020														January 31, 2020
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
	(in thousands)														(in thousands)
Assets
Cash equivalents⁽¹⁾
Money market funds	$	252,523	$	—	$	—	$	252,523	$	205,379	$	—	$	—	$	205,379
Corporate debt securities	—		—		—		—		—		39,940		—		39,940
Total cash equivalents	252,523		—		—		252,523		205,379		39,940		—		245,319
Marketable securities
Corporate debt securities	—		—		—		—		—		495,022		—		495,022
U.S. treasury securities	—		—		—		—		84,431		—		—		84,431
Asset backed securities	—		—		—		—		—		67,813				67,813
Total marketable securities	—		—		—		—		84,431		562,835		—		647,266
Total assets	$	252,523	$	—	$	—	$	252,523	$	289,810	$	602,775	$	—	$	892,585


	Amortized cost		Fair value
	(in thousands)
Due in one year or less	$	377,722	$	378,408
Due after one year through five years	266,670		267,728
Due after five years through nineteen years	1,127		1,130
	$	645,519	$	647,266


	April 30, 2020		January 31, 2020
	(in thousands)
Prepaid expenses	$	17,495	$	20,390
Prepaid software licenses	16,013		16,645
Prepaid hosting services	7,359		8,056
Other current assets	5,007		6,523
Prepaid expenses and other current assets	$	45,874	$	51,614


	April 30, 2020							Weighted-Average Remaining Useful Life
	Gross Carrying Amount		Accumulated Amortization		Net Amount
	(in thousands)							(in months)
Developed technology	$	1,228	$	1,120	$	108	6
Customer relationships	599		306		293		30
Non-compete agreement	120		102		18		6
Total	$	1,947	$	1,528	$	419


	Total
	(in thousands)
Fiscal 2021 (remaining nine months)	$	217
Fiscal 2022	119
Fiscal 2023	83


Total amortization expense	$	419


	April 30, 2020		January 31, 2020
	(in thousands)
Data center and other computer equipment	$	109,988	$	87,166
Capitalized internal-use software	32,613		30,354
Leasehold improvements	15,352		13,157
Purchased software	2,727		2,604
Furniture and equipment	5,329		4,835
Construction in process	30,883		47,626
	196,892		185,742
Less: Accumulated depreciation and amortization	(57,796)		(49,664)
Property and equipment, net	$	139,096	$	136,078


	Real Estate Arrangements
	(in thousands)
Fiscal 2021	$	9,958
Fiscal 2022	9,869
Fiscal 2023	9,377
Fiscal 2024	9,370
Fiscal 2025	8,441
Thereafter	3,671
Total	$	50,686


	Three MonthsEnded April 30, 2019
Expected term (in years)	6.05
Risk-free interest rate	2.4%
Expected stock price volatility	37.9%
Dividend yield	—	%


	Number of Shares	Weighted-Average Exercise Price Per Share
	(in thousands)
Options outstanding at January 31, 2020	14,689	$	5.52

Exercised	(2,056)	$	3.11
Canceled	(161)	$	8.48
Options outstanding at April 30, 2020	12,472	$	5.88








Options vested and expected to vest at April 30, 2020	12,472	$	5.88
Options exercisable at April 30, 2020	6,426	$	3.80


	April 30, 2020
	(in thousands)
Lease cost
Operating lease cost	$	2,283
Short-term lease cost	493
Variable lease cost	836
Total lease cost	$	3,612


	Number of Shares	Weighted- Average Grant Date Fair Value Per Share
	(in thousands)
RSUs and PSUs outstanding at January 31, 2020	6,063	$	29.82
Granted	2,824	$	57.94
Vested	(501)	$	22.45
Forfeited	(141)	$	26.25
RSUs and PSUs outstanding at April 30, 2020	8,245	$	39.96








RSUs and PSUs expected to vest at April 30, 2020	8,245	$	39.96


	Three Months Ended April 30, 2020
Expected term (in years)	0.5 - 2.0
Risk-free interest rate	1.6% - 2.0%
Expected stock price volatility	30.1- 35.7%
Dividend yield	—	%


	Total Commitments
	(in thousands)
Fiscal 2021 (remaining nine months)	$	67,113
Fiscal 2022	90,298
Fiscal 2023	10,156
Fiscal 2024	10,379
Fiscal 2025	2,721
Thereafter	3,221
Total purchase commitments	$	183,888


	April 30, 2020	April 30, 2019
	(in thousands)
Shares of common stock issuable upon conversion of redeemable convertible preferred stock	—	131,268
Shares of common stock issuable upon conversion of redeemable convertible preferred stock warrants	—	336
Shares of common stock subject to repurchase from outstanding stock options	849	466
RSUs and PSUs subject to future vesting	8,245	—
Shares of common stock issuable from stock options	12,472	26,200
Share purchase rights under the employee stock purchase plan	1,426	—
Potential common shares excluded from diluted net loss per share	22,992	158,270


	As of April 30,
	2020		2019
Subscription customers	6,261		3,059
Year-over-year growth	105	%	105	%


	Three Months Ended April 30,						Change $		Change %
	2020		2019
	(in thousands)
Revenue
Subscription	$	162,222	$	85,990	$	76,232	89	%
Professional services	15,856		10,087		5,769		57	%
Total revenue	178,078		96,077		82,001		85	%
Cost of revenue
Subscription^{(1) (2)}	37,244		23,691		13,553		57	%
Professional services ⁽¹⁾	9,651		5,582		4,069		73	%
Total cost of revenue	46,895		29,273		17,622		60	%
Gross profit	131,183		66,804		64,379		96	%
Operating expenses
Sales and marketing ^{(1) (2)}	88,138		56,843		31,295		55	%
Research and development ^{(1) (2)}	40,578		23,875		16,703		70	%
General and administrative ⁽¹⁾	25,043		11,861		13,182		111	%
Total operating expenses	153,759		92,579		61,180		66	%
Loss from operations	(22,576)		(25,775)		3,199		(12)	%
Interest expense	(143)		(1)		(142)		14,200	%
Other income, net	4,533		394		4,139		1,051	%
Loss before provision for income taxes	(18,186)		(25,382)		7,196		(28)	%
Provision for income taxes	(1,036)		(595)		(441)		74	%
Net loss	$	(19,222)	$	(25,977)	$	6,755	(26)	%


	Total		2021		2022		2023		2024		2025		Thereafter
	(in thousands)

Real estate arrangements⁽¹⁾	$	45,857	$	5,481	$	9,746	$	9,307	$	9,258	$	8,414	$	3,651
Data center commitments⁽²⁾	149,993		47,017		76,622		10,077		10,348		2,708		3,221
Other purchase obligations⁽³⁾	33,895		20,096		13,676		79		31		13		—
Total	$	229,745	$	72,594	$	100,044	$	19,463	$	19,637	$	11,135	$	6,872


			CROWDSTRIKE HOLDINGS, INC.

			By:			/s/ Burt W. Podbere
						Burt W. Podbere Chief Financial Officer (Principal Financial Officer)

			By:			/s/ Abhishek Maheshwari
						Abhishek Maheshwari Chief Accounting Officer (Principal Accounting Officer)