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Item 3. Legal Proceedings

2022-03-16 compared with 2021-03-18 · 7 added, 102 removed, 36 unchanged (75% of the section changed)

1 unchanged sentence

We are currently a party to, and may from time to time in the future be involved in, various litigation matters and subject to claims that arise in the ordinary course of business, including claims asserted by third parties in the form of letters and other communications.

For information regarding legal proceedings and other claims in which we are involved, see Note 12, “Commitments and Contingencies” in our Notes to Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K.

For information regarding legal proceedings and other claims in which we are involved, see Note 11, Commitments and Contingencies, in Part II, Item 8 of this Annual Report on Form 10-K.

For any claims for which we believe a liability is both probable and reasonably estimable, we record a liability in the period for which it makes this determination.

There is no pending or threatened legal proceeding to which we are a party that, in our opinion, is likely to have a material adverse effect on our consolidated financial statements;

There is no pending or threatened legal proceeding to which we are a party that, in our opinion, is likely to have a material adverse effect on our business and our consolidated financial statements;

however, the results of litigation and claims are inherently unpredictable.

20 unchanged sentences

(a) Sale of Unregistered Equity Securities

On September 30, 2020, we agreed to issue up to $5.3 million of shares of our Class A common stock, subject to service-based vesting and other conditions, to certain individual stockholders of Preempt Security in connection with our acquisition of Preempt Security.

On November 29, 2021, we agreed to issue $10.7 million of shares of our Class A common stock, subject to service-based vesting and other conditions, to certain individual interest holders of Secure Circle LLC (“SecureCircle”) in connection with our acquisition of SecureCircle.

The transaction was exempt from registration under Section 4(a)(2) of the Securities Act.

(b) Use of Proceeds from Public Offering of Common Stock

On June 11, 2019, the SEC declared our registration statement on Form S-1 (File No.

333-231461) for our IPO effective.

There have been no material changes in the planned use of proceeds from our IPO as described in our final prospectus filed with the SEC on June 13, 2019.

Issuer Purchases of Equity Securities

2 unchanged sentences

under the Securities Act or the Exchange Act.

We have presented below the cumulative total return to our stockholders between June 12, 2019 (the date our common stock commenced trading on the Nasdaq) through January 31, 2021 in comparison to the Standard & Poor’s 500 Index and Standard & Poor Information Technology Index.

All values assume a $100 initial investment and data for the Standard & Poor’s 500 Index and Standard & Poor Information Technology Index assume reinvestment of dividends.

We have presented below the cumulative total return to our stockholders between June 12, 2019 (the date our common stock commenced trading on the Nasdaq) through January 31, 2022 in comparison to the Standard & Poor’s 500 Index, Standard & Poor Information Technology Index, and the Nasdaq 100 Index.

All values assume a $100 initial investment and data for the Standard & Poor’s 500 Index, Standard & Poor Information Technology Index and the Nasdaq 100 Index assume reinvestment of dividends.

The comparisons are based on historical data and are not indicative of, nor intended to forecast, the future performance of our common stock.

Company/ Index June 12, 2019 July 31, 2019 October 31, 2019 January 31, 2020 April 30, 2020 July 31, 2020 October 31, 2020 January 31, 2021

Company/ Index Base period 6/12/19 7/31/19 10/31/19 1/31/20 4/30/20 7/31/20 10/31/20 1/31/21 4/30/21 7/31/21 10/31/21 1/31/22

CrowdStrike Holdings, Inc.

2 unchanged sentences

S&P Information Technology $ 100.00 $ 112.77 $ 117.16 $ 134.13 $ 129.30 $ 156.64 $ 157.56 $ 183.94 $ 199.27 $ 219.35 $ 231.50 $ 232.55

Selected Financial Data

The selected consolidated statements of operations data presented below for fiscal 2021, fiscal 2020, and fiscal 2019 and the consolidated balance sheets data as of January 31, 2021 and 2020 are derived from our audited consolidated financial statements that are included elsewhere in this Annual Report on Form 10-K.

The selected consolidated statements of operations data for fiscal 2018 and 2017 and the consolidated balance sheets data as of January 31, 2019, 2018, and 2017 have been derived from our audited consolidated financial statements that are not included elsewhere in this Annual Report on Form 10-K.

Our historical results are not necessarily indicative of the results that may be expected in the future.

Effective February 1, 2020, we adopted the Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842) as discussed in Note 2, “Summary of Significant Accounting Policies” to our consolidated financial statements in this Annual Report on Form 10-K.

Prior periods were not retrospectively adjusted, and accordingly, the consolidated statements of operations for the years ended January 31, 2020, 2019, 2018, and 2017 and the consolidated balance sheets as of January 31, 2020, 2019, 2018, and 2017 were prepared using the prior lease accounting standard referred to as ASC Topic 840.

Effective February 1, 2019, the Company adopted ASU 2014-09, Revenue from Contracts with Customers (“ASC 606”) as discussed in Note 2, “Summary of Significant Accounting Policies” to our consolidated financial statements in this Annual Report on Form 10-K.

Prior periods were not retrospectively adjusted, and accordingly, the consolidated statement of operations data for the years ended January 31, 2019, 2018, and 2017 and the consolidated balance sheets data as of January 31, 2019, 2018, and 2017 were prepared using the prior revenue recognition standard referred to as ASC 605.

The selected consolidated financial data and other data set forth below should be read in conjunction with the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and related notes included elsewhere in this Annual Report on Form 10-K.

Year Ended January 31,

2021 2020 2019 2018 2017

(in thousands, except per share data)

Consolidated Statement of Operations Data:

Subscription $ 804,670 $ 436,323 $ 219,401 $ 92,568 $ 37,895

Professional services 69,768 45,090 30,423 26,184 14,850

Total revenue 874,438 481,413 249,824 118,752 52,745

Cost of revenue

Subscription (1)(2)

185,212 112,474 69,208 39,857 24,378

Professional services (1)

44,333 29,153 18,030 14,629 9,628

Total cost of revenue 229,545 141,627 87,238 54,486 34,006

Gross profit 644,893 339,786 162,586 64,266 18,739

Operating expenses

Sales and marketing (1)(2)

401,316 266,595 172,682 104,277 53,748

Research and development (1)(2)

214,670 130,188 84,551 58,887 39,145

General and administrative (1)(3)

121,436 89,068 42,217 32,542 16,402

Total operating expenses 737,422 485,851 299,450 195,706 109,295

Loss from operations (92,529) (146,065) (136,864) (131,440) (90,556)

Interest expense (4)

(1,559) (442) (428) (1,648) (615)

Other income (expense), net 6,219 6,725 (1,418) (1,473) (82)

Loss before provision for income taxes (87,869) (139,782) (138,710) (134,561) (91,253)

Provision for income taxes 4,760 1,997 1,367 929 87

Net loss $ (92,629) $ (141,779) $ (140,077) $ (135,490) $ (91,340)

Accretion of redeemable convertible preferred stock — — — (5,853) (17,012)

Net loss attributable to Class A and Class B common stockholders, basic and diluted $ (92,629) $ (141,779) $ (140,077) $ (141,343) $ (108,352)

Net loss per share attributable to Class A and Class B common stockholders, basic and diluted (5)

$ (0.43) $ (0.96) $ (3.12) $ (3.38) $ (2.73)

Weighted-average shares used in computing net loss per share attributable to Class A and Class B common stockholders, basic and diluted (5)

217,756 148,062 44,863 41,876 39,706

______________________________

(1) Includes stock-based compensation expense as follows:

Year Ended January 31,

2021 2020 2019 2018 2017

(in thousands)

Subscription cost of revenue $ 11,705 $ 5,226 $ 689 $ 89 $ 50

Professional services cost of revenue 6,005 2,486 205 252 41

Sales and marketing 50,557 23,919 5,175 1,386 638

Research and development 40,274 15,403 7,815 3,429 561

General and administrative 41,134 32,906 6,621 7,187 704

Total stock-based compensation expense $ 149,675 $ 79,940 $ 20,505 $ 12,343 $ 1,994

(2) Includes amortization of acquired intangible assets as follows:

Year Ended January 31,

2021 2020 2019 2018 2017

(in thousands)

Subscription cost of revenue $ 1,057 $ 323 $ 327 $ 287 $ 97

Sales and marketing 362 123 143 20 —

Research and development 29 41 113 321 —

Total amortization of purchased intangibles

$ 1,448 $ 487 $ 583 $ 628 $ 97

(3) Includes acquisition-related expenses as follows:

Year Ended January 31,

2021 2020 2019 2018 2017

(in thousands)

General and administrative $ 3,758 $ — $ — $ 167 $ —

Total acquisition-related expenses $ 3,758 $ — $ — $ 167 $ —

(4) Includes amortization of debt issuance costs and discount as follows:

Year Ended January 31,

2021 2020 2019 2018 2017

(in thousands)

Interest expense $ 347 $ — $ — $ — $ —

Total amortization of debt issuance costs and discount $ 347 $ — $ — $ — $ —

(5) See Note 2 and Note 16 to our consolidated financial statements elsewhere in this Annual Report on Form 10-K for an explanation of the method used to calculate our basic and diluted net loss per share attributable to our common stockholders and the weighted-average number of shares used in the computation of the per share amounts.

As of January 31,

2021 2020 2019 2018 2017

(in thousands)

Consolidated Balance Sheets Data:

Cash, cash equivalents and marketable securities $ 1,918,608 $ 912,064 $ 191,655 $ 65,772 $ 33,450

Working capital (deficit) (1)

$ 1,428,721 $ 678,540 $ 49,968 $ (12,279) $ (19,013)

Total assets $ 2,732,533 $ 1,404,906 $ 433,219 $ 217,703 $ 91,371

Deferred revenue, current and noncurrent $ 911,895 $ 571,168 $ 290,067 $ 158,950 $ 76,551

Long-term debt $ 738,029 $ — $ — $ — $ —

Redeemable convertible preferred stock $ — $ — $ 557,912 $ 351,016 $ 214,728

Accumulated deficit $ (730,116) $ (637,487) $ (519,126) $ (378,948) $ (243,458)

Total stockholders’ equity (deficit)

$ 871,874 $ 742,607 $ (487,793) $ (369,474) $ (243,453)

______________________________

(1) Working capital (deficit) is defined as current assets less current liabilities.

Nasdaq 100 $ 100.00 $ 110.24 $ 113.85 $ 126.96 $ 127.41 $ 154.74 $ 157.13 $ 184.09 $ 197.77 $ 213.84 $ 226.94 $ 214.11

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 3. Legal Proceedings