CrowdStrike racked up a “record number of wins” over SentinelOne and legacy foes like Microsoft thanks to superior scalability and performance, CEO George Kurtz said.
“This quarter, our win rates increased across the board, and we saw a record number of wins against both legacy and next-gen vendors with SMB, midmarket and large enterprise customers,” Kurtz told investors Wednesday. “We also landed a record number of wins and displacements over recently public next-gen vendor SentinelOne.”
Kurtz said one of the largest nonprofit hospital systems in the U.S. signed a multiyear contract with SentinelOne based on price and promised features that were never delivered. Within two months, Kurtz said the hospital realized SentinelOne’s product failed to scale, caused major performance issues, prohibited critical processes from functioning properly and drove significant friction in the organization.
In response, Kurtz said the hospital system purchased multiple CrowdStrike modules in a multimillion-dollar annual recurring revenue deal and witnessed immediate improvement. With CrowdStrike, Kurtz said the hospital system saw a server performance increase of up to 30 percent and greater efficacy without intrusive false positives. SentinelOne didn’t immediately respond to a request for comment.
“We have a broad platform that’s differentiated and works,” Kurtz said. “The key aspect of our platform is that it actually works.”https://371e648e9ee53345b9dd727bf11ed4c7.safeframe.googlesyndication.com/safeframe/1-0-38/html/container.html
In addition, Kurtz said experience management provider Qualtrics ditched SentinelOne for CrowdStrike Falcon to have a single platform that could be easily deployed and scaled alongside its business. Kurtz said Qualtrics needed a product that could protect its entire estate of traditional endpoints and cloud workloads without sacrificing end-user experience. Qualtrics declined a request for additional comment.
As for CrowdStrike’s legacy competitors, Kurtz said a leading health-care system using a combination of Microsoft and Symantec was hit with a massive ransomware attack that disrupted its business. The organization remediated the breach with CrowdStrike’s incident response services, and then adopted the company’s Falcon Complete managed detection and response (MDR) platform, according to Kurtz.
“While Microsoft attempts to check most of the boxes on paper and appeal to the CFO office, in reality, when every second counts, they needed CrowdStrike,” Kurtz said. Neither Microsoft nor Symantec immediately responded to CRN requests for comment.
In the coming year, Kurtz said there’s a “massive opportunity” for CrowdStrike to displace both legacy players like Symantec and Microsoft as well as next-generation players as customers become dissatisfied with how the technology actually works in the field. The win and displacement opportunities for CrowdStrike span the gamut from pure endpoint to cloud, according to Kurtz.
“If you look at our overall customer count, it‘s fantastic, but it’s still small in the grand scheme of customers that are out there,” Kurtz said. “And there’s still a lot of legacy technologies that are out there and will be displaced.”
CrowdStrike’s revenue for the quarter ended Oct. 31 skyrocketed to $380 million, up 63.5 percent from $232.5 million a year earlier. That crushed analysts’ revenue expectations of $364.2 million, according to Seeking Alpha.
The company’s loss deepened to $50.5 million, or $0.22 per diluted share, 105.7 percent worse than a loss of $24.5 million, or $0.11 per diluted share, a year earlier. On a non-GAAP basis, net income surged to $41.1 million, or $0.17 per diluted share, up 121.1 percent from $18.6 million, or $0.08 per diluted share, the year prior. That beat analysts’ non-GAP earnings estimates of $0.10 per diluted share.
CrowdStrike’s stock is up $5.00 (2.48 percent) to $206.50 per share in after-hours trading. Earnings were announced after the market closed Wednesday.
Subscription sales for the quarter leapfrogged to $357 million, up 67.2 percent from $213.5 million the year prior. And professional services revenue surged to $23 million, up 21.6 percent from $18.9 million last year.
For the quarter ended Jan. 31, CrowdStrike expects non-GAAP net income of $45.2 million to $49.4 million, or $0.19 to $0.21 per diluted share, on revenue of $406.5 million to $412.3 million. Analysts had been expecting earnings of $0.16 per diluted share on sales of $401 million, according to Seeking Alpha.RELATED TOPICS:
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