CRWD - Comprehensive Filing Intelligence
Q3 2026•10-Q•Filed Dec 3, 2025
5.0/10
Filing Health:CAUTION
Notable concerns that warrant closer review
Executive Summary
Despite the July 19 Incident causing sales cycle delays and increased customer contraction, the company maintained strong gross retention and achieved 23% ARR growth.. Management is prioritizing continued investment in sales, marketing, and R&D to capture a large market opportunity, signaling a focus on growth.. Significant contingent liabilities exist due to numerous lawsuits stemming from the July 19 Incident, with potential for material impact and ongoing legal/professional expenses.. Total revenue increased 22% YoY to $1,234.2M for the quarter.
Top Concerns
- !Gross margins have slightly declined due to increased stock-based compensation and data center depreciation, while professional services margins saw a larger drop due to consulting expenses.
- !High stock-based compensation expense relative to revenue (22.93%) indicates potential significant dilution and earnings quality concerns.
- !Significant increase in goodwill through acquisitions ($442.21M) warrants scrutiny for potential overpayment or integration risks.
- !Significant contingent liabilities exist due to numerous lawsuits stemming from the July 19 Incident, with potential for material impact and ongoing legal/professional expenses.
- !Substantial non-cancelable purchase obligations totaling $2.57 billion over the next several fiscal years, primarily for data center capacity and technology.
Top Positives
- +Despite the July 19 Incident causing sales cycle delays and increased customer contraction, the company maintained strong gross retention and achieved 23% ARR growth.
- +Management is prioritizing continued investment in sales, marketing, and R&D to capture a large market opportunity, signaling a focus on growth.
- +Gross margins have slightly declined due to increased stock-based compensation and data center depreciation, while professional services margins saw a larger drop due to consulting expenses.