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Item 7. Management’s Discussion and Analysis

2026-03-05 compared with 2025-03-10 · 176 added, 57 removed, 336 unchanged (41% of the section changed)

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Discussions of fiscal 2024 items and year-over-year comparisons between fiscal 2025 and 2024 are not included in this Form 10-K, and can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended January 31, 2025.

As discussed in Note 1 and Note 16 to the Consolidated Financial Statements included in this report, the Company revised its fiscal 2025 and 2024 financial results to correct for an immaterial error discovered during the fourth quarter of fiscal 2026.

The revisions are intended to ensure comparability across all periods reflected herein.

Some of the information contained in this discussion and analysis or set forth elsewhere in this Annual Report on Form 10-K, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties, including those described under the heading “Special Note Regarding Forward-Looking Statements.” You should review the disclosure under Part I, Item 1A, “Risk Factors” in this Annual Report on Form 10-K for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Our fiscal years ended January 31, 2026, January 31, 2025, and January 31, 2024, are referred to herein as fiscal 2026, fiscal 2025, and fiscal 2024, respectively.

Founded in 2011, CrowdStrike reinvented cybersecurity for the cloud era and transformed the way cybersecurity is delivered and experienced by customers.

Founded in 2011, we reinvented cybersecurity for the cloud era and transformed the way cybersecurity is delivered and experienced by customers.

When we started CrowdStrike, cyberattackers had an asymmetric advantage over legacy cybersecurity products that could not keep pace with the rapid changes in adversary tactics.

We took a fundamentally different approach to solve this problem with the AI-native CrowdStrike Falcon platform – the first, true cloud-native unified platform built with AI at the core, capable of harnessing vast amounts of security and enterprise data to deliver highly modular solutions through a single lightweight agent.

We took a fundamentally different approach to solve this problem with the AI-native CrowdStrike Falcon platform – the first, true cloud-native unified platform built with artificial intelligence (“AI”) at the core, capable of harnessing vast amounts of security and enterprise data to deliver highly modular solutions through a single lightweight sensor.

We believe our approach has defined a new category called the Security Cloud, which has transformed the cybersecurity industry the same way the cloud has transformed the customer relationship management, human resources, and service management industries.

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In addition to our ongoing investment in research and development, we may also pursue acquisitions of businesses, technologies, and assets that complement and expand the functionality of our Falcon platform, add to our technology or security expertise, or bolster our leadership position by gaining access to new customers or markets.

Furthermore, we expect our general and administrative expenses to increase in dollar amount for the foreseeable future given the additional expenses for accounting, compliance, and investor relations as we grow as a public company.

July 19 Incident .

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While we have maintained high dollar-based gross retention rates following the incident, we have experienced delays in creating sales opportunities and longer sales cycles, including delays in customer purchasing decisions.

We expect sales cycles to continue to be elongated in future periods.

In addition, because our customers typically sign contracts with terms of twelve months or longer, customer churn and any corresponding impact to our key metrics and revenue may occur in future periods.

Sales cycles may be elongated in future periods.

In addition, because our customers typically sign contracts with terms over one year, customer churn and any corresponding impact to our key metrics and revenue may occur in future periods.

Customer commitment packages introduced following the July 19 Incident have included discounting, additional modules, professional services, flexible payment terms or subscription period extensions.

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Year-over-year growth 24 % 23 %

ARR increased 23% year-over-year and grew to $4.2 billion as of January 31, 2025, of which $806.7 million was net new ARR added during fiscal 2025.

ARR increased 24% year-over-year and grew to $5.3 billion as of January 31, 2026, of which $1.0 billion was net new ARR added during fiscal 2026.

ARR increased 23% year-over-year and grew to $4.2 billion as of January 31, 2025, of which $806.7 million was net new ARR added during fiscal 2025.

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Our operating expenses consist of sales and marketing, research and development, and general administrative expenses.

For each of these categories of expense, employee-related expenses are the most significant component, which include salaries, employee bonuses, sales commissions, and employer payroll tax.

For each of these categories of expense, employee-related expenses are the most significant component, which include salaries,

employee bonuses, sales commissions, and employer payroll tax.

Operating expenses also include an allocated portion of overhead costs for facilities and other administrative functions.

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We expect general and administrative expenses to increase in dollar amount over time.

We expect to incur significant legal and professional services and other expenses associated with the July 19 Incident in future periods.

We expect to incur significant legal and professional services and other expenses associated with the July 19 Incident and related matters in future periods.

General and administrative expenses may fluctuate as a percentage of our total revenue from period to period depending on the timing of these expenses.

Interest Expense.

Interest expense consists primarily of amortization of debt issuance costs, contractual interest expense for our Senior Notes issued in January 2021, and amortization of debt issuance costs on our secured revolving credit facility (“Revolving Facility”).

Interest Income.

Interest income consists primarily of income earned on our cash, cash equivalents, and short-term investments.

Other Income, Net.

Other income, net consists primarily of gains and losses on strategic investments and foreign currency transaction gains and losses.

Interest income consists primarily of income earned on our cash and cash equivalents.

Other Income (Expense), Net.

Other income (expense), net consists primarily of gains and losses on strategic investments and foreign currency transaction gains and losses.

Provision for Income Taxes.

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Interest income 194,969 196,174 148,930

Other income, net 5,101 1,638 3,053

Other income (expense), net (645) 5,101 1,638

Income (loss) before provision for income taxes (126,989) 58,564 105,671

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Interest income 4 % 5 % 5 %

Other income, net — % — % — %

Other income (expense), net — % — % — %

Income (loss) before provision for income taxes (3) % 1 % 3 %

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The following shows total revenue from subscriptions and professional services for fiscal 2026, as compared to fiscal 2025 (in thousands, except percentages):

Year Ended January 31, Change

2026 2025 $ %

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Total revenue $ 4,812,005 $ 3,953,624 $ 858,381 22 %

Total revenue increased by $898.1 million, or 29%, in fiscal 2025, compared to fiscal 2024.

Subscription revenue accounted for 95% and 94% of our total revenue in fiscal 2025 and fiscal 2024, respectively.

Professional services revenue accounted for 5% and 6% of our total revenue in fiscal 2025 and fiscal 2024, respectively.

Subscription revenue increased by $890.9 million, or 31% in fiscal 2025, compared to fiscal 2024, which was primarily driven by a combination of the addition of new customers and the sale of additional sensors and modules to existing customers.

Professional services revenue increased by $7.1 million, or 4%, in fiscal 2025 , compared to fiscal 2024, which was primarily attributable to an increase in the number of professional service hours.

Total revenue increased by $858.4 million, or 22%, in fiscal 2026, as compared to fiscal 2025.

Subscription revenue accounted for 95% of total revenue for each of fiscal 2026 and fiscal 2025.

Professional services revenue accounted for 5% of total revenue for each of fiscal 2026 and fiscal 2025.

Subscription revenue increased by $803.2 million, or 21% in fiscal 2026, as compared to fiscal 2025, which was primarily driven by a combination of the addition of new customers and the sale of additional sensors and modules to existing customers.

Professional services revenue increased by $55.2 million, or 29%, in fiscal 2026 , as compared to fiscal 2025, which was primarily attributable to an increase in the number of professional service hours.

Cost of Revenue, Gross Profit, and Gross Margin

The following shows cost of revenue related to subscriptions and professional services for fiscal 2026, as compared to fiscal 2025 (in thousands, except percentages):

Year Ended January 31, Change

2026 2025 $ %

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Total cost of revenue $ 1,218,929 $ 990,172 $ 228,757 23 %

Total cost of revenue increased by $235.8 million, or 31%, in fiscal 2025 , compared to fiscal 2024.

Subscription cost of revenue increased by $204.8 million, or 32%, in fiscal 2025 , compared to fiscal 2024.

The increase in subscription cost of revenue was primarily due to an increase in employee-related expenses of $55.6 million driven by a 28% increase in average headcount, an increase in depreciation of data center equipment of $38.4 million, an increase in stock-based compensation expense of $29.7 million, an increase in cloud hosting and related services costs of $28.5 million, an increase in allocated overhead costs of $20.3 million, an increase in amortization of internal-use software of $17.6 million, an increase in hardware maintenance costs of $5.4 million, and an increase in employee benefits of $4.2 million.

Professional services cost of revenue increased by $31.0 million, or 25%, in fiscal 2025 , compared to fiscal 2024.

The increase in professional services cost of revenue was primarily due to an increase in employee-related expenses of $13.1 million driven by an 20% increase in average headcount, an increase in stock-based compensation expense of $8.8 million, an increase in allocated overhead costs of $5.0 million, an increase in consulting expense of $2.2 million, and an increase in employee benefits of $1.0 million.

Total cost of revenue increased by $228.8 million, or 23%, in fiscal 2026 , as compared to fiscal 2025.

Subscription cost of revenue increased by $181.3 million, or 22%, in fiscal 2026 , as compared to fiscal 2025.

The increase in subscription cost of revenue was primarily due to an increase in cloud hosting and related services costs of $46.4 million, an increase in employee-related expenses of $43.1 million driven by a 16% increase in average headcount, an increase in depreciation of data center equipment of $33.4 million, an increase in amortization of internal-use software of $24.9 million, an increase in stock-based compensation expense of $18.1 million, an increase in allocated overhead costs of $16.8 million, and charges related to the Strategic Plan of $3.4 million, partially offset by a decrease in other labor expenses of $2.8 million and a decrease in company events expenses of $1.2 million.

Professional services cost of revenue increased by $47.4 million, or 30%, in fiscal 2026 , as compared to fiscal 2025.

The increase in professional services cost of revenue was primarily due to an increase in consulting expenses of $18.7 million, an increase in employee-related expenses of $15.5 million driven by a 12% increase in average headcount, an increase in stock-based compensation expense of $5.7 million, charges related to the Strategic Plan of $3.3 million, and an increase in allocated overhead costs of $2.6 million.

The following shows gross profit and gross margin for subscriptions and professional services for fiscal 2026, as compared to fiscal 2025 (in thousands, except percentages):

Year Ended January 31, Change

2026 2025 $ %

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Total gross profit $ 3,593,076 $ 2,963,452 $ 629,624 21 %

Year Ended January 31, Change

Subscription gross margin 78 % 78 % — %

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Total gross margin 75 % 75 % — %

Subscription gross margin was flat in fiscal 2025 , compared to fiscal 2024.

Professional services gross margin decreased by 13% in fiscal 2025, compared to fiscal 2024 .

The decrease in professional services gross margin was primarily due to an increase in consulting expense and decreased utilization during fiscal 2025 compared to fiscal 2024.

Subscription gross margin was flat in fiscal 2026 , as compared to fiscal 2025.

Professional services gross margin decreased by 1% in fiscal 2026, as compared to fiscal 2025 .

The decrease in professional services gross margin was primarily due to an increase in consulting expense and an increase in stock-based compensation expense during fiscal 2026, as compared to fiscal 2025.

Operating Expenses

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The following shows sales and marketing expenses for fiscal 2026, as compared to fiscal 2025 (in thousands, except percentages):

Year Ended January 31, Change

2026 2025 $ %

Sales and marketing expenses $ 1,831,254 $ 1,523,001 $ 308,253 20 %

Sales and marketing expenses increased by $382.8 million, or 34%, in fiscal 2025 , compared to fiscal 2024.

The increase in sales and marketing expenses was primarily due to an increase in employee-related expenses of $159.0 million driven by a 14% increase in average headcount, an increase in stock-based compensation expense of $59.7 million, an increase in marketing programs of $55.5 million, an increase in allocated overhead costs of $28.4 million, $21.4 million of expenses relating to the July 19 Incident, an increase in travel expenses of $13.1 million, an increase in company events expenses of $8.6 million, an increase in employee benefits of $6.3 million, an increase in term-based software licenses of $5.4 million, an increase in cloud hosting and related costs of $4.2 million, an increase in other labor expenses of $2.8 million, and an increase in consulting expense of $2.5 million.

Sales and marketing expenses increased by $308.3 million, or 20%, in fiscal 2026 , as compared to fiscal 2025.

The increase in sales and marketing expenses was primarily due to an increase in employee-related expenses of $168.4 million driven by a 12% increase in average headcount, an increase in stock-based compensation expense of $48.2 million, an increase in marketing programs of $29.2 million, an increase in allocated overhead costs of $20.2 million, an increase in employee benefits of $16.5 million, an increase in travel expenses of $11.2 million, charges related to the Strategic Plan of $9.0 million, an increase in cloud hosting and related costs of $6.2 million, an increase in term-based software licenses of $3.2 million, an increase in other labor expenses of $2.1 million, and an increase in consulting expenses of $1.7 million, partially offset by a decrease in expenses associated with the July 19 Incident and related matters of $20.3 million.

Research and Development

The following shows research and development expenses for fiscal 2026, as compared to fiscal 2025 (in thousands, except percentages):

Year Ended January 31, Change

2026 2025 $ %

Research and development expenses $ 1,384,770 $ 1,075,587 $ 309,183 29 %

Research and development expenses increased by $308.4 million, or 40% in fiscal 2025 , compared to fiscal 2024.

This increase was primarily due to an increase in stock-based compensation expense of $131.7 million, an increase in employee-related expenses of $119.3 million driven by a 18% increase in average headcount, an increase in cloud hosting and related costs of $64.2 million, $6.8 million of expenses relating to the July 19 Incident, an increase in term-based software licenses of $6.4 million, an increase in employee benefits of $5.1 million, an increase in travel expenses of $3.2 million, and an increase in consulting expense of $1.7 million, partially offset by a decrease in allocated engineering and overhead costs of $27.5 million, an increase in software capitalization of $11.4 million, and a decrease in other labor expenses of $9.7 million.

Research and development expenses increased by $309.2 million, or 29% in fiscal 2026 , as compared to fiscal 2025.

This increase was primarily due to an increase in employee-related expenses of $116.8 million driven by a 20% increase in average headcount, an increase in stock-based compensation expense of $94.0 million, an increase in cloud hosting and related costs of $46.4 million, an increase in allocated overhead costs of $27.6 million, charges related to the Strategic Plan of $16.6 million, and an increase in term-based software licenses of $3.5 million, partially offset by an increase in software capitalization of $9.8 million, and a decrease in expenses associated with the July 19 Incident and related matters of $4.4 million.

General and Administrative

The following shows general and administrative expenses for fiscal 2026, as compared to fiscal 2025 (in thousands, except percentages):

Year Ended January 31, Change

2026 2025 $ %

General and administrative expenses $ 670,344 $ 481,264 $ 189,080 39 %

General and administrative expenses increased by $89.6 million, or 23%, in fiscal 2025, compared to fiscal 2024.

The increase in general and administrative expenses was primarily due to $31.9 million of expenses relating to the July 19 Incident, an increase in employee-related expenses of $27.2 million driven by a 19% increase in average headcount, an increase in allocated overhead costs of $6.3 million, an increase in consulting expense of $5.0 million, an increase in leased airfare costs of $4.5 million, an increase in stock-based compensation expense of $4.0 million, an increase in travel expenses of $2.3 million, an increase in company events expenses of $2.1 million, an increase in term-based software licenses of $2.1 million, an increase in taxes and licenses expenses of $2.0 million, an increase in employee related programs of $1.8 million, and an increase in other labor expenses of $1.7 million, partially offset by a decrease in legal expense of $7.5 million unrelated to the July 19 Incident.

Interest Expense, Interest Income and Other Income, Net

The following shows interest expense, interest income, and other income, net, for fiscal 2025, as compared to fiscal 2024 (in thousands, except percentages):

General and administrative expenses increased by $189.1 million, or 39%, in fiscal 2026, as compared to fiscal 2025.

The increase in general and administrative expenses was primarily due to an increase in expenses associated with the July 19 Incident and related matters of $82.4 million, an increase in stock-based compensation expense of $52.4 million, an increase in consulting expense of $16.4 million, charges related to the Strategic Plan of $12.5 million, an increase in employee-related expenses of $11.2 million driven by a 14% increase in average headcount, an increase in legal expense of $4.5 million unrelated to the July 19 Incident or related matters, an increase in allocated overhead costs of $4.4 million, and an increase in term-based software licenses of $3.0 million.

Interest Expense, Interest Income and Other Income (Expense), Net

The following shows interest expense, interest income, and other income (expense), net, for fiscal 2026, as compared to fiscal 2025 (in thousands, except percentages):

Year Ended January 31, Change

2026 2025 $ %

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Interest income $ 194,969 $ 196,174 $ (1,205) (1) %

Other income, net $ 5,101 $ 1,638 $ 3,463 211 %

Interest expense consists primarily of amortization of debt issuance costs, contractual interest expense, accretion of debt discount for our Senior Notes issued in January 2021, and amortization of debt issuance costs on our Revolving Facility.

The increase in interest income during fiscal 2025 compared to fiscal 2024 was driven by an increase in our cash and cash equivalents.

The increase in other income, net during fiscal 2025 compared to fiscal 2024 was primarily due to an increase in gains on our strategic investments of $2.4 million, a decrease in downward mark to market adjustments of $0.5 million on our strategic investments, and gains on deferred compensation assets of $0.4 million.

Other income (expense), net $ (645) $ 5,101 $ (5,746) (113) %

The decrease in interest income during fiscal 2026 compared to fiscal 2025 was driven by lower market rates, partially offset by higher cash balances.

The decrease in other income (expense), net during fiscal 2026 compared to fiscal 2025 was primarily due to an increase in net foreign currency transaction losses of $3.5 million, a decrease in net realized gains on our strategic investments of $2.2 million, and an increase in downward adjustments and impairment of $0.6 million of our strategic investments, partially offset by an increase in gains from deferred compensation assets of $0.8 million.

Provision for Income Taxes

The following shows the provision for income taxes for fiscal 2026, as compared to fiscal 2025 (in thousands, except percentages):

Year Ended January 31, Change

2026 2025 $ %

Provision for income taxes $ 34,176 $ 71,130 $ (36,954) (52) %

The increase in provision for income taxes during fiscal 2025 compared to fiscal 2024 was primarily attributable to intercompany sales of intellectual property from acquired entities, pre-tax foreign earnings, withholding taxes related to customer payments in certain foreign jurisdictions, and change in the realizability of deferred tax assets in certain foreign jurisdictions.

The decrease in provision for income taxes during fiscal 2026 compared to fiscal 2025 was primarily attributable to a decrease in tax on intercompany sale of intellectual property from acquired entities, partially offset by an increase in tax on foreign earnings and withholding taxes in certain foreign jurisdictions.

Liquidity and Capital Resources

Our primary sources of liquidity as of January 31, 2026, consisted of:

(i) $4.3 billion in cash and cash equivalents, which mainly consists of cash on hand and highly liquid investments in money market funds and U.S.

Treasury bills, (ii) cash we expect to generate from operations, and (iii) available capacity under our $750.0 million Revolving Facility.

It is not currently possible to reasonably estimate the amount of loss or range of possible loss that might result from adverse judgments, settlements, penalties, or other resolution of proceedings resulting from the July 19 Incident.

However, despite such uncertainties, we expect that the combination of our existing cash and cash equivalents, cash flows from operations, and the Revolving Facility will be sufficient to meet our anticipated cash needs for working capital and capital expenditures for at least the next 12 months.

Our Revolving Facility matures on January 2, 2026.

(i) $5.2 billion in cash and cash equivalents, which mainly consists of cash on hand and highly liquid investments in money market funds, U.S.

Treasury bills, and time deposits, and (ii) cash we expect to generate from operations.

However, despite such uncertainties, we expect that the combination of our existing cash and cash equivalents and cash flows from operations will be sufficient to meet our anticipated cash needs for working capital and capital expenditures for at least the next 12 months.

Our short-term and long-term liquidity requirements primarily arise from:

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Our ability to fund these requirements will depend, in part, on our future cash flows, which are determined by our future operating performance and, therefore, subject to prevailing global macroeconomic conditions and financial, business, and other factors, some of which are beyond our control.

We have historically generated operating losses prior to fiscal 2024 and during fiscal 2025, as reflected in our accumulated deficit of $1.1 billion as of January 31, 2025.

We have a history of losses, and while we have achieved profitability in certain periods, including fiscal 2024, our accumulated deficit is $1.3 billion as of January 31, 2026.

We expect to continue to make investments, particularly in sales and marketing and research and development.

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Net cash provided by financing activities 132,452 107,208 93,158

Net change in cash, cash equivalents and restricted cash 947,069 920,673 460,291

Net increase in cash, cash equivalents, and restricted cash 989,951 947,069 920,673

Operating Activities

Net cash provided by operating activities during fiscal 2026 was $1.6 billion, which resulted from net loss of $161.2 million, adjusted for non-cash charges of $1.8 billion and net cash outflow of $59.3 million from changes in operating assets and liabilities.

Non-cash charges primarily consisted of $1.1 billion in stock-based compensation expense, $449.4 million of amortization of deferred contract acquisition costs, $250.2 million of depreciation and amortization, $31.2 million of amortization of intangibles assets, $17.2 million of non-cash operating lease costs, $5.4 million of non-cash interest expense, and $1.6 million change in fair value of strategic investments, partially offset by $14.8 million of deferred income taxes and $4.2 million of realized gains on strategic investments.

The net cash outflow from changes in operating assets and liabilities was primarily due to an increase of $703.7 million in deferred contract acquisition costs, an increase of $232.5 million in accounts receivable, an increase of $206.2 million in prepaid expenses and other assets, a decrease of $13.7 million in operating lease liabilities, and a decrease of $11.3 million in accounts payable, partially offset by an increase of $1.0 billion in deferred revenue, an increase of $61.6 million in accrued payroll and benefits, and an increase of $22.6 million in accrued expenses and other liabilities.

Net cash provided by operating activities during fiscal 2025 was $1.4 billion, which resulted from net loss of $12.6 million, adjusted for non-cash charges of $1.4 billion and net cash outflow of $6.0 million from changes in operating assets and liabilities.

Non-cash charges primarily consisted of $861.4 million in stock-based compensation expense, $318.8 million of amortization of deferred contract acquisition costs, $188.0 million of depreciation and amortization, $26.0 million of amortization of intangibles assets, $15.3 million of non-cash operating lease costs, $3.8 million of non-cash interest expense, and $2.3 million of accretion of short-term investments purchased at a discount, partially offset by $9.9 million of deferred income taxes and $6.3 million of realized gains on strategic investments.

The net cash outflow from changes in operating assets and liabilities was primarily due to a $584.5 million increase in deferred contract acquisition costs, a $274.2 million increase in accounts receivable, net, a $190.2 million increase in prepaid expenses and other assets, and a $15.7 million decrease in operating lease liabilities, partially offset by a $669.3 million increase in deferred revenue, a $218.5 million increase in accrued expenses and other liabilities, an $85.9 million increase in accrued payroll and benefits, and an $84.9 million increase in accounts payable.

Net cash provided by operating activities during fiscal 2024 was $1.2 billion, which resulted from net income of $90.6 million, adjusted for non-cash charges of $1.0 billion and net cash inflow of $51.5 million from changes in operating assets and liabilities.

Non-cash charges primarily consisted of $631.5 million in stock-based compensation expense, $238.9 million of amortization of deferred contract acquisition costs, $126.8 million of depreciation and amortization, $18.4 million of amortization of intangibles assets, $13.4 million of non-cash operating lease costs, and $3.2 million of non-cash interest expense, partially offset by $3.9 million of realized gains on strategic investments and a $3.4 million change in deferred income taxes.

The net cash inflow from changes in operating assets and liabilities was primarily due to a $696.6 million increase in deferred revenue, a $65.1 million increase in accrued payroll and benefits, a $14.6 million increase in accrued expenses and other liabilities, partially offset by a $371.6 million increase in deferred contract acquisition costs, a $217.7 million increase in accounts receivable, net, a $102.5 million increase in prepaid expenses and other assets, a $18.9 million decrease in accounts payable, and a $14.0 million decrease in operating lease liabilities.

Investing Activities

Net cash used in investing activities during fiscal 2026 of $764.5 million was primarily due to business acquisitions, net of cash acquired, of $382.3 million, which was related to the Onum Technology Inc.

and Pangea Cyber Corporation acquisitions, purchases of property and equipment of $302.1 million, capitalized internal-use software and website development costs of $68.8 million, purchases of strategic investments of $10.8 million, and purchases of deferred compensation investments of $6.0 million, partially offset by proceeds from sales of strategic investments of $5.2 million.

Net cash used in investing activities during fiscal 2025 of $536.6 million was primarily due to business acquisitions, net of cash acquired, of $310.3 million, which was related to the Flow Security and Adaptive Shield acquisitions, purchases of property and equipment of $254.9 million, capitalized internal-use software and website development costs of $59.0 million, purchases of strategic investments of $19.7 million, and purchases of deferred compensation investments of $2.7 million, partially offset by proceeds from maturities of short-term investments of $97.3 million and proceeds from sales of strategic investments of $12.5 million.

Net cash used in investing activities during fiscal 2024 of $340.7 million was primarily due to business acquisitions, net of cash acquired, of $239.0 million, which was related to the Bionic acquisition, purchases of short-term investments of $195.6 million, purchases of property and equipment of $176.5 million, capitalized internal-use software and website development costs of $49.5 million, purchases of strategic investments of $17.2 million, purchases of intangible assets of $11.1 million, and purchases of deferred compensation investments of $2.0 million, partially offset by proceeds from maturities and sales of short-term investments of $348.3 million, and proceeds from sales of strategic investments of $2.0 million.

Financing Activities

Net cash provided by financing activities of $132.5 million during fiscal 2026 was primarily due to proceeds from our employee stock purchase plan of $125.8 million, capital contributions from non-controlling interests of $6.0 million, and proceeds from the exercise of stock options of $3.2 million, partially offset by distributions to non-controlling interest holders of $2.5 million.

Net cash provided by financing activities of $107.2 million during fiscal 2025 was primarily due to proceeds from our employee stock purchase plan of $99.6 million, capital contributions from non-controlling interest holders of $8.5 million, and proceeds from the exercise of stock options of $4.0 million, partially offset by distributions to non-controlling interest holders of $4.9 million.

Net cash provided by financing activities of $93.2 million during fiscal 2024 was primarily due to proceeds from our employee stock purchase plan of $76.4 million, proceeds from the exercise of stock options of $8.7 million, and capital contributions from non-controlling interests of $8.1 million.

Supplemental Guarantor Financial Information

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We conduct our operations almost entirely through our subsidiaries.

Accordingly, the Obligor Group’s cash flows and ability to service the notes will depend on the earnings of our subsidiaries and the distribution of those earnings to the Obligor Group, whether by dividends, loans, or otherwise.

Accordingly, the Obligor Group’s cash flows and ability to service the Senior Notes will depend on the earnings of our subsidiaries and the distribution of those earnings to the Obligor Group, whether by dividends, loans, or otherwise.

Holders of the guaranteed registered debt securities will have a direct claim only against the Obligor Group.

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Contractual Obligations and Commitments

Our commitments consist of obligations under non-cancellable real estate arrangements on an undiscounted basis, of which $14.1 million is due in the next 12 months and $35.6 million is due thereafter.

Our commitments consist of obligations under non-cancelable real estate arrangements on an undiscounted basis, of which $16.9 million is due in the next 12 months and $65.8 million is due thereafter.

In addition, we have debt obligations related to $750.0 million aggregate principal amount of the Senior Notes due in fiscal 2030 and the interest payments associated with the Senior Notes of $22.5 million due in the next 12 months and $56.3 million due thereafter.

We have non-cancellable purchase commitments with various parties to purchase products and services entered in the normal course of business totaling $2.7 billion as of January 31, 2025, with remaining terms in excess of 12 months.

We have non-cancelable purchase commitments with various parties to purchase products and services entered in the normal course of business totaling $2.8 billion as of January 31, 2026, with remaining terms in excess of 12 months.

We expect to fund these obligations with cash flows from operations and cash on our balance sheet.

As of January 31, 2026, our unrecognized tax benefits included $47.3 million, which were classified as long-term liabilities due to the inherent uncertainty with respect to the timing of future cash outflows associated with our unrecognized tax benefits.

As of January 31, 2025, we had non-cancellable unfunded commitments from our financing arrangements totaling approximately $94.2 million.

As of January 31, 2026, we had non-cancelable unfunded commitments from our financing arrangements totaling approximately $89.9 million.

On January 7, 2026, we entered into a definitive agreement to acquire 100% of the equity interest of SGNL.AI, Inc., a leader in continuous identity.

The acquisition closed on February 20, 2026.

The total consideration transferred consisted of $627.9 million in cash, net of $9.4 million of cash acquired, and $8.9 million representing the fair value of replacement equity awards attributable to pre-acquisition service, subject to customary net working capital and purchase price adjustments.

The cash consideration included cash held back in an escrow fund for a partial security for post-closing indemnification claims.

We are currently finalizing the intangible assets valuation and purchase price allocation.

On January 12, 2026, we entered into a definitive agreement to acquire 100%of the equity interest of Seraphic Algorithms Ltd.

(“Seraphic”), a leader in browser runtime security.

The acquisition closed on February 3, 2026.

The total consideration transferred consisted of $327.4 million in cash, net of $1.1 million of cash and restricted cash acquired, and $13.9 million representing the fair value of replacement equity awards attributable to pre-acquisition service, subject to customary net working capital and purchase price adjustments.

Critical Accounting Policies and Estimates

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The purchase price allocation process requires management to make significant estimates and assumptions with respect to intangible assets.

Although we believe the assumptions and estimates we have made are reasonable, they are based in part on historical experience, market conditions, and information obtained from management of the acquired companies and are inherently uncertain.

Although we believe the

assumptions and estimates we have made are reasonable, they are based in part on historical experience, market conditions, and information obtained from management of the acquired companies and are inherently uncertain.

Examples of judgments used to estimate the fair value of intangibles assets include, but are not limited to, future expected cash flows, expected customer attrition rates, estimated obsolescence rates, and discount rates.

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however, the final determination of any of these examinations could significantly impact the amounts provided for income taxes in our consolidated financial statements.

Change in Accounting Estimate

In February 2026, we completed an assessment of the estimated period of benefit of commissions earned upon the initial acquisition of a contract, or subsequent upsell, and determined that it should increase from four to five years.

This change in estimate will be effective beginning in fiscal year 2027.

It is estimated this change will improve our fiscal year 2027 income (loss) from operations by $85.0 million to $95.0 million.

Quarterly Financial Information

Three Months Ended

January 31, 2026 October 31, 2025 July 31, 2025 April 30, 2025

Revenue $ 1,305,375 $ 1,234,244 $ 1,168,952 $ 1,103,434

Gross profit 989,462 927,654 860,401 815,559

Loss from operations (6,900) (62,222) (105,457) (118,713)

Net income (loss) 40,775 (26,767) (70,123) (105,050)

Net income (loss) attributable to CrowdStrike $ 38,691 $ (26,776) $ (70,153) $ (104,264)

Net income (loss) per share attributable to CrowdStrike common stockholders:

Basic $ 0.15 $ (0.11) $ (0.28) $ (0.42)

Diluted $ 0.15 $ (0.11) $ (0.28) $ (0.42)

Three Months Ended

January 31, 2025 October 31, 2024 July 31, 2024 April 30, 2024

Revenue $ 1,058,538 $ 1,010,178 $ 963,872 $ 921,036

Gross profit 786,157 755,424 726,161 695,710

Income (loss) from operations (79,305) (54,365) 12,525 4,745

Net income (loss) (86,735) (15,461) 45,557 44,073

Net income (loss) attributable to CrowdStrike $ (86,286) $ (15,464) $ 45,880 $ 40,629

Net income (loss) per share attributable to CrowdStrike common stockholders:

Basic $ (0.35) $ (0.06) $ 0.19 $ 0.17

Diluted $ (0.35) $ (0.06) $ 0.18 $ 0.16

As discussed in Note 1 and Note 16 of the Notes to the Consolidated Financial Statements, we identified an immaterial error related to the recognition of stock-based compensation expense in prior periods.

We will revise our previously reported quarterly financial information based on the summary presented below in our future filings with the SEC, as applicable, to correct for this error.

A summary of the impacts of the revision to the affected financial statement line items in our Condensed Consolidated Financial Statements is presented below for each quarterly period in the fiscal year ended January 31, 2026 (in thousands, except per share data).

As the impact of the error for the fiscal year ended January 31, 2025 was only $4.0 million, the impacts of the revision on the associated quarterly periods have not been presented as they are not individually material to any quarterly period.

Consolidated Balance Sheets

As of April 30, 2025

As previously reported Adjustments As revised

Additional paid-in-capital $ 4,633,211 $ 36,490 $ 4,669,701

Accumulated deficit $ (1,188,314) $ (36,490) $ (1,224,804)

As of July 31, 2025

As previously reported Adjustments As revised

Additional paid-in-capital $ 5,016,544 $ 28,968 $ 5,045,512

Accumulated deficit $ (1,265,989) $ (28,968) $ (1,294,957)

As of October 31, 2025

As previously reported Adjustments As revised

Additional paid-in-capital $ 5,314,820 $ 21,747 $ 5,336,567

Accumulated deficit $ (1,299,986) $ (21,747) $ (1,321,733)

Consolidated Statements of Operations

Three Months Ended April 30, 2025

As previously reported Adjustments As revised

Subscription cost of revenue $ 242,374 $ (1,014) $ 241,360

Professional services cost of services 46,769 (254) 46,515

Total cost of revenue 289,143 (1,268) 287,875

Gross profit 814,291 1,268 815,559

Sales and marketing 439,617 (406) 439,211

Research and development 334,129 (3,203) 330,926

General and administrative 165,201 (1,066) 164,135

Total operating expenses 938,947 (4,675) 934,272

Loss from operations (124,656) 5,943 (118,713)

Loss before provision for income taxes (89,887) 5,943 (83,944)

Net loss (110,993) 5,943 (105,050)

Net loss attributable to CrowdStrike $ (110,207) $ 5,943 $ (104,264)

Net loss per share attributable to CrowdStrike common stockholders:

Basic $ (0.44) $ 0.02 $ (0.42)

Diluted $ (0.44) $ 0.02 $ (0.42)

Three Months Ended July 31, 2025 Six Months Ended July 31, 2025

As previously reported Adjustments As revised As previously reported Adjustments As revised

Subscription cost of revenue $ 253,640 $ (1,189) $ 252,451 $ 496,014 $ (2,203) $ 493,811

Professional services cost of services 56,643 (543) 56,100 103,412 (797) 102,615

Total cost of revenue 310,283 (1,732) 308,551 599,426 (3,000) 596,426

Gross profit 858,669 1,732 860,401 1,672,960 3,000 1,675,960

Sales and marketing 447,024 (444) 446,580 886,641 (850) 885,791

Research and development 346,668 (4,135) 342,533 680,797 (7,338) 673,459

General and administrative 177,956 (1,211) 176,745 343,157 (2,277) 340,880

Total operating expenses 971,648 (5,790) 965,858 1,910,595 (10,465) 1,900,130

Loss from operations (112,979) 7,522 (105,457) (237,635) 13,465 (224,170)

Loss before provision for income taxes (71,674) 7,522 (64,152) (161,561) 13,465 (148,096)

Net loss (77,645) 7,522 (70,123) (188,638) 13,465 (175,173)

Net loss attributable to CrowdStrike $ (77,675) $ 7,522 $ (70,153) $ (187,882) $ 13,465 $ (174,417)

Net loss per share attributable to CrowdStrike common stockholders:

Basic $ (0.31) $ 0.03 $ (0.28) $ (0.75) $ 0.05 $ (0.70)

Diluted $ (0.31) $ 0.03 $ (0.28) $ (0.75) $ 0.05 $ (0.70)

Three Months Ended October 31, 2025 Nine Months Ended October 31, 2025

As previously reported Adjustments As revised As previously reported Adjustments As revised

Subscription cost of revenue $ 257,915 $ (920) $ 256,995 $ 753,929 $ (3,123) $ 750,806

Professional services cost of services 49,890 (295) 49,595 153,302 (1,092) 152,210

Total cost of revenue 307,805 (1,215) 306,590 907,231 (4,215) 903,016

Gross profit 926,439 1,215 927,654 2,599,399 4,215 2,603,614

Sales and marketing 481,032 (364) 480,668 1,367,673 (1,214) 1,366,459

Research and development 347,564 (3,980) 343,584 1,028,361 (11,318) 1,017,043

General and administrative 167,286 (1,662) 165,624 510,443 (3,939) 506,504

Total operating expenses 995,882 (6,006) 989,876 2,906,477 (16,471) 2,890,006

Loss from operations (69,443) 7,221 (62,222) (307,078) 20,686 (286,392)

Loss before provision for income taxes (23,268) 7,221 (16,047) (184,829) 20,686 (164,143)

Net loss (33,988) 7,221 (26,767) (222,626) 20,686 (201,940)

Net loss attributable to CrowdStrike $ (33,997) $ 7,221 $ (26,776) $ (221,879) $ 20,686 $ (201,193)

Net loss per share attributable to CrowdStrike common stockholders:

Basic $ (0.14) $ 0.03 $ (0.11) $ (0.89) $ 0.08 $ (0.81)

Diluted $ (0.14) $ 0.03 $ (0.11) $ (0.89) $ 0.08 $ (0.81)

There was no impact to the consolidated statements of cash flows from operating activities, investing activities, or financing activities for any period.

The impact to the consolidated statements of comprehensive income (loss) is limited to the impact to Net income (loss) as detailed above.

The impact to the consolidated statements of stockholders' equity is to Additional paid-in capital and Accumulated deficit for the same amounts as detailed above, with no resulting impact on Total stockholders’ equity as previously reported.

Recently Issued Accounting Pronouncements

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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 7. Management’s Discussion and Analysis