Item 1. FINANCIAL STATEMENTS

CrowdStrike Holdings, Inc.

Condensed Consolidated Balance Sheets

(in thousands, except per share data)

(unaudited)

			July 31,						January 31,
			2024						2024
Assets
Current assets:
Cash and cash equivalents			$	4,038,536					$	3,375,069
Short-term investments			—						99,591
Accounts receivable, net of allowance for credit losses of $1.8 million and $2.2 million as of July 31, 2024 and January 31, 2024, respectively			661,045						853,105
Deferred contract acquisition costs, current			251,246						246,370
Prepaid expenses and other current assets			230,821						183,172
Total current assets			5,181,648						4,757,307
Strategic investments			58,246						56,244
Property and equipment, net			648,474						620,172
Operating lease right-of-use assets			45,897						48,211
Deferred contract acquisition costs, noncurrent			341,539						335,933
Goodwill			721,996						638,041
Intangible assets, net			115,686						114,518
Other long-term assets			88,988						76,094
Total assets			$	7,202,474					$	6,646,520
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable			$	21,067					$	28,180
Accrued expenses			101,300						125,896
Accrued payroll and benefits			205,429						234,624
Operating lease liabilities, current			17,031						14,150
Deferred revenue			2,348,464						2,270,757
Other current liabilities			35,028						23,672
Total current liabilities			2,728,319						2,697,279
Long-term debt			743,238						742,494
Deferred revenue, noncurrent			744,733						783,342
Operating lease liabilities, noncurrent			31,704						36,230
Other liabilities, noncurrent			63,890						50,086
Total liabilities			4,311,884						4,309,431
Commitments and contingencies (Note 8)
Stockholders’ Equity
Preferred stock, $0.0005 par value; 100,000 shares authorized as of July 31, 2024 and January 31, 2024; no shares issued and outstanding as of July 31, 2024 and January 31, 2024.			—						—
Class A common stock, $0.0005 par value; 2,000,000 shares authorized as of July 31, 2024 and January 31, 2024; 232,698 shares and 229,380 shares issued and outstanding as of July 31, 2024 and January 31, 2024, respectively; Class B common stock, $0.0005 par value; 300,000 shares authorized as of July 31, 2024 and January 31, 2024; 12,424 shares and 12,485 shares issued and outstanding as of July 31, 2024 and January 31, 2024, respectively.			123						121
Additional paid-in capital			3,824,897						3,364,328
Accumulated deficit			(969,003)						(1,058,836)
Accumulated other comprehensive loss			(3,102)						(1,663)
Total CrowdStrike Holdings, Inc. stockholders’ equity			2,852,915						2,303,950
Non-controlling interest			37,675						33,139
Total stockholders’ equity			2,890,590						2,337,089
Total liabilities and stockholders’ equity			$	7,202,474					$	6,646,520

The accompanying notes are an integral part of these condensed consolidated financial statements.

CrowdStrike Holdings, Inc.

Condensed Consolidated Statements of Operations

(in thousands, except per share data)

(unaudited)

			Three Months Ended July 31,												Six Months Ended July 31,
			2024						2023						2024						2023
Revenue
Subscription			$	918,257					$	689,972					$	1,790,429					$	1,341,147
Professional services			45,615						41,654						94,479						83,059
Total revenue			963,872						731,626						1,884,908						1,424,206
Cost of revenue
Subscription			199,910						153,306						389,567						295,406
Professional services			37,491						29,611						72,837						56,741
Total cost of revenue			237,401						182,917						462,404						352,147
Gross profit			726,471						548,709						1,422,504						1,072,059
Operating expenses
Sales and marketing			355,471						282,916						705,585						564,023
Research and development			250,908						179,362						486,157						358,427
General and administrative			106,434						101,804						210,168						184,438
Total operating expenses			712,813						564,082						1,401,910						1,106,888
Income (loss) from operations			13,658						(15,373)						20,594						(34,829)
Interest expense			(6,549)						(6,444)						(13,060)						(12,831)
Interest income			51,526						36,638						97,376						67,159
Other income (expense), net			(1,031)						(1,734)						6,625						(1,504)
Income before provision for income taxes			57,604						13,087						111,535						17,995
Provision for income taxes			10,914						4,611						18,581						9,020
Net income			46,690						8,476						92,954						8,975
Net income (loss) attributable to non-controlling interest			(323)						4						3,121						12
Net income attributable to CrowdStrike			$	47,013					$	8,472					$	89,833					$	8,963
Net income per share attributable to CrowdStrike common stockholders:
Basic			$	0.19					$	0.04					$	0.37					$	0.04
Diluted			$	0.19					$	0.03					$	0.36					$	0.04
Weighted-average shares used in computing net income per share attributable to CrowdStrike common stockholders:
Basic			244,091						237,911						243,249						237,174
Diluted			251,265						242,144						250,724						241,383

The accompanying notes are an integral part of these condensed consolidated financial statements.

CrowdStrike Holdings, Inc.

Condensed Consolidated Statements of Comprehensive Income

(in thousands)

(unaudited)

			Three Months Ended July 31,												Six Months Ended July 31,
			2024						2023						2024						2023
Net income			$	46,690					$	8,476					$	92,954					$	8,975
Other comprehensive income (loss):
Foreign currency translation adjustments			1,635						774						(1,454)						1,932
Unrealized gain on short-term investments, net of tax			23						—						15						—
Other comprehensive income (loss)			1,658						774						(1,439)						1,932
Less: Comprehensive income (loss) attributable to non-controlling interest			(323)						4						3,121						12
Total comprehensive income attributable to CrowdStrike			$	48,671					$	9,246					$	88,394					$	10,895

The accompanying notes are an integral part of these condensed consolidated financial statements.

CrowdStrike Holdings, Inc.

Condensed Consolidated Statements of Stockholders’ Equity

Three Months Ended July 31, 2024 and 2023

(in thousands)

(unaudited)

						Common Stock												Additional Paid-in Capital						Accumulated Deficit						Accumulated Other Comprehensive Income (Loss)						Non-controlling Interest						Total Stockholders’ Equity
						Shares						Amount
Balances at April 30, 2024						243,184						$	122					$	3,556,194					$	(1,016,016)					$	(4,760)					$	33,242					$	2,568,782
Issuance of common stock upon exercise of options						208						—						1,641						—						—						—						1,641
Issuance of common stock under RSU and PSU release						1,210						1						(1)						—						—						—						—
Issuance of common stock under employee stock purchase plan						518						—						56,099						—						—						—						56,099
Issuance of common stock for founders holdbacks related to acquisitions						2						—						889						—						—						—						889
Issuance of common stock for payment of board of director fees						—						—						87						—						—						—						87
Stock-based compensation expense, net of founder revest						—						—						198,476						—						—						—						198,476
Capitalized stock-based compensation						—						—						11,512						—						—						—						11,512
Net income (loss)						—						—						—						47,013						—						(323)						46,690
Non-controlling interest						—						—						—						—						—						4,756						4,756
Other comprehensive income						—						—						—						—						1,658						—						1,658
Balances at July 31, 2024						245,122						$	123					$	3,824,897					$	(969,003)					$	(3,102)					$	37,675					$	2,890,590

						Common Stock												Additional Paid-in Capital						Accumulated Deficit						Accumulated Other Comprehensive Income						Non-controlling Interest						Total Stockholders’ Equity
						Shares						Amount
Balances at April 30, 2023						237,099						$	118					$	2,752,716					$	(1,147,672)					$	139					$	29,058					$	1,634,359
Issuance of common stock upon exercise of options						210						—						1,474						—						—						—						1,474
Issuance of common stock under RSU and PSU release						1,011						—						—						—						—						—						—
Issuance of common stock under employee stock purchase plan						450						1						45,431						—						—						—						45,432
Issuance of common stock for founders holdbacks related to acquisitions						5						—						889						—						—						—						889
Issuance of common stock for payment of board of director fees						—						—						88						—						—						—						88
Stock-based compensation expense, net of founder revest						—						—						163,811						—						—						—						163,811
Capitalized stock-based compensation						—						—						11,966						—						—						—						11,966
Net income						—						—						—						8,472						—						4						8,476
Non-controlling interest						—						—						—						—						—						2,831						2,831
Other comprehensive income						—						—						—						—						774						—						774
Balances at July 31, 2023						238,775						$	119					$	2,976,375					$	(1,139,200)					$	913					$	31,893					$	1,870,100

The accompanying notes are an integral part of these condensed consolidated financial statements.

CrowdStrike Holdings, Inc.

Condensed Consolidated Statements of Stockholders’ Equity

Six Months Ended July 31, 2024 and 2023

(in thousands)

(unaudited)

						Common Stock												Additional Paid-in Capital						Accumulated Deficit						Accumulated Other Comprehensive Loss						Non-controlling Interest						Total Stockholders’ Equity
						Shares						Amount
Balances at January 31, 2024						241,865						$	121					$	3,364,328					$	(1,058,836)					$	(1,663)					$	33,139					$	2,337,089
Issuance of common stock upon exercise of options						300						—						2,464						—						—						—						2,464
Issuance of common stock under RSU and PSU release						2,434						2						(2)						—						—						—						—
Issuance of common stock under employee stock purchase plan						518						—						56,099						—						—						—						56,099
Issuance of common stock for founders holdbacks related to acquisitions						5						—						1,778						—						—						—						1,778
Issuance of common stock for payment of board of director fees						—						—						175						—						—						—						175
Stock-based compensation expense, net of founder revest						—						—						380,109						—						—						—						380,109
Capitalized stock-based compensation						—						—						19,478						—						—						—						19,478
Fair value of replacement equity awards attributable to pre-acquisition service						—						—						468						—						—						—						468
Net income						—						—						—						89,833						—						3,121						92,954
Non-controlling interest						—						—						—						—						—						1,415						1,415
Other comprehensive loss						—						—						—						—						(1,439)						—						(1,439)
Balances at July 31, 2024						245,122						$	123					$	3,824,897					$	(969,003)					$	(3,102)					$	37,675					$	2,890,590

						Common Stock												Additional Paid-in Capital						Accumulated Deficit						Accumulated Other Comprehensive Income (Loss)						Non-controlling Interest						Total Stockholders’ Equity
						Shares						Amount
Balances at January 31, 2023						235,777						$	118					$	2,612,705					$	(1,148,163)					$	(1,019)					$	23,793					$	1,487,434
Issuance of common stock upon exercise of options						585						—						4,125						—						—						—						4,125
Issuance of common stock under RSU and PSU release						1,944						—						—						—						—						—						—
Issuance of common stock under employee stock purchase plan						450						1						45,431						—						—						—						45,432
Issuance of common stock for founders holdbacks related to acquisitions						18						—						2,538						—						—						—						2,538
Issuance of common stock for payment of board of director fees						1						—						167						—						—						—						167
Stock-based compensation expense, net of founder revest						—						—						292,941						—						—						—						292,941
Capitalized stock-based compensation						—						—						18,468						—						—						—						18,468
Net income						—						—						—						8,963						—						12						8,975
Non-controlling interest						—						—						—						—						—						8,088						8,088
Other comprehensive income						—						—						—						—						1,932						—						1,932
Balances at July 31, 2023						238,775						$	119					$	2,976,375					$	(1,139,200)					$	913					$	31,893					$	1,870,100

The accompanying notes are an integral part of these condensed consolidated financial statements.

CrowdStrike Holdings, Inc.

Condensed Consolidated Statements of Cash Flows

(in thousands)(unaudited)

			Six Months Ended July 31,
			2024						2023
Operating activities
Net income			$	92,954					$	8,975
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			88,936						56,184
Amortization of intangible assets			12,332						8,276
Amortization of deferred contract acquisition costs			147,851						112,877
Non-cash operating lease cost			7,167						6,331
Stock-based compensation expense			384,002						295,633
Deferred income taxes			(1,929)						(352)
Realized gains on strategic investments			(6,227)						—
Non-cash interest expense			1,785						1,531
Accretion of short-term investments purchased at a discount			2,285						—
Changes in operating assets and liabilities, net of impact of acquisitions
Accounts receivable, net			192,060						86,718
Deferred contract acquisition costs			(158,333)						(122,007)
Prepaid expenses and other assets			(63,224)						(26,338)
Accounts payable			(72)						(2,982)
Accrued expenses and other liabilities			7,968						4,935
Accrued payroll and benefits			(29,432)						(30,161)
Operating lease liabilities			(7,113)						(6,475)
Deferred revenue			38,859						152,528
Net cash provided by operating activities			709,869						545,673
Investing activities
Purchases of property and equipment			(88,937)						(102,681)
Capitalized internal-use software and website development costs			(24,995)						(25,975)
Purchases of strategic investments			(2,702)						(12,177)
Proceeds from sales of strategic investments			10,895						—
Business acquisitions, net of cash acquired			(96,381)						—
Purchases of intangible assets			—						(500)
Proceeds from maturities and sales of short-term investments			97,300						250,000
Purchases of deferred compensation investments			(1,209)						(876)
Proceeds from sales of deferred compensation investments			41						—
Net cash (used in) provided by investing activities			(105,988)						107,791
Financing activities
Proceeds from the issuance of common stock upon exercise stock options			2,464						4,125
Proceeds from issuance of common stock under the employee stock purchase plan			56,099						45,432
Distributions to non-controlling interest holders			(4,085)						—
Capital contributions from non-controlling interest holders			5,500						8,088
Net cash provided by financing activities			59,978						57,645
Effect of foreign exchange rates on cash, cash equivalents and restricted cash			(1,040)						1,083
Net increase in cash, cash equivalents and restricted cash			662,819						712,192
Cash, cash equivalents and restricted cash at beginning of period			3,377,597						2,456,924
Cash, cash equivalents and restricted cash at end of period			$	4,040,416					$	3,169,116
Cash, cash equivalents and restricted cash at the end of period:
Cash and cash equivalents			$	4,038,536					$	3,167,215
Restricted cash included in prepaid expenses and other assets			1,880						1,901
Total cash, cash equivalents and restricted cash shown in the condensed consolidated statements of cash flows			$	4,040,416					$	3,169,116
Supplemental disclosure of cash flow information:
Interest paid			$	11,250					$	11,250
Income taxes paid, net of refunds received			10,250						9,991
Supplemental disclosure of non-cash investing and financing activities:
Net decrease in property and equipment included in accounts payable and accrued expenses			(16,469)						(20,089)
Equity consideration for acquisitions			468						—
Operating lease liabilities arising from obtaining operating right-of-use assets			2,854						13,083
Purchases of intangible assets included in accrued expenses and other liabilities			—						26
Proceeds from sales of strategic investments not yet received			4,808						—
Stock-based compensation included in capitalized software development costs and fixed assets			19,478						16,000
Noncash consideration for the purchase of strategic investments			3,319						—
Noncash consideration received from sales of strategic investments			3,319						—

The accompanying notes are an integral part of these condensed consolidated financial statements.

CrowdStrike Holdings, Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

1. Description of Business and Significant Accounting Policies

Business

CrowdStrike Holdings, Inc. (the “Company”) was formed on November 7, 2011. The Company is a global cybersecurity leader that delivers cybersecurity’s AI-native platform for the XDR era, purpose-built to stop breaches. The Company’s unified platform provides cloud-delivered protection of endpoints, cloud workloads, identity, and data via a software as a service (“SaaS”) subscription-based model that spans multiple large security markets, including corporate endpoint security, security and IT operations, managed security services, next-gen SIEM, cloud security, identity protection, threat intelligence, data protection, exposure management and cybersecurity generative AI. The Company conducts its business in the United States, as well as locations internationally, including in Australia, Germany, India, Israel, Japan, Romania, and the United Kingdom.

Basis of Presentation

The accompanying condensed consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP have been condensed or omitted, and accordingly the balance sheet as of January 31, 2024, and related disclosures, have been derived from the audited consolidated financial statements at that date but do not include all of the information required by U.S. GAAP for complete consolidated financial statements. These unaudited condensed consolidated financial statements have been prepared on the same basis as the Company’s annual consolidated financial statements and, in the opinion of management, reflect all normal recurring adjustments that are necessary for the fair statement of the Company’s condensed consolidated financial information. The results of operations for the three and six months ended July 31, 2024 are not necessarily indicative of the results to be expected for the year ending January 31, 2025 or for any other interim period or for any other future year.

The accompanying interim unaudited condensed consolidated financial statements and related financial information should be read in conjunction with Item 8, “Financial Statements and Supplementary Data” included in the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2024, filed with the SEC on March 6, 2024.

Principles of Consolidation

The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported and disclosed in the Company’s condensed consolidated financial statements and accompanying notes. These estimates are based on information available as of the date of the condensed consolidated financial statements. On a regular basis, management evaluates these estimates and assumptions. Actual results may differ from these estimates and such differences could be material to the Company’s condensed consolidated financial statements.

Estimates and assumptions used by management include, but are not limited to, revenue recognition, the allowance for credit losses, the useful lives of long-lived assets, the fair values of strategic investments, the period of benefit for deferred contract acquisition costs, the discount rate used for operating leases, the recognition and disclosure of contingent liabilities, income taxes, stock-based compensation, and the fair value of assets acquired and liabilities assumed in business combinations.

Concentration of Credit Risk and Geographic Information

The Company generates revenue from the sale of subscriptions to access its cloud platform and professional services. The Company’s sales team, along with its channel partner network of system integrators and value-added resellers (collectively, “channel partners”), sells the Company’s services worldwide to organizations of all sizes.

Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash, cash equivalents, short-term investments, accounts receivable, and strategic investments. The Company’s cash is placed with high-credit-quality financial institutions and issuers, and at times exceeds federally insured limits. The Company has not experienced any credit loss relating to its cash, cash equivalents, short-term investments, or strategic investments. The Company performs periodic credit evaluations of its customers and generally does not require collateral.

There were no channel partners or direct customers who represented 10% or more of the Company’s accounts receivable as of July 31, 2024 or January 31, 2024.

There were no channel partners or direct customers who represented 10% or more of the Company’s total revenue for each of the three and six months ended July 31, 2024 or 2023.

Significant Accounting Policies

The Company’s significant accounting policies are described in the Company’s Annual Report on Form 10-K for the year ended January 31, 2024. There have been no significant changes to these policies that have had a material impact on the Company’s condensed consolidated financial statements and related notes for the three and six months ended July 31, 2024.

Recently Issued Accounting Pronouncements

In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures, a final standard on improvements to income tax disclosures. The standard requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. The standard is intended to benefit investors by providing more detailed income tax disclosures that would be useful in making capital allocation decisions and applies to all entities subject to income taxes. The new standard is effective for annual periods beginning after December 15, 2024. The Company does not expect the adoption of this new guidance to have a material impact on its disclosures within the consolidated financial statements.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The standard requires disclosure of significant segment expenses that are regularly provided to the Chief Operating Decision Maker (“CODM”) and included within each reported measure of segment profit or loss, an amount for other segment items required to reconcile the difference between segment revenue and segment expenses to segment profit or loss along with a description of their composition, and the title and position of the entity’s CODM. The update also expands interim segment disclosure requirements. The new standard is effective for annual periods beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted, and will be applied retrospectively to all prior periods presented in the condensed consolidated financial statements. The Company is currently evaluating the impact of this new guidance on its disclosures within the consolidated financial statements.

2. Investments and Fair Value Measurements

The Company follows ASC 820*, Fair Value Measurements*, with respect to cash equivalents, short-term investments and deferred compensation investments that are measured at fair value on a recurring basis. Under the standard, fair value is defined as the exit price, or the amount that would be received to sell an asset or a liability in an orderly transaction between market participants as of the measurement date. The standard also establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use in valuing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the factors market participants would use in valuing the asset or liability based upon the best information available in the circumstances.

The hierarchy is broken down into three levels as follows:

Level 1 Assets and liabilities whose values are based on unadjusted quoted market prices for identical assets and liabilities in active markets

Level 2 Assets and liabilities whose values are based on quoted prices in markets that are not active or inputs that are observable for substantially the full term of the asset or liability

Level 3 Assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement

Categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

The Company’s fair value hierarchy for its financial assets and liabilities that are measured at fair value on a recurring basis are as follows (in thousands):

			July 31, 2024																								January 31, 2024
			Level 1						Level 2						Level 3						Total						Level 1						Level 2						Level 3						Total
Assets
Cash equivalents
Money market funds			$	1,505,049					$	—					$	—					$	1,505,049					$	2,360,173					$	—					$	—					$	2,360,173
U.S. Treasury securities			—						2,190,251						—						2,190,251						—						693,599						—						693,599
Short-term investments
U.S. Treasury securities			—						—						—						—						—						99,591						—						99,591
Other assets
Deferred compensation investments			3,749						—						—						3,749						2,271						—						—						2,271
Total assets			$	1,508,798					$	2,190,251					$	—					$	3,699,049					$	2,362,444					$	793,190					$	—					$	3,155,634

There were no transfers between the levels of the fair value hierarchy during the periods presented.

As of July 31, 2024 and January 31, 2024, the Company’s U.S. Treasury securities were carried at fair value and there were no material realized or unrealized gains or losses, either individually or in aggregate.

Strategic Investments

The Company’s investments of privately held securities as of July 31, 2024, consisted of the following (in thousands):

			Privately held equity securities						Privately held debt and other securities						Total
Initial total cost			$	52,842					$	1,000					$	53,842
Cumulative net gains			4,404						—						4,404
Carrying amount, end of period			$	57,246					$	1,000					$	58,246

The Company’s investments of privately held securities as of January 31, 2024, consisted of the following (in thousands):

			Privately held equity securities						Privately held debt and other securities						Total
Initial total cost			$	50,373					$	1,000					$	51,373
Cumulative net gains			4,871						—						4,871
Carrying amount, end of period			$	55,244					$	1,000					$	56,244

As of July 31, 2024, the cumulative net gains of $4.4 million are comprised of upward adjustments of $8.8 million, less downward adjustments and impairment of $4.4 million. As of January 31, 2024, the cumulative net gains of $4.9 million are comprised of upward adjustments of $9.3 million, less downward adjustments and impairment of $4.4 million.

Gains and Losses on Strategic Investments

The components of gains and losses on strategic investments were as follows (in thousands):

			Three Months Ended July 31,												Six Months Ended July 31,
			2024						2023						2024						2023
Realized gains (losses) recognized on sales of privately held equity securities			$	(655)					$	—					$	6,227					$	—
Gains (losses) on strategic investments			$	(655)					$	—					$	6,227					$	—

Realized gains and losses recognized on sales of privately held equity securities reflect the difference between the sale proceeds and the carrying value of the security at the beginning of the period or the purchase date, if later.

3. Balance Sheet Components

Property and Equipment, Net

Property and equipment, net consisted of the following (in thousands):

			July 31, 2024						January 31, 2024
Data center and other computer equipment			$	642,555					$	525,890
Capitalized internal-use software and website development costs			225,902						183,117
Leasehold improvements			39,830						39,168
Purchased software			14,267						10,907
Furniture and equipment			9,452						8,524
Construction in progress			142,849						190,832
			1,074,855						958,438
Less: Accumulated depreciation and amortization			(426,381)						(338,266)
Property and equipment, net			$	648,474					$	620,172

Construction in progress primarily includes data center equipment purchased that has not yet been placed in service. Data center equipment that was purchased but not yet been placed into service was $119.2 million as of July 31, 2024.

Depreciation and amortization expense of property and equipment was $46.2 million and $29.8 million during the three months ended July 31, 2024 and July 31, 2023, respectively, and $88.9 million and $56.2 million during the six months ended July 31, 2024 and July 31, 2023, respectively.

There was no impairment of property and equipment during the three and six months ended July 31, 2024 and July 31, 2023. The Company capitalized $25.0 million and $23.6 million in internal-use software and website development costs during the three months ended July 31, 2024 and July 31, 2023, respectively, and $42.5 million and $40.2 million during the six months ended July 31, 2024 and July 31, 2023, respectively. Amortization expense associated with internal-use software and website development costs totaled $13.8 million and $8.4 million during the three months ended July 31, 2024 and July 31, 2023, respectively, and $26.6 million and $15.9 million during the six months ended July 31, 2024 and July 31, 2023, respectively. The net book value of capitalized internal-use software and website development costs was $122.8 million and $106.9 million as of July 31, 2024 and January 31, 2024, respectively.

Intangible Assets, Net

Total intangible assets, net consisted of the following (dollars in thousands):

			July 31, 2024																		Weighted-Average Remaining Useful Life
			Gross Carrying Amount						Accumulated Amortization						Net Amount
																					(in months)
Developed technology			$	144,846					$	52,279					$	92,567					57
Customer relationships			17,027						7,030						9,997						64
Intellectual property and other acquired intangible assets			15,842						2,720						13,122						118
Total			$	177,715					$	62,029					$	115,686

			January 31, 2024																		Weighted-Average Remaining Useful Life
			Gross Carrying Amount						Accumulated Amortization						Net Amount
																					(in months)
Developed technology			$	131,346					$	41,854					$	89,492					60
Customer relationships			17,027						5,825						11,202						68
Intellectual property and other acquired intangible assets			15,842						2,018						13,824						123
Total			$	164,215					$	49,697					$	114,518

Amortization expense of intangible assets was $6.3 million and $4.1 million during the three months ended July 31, 2024 and July 31, 2023, and $12.3 million and $8.3 million during the six months ended July 31, 2024 and July 31, 2023, respectively.

The estimated aggregate future amortization expense of intangible assets as of July 31, 2024 was as follows (in thousands):

			Total
Fiscal 2025 (remaining six months)			$	12,666
Fiscal 2026			24,240
Fiscal 2027			22,065
Fiscal 2028			21,552
Fiscal 2029			18,799
Thereafter			16,364
Total amortization expense			$	115,686

Developed technology, customer relationships, intellectual property and other acquired intangible assets are amortized over their estimated useful lives, generally on a straight-line basis, for periods ranging from 2 to 20 years.

Goodwill

The change in goodwill during the six months ended July 31, 2024 consisted of the following (in thousands):

			Amounts
Goodwill as of January 31, 2024			$	638,041
Goodwill acquired(1)			83,957
Foreign currency translation			(2)
Goodwill as of July 31, 2024			$	721,996

(1) Goodwill acquired resulted from the acquisition of Flow Security. Refer to Note 9 for additional information.

Accrued Expenses

Accrued expenses consisted of the following (in thousands):

			July 31, 2024						January 31, 2024
Web hosting services			$	18,926					$	40,706
Accrued professional services			15,767						11,867
Accrued marketing			14,881						14,623
Accrued interest expense			10,375						10,375
Accrued partner commissions			10,347						13,584
Other accrued expenses			10,155						9,078
Accrued partner rebates			9,935						4,434
Accrued purchases of property and equipment			6,819						16,190
Accrued health benefits and claims			4,095						5,039
Accrued expenses			$	101,300					$	125,896

Accrued Payroll and Benefits

Accrued payroll and benefits consisted of the following (in thousands):

			July 31, 2024						January 31, 2024
Accrued commissions			$	90,514					$	116,870
Accrued payroll and related expenses			62,408						58,579
Accrued bonuses			35,226						36,860
Employee Stock Purchase Plan			17,281						22,315
Accrued payroll and benefits			$	205,429					$	234,624

4. Debt

Secured Revolving Credit Facility

In April 2019, the Company entered into a Credit Agreement with Silicon Valley Bank and other lenders, to provide a revolving line of credit of up to $150.0 million, including a letter of credit sub-facility in the aggregate amount of $10.0 million, and a swingline sub-facility in the aggregate amount of $10.0 million.

On January 4, 2021, the Company amended and restated its existing credit agreement (the “A&R Credit Agreement” and the facility thereunder the “Revolving Facility”) among CrowdStrike, Inc., as borrower, CrowdStrike Holdings, Inc., as guarantor, and Silicon Valley Bank and the other lenders party thereto, providing the Company with a revolving line of credit of up to $750.0 million, including a letter of credit sub-facility in the aggregate amount of $100.0 million, and a swingline sub-facility in the aggregate amount of $50.0 million. The Company also has the option to request an incremental facility of up to an additional $250.0 million from one or more of the lenders under the A&R Credit Agreement. The A&R Credit Agreement is guaranteed by all of the Company’s material domestic subsidiaries. The A&R Credit Agreement extended the maturity date of April 19, 2022 to January 2, 2026.

On January 6, 2022, the Company modified the A&R Credit Agreement (the “Amended A&R Credit Agreement”) among CrowdStrike, Inc., as borrower, CrowdStrike Holdings, Inc., as guarantor, and Silicon Valley Bank and the other lenders party thereto. There were no changes to the borrowing amounts or maturity date. Under the Amended A&R Credit Agreement, revolving loans are Alternate Base Rate (“ABR”) Loans. Outstanding ABR Loans incur interest at the highest of (a) the Prime Rate, as published by the Wall Street Journal, (b) the federal funds rate in effect on such day plus 0.50%, and (c) the Term Secured Overnight Finance Rate (the “Term SOFR”) for a one-month tenor in effect on such day plus 1.00%, in each case plus a margin between (0.25)% and 0.25%, depending on the senior secured leverage ratio. The Company will be charged a commitment fee of 0.15% to 0.25% per year for committed but unused amounts, depending on the senior secured leverage ratio. The financial covenants require the Company to maintain a minimum consolidated interest coverage ratio of 3.00:1.00 and a maximum total leverage ratio of 5.50:1.00 stepping down to 3.50:1.00 over time. The Company was in compliance with all of its financial covenants as of July 31, 2024.

The Amended A&R Credit Agreement is secured by substantially all of the Company’s current and future consolidated assets, property and rights, including, but not limited to, intellectual property, cash, goods, equipment, contractual rights, financial assets, and intangible assets of the Company and certain of its subsidiaries. The Amended A&R Credit Agreement contains customary covenants limiting the Company’s ability and the ability of its subsidiaries to, among other things, dispose of assets, undergo a change in control, merge or consolidate, make acquisitions, incur debt, incur liens, pay dividends, repurchase stock, and make investments, in each case subject to certain exceptions.

No amounts were outstanding under the Amended A&R Credit Agreement as of July 31, 2024 or January 31, 2024.

Senior Notes

On January 20, 2021, the Company issued $750.0 million in aggregate principal amount of 3.00% Senior Notes maturing in February 2029. The Senior Notes are guaranteed by the Company’s subsidiary, CrowdStrike, Inc. and will be guaranteed by each of the Company’s existing and future domestic subsidiaries that becomes a borrower or guarantor under the A&R Credit Agreement. The Senior Notes were issued at par and bear interest at a rate of 3.00% per annum. Interest payments are payable semiannually on February 15 and August 15 of each year, commencing on August 15, 2021. The Company may voluntarily redeem the Senior Notes, in whole or in part, 1) at any time prior to February 15, 2024 at (a) 100.00% of their principal amount, plus a “make whole” premium or (b) with the net cash proceeds received from an equity offering at a redemption price equal to 103.00% of the principal amount, provided the aggregate principal amount of all such redemptions does not exceed 40% of the original aggregate principal amount of the Senior Notes; 2) at any time on or after February 15, 2024 at a prepayment price equal to 101.50% of the principal amount; 3) at any time on or after February 15, 2025 at a prepayment price equal to 100.75% of the principal amount; and 4) at any time on or after February 15, 2026 at a prepayment price equal to 100.00% of the principal amount; in each case, plus accrued and unpaid interest, if any, to but excluding, the date of redemption.

The net proceeds from the debt offering were $738.0 million after deducting the underwriting commissions of $9.4 million and $2.6 million of issuance costs. The debt issuance costs are being amortized to interest expense using the effective interest method over the term of the Senior Notes. Interest expense related to contractual interest expense, amortization of debt issuance costs, and accretion of debt discount was $6.0 million during the three months ended July 31, 2024 and 2023 and $12.0 million during the six months ended July 31, 2024 and 2023.

In certain circumstances involving a change of control event, the Company will be required to make an offer to repurchase all or, at the holder’s option, any part, of each holder’s notes of that series at 101% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, to, but excluding, the repurchase date.

The indenture governing the Senior Notes (the “Indenture”) contains covenants limiting the Company’s ability and the ability of its subsidiaries to create liens on certain assets to secure debt; grant a subsidiary guarantee of certain debt without also providing a guarantee of the Senior Notes; declare dividends; and consolidate or merge with or into, or sell or otherwise dispose of all or substantially all of its assets to, another person. These covenants are subject to a number of limitations and exceptions. Certain of these covenants will not apply during any period in which the notes are rated investment grade by Fitch Ratings, Inc. (“Fitch”), Moody’s Investors Service, Inc. (“Moody’s”), and Standard & Poor’s Ratings Services (“S&P”).

As of July 31, 2024, the Company was in compliance with all of its financial covenants under the Indenture associated with the Senior Notes.

Based on the trading prices of the Senior Notes, the fair value of the Senior Notes was approximately $673.2 million and $671.2 million as of July 31, 2024 and January 31, 2024, respectively. While the Senior Notes are recorded at cost, the fair value of the Senior Notes was determined based on quoted prices in markets that are not active; accordingly, the Senior Notes are categorized as Level 2 for purposes of the fair value measurement hierarchy.

5. Income Taxes

The Company’s provision for income taxes during interim reporting periods has generally been calculated using an estimated annual effective tax rate, adjusted for discrete items. When a reliable estimate cannot be made, the actual tax or benefit applicable may be reported as a discrete item in the interim period. For the three and six months ended July 31, 2024, the Company was unable to reliably estimate the annual effective tax rate for its U.S. jurisdiction, due to the sensitivity of the tax rate as a result of minor changes in forecasted income. As a result, the Company has computed its U.S. tax provision on a discrete basis. The Company recognized income tax expense of $10.9 million and $4.6 million for the three months ended July 31, 2024 and July 31, 2023, respectively, and $18.6 million and $9.0 million for the six months ended July 31, 2024 and July 31, 2023, respectively. The tax expense for the three and six months ended July 31, 2024 and July 31, 2023 was primarily attributable to pre-tax earnings and withholding taxes related to customer payments in certain foreign jurisdictions in which the Company conducts business. The Company’s effective tax rates of 18.9% and 35.2% for the three months ended July 31, 2024 and July 31, 2023, respectively, and 16.7% and 50.1% for the six months ended July 31, 2024 and July 31, 2023, respectively, differ from the U.S. statutory tax rate primarily due to income taxes in foreign jurisdictions, withholding taxes related to customer payments in certain foreign jurisdictions in which the Company conducts business, and valuation allowance in the U.S. and certain foreign jurisdictions.

Total gross unrecognized tax benefits were $70.9 million and $58.9 million as of July 31, 2024 and January 31, 2024, respectively, which is primarily attributable to research and development credits. As of July 31, 2024 and January 31, 2024, approximately $14.4 million and $12.7 million, respectively of unrecognized tax benefits, which, if recognized, would affect the Company’s effective tax rate due to the full valuation allowance. The Company’s policy is to classify interest and penalties related to unrecognized tax benefits as part of the income tax provision in the condensed consolidated statements of operations. The Company had incurred $2.1 million and $1.4 million of interest and penalties related to unrecognized tax benefits as of July 31, 2024 and January 31, 2024. The potential change in unrecognized tax benefits during the next 12 months is not expected to be material.

In accordance with the guidance on the accounting for uncertainty in income taxes, for all U.S. and other tax jurisdictions, the Company recognizes potential liabilities for anticipated tax audit issues based on the Company’s estimate of whether, and the extent to which, additional taxes and interest will be due. The Company files income tax returns in the U.S. federal, and various state jurisdictions, as well as various foreign jurisdictions. Tax years 2011 and onwards remain subject to examination by taxing authorities. If the Company’s estimate of income tax liabilities proves to be less than the ultimate assessment, a further charge to expense would be required. If events occur and the payment of these amounts ultimately proves to be unnecessary, the reversal of the liabilities would result in tax benefits being recognized in the period when the Company determines the liabilities are no longer necessary. The Company includes interest and penalties related to unrecognized tax benefits within the provision for income taxes in the condensed consolidated statements of operations. Accrued interest and penalties are included within other liabilities, noncurrent on the condensed consolidated balance sheets.

The Company maintains a full valuation allowance on U.S. federal and state and certain foreign deferred tax assets, including net operating loss carryforwards and tax credits, which the Company has determined are not realizable on a more-likely-than-not basis. The Company regularly evaluates the need for a valuation allowance.

6. Stock-Based Compensation

Stock Incentive Plan

In May 2019, the Company’s board of directors adopted, and the stockholders approved the CrowdStrike Holdings, Inc. 2019 Equity Incentive Plan (the “2019 Plan”) with the purpose of granting stock-based awards to employees, directors, officers, and consultants, including stock options, restricted stock awards, restricted stock units (“RSUs”), and performance-based restricted stock units (“PSUs”). A total of 8,750,000 shares of Class A common stock were initially available for issuance under the 2019 Plan. The Company’s compensation committee administers the 2019 Plan. The number of shares of the Company’s common stock available for issuance under the 2019 Plan is subject to an annual increase on the first day of each fiscal year beginning on February 1, 2020, equal to the lesser of: (i) two percent (2%) of outstanding shares of the Company’s capital stock as of the last day of the immediately preceding fiscal year or (ii) such other amount as the Company’s board of directors may determine.

The 2011 Plan was terminated on June 10, 2019, which was the business day prior to the effectiveness of the Company’s registration statement on Form S-1 used in connection with the Company’s IPO, and stock-based awards are no longer granted under the 2011 Plan. Any shares underlying stock options that expire, terminate, or are forfeited or repurchased under the 2011 Plan will be automatically transferred to the 2019 Plan.

Stock Options

The Company records compensation expense for employee stock options based on the estimated fair value of the options on the date of grant using the Black-Scholes option-pricing model.

Stock options granted during the six months ended July 31, 2024 were immaterial. There were no stock options granted during the six months ended July 31, 2023.

The following table is a summary of stock option activity for the six months ended July 31, 2024:

			Number of Shares						Weighted-Average Exercise Price Per Share
			(in thousands)
Options outstanding at January 31, 2024			1,754						$	9.37
Granted			14						$	3.25
Exercised			(300)						$	8.20
Canceled			(16)						$	8.41
Options outstanding at July 31, 2024			1,452						$	9.58
Options vested and expected to vest at July 31, 2024			1,452						$	9.58
Options exercisable at July 31, 2024			1,375						$	9.41

Options outstanding include 43,999 options that were unvested and exercisable as of July 31, 2024.

The aggregate intrinsic value of options vested and exercisable was $306.0 million and $451.0 million as of July 31, 2024 and January 31, 2024, respectively. The weighted-average remaining contractual term of options vested and exercisable was 3.8 years and 4.2 years as of July 31, 2024 and January 31, 2024, respectively.

The weighted-average grant date fair values of all options granted was $325.22 per share and none during the six months ended July 31, 2024 and July 31, 2023, respectively. The total intrinsic value of all options exercised was $75.2 million and $29.4 million during the three months ended July 31, 2024 and July 31, 2023, respectively, and $103.7 million and $74.5 million during the six months ended July 31, 2024 and July 31, 2023, respectively.

The aggregate intrinsic value of stock options outstanding as of July 31, 2024 and January 31, 2024 was $322.7 million and $496.7 million, respectively, which represents the excess of the fair value of the Company’s common stock over the exercise price of the options multiplied by the number of options outstanding. The weighted-average remaining contractual term of stock options outstanding was 3.9 years and 4.3 years as of July 31, 2024 and January 31, 2024, respectively.

Total unrecognized stock-based compensation expense related to unvested options was $6.2 million as of July 31, 2024. This expense is expected to be amortized over a weighted-average vesting period of one year.

Restricted Stock Units

RSUs granted under the 2019 Plan are generally subject to only a service-based vesting condition. The service-based vesting condition is generally satisfied based on one of the following vesting schedules: (i) vesting of one-fourth of the RSUs on the first “Company vest date” (defined as March 20, June 20, September 20, or December 20) on or following the one-year anniversary of the vesting commencement date with the remainder of the RSUs vesting in twelve equal quarterly installments thereafter, subject to continued service, (ii) vesting in sixteen equal quarterly installments, subject to continued service, or (iii) vesting in sixteen quarterly installments with 10% in the first year, 15% in the second year, 25% in the third year and 50% in the fourth year, subject to continued service. The valuation of these RSUs is based solely on the fair value of the Company’s stock on the date of grant.

Total unrecognized stock-based compensation expense related to unvested RSUs was $1.7 billion as of July 31, 2024. This expense is expected to be amortized over a weighted-average vesting period of 2.7 years.

Performance-based Stock Units

PSUs granted under the 2019 Plan are generally subject to both a service-based vesting condition and a performance-based vesting condition. PSUs will vest upon the achievement of specified performance targets and subject to continued service through the applicable vesting dates. The stock-based compensation expense relating to PSUs is recognized using the accelerated attribution method over the requisite service period when it is probable that the performance condition will be satisfied.

Total unrecognized stock-based compensation expense related to unvested PSUs was $62.8 million as of July 31, 2024, which reflects the Company's updated assessment of the likelihood of satisfying the performance conditions. This expense is expected to be amortized over a weighted-average vesting period of 1.4 years.

Special PSU Awards

In fiscal 2022 the Company’s board of directors granted 655,000 performance stock units (the “Special PSU Awards”) to certain executives under the 2019 Plan. The Special PSU Awards vest upon the satisfaction of the Company’s achievement of specified stock price hurdles, which are based on the average of the closing stock price per share of the Company’s Class A common stock during any 45 consecutive trading day period during the applicable performance period, and a service-based vesting condition. The service condition applicable to each tranche of the Special PSU Awards will be satisfied in installments as follows, subject to continued employment with the Company through each applicable vesting date: (i) 50% of the Special PSU Awards underlying the applicable tranche will service vest on the first anniversary of the vesting commencement date applicable to such tranche of the Special PSU Awards (i.e., February 1, 2022, February 1, 2023, February 1, 2024 and February 1, 2025) and (ii) the remaining PSUs with respect to such tranche will thereafter service vest in four equal quarterly installments of 12.5%.

The Company measured the fair value of the Special PSU Awards on the grant date using a Monte Carlo simulation valuation model. The risk-free interest rates used were 0.85% -1.51%, which were based on the zero-coupon-risk-free interest rate derived from the Treasury Constant Maturities yield curve for the expected term of the award on the grant date. The expected volatility was a blended volatility rate of 54.89% - 55.36%, which includes 50% weight on the Company’s historical volatility calculated from daily stock returns over a 2.21- 2.58 year look-back from the grant date and 50% weight based on the Company’s implied volatility as of the grant date.

Total unrecognized stock-based compensation expense related to the unvested portion of the Special PSU Awards was $20.2 million as of July 31, 2024. This expense is expected to be amortized over a weighted-average vesting period of 1.2 years.

The following table is a summary of RSUs, PSUs and the Special PSU Awards activities for the six months ended July 31, 2024:

			Number of Shares						Weighted- Average Grant Date Fair Value Per Share
			(in thousands)
RSUs and PSUs outstanding at January 31, 2024			10,968						$	167.84
Granted			2,260						$	316.48
Released			(2,434)						$	157.47
Performance adjustment (1)			241						$	132.83
Forfeited			(412)						$	191.16
RSUs and PSUs outstanding at July 31, 2024			10,623						$	200.17
RSUs and PSUs expected to vest at July 31, 2024 (2)			9,832						$	197.27

(1)The performance adjustment represents adjustments in shares outstanding due to the actual achievement of performance-based awards, the achievement of which was based upon pre-defined financial performance targets.

(2)Excludes in progress PSUs and Special PSUs where pre-defined targets have not yet been achieved.

Employee Stock Purchase Plan

In May 2019, the board of directors adopted, and the stockholders approved the CrowdStrike Holdings, Inc. 2019 Employee Stock Purchase Plan (“ESPP”), which became effective on June 10, 2019, which was the business day prior to the effectiveness of the Company’s registration statement on Form S-1 used in connection with the Company’s IPO. A total of 3,500,000 shares of Class A common stock were initially reserved for issuance under the ESPP. The Company’s compensation committee administers the ESPP. The number of shares of common stock available for issuance under the ESPP is subject to an annual increase on the first day of each fiscal year beginning on February 1, 2020, equal to the lesser of: (i) one percent (1%) of the outstanding shares of the Company’s capital stock as of the last day of the immediately preceding fiscal year or (ii) such other amount as its board of directors may determine. In May 2021, the Company’s compensation committee adopted an amendment and restatement of the ESPP, which was approved by the Company’s stockholders in June 2021. The amended and restated ESPP clarified the original intent that the annual increase will in no event exceed 5,000,000 shares of the Company’s Class A common stock in any year.

The ESPP provides for consecutive offering periods that will typically have a duration of approximately 24 months in length and are comprised of four purchase periods of approximately six months in length. The offering periods are scheduled to start on the first trading day on or after June 11 and December 11 of each year. The first offering period commenced on June 11, 2019 and ended on June 10, 2021.

The ESPP provides eligible employees with an opportunity to purchase shares of the Company’s Class A common stock through payroll deductions of up to 15% of their eligible compensation. A participant may purchase a maximum of 2,500 shares of common stock during a purchase period. Amounts deducted and accumulated by the participant are used to purchase shares of common stock at the end of each six-month purchase period. The purchase price of the shares is 85% of the lower of the fair market value of the Class A common stock on (i) the first trading day of the applicable offering period and (ii) the last trading day of each purchase period in the related offering period. Participants may end their participation at any time during an offering period and will be paid their accrued contributions that have not yet been used to purchase shares of common stock. Participation ends automatically upon termination of employment. The ESPP allows for up to one increase in contribution during each purchase period. If an employee elects to increase his or her contribution, the Company treats this as an accounting modification. The ESPP also offers a two-year look-back feature, as well as a rollover feature that provides for an offering period to be rolled over to a new lower-priced offering if the offering price of the new offering period is less than that of the current offering period. Contribution modifications during the three and six months ended July 31, 2024 were $7.2 million, which will be recognized over the remaining offering periods.

Employee payroll contributions ultimately used to purchase shares are reclassified to stockholders’ equity on the purchase date. ESPP employee payroll contributions accrued as of July 31, 2024 and January 31, 2024 totaled $17.3 million and $22.3 million, respectively, and are included within accrued payroll and benefits in the condensed consolidated balance sheets.

The following table summarizes the assumptions used in the Black-Scholes option-pricing model to determine the fair value of employee stock purchase rights granted under the Company’s ESPP:

			Six Months Ended July 31,
			2024						2023
Expected term (in years)			0.5 – 2.0						0.5 – 2.0
Risk-free interest rate			3.4% – 5.3%						0.2% – 5.2%
Expected stock price volatility			40.8% – 59.8%						46.3% – 61.2%
Dividend yield			—		%				—		%

Stock-Based Compensation Expense

Stock-based compensation expense included in the condensed consolidated statements of operations is as follows (in thousands):

			Three Months Ended July 31,												Six Months Ended July 31,
			2024						2023						2024						2023
Subscription cost of revenue			$	16,732					$	10,132					$	30,648					$	19,098
Professional services cost of revenue			7,344						5,745						13,617						10,375
Sales and marketing			57,405						51,442						109,663						87,181
Research and development			75,851						46,985						142,593						91,366
General and administrative			43,545						50,473						87,481						87,613
Total stock-based compensation expense			$	200,877					$	164,777					$	384,002					$	295,633

7. Revenue, Deferred Revenue and Remaining Performance Obligations

The following table summarizes revenue by region based on the shipping address of customers who have contracted to use the Company’s platform or service (in thousands, except percentages):

			Three Months Ended July 31,																								Six Months Ended July 31,
			2024												2023												2024												2023
			Amount						% Revenue						Amount						% Revenue						Amount						% Revenue						Amount						% Revenue
United States			$	655,001					68		%				$	500,864					69		%				$	1,285,027					68		%				$	975,689					69		%
Europe, Middle East, and Africa			148,851						15		%				111,909						15		%				290,463						15		%				216,461						15		%
Asia Pacific			98,274						10		%				75,198						10		%				191,736						10		%				147,417						10		%
Other			61,746						7		%				43,655						6		%				117,682						7		%				84,639						6		%
Total revenue			$	963,872					100		%				$	731,626					100		%				$	1,884,908					100		%				$	1,424,206					100		%

No single country other than the United States represented 10% or more of the Company’s total revenue during the three and six months ended July 31, 2024 and July 31, 2023.

Contract Balances

Contract liabilities consist of deferred revenue and include payments received in advance of performance under the contract. Such amounts are recognized as revenue over the contractual period. The Company recognized revenue of $843.4 million and $642.3 million for the three months ended July 31, 2024 and July 31, 2023, respectively, and $1,456.5 million and $1,089.9 million for the six months ended July 31, 2024 and July 31, 2023, respectively which was included in the corresponding contract liability balance at the beginning of the period.

The Company receives payments from customers based upon contractual billing schedules. Accounts receivable are recorded when the right to consideration becomes unconditional. Payment terms on invoiced amounts are typically 30 – 60 days. Contract assets include amounts related to the contractual right to consideration for both completed and partially completed performance obligations that may not have been invoiced.

Changes in deferred revenue were as follows (in thousands):

			Three Months Ended July 31,												Six Months Ended July 31,
			2024						2023						2024						2023
			Carrying Amount												Carrying Amount
Beginning balance			$	3,069,379					$	2,403,791					$	3,054,099					$	2,355,113
Additions to deferred revenue			987,690						835,477						1,924,006						1,576,735
Recognition of deferred revenue			(963,872)						(731,626)						(1,884,908)						(1,424,206)
Ending balance			$	3,093,197					$	2,507,642					$	3,093,197					$	2,507,642

Remaining Performance Obligations

The Company’s subscription contracts with its customers have a typical term of one to three years and most subscription contracts are non-cancellable. Customers generally have the right to terminate their contracts for cause as a result of the Company’s failure to perform. As of July 31, 2024, the aggregate amount of the transaction price allocated to remaining performance obligations was $4.9 billion. The Company expects to recognize approximately 59% of the remaining performance obligations in the 12 months following July 31, 2024, and 38% of the remaining performance obligations between 13 to 36 months, with the remainder to be recognized thereafter.

Costs to Obtain and Fulfill a Contract

The Company capitalizes referral fees paid to partners and sales commissions and associated payroll taxes paid to internal sales personnel, contractors or sales agents that are incremental to the acquisition of channel partner and direct customer contracts and would not have occurred absent the customer contract. These costs are recorded as deferred contract acquisition costs, current and deferred contract acquisition costs, noncurrent on the condensed consolidated balance sheets.

Sales commissions for renewal of a contract are not considered commensurate with the commissions paid for the acquisition of the initial contract or follow-on upsell given the substantive difference in commission rates in proportion to their respective contract values. Commissions, including referral fees paid to referral partners, earned upon the initial acquisition of a contract or subsequent upsell are amortized over an estimated period of benefit of four years, while commissions earned for renewal contracts are amortized over the contractual term of the renewals. Sales commissions associated with professional service contracts are amortized ratably over an estimated period of benefit of five months and are included in sales and marketing expense in the condensed consolidated statements of operations. In determining the period of benefit for commissions paid for the acquisition of the initial contract, the Company took into consideration the expected subscription term and expected renewals of customer contracts, the historical duration of relationships with customers, customer retention data, and the life of the developed technology. The Company periodically reviews the carrying amount of deferred contract acquisition costs to determine whether events or changes in circumstances have occurred that could impact the period of benefit of these deferred costs. The Company did not recognize any material impairment losses of deferred contract acquisition costs during the three and six months ended July 31, 2024 or July 31, 2023.

The following table summarizes the activity of deferred contract acquisition costs (in thousands):

			Three Months Ended July 31,												Six Months Ended July 31,
			2024						2023						2024						2023
Beginning balance			$	574,655					$	441,298					$	582,303					$	447,088
Capitalization of contract acquisition costs			91,853						74,942						158,333						124,474
Amortization of deferred contract acquisition costs			(73,723)						(57,555)						(147,851)						(112,877)
Ending balance			$	592,785					$	458,685					$	592,785					$	458,685
Deferred contract acquisition costs, current			$	251,246					$	197,111					$	251,246					$	197,111
Deferred contract acquisition costs, noncurrent			341,539						261,574						341,539						261,574
Total deferred contract acquisition costs			$	592,785					$	458,685					$	592,785					$	458,685

8. Commitments and Contingencies

Channel File 291 Incident

On July 19, 2024, the Company released a content configuration update for its Falcon sensor that resulted in system crashes for certain Windows systems (the “Channel File 291 Incident”). The Company is subject to a number of legal proceedings in connection with the Channel File 291 Incident, including:

• On July 30, 2024, a putative class action lawsuit was filed against the Company and certain of the Company’s officers in federal court in the Western District of Texas alleging violations of federal securities laws, including that the defendants made false or misleading statements. The complainants seek certification of a class of all persons who purchased or otherwise acquired the Company’s securities during specified periods of time and are seeking unspecified monetary damages, costs and attorneys’ fees.

• On August 5, 2024, a putative class action lawsuit was filed against the Company in federal court in the Western District of Texas alleging, among other things, negligence and violations of the California Unfair Competition Law. The complainants seek certification of a nationwide class, as well as sub-classes of certain California, Ohio, and Pennsylvania citizens, who had a flight delayed or canceled during a specified period of time and are seeking unspecified monetary damages, certain injunctive relief, costs and attorneys’ fees.

• On August 19, 2024, a putative class action lawsuit was filed against the Company in federal court in the Western District of Texas alleging, among other things, negligence in the design and testing of the Falcon sensor and tortious interference between certain airline customers and their airline. The complainants seek certification of a nationwide class (or alternatively a class of Iowa citizens) who had a flight delayed or canceled on a specified airline during a specific period of time and are seeking unspecified monetary damages, costs and attorneys’ fees.

Additionally, some customers and third parties have asserted claims or publicly threatened litigation against the Company, such as Delta Air Lines. The Company has also received inquiries from governmental authorities and other third parties related to the Channel File 291 Incident. The Company is cooperating and providing information in connection with these inquiries.

For any claims and legal proceedings for which the Company believes a liability is both probable and reasonably estimable, the Company records a liability in the period for which it makes this determination. For claims and legal proceedings where a loss may be reasonably possible, but not probable, or is probable but not reasonably estimable, no accrual is established. While the Company believes it is reasonably possible that it could incur losses associated with the claims, proceedings and inquiries described above, it is not possible to estimate the amount of any loss or range of possible loss that might result from adverse judgments, settlements, penalties or other resolutions of these claims, proceedings and inquiries based on their early stage, and the lack of resolution on significant factual and legal issues. Because the final outcome of any of these matters cannot be predicted with certainty, unfavorable or unexpected developments or outcomes could result in a material impact to the Company’s results of operations.

The Company expects to incur significant legal and professional services and other expenses associated with the Channel File 291 Incident in future periods. These expenses will be recognized as incurred. Certain costs may be recoverable under the Company’s insurance policies in effect at the date of the Channel File 291 Incident. Any amounts recoverable under such policies will be reflected in future periods in which recovery is considered probable.

Expenses incurred and amounts accrued relating to the Channel File 291 Incident as of July 31, 2024 were as follows (in thousands):

			July 31, 2024
			Liabilities
Expenses incurred			$	5,131
Payments made			(840)
Balance, end of period			$	4,291

Other Legal Proceedings

In March 2022, Webroot, Inc. and Open Text, Inc. (collectively, “Webroot”) filed a lawsuit against the Company and CrowdStrike, Inc. in federal court in the Western District of Texas alleging that certain of the Company’s products infringe six patents held by them. In the complaint, Webroot sought unspecified damages, attorneys’ fees and a permanent injunction. In May 2022, CrowdStrike, Inc. asserted counterclaims alleging that certain of Webroot’s products infringe two of its patents. In the filing, CrowdStrike, Inc. sought unspecified damages, reasonable fees and costs, and a permanent injunction. In September 2022, Webroot amended its complaint to assert six additional patents. In November 2023, CrowdStrike, Inc. entered into an agreement that provided for, among other things, the settlement and dismissal of the parties’ claims and filed for dismissal. The amount attributable to the settlement was not material.

In addition, the Company is involved in various other legal proceedings and subject to claims that arise in the ordinary course of business. For any claims for which the Company believes a liability is both probable and reasonably estimable, the Company records a liability in the period for which it makes this determination. Other than as discussed above, there is no pending or threatened legal proceeding to which the Company is a party that, in the Company’s opinion, is reasonably possible to have a material effect on its condensed consolidated financial statements; however, the results of litigation and claims are inherently unpredictable. Regardless of the outcome, litigation can have an adverse impact on the Company’s business because of defense and settlement costs, diversion of management resources, and other factors. In addition, the costs of litigation and the timing of these costs from period to period are difficult to estimate, subject to change and could adversely affect the Company’s condensed consolidated financial statements.

Purchase Obligations

In the normal course of business, the Company enters into non-cancellable purchase commitments with various parties to purchase products and services such as data center capacity, advertising, technology, equipment, office renovations, corporate events, and consulting services. A summary of non-cancellable purchase obligations in excess of one year as of July 31, 2024, with expected date of payment is as follows (in thousands):

			Total Commitments
Fiscal 2025 (remaining six months)			$	254,657
Fiscal 2026			510,988
Fiscal 2027			467,172
Fiscal 2028			476,547
Fiscal 2029			469,616
Thereafter			489,250
Total purchase commitments			$	2,668,230

Warranties and Indemnification

The Company’s cloud computing services are typically warranted to perform in a manner consistent with general industry standards that are reasonably applicable and materially in accordance with the Company’s online help documentation under normal use and circumstances. In addition, for its Falcon Complete customers, the Company offers a limited warranty, subject to certain conditions, to cover certain costs incurred by the customer in case of a cybersecurity breach. The Company has entered into an insurance policy to reduce its potential liability arising from such limited warranty arrangements. The Company’s customer arrangements generally include certain provisions for indemnifying customers against losses suffered or incurred as a result of third-party claims that the Company’s products or services infringe a third party’s intellectual property rights. From time to time, the Company has also agreed to certain other indemnifications and warranties. The Company has not incurred any material costs because of such obligations and has not accrued any liabilities related to such obligations in the condensed consolidated financial statements as of July 31, 2024 or January 31, 2024.

The Company has also agreed to indemnify its directors and certain executive officers for costs associated with any fees, expenses, judgments, fines and settlement amounts incurred by any of these persons in any action or proceeding to which any of those persons is, or is threatened to be, made a party by reason of the person’s service as a director or officer, including any action by the Company, arising out of that person’s services as the Company’s director or officer or that person’s services provided to any other company or enterprise at the Company’s request. The Company maintains director and officer insurance coverage that would generally enable the Company to recover a portion of any future amounts paid. The Company may also be subject to indemnification obligations by law with respect to the actions of its employees under certain circumstances and in certain jurisdictions. No liabilities have been accrued associated with this indemnification provision as of July 31, 2024 or January 31, 2024.

9. Acquisitions

Flow Security

On March 26, 2024, the Company acquired 100% of the equity interest of Flow Security Ltd. (“Flow Security”), a leading provider of data security solutions.

The acquisition has been accounted for as a business combination. The total consideration transferred consisted of $96.4 million in cash, net of $0.8 million of cash acquired, and $0.5 million representing the fair value of replacement equity awards attributable to pre-acquisition service. The remaining fair value of these replacement awards attributed to post-combination service was excluded from the purchase price. The purchase price was allocated on a preliminary basis, subject to working capital adjustment and continuing management analysis, to developed technology of $13.5 million with a useful life of 72 months, net tangible liabilities acquired of $0.6 million, and goodwill of $84.0 million, which was allocated to the Company’s one reporting unit and represents the excess of the purchase price over the fair value of net tangible and intangible assets acquired. The goodwill was primarily attributable to the assembled workforce of Flow Security, planned growth in new markets, and synergies expected to be achieved from the integration of Flow Security. Goodwill is not deductible for income tax purposes.

Per the terms of the share purchase agreement with Flow Security, certain unvested stock options held by Flow Security employees were canceled and exchanged for replacement stock options under the 2019 Plan. Additionally, certain shares of Flow Security stock held by Flow Security employees were exchanged for the right to receive shares of the Company’s Class A common stock, subject to service-based vesting and other conditions. Further, the Company agreed to grant RSUs and PSUs under the 2019 Plan to certain continuing employees. The awards that are subject to continued service are recognized ratably as stock-based compensation cost over the requisite service period. The awards that are subject to both continued service and specified performance targets are recognized over the requisite service period when it is probable that the performance condition will be satisfied.

Acquisition costs incurred during the six months ended July 31, 2024 were $3.0 million and are primarily recorded in general and administrative expenses on the Company’s condensed consolidated statements of operations.

The results of operations for the acquisition have been included in the Company’s condensed consolidated financial statements from the date of acquisition. The acquisition of Flow Security did not have a material impact on the Company’s condensed consolidated financial statements, and therefore historical and pro forma disclosures have not been presented.

Bionic

On September 28, 2023, the Company acquired 100% of the equity interest of Bionic Stork, Ltd. (“Bionic”), a privately-held company that provides an Application Security Posture Management platform designed to proactively reduce and mitigate security, data privacy, and operational risks by analyzing application architecture and dependencies that run in production.

The acquisition has been accounted for as a business combination. The total consideration transferred consisted of $239.0 million in cash, net of $25.7 million of cash acquired, and $0.7 million representing the fair value of replacement equity awards attributable to pre-acquisition service. The remaining fair value of these replacement awards attributed to post-combination service was excluded from the purchase price. The purchase price was allocated on a preliminary basis, subject to working capital adjustment and continuing management analysis, to identified intangible assets, which include developed technology and customer relationships of $34.9 million, net tangible liabilities acquired of $2.7 million, and goodwill of $207.5 million, which was allocated to the Company’s one reporting unit and represents the excess of the purchase price over the fair value of net tangible and intangible assets acquired. The goodwill was primarily attributable to the assembled workforce of

Bionic, planned growth in new markets, and synergies expected to be achieved from the integration of Bionic. Goodwill is not deductible for income tax purposes.

Per the terms of the share purchase agreement with Bionic, certain unvested stock options held by Bionic employees were canceled and exchanged for replacement stock options under the 2019 Plan. Additionally, certain shares of Bionic stock held by Bionic employees were exchanged for shares of the Company’s Class A common stock, subject to service-based vesting and other conditions. Further, the Company granted RSUs and PSUs under the 2019 Plan to certain continuing employees. The awards that are subject to continued service are recognized ratably as stock-based compensation expense over the requisite service period. The awards that are subject to both continued service and specified performance targets are recognized over the requisite service period when it is probable that the performance condition will be satisfied.

The following table sets forth the components of identifiable intangible assets acquired and their estimated useful lives as of the date of acquisition (dollars in thousands):

			Fair Value						Useful Life
									(in months)
Developed technology			$	29,900					72
Customer relationships			5,000						96
Total intangible assets acquired			$	34,900

Acquisition costs during the six months ended July 31, 2024 were immaterial.

The results of operations for the acquisition have been included in the Company’s condensed consolidated financial statements from the date of acquisition. The acquisition of Bionic did not have a material impact on the Company’s condensed consolidated financial statements, and therefore historical and pro forma disclosures have not been presented.

10. Net Income Per Share Attributable to Common Stockholders

Basic and diluted net income per share attributable to CrowdStrike’s common stockholders is computed in conformity with the two-class method required for participating securities. Basic net income per share attributable to CrowdStrike common stockholders is computed by dividing the net income attributable to CrowdStrike by the weighted-average number of shares of common stock outstanding during the period. Diluted net income per share attributable to CrowdStrike common stockholders is calculated by dividing net income by the combination of the weighted-average number of common shares outstanding and the effect of the weighted-average number of dilutive common share equivalents during the period. The dilutive potential shares of common stock are comprised of outstanding stock options, RSUs, PSUs, Special PSUs, ESPP obligations, and founder holdbacks, and are computed using the treasury stock method. The effects of the outstanding stock options, RSUs, PSUs, Special PSUs, ESPP obligations, and founders holdbacks are excluded from the computation of the diluted net income per share in periods in which the effect would be anti-dilutive.

The rights of the holders of Class A and Class B common stock are identical, except with the respect to voting and conversion rights. As such, the undistributed earnings are allocated equally to each share of common stock without class distinction and the resulting basic and diluted net income per share attributable to CrowdStrike common stockholders are the same for shares of Class A and Class B common stock.

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The following table sets forth the computation of basic and diluted net income per share attributable to CrowdStrike common stockholders (in thousands, except per share data):

			Three Months Ended July 31,												Six Months Ended July 31,
			2024						2023						2024						2023
Numerator:
Net income attributable to CrowdStrike			$	47,013					$	8,472					$	89,833					$	8,963
Denominator:
Weighted-average shares used in computing net income per share attributable to CrowdStrike common stockholders, basic			244,091						237,911						243,249						237,174
Dilutive effect of common stock equivalents			7,174						4,233						7,475						4,209
Weighted-average shares used in computing net income per share attributable to CrowdStrike common stockholders, dilutive			251,265						242,144						250,724						241,383
Net income per share attributable to CrowdStrike common stockholders, basic			$	0.19					$	0.04					$	0.37					$	0.04
Net income per share attributable to CrowdStrike common stockholders, diluted			$	0.19					$	0.03					$	0.36					$	0.04

The potential shares of common stock that were excluded from the computation of diluted net income per share attributable to common stockholders for the periods presented because including them would have been antidilutive are as follows (in thousands):

			July 31, 2024						July 31, 2023
RSUs and PSUs subject to future vesting			117						3,960
Share purchase rights under the Employee Stock Purchase Plan			1						100
Potential common shares excluded from diluted net income per share			118						4,060

The above table excludes founder holdbacks related to business combinations where a variable number of shares will be issued upon vesting to settle a fixed monetary amount of $20.2 million, contingent upon continued employment with the Company. The share price will be determined based on the Company’s average stock price or the volume weighted average stock price five days prior to each vesting date. During the three and six months ended July 31, 2024, 2,295 shares and 5,040 shares, respectively, were issued to settle founder holdbacks at a weighted average price of $387.30 per share and $352.72 per share, respectively.

As of July 31, 2024, the above table also excludes 508,230 weighted average shares of in progress PSUs and Special PSUs where pre-defined targets have not yet been achieved.

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