What you need to know before CrowdStrike’s earnings report

Key findings

• CrowdStrike will announce its second quarter results next Wednesday, August 28th.

• Analysts expect the cybersecurity company to report revenue and profit increases compared to the same period last year.

• CrowdStrike will also likely provide updates on the impact of last month’s global outage, which was caused by a faulty software update from the company.

CrowdStrike (CRWD) will release its second-quarter fiscal 2025 results after the market closes next Wednesday, August 28. It will be the first earnings report since a faulty software update caused a global outage, with investors trying to gauge the impact of the incident.

Analysts expect revenue to rise to $957.6 million from $731.63 million last year, according to estimates from Visible Alpha. Net income is expected to be $49.42 million, or 20 cents per share, up from the same period last year.

Key figures: Impact of defaults on the annual outlook

CrowdStrike could update its fiscal year 2025 revenue guidance, giving investors a better insight into the near-term impact of July’s global power outage on revenue.

Citi analysts said CrowdStrike will not emerge from the incident “unscathed” given the higher discounts, reduced negotiating power and litigation costs it now has to deal with. However, the analysts said they are confident the company can “gradually overcome inevitable headwinds over the long term.”

Analysts expect revenue of about $3.96 billion for the full fiscal year 2025, according to consensus estimates from Visible Alpha, which would be slightly below the lower end of the company’s previous forecast of $3.98 billion to $4.01 billion, which was published in early June before the global power outage.

Business Spotlight: Litigation after power outages

CrowdStrike may face legal action from customers affected by the outage. Some estimates suggest the companies affected could face billions of dollars in damages.

Delta Air Lines (DAL), which said the incident cost the airline at least $500 million, threatened legal action against CrowdStrike. The cybersecurity company and Microsoft (MSFT) have disputed Delta’s statements about the sequence of events.

CrowdStrike may provide updates on the potential litigation and expected legal costs during its earnings call on August 28.

The story continues

CrowdStrike shares have gained about 7% since the beginning of the year and closed at $273.21 at the close on Wednesday.

Read the original article on Investopedia.