Earnings call · Jul 2026 (Q2 FY27)

CrowdStrike Holdings Q2 FY27 earnings call CRWD

Aug 26, 2026 Source

Executive summary

CrowdStrike Q2 FY27 — Record Net New ARR and AI-Driven Acceleration

The quarter saw CrowdStrike achieve record performance across key metrics, driven by the "Mythos moment" and accelerating AI adoption. The Falcon platform, particularly Falcon Flex, AIDR, Next-Gen SIEM, and Identity, is proving critical for securing AI workloads and consolidating customer security stacks. Management expressed strong confidence in continued durable demand and operating leverage.

Highlights

All-time record net new ARR of $333 million, accelerating to 51% year-over-year growth and beating guidance by more than $45 million.
Ending ARR reached $5.84 billion, up more than 25% year-over-year, accelerating for the fourth consecutive quarter.
Total revenue grew 26% year-over-year to $1.47 billion, accelerating for the fifth consecutive quarter.
Record free cash flow of $377 million (26% of revenue), growing 33% year-over-year.
Record operating income of $372 million (25% of revenue), growing 46% year-over-year.

Guidance & targets

Category	Target	Timeline	Confidence
FY27 Net New ARR Outlook	$1.355 billion (midpoint), up 34% year-over-year high materiality	FY27	High
Q3 FY27 Annual Recurring Revenue (ARR)	$6.184 billion to $6.188 billion, up 26% year-over-year high materiality	Q3 · FY27	High
Q3 FY27 Net New ARR	$343 million to $347 million, up 29% to 31% year-over-year high materiality	Q3 · FY27	High
Q3 FY27 Total Revenue	$1.523 billion to $1.529 billion, up 23% to 24% year-over-year high materiality	Q3 · FY27	High
Q3 FY27 Non-GAAP Income from Operations	$373 million to $376 million high materiality	Q3 · FY27	High
Q3 FY27 Non-GAAP Net Income attributable to CrowdStrike	$325 million to $328 million high materiality	Q3 · FY27	High
Q3 FY27 Diluted Non-GAAP Net Income Per Share	$0.31 high materiality	Q3 · FY27	High
FY27 Annual Recurring Revenue (ARR)	$6.603 billion to $6.612 billion, up 26% year-over-year high materiality	FY27	High
FY27 Net New ARR	$1.350 billion to $1.359 billion, up 34% year-over-year high materiality	FY27	High
FY27 Total Revenue	$5.991 billion to $6.011 billion, up 25% over prior fiscal year high materiality	FY27	High
FY27 Non-GAAP Income from Operations	$1.497 billion and $1.508 billion high materiality	FY27	High
FY27 Non-GAAP Net Income attributable to CrowdStrike	$1.303 billion and $1.312 billion high materiality	FY27	High
FY27 Diluted Non-GAAP Net Income Per Share	$1.25 to $1.26 high materiality	FY27	High
FY27 Free Cash Flow Margin	at least 30% high materiality	FY27	High
Q3 FY27 Free Cash Flow Margin	27.5% high materiality	Q3 · FY27	High

Segment performance

Segment	Revenue	YoY	QoQ	Margin
U.S. Represents approximately 65% of total Q2 revenue.	65%	—	—	—
International Represents approximately 35% of total Q2 revenue, with broad-based strength across major regions.	35%	accelerated for the fifth consecutive quarter	—	—

CRWD operating KPIs by quarter

CRWD operating KPIs stated on its earnings calls, by fiscal quarter
KPI	Jan 2025 Q4 FY25	Apr 2025 Q1 FY26	Jul 2025 Q2 FY26	Oct 2025 Q3 FY26	Jan 2026 Q4 FY26	Apr 2026 Q1 FY27	This call Jul 2026 Q2 FY27	Change vs prior quarter
Annual recurring revenue (ARR)	$4.24B Q4 and FY 2025 highlights include: Q4 net new ARR of $224 million, well ahead of our expectations closing FY 2025 at $4.24 billion in ending ARR. Source transcript	$4.44B In Q1, we achieved net new ARR of $194 million, growing ending ARR to $4.44 billion, up 22% over last year. Source transcript	$4.66B Highlights included: one, record Q2 net new ARR of $221 million, double-digit millions ahead of our expectations, showcasing accelerating net new ARR; two, ending ARR of $4.66 billion, growing more than 20% year-over-year; three, record Q2 free cash flow of $284 million or 24% of revenue; four, record operating income of $255 million or 22% of revenue; five, total revenue growth of 21% year-over-year, reaching $1.17 billion and exceeding the high end of our guidance; six, cloud, Next-Gen Identity, and Next-Gen SIEM platform solutions are now more than $1.56 billion in ending ARR, growing more than 40% year-over-year; and seven, we surpassed the 1,000 Falcon Flex customer milestone with the average Flex customer representing more than $1 million of ending ARR. Source transcript	$4.92B Across the entire CrowdStrike team, I'm extremely proud of our Q3 with highlights including: one, record Q3 net new ARR of $265 million, which grew 73% year-over-year, beating our expectations by more than 10%; two, ending ARR of $4.92 billion, which accelerated to 23% growth year-over-year; three, record Q3 free cash flow of $296 million or 24% of revenue; four, all-time record operating income of $265 million or 21% of revenue, this is the second consecutive quarter of record operating income; five, broad-based ending ARR acceleration across cloud, Next-Gen Identity and Next-Gen SIEM collectively as well as acceleration in our endpoint business; and six, more than $1.35 billion in ending ARR from accounts that have adopted the Falcon Flex subscription model, growing more than 200% year-over-year. Source transcript	$5.25B Two, ending ARR of $5.25 billion, crossing the $5 billion milestone, which accelerated to 24% growth year-over-year. Source transcript	$5.51B In this new Agentic era, we're now guiding net new ARR acceleration for the full year Q1 highlights included: one, record Q1 net new ARR of $256 million, up 32% year-over-year and exceeding the high end of our guidance; two, ending ARR of $5.51 billion, accelerating over our record Q4 and more than 24% growth; three, total revenue of $1.39 billion, up 26% year-over-year, beating guidance and accelerating for the fourth consecutive quarter; four, all-time record free cash flow of $468 million or 34% of revenue, exceeding our expectations. Source transcript	$5.84B Two, ending ARR growth accelerated for the fourth consecutive quarter, reaching $5.84 billion, up more than 25% year-over-year; three, total revenue growth accelerated for the fifth consecutive quarter, reaching $1.47 billion, up 26% year-over-year. Source transcript	+6%
Annual recurring revenue (ARR) Identity	$370M+ Moving on to our Identity business, which grew to more than $370 million in ending ARR. Source transcript	—	—	—	—	—	$585M+ Ending ARR grew 34% year-over-year to more than $585 million driven by strength across our identity product portfolio. Source transcript	—
Annual recurring revenue (ARR) Next-Gen SIEM	$330M+ Moving on to our Next-Gen SIEM business, which grew more than 115% year-over-year, finishing the year at more than $330 million in ending ARR. Source transcript	—	—	—	$585M+ Our Next-Gen SIEM business grew over 75% year-over-year, delivering ending ARR of more than $585 million. Source transcript	$600M+ Our next-gen SIEM business exceeded $600 million in ending ARR and has transformed CrowdStrike into the operating system of the AI SOC. Source transcript	$695M+ NextGen SIEM ending ARR surpassed $695 million this quarter as both new and existing customers are standardizing on Falcon as the operating system of the SOC. Source transcript	—
Gross retention rate	97% Gross retention in Q4 remained high at 97%, and our dollar-based net retention rate was 112%, reflecting the impact of customer commitment packages. Source transcript	97% In Q1, where we met or exceeded our key metrics, highlights include: one, Q1 net new ARR of $194 million, double-digit millions ahead of our expectations; two, Q1 ending ARR surpassing $4.4 billion, maintaining our leadership as the only pure-play cybersecurity software company of this size; three, subscription gross margin of 80%, demonstrating our AI platform efficiency; four, sustained 97% gross retention as customers remain firmly committed to Falcon; five, free cash flow of $279 million or 25% of revenue, demonstrating double-digit quarter-on-quarter growth; and six, added $774 million of total Falcon Flex account value, bringing the total deal value of accounts that have adopted Falcon Flex to $3.2 billion, growing 31% sequentially and more than 6x year-over-year. Source transcript	—	—	97% Six, dollar-based net retention of 115% and gross retention of 97%, showcasing best-in-class durability and stickiness, which leads to my final point. Source transcript	—	—	—
Net revenue retention rate	112% Gross retention in Q4 remained high at 97%, and our dollar-based net retention rate was 112%, reflecting the impact of customer commitment packages. Source transcript	—	—	—	115% Six, dollar-based net retention of 115% and gross retention of 97%, showcasing best-in-class durability and stickiness, which leads to my final point. Source transcript	—	—	—
Annual recurring revenue (ARR) Falcon Flex	—	—	—	$1.35B+ Across the entire CrowdStrike team, I'm extremely proud of our Q3 with highlights including: one, record Q3 net new ARR of $265 million, which grew 73% year-over-year, beating our expectations by more than 10%; two, ending ARR of $4.92 billion, which accelerated to 23% growth year-over-year; three, record Q3 free cash flow of $296 million or 24% of revenue; four, all-time record operating income of $265 million or 21% of revenue, this is the second consecutive quarter of record operating income; five, broad-based ending ARR acceleration across cloud, Next-Gen Identity and Next-Gen SIEM collectively as well as acceleration in our endpoint business; and six, more than $1.35 billion in ending ARR from accounts that have adopted the Falcon Flex subscription model, growing more than 200% year-over-year. Source transcript	$1.69B Seven, we delivered $1.69 billion in ending ARR from accounts that have adopted the Falcon Flex subscription model, growing more than 120% year-over-year, turbocharging our land-and-expand motion. Source transcript	$1.9B+ Five, record Q1 operating income of $326 million or 24% of revenue, up 62% year-over-year, exceeding guidance and six, we added over 300 Falcon Flex accounts in the quarter with accounts that have adopted the subscription model reaching more than $1.9 billion in ending ARR, growing 99% year-over-year. Source transcript	$2.29B+ Seven, all-time record Falcon Flex quarter with ending ARR from accounts that have adopted the Falcon Flex subscription model surpassing $2.29 billion, accelerating to 101% year-over-year growth. Source transcript	—
Annual recurring revenue (ARR) Next-Gen Identity, Cloud and Next-Gen SIEM	—	—	—	—	$1.9B+ Collectively, our Next-Gen Identity, cloud and Next-Gen SIEM businesses grew more than 45% year-over-year reaching more than $1.9 billion in ending ARR. Source transcript	$2B+ Combined, these businesses have now exceeded $2 billion in ending ARR. Source transcript	$2.1B When you think about cloud, next-gen SIEM, next-gen identity, ending ARR was $2.1 billion, up 39% year-over-year. Source transcript	—
Annual recurring revenue (ARR) Cloud	—	—	—	—	$800M+ For the first time, our cloud business exceeded $800 million in ending ARR as our customers look to us to secure the infrastructure powering their AI future. Source transcript	—	$905M+ Moving on to cloud, where ending ARR exceeded $905 million, growing more than 29% year-over-year. Source transcript	—
Customers Reflex	—	—	—	—	—	480 The most exciting part is the Reflex dynamic, customers renewing and expanding their investment beyond their first Flex contract with highlights including the number of Reflex customers reached 480, representing nearly 25% of all Flex customers. Source transcript	630+ We also saw a record reflex activity for existing Flex customers with more than 630 accounts having reflexed at least once up 6x year-over-year. Source transcript	—

Operating figures the company states on every call, checked against each call's transcript. Click a figure to read the sentence. A dash means it was not stated that quarter.

Orderbook & backlog

Net New ARR $333 million Q2 FY27

up 51% YoY

All-time record, beating high end of guidance by more than $45 million.

Ending ARR $5.84 billion Q2 FY27

up >25% YoY

Accelerated for the fourth consecutive quarter.

Q3 Pipeline Record Q2 FY27 end

Reinforces confidence in the demand environment ahead.

Product announcements

Product	Type	Timeline	Details
AI Security Innovations	roadmap	next week (Fal.Con conference)

Deals & partnerships

XM Cyber Acquisition of technology assets

Acquisition of XM Cyber's technology assets is expected to close in the second half of FY27.

Project QuoteWerks Partners Collaboration with GSIs, hyperscalers, resellers, ISVs, distributors, and MSPs

United more than 25 partners to leverage Falcon capabilities for vulnerability assessments and remediation, leading to platform pull-through.

Kroll Strategic migration of customers to Falcon platform and multiyear Flex subscription multiyear

Kroll migrated all customers off a competing next-gen endpoint technology to Falcon, covering 450,000 endpoints. This Flex addresses platform consolidation and SIEM transformation.

Accenture Standardization on CrowdStrike for new SMB-focused business

Accenture standardized on CrowdStrike for its new SMB-focused Accenture Edge business, launched in June.

AWS, Google, Microsoft Cloud marketplace go-to-market motion $600 million

Customers use their hyperscaler of choice for security investments, with record Q2 performance across all three partners. Immediate Microsoft marketplace wins included a 7-figure Flex deal with an Australian healthcare provider and an American manufacturing firm.

What to watch in Q3 FY27

AI Security Innovations

next week (Fal.Con conference)

Current Newest AI security innovations to be unveiled

Target Specific product launches and roadmap details

Why it matters

New innovations are key to maintaining market leadership in AI security and capturing new revenue streams.

I can't wait to unveil our newest AI security innovations at next week's Fal.Con conference.

Q&A highlights

What transpired after the 'Mythos moment' and what were the key drivers of the Q2 upside?

George Kurtz explained that the 'Mythos moment' was building and became a growth driver, showing up in results. Key drivers included AI agents going rogue, the need to protect AI, understanding shadow AI, and strong performance across AIDR, Cloud, Identity, Next-Gen SIEM, Endpoint, and Exposure Management.

“When we think about AI agents going rogue when you think about the need for protecting AI and understanding where shadow AI is, it all points to the technologies that we're building and delivering here like AIDR, which was just had a phenomenal quarter, no surprise.”

asked by Saket Kalia · answered by George Kurtz

2 min read 6 chapters

Detailed narrative

AI-Driven Acceleration

The "Mythos moment" has transitioned into significant acceleration, with AI agents driving increased cyber attacks and spending, creating a clear divide in the cybersecurity market. CrowdStrike's Q2 performance, including record net new ARR and revenue growth, demonstrates market trust in its platform for securing AI adoption. The company sees these dynamics continuing, with AI expanding the attack surface and increasing the urgency for cybersecurity investment.

Falcon Flex Strategy Success

The "Flex first" go-to-market strategy drove record Falcon Flex activity, adding over 935 Flex accounts in Q2, more than the last three quarters combined. Flex new logo ARR contributed 34% of Q2 net new ARR. Customers converting from standard subscriptions to Flex saw over 40% average ending ARR uplift, with repeat reflex customers achieving 53% higher ARR from their initial Flex subscription, underscoring the power of platform consolidation.

Endpoint as AI Epicenter

The endpoint business accelerated for the fourth consecutive quarter, driven by dramatic expansion in agentic work and AI usage on endpoints, with over 400% growth in Claude usage and over 100% growth in custom agent usage in recent months. CrowdStrike is positioned as critical infrastructure to enable and safeguard AI futures, displacing legacy EDR solutions due to superior detection, deployment ease, and light impact.

Emerging Product Strength

AIDR's ending ARR nearly tripled versus Q1, with significant adoption from large banks for AI usage visibility and data exfiltration prevention. Next-Gen SIEM delivered record net new ARR, surpassing $695 million in ending ARR, driven by its native first-party data advantage. The Identity business ending ARR grew 34% year-over-year to over $585 million, with Falcon Shield growing over 185% and privileged account security over 35x.

Cloud and Exposure Management

Cloud ending ARR exceeded $905 million, growing over 29% year-over-year, with Falcon Cloud Security being adopted for runtime superiority in AI workloads by mega technology conglomerates. Exposure Management accelerated sequentially as the agentic adversary has made traditional vulnerability management insufficient, leading to displacement of legacy products for real-time detection and continuous prioritization of vulnerability risk.

Ecosystem and Marketplace Momentum

Project QuoteWerks, uniting over 25 partners (GSIs, hyperscalers, resellers, ISVs, distributors, MSPs), has generated nearly $400 million in total contract value pipeline. GSI business grew nearly 50% year-over-year. Cloud marketplace transactions exceeded $600 million in deal value in Q2, representing over 30% year-over-year growth, with strong traction in Microsoft Marketplace for SOC transformation and platform expansion.

AI-generated summary of the company's earnings call. Not investment advice.