Item 1. FINANCIAL STATEMENTS

159K characters. Original on sec.gov · Markdown

Item 1. FINANCIAL STATEMENTS

CrowdStrike Holdings, Inc.

Condensed Consolidated Balance Sheets

(in thousands, except per share data)

(unaudited)


	July 31,		January 31,
	2026		2026
Assets
Current assets:
Cash and cash equivalents	$	5,013,847	$	5,230,125

Accounts receivable, net of allowance for credit losses of $3.3 million and $3.0 million as of July 31, 2026 and January 31, 2026, respectively	1,038,575		1,361,844
Deferred contract acquisition costs, current	389,070		447,455
Prepaid expenses and other current assets	513,686		379,695
Total current assets	6,955,178		7,419,119
Strategic investments	69,263		76,832
Property and equipment, net	1,174,851		976,331
Operating lease right-of-use assets	68,389		69,860
Deferred contract acquisition costs, noncurrent	805,537		655,658
Goodwill	2,251,426		1,363,294
Intangible assets, net	273,235		136,702
Other long-term assets	427,122		388,888
Total assets	$	12,025,001	$	11,086,684
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	114,487	$	105,319
Accrued expenses	220,069		181,089
Accrued payroll and benefits	418,070		389,690
Operating lease liabilities, current	22,067		18,232
Deferred revenue	3,497,144		3,421,051
Other current liabilities	157,851		68,811
Total current liabilities	4,429,688		4,184,192
Long-term debt	746,216		745,471
Deferred revenue, noncurrent	1,345,066		1,332,387
Operating lease liabilities, noncurrent	51,896		56,374
Other liabilities, noncurrent	312,610		295,655
Total liabilities	6,885,476		6,614,079
Commitments and contingencies (Note 11)
Stockholders’ Equity
Preferred stock, $0.0005 par value; 100,000 shares authorized as of July 31, 2026 and January 31, 2026; no shares issued and outstanding as of July 31, 2026 and January 31, 2026.	—		—
Class A common stock, $0.0005 par value; 2,000,000 shares authorized as of July 31, 2026 and January 31, 2026; 1,023,845 shares and 1,013,453 shares issued and outstanding as of July 31, 2026 and January 31, 2026, respectively; Class B common stock, $0.0005 par value; 92,364 shares authorized as of July 31, 2026 and January 31, 2026; no shares issued and outstanding as of July 31, 2026 and January 31, 2026.	512		507
Additional paid-in capital	6,335,490		5,694,169
Accumulated deficit	(1,249,962)		(1,283,042)
Accumulated other comprehensive income	15,684		16,756
Total CrowdStrike Holdings, Inc. stockholders’ equity	5,101,724		4,428,390
Non-controlling interest	37,801		44,215
Total stockholders’ equity	5,139,525		4,472,605
Total liabilities and stockholders’ equity	$	12,025,001	$	11,086,684

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,
	2026		2025		2026		2025
Revenue
Subscription	$	1,400,291	$	1,102,945	$	2,721,144	$	2,153,713
Professional services	70,606		66,007		135,382		118,673
Total revenue	1,470,897		1,168,952		2,856,526		2,272,386

Cost of revenue
Subscription	310,691		252,451		599,154		493,811
Professional services	63,311		56,100		117,125		102,615
Total cost of revenue	374,002		308,551		716,279		596,426

Gross profit	1,096,895		860,401		2,140,247		1,675,960

Operating expenses
Sales and marketing	509,973		446,580		998,647		885,791
Research and development	444,200		342,533		852,526		673,459
General and administrative	175,954		176,745		352,906		340,880
Total operating expenses	1,130,127		965,858		2,204,079		1,900,130

Loss from operations	(33,232)		(105,457)		(63,832)		(224,170)
Interest expense	(6,047)		(6,823)		(12,163)		(13,538)
Interest income	43,881		50,850		84,423		96,230
Other income (expense), net	(669)		(2,722)		34,568		(6,618)

Income (loss) before provision for income taxes	3,933		(64,152)		42,996		(148,096)

Provision (benefit) for income taxes	(1,373)		5,971		(8,276)		27,077

Net income (loss)	5,306		(70,123)		51,272		(175,173)
Net income (loss) attributable to non-controlling interest	—		30		18,192		(756)
Net income (loss) attributable to CrowdStrike	$	5,306	$	(70,153)	$	33,080	$	(174,417)

Net income (loss) per share attributable to CrowdStrike common stockholders:
Basic	$	0.01	$	(0.07)	$	0.03	$	(0.17)
Diluted	$	0.01	$	(0.07)	$	0.03	$	(0.17)

Weighted-average shares used in computing net income (loss) per share attributable to CrowdStrike common stockholders:
Basic	1,019,448		999,634		1,017,225		996,730
Diluted	1,044,469		999,634		1,038,033		996,730

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

CrowdStrike Holdings, Inc.

Condensed Consolidated Statements of Comprehensive Income (Loss)

(in thousands)

(unaudited)


	Three Months Ended July 31,				Six Months Ended July 31,
	2026		2025		2026		2025
Net income (loss)	$	5,306	$	(70,123)	$	51,272	$	(175,173)
Other comprehensive income:
Foreign currency translation adjustments	(20,768)		206		(1,856)		16,400
Unrealized gains (loss) on cash equivalents and short-term investments, net of tax	306		(61)		287		(807)
Cash flow hedges:
Change in net unrealized gains	284		—		284		—
Reclassification adjustment for net losses included in net income (loss)	213		—		213		—
Net change on cash flow hedges	497		—		497		—
Other comprehensive income (loss)	(19,965)		145		(1,072)		15,593
Less: Comprehensive income (loss) attributable to non-controlling interest	—		30		18,192		(756)
Total comprehensive income (loss) attributable to CrowdStrike	$	(14,659)	$	(70,008)	$	32,008	$	(158,824)

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, 2026 and 2025

(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, 2026	1,018,149	$	509	$	5,852,987	$	(1,255,268)	$	35,649	$	41,455	$	4,675,332
Issuance of common stock upon exercise of options	375	—		986		—		—		—		986
Issuance of common stock under RSU and PSU release	4,276	3		(3)		—		—		—		—

Issuance of common stock under employee stock purchase plan	1,035	—		86,624		—		—		—		86,624


Issuance of common stock for founders holdbacks related to acquisitions	9	—		1,534		—		—		—		1,534
Issuance of common stock for payment of board of director fees	1	—		105		—		—		—		105
Stock-based compensation expense, net of founder revest	—	—		372,291		—		—		—		372,291
Capitalized stock-based compensation	—	—		20,966		—		—		—		20,966

Net income	—	—		—		5,306		—		—		5,306
Non-controlling interest	—	—		—		—		—		(3,654)		(3,654)
Other comprehensive loss	—	—		—		—		(19,965)		—		(19,965)
Balances at July 31, 2026	1,023,845	$	512	$	6,335,490	$	(1,249,962)	$	15,684	$	37,801	$	5,139,525


	Common Stock			Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Income		Non-controlling Interest		Total Stockholders’ Equity
	Shares	Amount
Balances at April 30, 2025	996,297	$	498	$	4,669,328	$	(1,224,804)	$	5,855	$	40,137	$	3,491,014
Issuance of common stock upon exercise of options	763	—		1,721		—		—		—		1,721
Issuance of common stock under RSU and PSU release	5,095	4		(4)		—		—		—		—
Issuance of common stock under employee stock purchase plan	1,100	—		74,622		—		—		—		74,622
Issuance of common stock for founders holdbacks related to acquisitions	52	—		6,136		—		—		—		6,136
Issuance of common stock for payment of board of director fees	1	—		88		—		—		—		88
Stock-based compensation expense, net of founder revest	—	—		278,104		—		—		—		278,104
Capitalized stock-based compensation	—	—		15,140		—		—		—		15,140
Net income (loss)	—	—		—		(70,153)		—		30		(70,123)
Non-controlling interest	—	—		—		—		—		(2,156)		(2,156)
Other comprehensive income	—	—		—		—		145		—		145
Balances at July 31, 2025	1,003,308	$	502	$	5,045,135	$	(1,294,957)	$	6,000	$	38,011	$	3,794,691

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, 2026 and 2025

(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 January 31, 2026	1,013,453	$	507	$	5,694,169	$	(1,283,042)	$	16,756	$	44,215	$	4,472,605
Issuance of common stock upon exercise of options	636	—		1,669		—		—		—		1,669
Issuance of common stock under RSU and PSU release	9,376	6		(6)		—		—		—		—
Repurchases of common stock	(1,920)	(1)		(175,621)		—		—		—		(175,622)
Issuance of common stock under employee stock purchase plan	1,035	—		86,624		—		—		—		86,624
Issuance of common stock for restricted stock awards	1,240	—		—		—		—		—		—
Issuance of common stock for founders holdbacks related to acquisitions	23	—		3,068		—		—		—		3,068
Issuance of common stock for payment of board of director fees	2	—		208		—		—		—		208
Stock-based compensation expense, net of founder revest	—	—		665,522		—		—		—		665,522
Capitalized stock-based compensation	—	—		36,908		—		—		—		36,908
Fair value of replacement equity awards attributable to pre-acquisition service	—	—		22,949		—		—		—		22,949
Net income	—	—		—		33,080		—		18,192		51,272
Non-controlling interest	—	—		—		—		—		(24,606)		(24,606)
Other comprehensive loss	—	—		—		—		(1,072)		—		(1,072)
Balances at July 31, 2026	1,023,845	$	512	$	6,335,490	$	(1,249,962)	$	15,684	$	37,801	$	5,139,525


	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, 2025	991,488	$	496	$	4,409,131	$	(1,120,540)	$	(9,593)	$	39,423	$	3,318,917
Issuance of common stock upon exercise of options	1,060	—		2,355		—		—		—		2,355
Issuance of common stock under RSU and PSU release	9,608	6		(6)		—		—		—		—
Issuance of common stock under employee stock purchase plan	1,100	—		74,622		—		—		—		74,622
Issuance of common stock for founders holdbacks related to acquisitions	52	—		6,136		—		—		—		6,136
Issuance of common stock for payment of board of director fees	—	—		176		—		—		—		176
Stock-based compensation expense, net of founder revest	—	—		524,290		—		—		—		524,290
Capitalized stock-based compensation	—	—		28,431		—		—		—		28,431
Net loss	—	—		—		(174,417)		—		(756)		(175,173)
Non-controlling interest	—	—		—		—		—		(656)		(656)
Other comprehensive income	—	—		—		—		15,593		—		15,593
Balances at July 31, 2025	1,003,308	$	502	$	5,045,135	$	(1,294,957)	$	6,000	$	38,011	$	3,794,691

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,
	2026		2025
Operating activities
Net income (loss)	$	51,272	$	(175,173)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization	157,597		116,834


Amortization of intangible assets	25,690		15,261
Amortization of deferred contract acquisition costs	207,052		209,941
Non-cash operating lease cost	10,371		8,717
Stock-based compensation expense	674,617		527,292
Deferred income taxes	(7,062)		(2,320)
Realized gains on strategic investments	(36,362)		—
Non-cash interest expense	883		2,293
Change in fair value of strategic investments	—		1,579

Changes in operating assets and liabilities, net of impact of acquisitions
Accounts receivable, net	324,183		242,008
Deferred contract acquisition costs	(298,436)		(251,622)
Prepaid expenses and other assets	(95,422)		(50,411)

Accounts payable	(7,717)		(13,310)
Accrued expenses and other liabilities	11,918		12,716
Accrued payroll and benefits	28,394		(24,931)
Operating lease liabilities	(9,087)		(8,113)
Deferred revenue	83,314		106,178

Net cash provided by operating activities	1,121,205		716,939
Investing activities
Purchases of property and equipment	(222,037)		(116,248)
Capitalized internal-use software and website development costs	(49,090)		(34,726)
Purchases of strategic investments	(3,400)		(1,417)
Proceeds from sales of strategic investments	17,504		4,388
Business acquisitions, net of cash and restricted cash acquired	(881,376)		—
Purchases of intangible assets	(3,000)		—



Purchases of deferred compensation investments	(4,338)		(2,770)
Proceeds from the sale of deferred compensation investments	130		164
Net cash used in investing activities	(1,145,607)		(150,609)
Financing activities








Proceeds from issuance of common stock upon exercise of stock options	1,669		2,355


Proceeds from issuance of common stock under the employee stock purchase plan	86,624		74,622
Distributions to non-controlling interest holders	(24,606)		(2,156)
Capital contributions from non-controlling interest holders	—		1,500
Repurchases of common stock	(175,622)		—
Net cash provided by (used in) financing activities	(111,935)		76,321

Effect of foreign exchange rates on cash, cash equivalents and restricted cash	(1,616)		6,595
Net increase (decrease) in cash, cash equivalents and restricted cash	(137,953)		649,246
Cash, cash equivalents and restricted cash at beginning of period	5,314,617		4,324,666
Cash, cash equivalents, and restricted cash	$	5,176,664	$	4,973,912
Cash, cash equivalents and restricted cash at the end of period:
Cash and cash equivalents	$	5,013,847	$	4,972,436
Restricted cash included in prepaid expenses and other current assets	82,600		1,476
Restricted cash included in other long-term assets	80,217		—
Total cash, cash equivalents and restricted cash shown in the condensed consolidated statements of cash flows	$	5,176,664	$	4,973,912
Supplemental disclosure of cash flow information:
Interest paid	$	11,250	$	11,250
Income taxes paid, net of refunds received	36,225		26,031
Supplemental disclosure of non-cash investing and financing activities:
Net increase in property and equipment included in accounts payable and accrued expenses	52,136		7,918

Equity consideration for acquisitions	22,949		—

Operating lease liabilities arising from obtaining operating right-of-use assets	8,578		28,273

Proceeds from sales of strategic investments not yet received	398		661
Stock-based compensation included in capitalized software development costs and fixed assets	36,799		28,431
Non-cash consideration for the purchase of strategic investments	—		1,101


Restricted cash held in escrow for purchase consideration for business combinations	74,000		—

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. (and/or its subsidiaries, as applicable, the “Company”) was formed on November 7, 2011. The Company is a global cybersecurity leader that delivers an AI-native platform designed for the agentic era and is purpose-built to stop breaches. The Company’s unified, cloud-delivered platform provides protection across endpoints, cloud workloads, identity, and data through a software as a service (“SaaS”) subscription-based model, spanning multiple large and strategic markets, including endpoint protection, security and IT operations, managed detection and response, Next-Gen SIEM, cloud and identity security, threat intelligence, data protection, exposure management, and AI security capabilities. The Company conducts its business in the United States and internationally, including Australia, Canada, Germany, India, Israel, Japan, Romania, Spain, 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, 2026, 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, 2026 are not necessarily indicative of the results to be expected for the year ending January 31, 2027 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, 2026, filed with the SEC on March 5, 2026.

Stock Split

On June 3, 2026, the Company announced a four-for-one split of the Company’s outstanding shares of Class A common stock in the form of a stock dividend (the “Stock Split”). Each stockholder of record at the close of business on June 25, 2026 (the “Record Date”) received, after the close of business on July 1, 2026, three additional shares for every share held on the Record Date. References made to all share, equity award, and per share amounts and related stockholders’ equity balances related to the Company’s outstanding common stock have been retroactively adjusted on the accompanying condensed consolidated financial statements and applicable disclosures to reflect the effects of the Stock Split.

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.

In February 2026, the Company 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 was effective beginning in fiscal 2027. Based on the carrying value of the related deferred contract acquisition costs as of January 31, 2026, the effect of this change in estimate for the three and six months ended July 31, 2026 was a reduction in sales commission expense of $25.5 million and $53.4 million, respectively.

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, derivative contracts, accounts receivable, financing receivables, and strategic investments.

The Company’s cash is placed with high-credit-quality financial institutions and issuers, and at times exceeds federally insured limits.

Derivative transactions expose the Company to credit risk to the extent that the counterparties are unable to meet the terms of the arrangements. The Company mitigates this exposure by transacting with highly-rated counterparties under master netting arrangements that permit net settlement. The Company is not required to pledge, nor does it receive collateral in connection with these instruments.

The Company has not experienced any credit loss relating to its cash, cash equivalents, or strategic investments. The Company performs periodic credit evaluations of its customers and generally does not require collateral on accounts or financing receivables.

There were no channel partners or direct customers who represented 10% or more of the Company’s accounts receivable as of July 31, 2026 or January 31, 2026.

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, 2026 or July 31, 2025.

As of July 31, 2026, one end user represented 12% of the Company’s financing receivables. As of January 31, 2026, two end users represented 10% or more of the Company’s financing receivables, and in aggregate represented 27% of the Company’s financing receivables.

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, 2026. With the exception of the accounting policy described below, there have been no material changes to the Company’s significant accounting policies during the three and six months ended July 31, 2026.

Derivative Contracts: The Company records derivative contracts at fair value as either assets or liabilities on its condensed consolidated balance sheets. For derivative contracts entered into in order to hedge a portion of the Company’s forecasted foreign currency denominated cash flow, which are designated as cash flow hedges, the unrealized gain or loss on the derivative instrument is reported as a component of accumulated other comprehensive income (loss) and reclassified into the financial statement line item associated with the underlying hedged transaction on the Company’s condensed consolidated statements of operations when the underlying hedged transaction is recognized in earnings. Cash flows from these hedges are classified on the condensed consolidated statements of cash flows in the same manner as the underlying transaction, which is within cash flows from operating activities.

The Company formally documents all relationships between hedging instruments and hedged items, as well as its risk management objective and strategy for undertaking various hedge transactions. The Company also formally assesses, both at the inception of the hedge, and on an ongoing basis, whether each derivative is highly effective in offsetting changes in cash flows of the hedged item. If the Company determines that a derivative is not highly effective as a hedge, or that a derivative has ceased to be a highly effective hedge, the Company will discontinue hedge accounting prospectively for the affected derivative.

Revision of Prior Period Financial Statements

As previously disclosed in the Fiscal 2026 Annual Report on Form 10-K, in connection with the preparation of its fiscal 2026 financial statements, the Company identified an immaterial error related to the timing of recognition of stock-based compensation expense associated with certain awards granted in the fiscal years ended January 31, 2022 and 2023. Further information regarding the error and related revisions is included in Note 17, “Revision of Prior Period Financial Statements.”

Recently Adopted Accounting Pronouncements

In July 2025, the FASB issued ASU 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. The standard amends ASC 326-20 to provide a practical expedient (for all entities) and an accounting policy election (for all entities, other than public business entities that elect the practical expedient) related to the estimation of expected credit losses for current accounts receivable and current contract assets that arise from transactions accounted for under ASC 606. The standard should be applied prospectively, and is effective for annual periods, including interim reporting periods, beginning after December 15, 2025, with early adoption permitted. The Company adopted ASU 2025-05 on February 1, 2026 and the adoption of this standard did not have a material impact on the Company’s condensed consolidated financial statements.

Recently Issued Accounting Pronouncements

In November 2025, FASB issued ASU 2025-09, Derivatives and Hedging (Topic 815): Hedge Accounting Improvements. The standard expands and clarifies existing hedge accounting requirements to improve the alignment of financial reporting with risk management strategies. ASU 2025-09 is effective for fiscal years beginning after December 15, 2026, including interim periods within those fiscal years, with early adoption permitted on a prospective basis. The Company is currently evaluating the impact of this guidance on its consolidated financial statements and related disclosures.

In September 2025, the FASB issued ASU 2025-06, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. The standard intends to modernize the recognition and capitalization framework by removing the previous “development stage” model and introducing a more judgment-based approach. The standard can be applied prospectively, using a modified transition method based on the status of the project and whether software costs were capitalized prior to the date of adoption, or retrospectively, and is effective for annual periods beginning after December 15, 2027, and interim periods within those annual reporting periods. Early adoption is permitted as of the beginning of an annual reporting period. The Company is currently evaluating the impact of this guidance on its consolidated financial statements and related disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures, with a subsequent clarification of its effective date through ASU 2025-01, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date in January 2025, requiring additional disclosure on specific expense categories included in the expense captions presented on the statements of operations. The new standard can be applied either prospectively or retrospectively, and is effective for annual periods beginning after December 15, 2026 and interim reporting periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. 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, deferred compensation investments, and derivative contracts 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 as of July 31, 2026 and January 31, 2026 is as follows (in thousands):


	July 31, 2026								January 31, 2026
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets
Cash equivalents (1)
Money market funds	$	1,067,046	$	—	$	—	$	1,067,046	$	1,407,062	$	—	$	—	$	1,407,062
U.S. Treasury securities	—		1,193,202		—		1,193,202		—		598,398		—		598,398
Total investments	$	1,067,046	$	1,193,202	$	—	$	2,260,248	$	1,407,062	$	598,398	$	—	$	2,005,460
Prepaid expenses and other current assets
Foreign currency forward contracts	$	—	$	497	$	—	$	497	$	—	$	—	$	—	$	—
Total prepaid expenses and other current assets	$	—	$	497	$	—	$	497	$	—	$	—	$	—	$	—
Other assets
Deferred compensation investments	$	17,909	$	—	$	—	$	17,909	$	12,710	$	—	$	—	$	12,710
Total other assets	$	17,909	$	—	$	—	$	17,909	$	12,710	$	—	$	—	$	12,710
Total assets	$	1,084,955	$	1,193,699	$	—	$	2,278,654	$	1,419,772	$	598,398	$	—	$	2,018,170

(1)Cash equivalents exclude $1.2 billion of time deposits, which are carried at cost and approximate fair value as of July 31, 2026.

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

As of July 31, 2026 and January 31, 2026, the Company’s U.S. Treasury securities are carried at fair value and there were no material realized or unrealized gains or losses, either individually or in aggregate. All foreign currency forward contracts are measured based on market observable inputs, including foreign currency spot and forward rates.

The total estimated fair value of the Company’s financing receivables approximates their carrying amounts as of July 31, 2026 and January 31, 2026. The fair value of the Company’s financing receivables is considered to be a Level 3 measurement as unobservable inputs are used in determining discounted cash flows to estimate fair value.

Strategic Investments

The Company’s investments of privately held securities as of July 31, 2026, consisted of the following (in thousands):


	Privately held equity securities
Initial total cost	$	67,438
Cumulative net gains	1,825
Carrying amount, end of period	$	69,263

The Company’s investments of privately held securities as of January 31, 2026, consisted of the following (in thousands):


	Privately held equity securities
Initial total cost	$	75,007
Cumulative net gains	1,825
Carrying amount, end of period	$	76,832

As of July 31, 2026 and January 31, 2026, the cumulative net gains of $1.8 million are comprised of upward adjustments of $7.3 million, less downward adjustments and impairment of $5.5 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,
	2026		2025		2026		2025

Unrealized losses recognized on privately held equity securities, including impairment	$	—	$	—	$	—	$	(1,579)
Unrealized losses	$	—	$	—	$	—	$	(1,579)

Realized gains recognized on sales of privately held equity securities	$	—	$	—	$	36,362	$	—

Realized gains	$	—	$	—	$	36,362	$	—
Gains (losses) on strategic investments, net	$	—	$	—	$	36,362	$	(1,579)

Unrealized losses recognized during the reporting period on privately held equity securities still held at the reporting date	$	—	$	—	$	—	$	(1,579)

Unrealized gains recognized on privately held equity securities include upward adjustments from equity securities accounted for under the measurement alternative while unrealized losses recognized on privately held equity securities include downward adjustments and impairment.

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. Financing Receivables

The Company’s short-term and long-term financing receivables were as follows (in thousands):


	July 31, 2026		January 31, 2026
Short-term financing receivables, gross	$	124,332	$	81,723
Unearned income	(16,152)		(13,236)
Allowance for credit losses	(2,883)		(1,002)
Short-term financing receivables, net	$	105,297	$	67,485

Long-term financing receivables, gross	$	239,525	$	213,601
Unearned income	(17,267)		(17,847)
Allowance for credit losses	(2,686)		(1,648)
Long-term financing receivables, net	$	219,572	$	194,106

The Company’s amortized cost basis of financing receivables categorized by internal risk rating and year of origination was as follows (in thousands):


	July 31, 2026								January 31, 2026
	Fiscal Year of Origination								Fiscal Year of Origination
Internal Risk Rating(1)	2027		2026		2025		Total		2026		2025		Total
1 to 4	$	28,558	$	110,762	$	17,825	$	157,145	$	127,440	$	17,374	$	144,814
5 to 6	69,672		74,739		24,172		168,583		91,249		23,719		114,968
7 to 9	—		4,710		—		4,710		4,459		—		4,459
Amortized cost basis of financing receivables	$	98,230	$	190,211	$	41,997	$	330,438	$	223,148	$	41,093	$	264,241

(1)Internal risk ratings are determined based on the end-user’s financial condition and are categorized as 1 through 9, with the lowest rating representing the highest quality. Credit quality indicators are generally updated at least annually, or more frequently to the extent required by economic conditions.

There was no significant activity in allowance for credit losses during the three and six months ended July 31, 2026 and July 31, 2025. As of July 31, 2026, there were no past due amounts on financing receivables. Past due amounts on financing receivables as of January 31, 2026 were immaterial.

4. Derivative Contracts

During the second quarter of fiscal 2027, the Company entered into foreign currency forward contracts to hedge a portion of its forecasted foreign currency denominated cash flow, with a maximum maturity of 3 months. These foreign currency forward contracts are recorded at fair value. As of July 31, 2026, the notional amount of the Company’s outstanding foreign currency forward contracts designated as cash flow hedges was $57.9 million.

As of July 31, 2026, there were $0.5 million of unrealized gains in accumulated other comprehensive income (loss) related to the Company’s cash flow hedges, all of which are expected to be recognized into earnings within the next 12 months.

Losses related to the Company’s cash flow hedges reclassified from accumulated other comprehensive income (loss) into the condensed consolidated statements of operations consisted of the following (in thousands):



	Three months ended July 31, 2026		Six months ended July 31, 2026

Subscription cost of revenue	$	32	$	32
Professional services cost of revenue	6		6
Sales and marketing	86		86
Research and development	79		79
General and administrative	10		10
Total	$	213	$	213

There was no ineffectiveness in the Company’s cash flow hedging program for the three months ended July 31, 2026.

5. Balance Sheet Components

Prepaid Expenses and Other Current Assets

Prepaid expenses were $257.0 million and $250.9 million as of July 31, 2026 and January 31, 2026, respectively. Other current assets were $256.7 million and $128.8 million as of July 31, 2026 and January 31, 2026, respectively.

Property and Equipment, Net

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


	July 31, 2026		January 31, 2026
Data center and other computer equipment	$	1,199,171	$	1,058,690
Capitalized internal-use software and website development costs	451,347		383,119
Leasehold improvements	68,776		54,305
Purchased software	19,335		18,628
Furniture and equipment	13,894		12,752
Construction in progress	342,470		219,509
	2,094,993		1,747,003
Less: Accumulated depreciation and amortization	(920,142)		(770,672)
Property and equipment, net	$	1,174,851	$	976,331

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 $273.7 million as of July 31, 2026.

Depreciation and amortization expense of property and equipment was $82.1 million and $60.4 million during the three months ended July 31, 2026 and July 31, 2025, respectively, and $157.6 million and $116.8 million during the six months ended July 31, 2026 and July 31, 2025, respectively.

There was no impairment of property and equipment during the three and six months ended July 31, 2026 and July 31, 2025. The Company capitalized $45.4 million and $31.0 million in internal-use software and website development costs during the three months ended July 31, 2026 and July 31, 2025, respectively, and $81.5 million and $60.6 million during the six months ended July 31, 2026 and July 31, 2025, respectively. Amortization expense associated with internal-use software and website development costs totaled $25.7 million and $19.6 million during the three months ended July 31, 2026 and July 31, 2025, respectively, and $50.1 million and $37.1 million during the six months ended July 31, 2026 and July 31, 2025, respectively. The net book value of capitalized internal-use software and website development costs was $216.1 million and $184.7 million as of July 31, 2026 and January 31, 2026, respectively.

Intangible Assets, Net

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


	July 31, 2026						Weighted-Average Remaining Useful Life
	Gross Carrying Amount		Accumulated Amortization		Net Amount
							(in months)
Developed technology	$	361,696	$	113,290	$	248,406	74
Customer relationships	25,364		13,823		11,541		48
Intellectual property and other acquired intangible assets	18,827		5,539		13,288		100
Total	$	405,887	$	132,652	$	273,235


	January 31, 2026						Weighted-Average Remaining Useful Life
	Gross Carrying Amount		Accumulated Amortization		Net Amount
							(in months)
Developed technology	$	202,561	$	90,199	$	112,362	54
Customer relationships	25,383		12,122		13,261		53
Intellectual property and other acquired intangible assets	15,854		4,775		11,079		100
Total	$	243,798	$	107,096	$	136,702

Amortization expense of intangible assets was $13.3 million and $7.6 million during the three months ended July 31, 2026 and July 31, 2025, respectively, and $25.7 million and $15.3 million during the six months ended July 31, 2026 and July 31, 2025, respectively.

The estimated aggregate future amortization expense of intangible assets as of July 31, 2026 was as follows (in thousands):


	Total
Fiscal 2027 (remaining six months)	$	26,576
Fiscal 2028	52,365
Fiscal 2029	49,345
Fiscal 2030	39,968
Fiscal 2031	31,880
Thereafter	73,101
Total future amortization expense	$	273,235

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, 2026 consisted of the following (in thousands):


	Amounts
Goodwill as of January 31, 2026	$	1,363,294
Goodwill acquired(1)	886,587
Foreign currency translation	1,545
Goodwill as of July 31, 2026	$	2,251,426

(1)Goodwill acquired resulted from the acquisitions of SGNL.AI, Inc. (“SGNL”), and Seraphic Algorithms Ltd. (“Seraphic”). Refer to Note 12 for additional information.

Accrued Payroll and Benefits

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


	July 31, 2026		January 31, 2026
Accrued commissions	$	192,622	$	207,378
Accrued payroll and related expenses	146,966		100,915
Accrued bonuses	53,034		45,204
Employee Stock Purchase Plan	25,448		36,193
Accrued payroll and benefits	$	418,070	$	389,690

6. Debt

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”). The Senior Notes are guaranteed by the Company’s subsidiaries, CrowdStrike, Inc. and CrowdStrike Financial Services, Inc., and will be guaranteed by each of the Company’s existing and future domestic subsidiaries that becomes a borrower or guarantor under any credit agreement the Company may enter into in the future that replaces the Amended 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, 2026 and 2025, and $12.0 million during the six months ended July 31, 2026 and 2025.

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 Senior 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, 2026, 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 $712.5 million and $718.2 million as of July 31, 2026 and January 31, 2026, 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.

7. Income Taxes

The Company recognized income tax expense (benefit) of $(1.4) million and $6.0 million for the three months ended July 31, 2026 and July 31, 2025, respectively, and $(8.3) million and $27.1 million during the six months ended July 31, 2026 and July 31, 2025, respectively. The tax benefit for the three months ended July 31, 2026, based on the application of interim period tax accounting methodology, was primarily attributable to excess tax benefits related to stock-based awards, partially offset by income taxes on earnings in jurisdictions in which the Company conducts business. The tax benefit for the six months ended July 31, 2026, based on the application of interim period tax accounting methodology, was primarily attributable to income tax benefit recognized in the current period resulting from the realization of deferred tax assets in connection with recent acquisitions and excess tax benefits related to stock-based awards, partially offset by income taxes on earnings in jurisdictions in which the Company conducts business. The tax expense for the three months ended July 31, 2025 was primarily attributable to tax impacts from the enactment of the One Big Beautiful Bill Act (“OBBBA”), partially offset by valuation allowance in the U.S. and certain foreign jurisdictions where the Company does not benefit from losses and tax credits. The tax expense for the six months ended July 31, 2025 was primarily attributable to income taxes in foreign jurisdictions and withholding taxes related to customer payments in certain foreign jurisdictions in which the Company conducts business.

The Company’s effective tax rates were (34.9)% and (9.3)% for the three months ended July 31, 2026 and July 31, 2025, respectively and (19.2)% and (18.3)% during the six months ended July 31, 2026 and July 31, 2025, respectively. The difference in the effective tax rate for the three months ended July 31, 2026 from the U.S. statutory tax rate is primarily due to excess tax benefits related to stock-based awards, partially offset by income taxes on earnings in jurisdictions in which the Company conducts business. The difference in the effective tax rate for the six months ended July 31, 2026 from the U.S. statutory tax rate is primarily due to income tax benefits recognized in the current period resulting from the realization of deferred tax assets in connection with recent acquisitions and excess tax benefits related to stock-based awards, partially offset by income taxes on earnings in jurisdictions in which the Company conducts business. The effective tax rate for the three and six months ended July 31, 2025, 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 tax impacts from the enactment of the OBBBA, partially offset by valuation allowance in the U.S. and certain foreign jurisdictions where the Company does not benefit from losses and tax credits.

Total gross unrecognized tax benefits were $140.9 million and $137.8 million as of July 31, 2026 and January 31, 2026, respectively, which are primarily attributable to research and development credits. As of July 31, 2026 and January 31, 2026, there were approximately $45.3 million and $41.0 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 incurred $8.8 million and $6.6 million of interest and penalties related to unrecognized tax benefits as of July 31, 2026 and January 31, 2026, respectively.

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 evaluates the need for a valuation allowance on a quarterly basis.

8. Leases

Operating Leases

The Company has entered into non-cancelable operating lease agreements with various expiration dates through fiscal 2039. Certain lease agreements include options to renew or terminate the lease, which are not reasonably certain to be exercised and therefore are not factored into the determination of lease payments.

The maturities of the Company’s non-cancelable operating lease liabilities are as follows (in thousands):


	Total
Fiscal 2027 (remaining six months)	$	10,917
Fiscal 2028	23,556
Fiscal 2029	15,884
Fiscal 2030	12,157
Fiscal 2031	8,124
Thereafter	12,036
Total operating lease payments	82,674
Less: imputed interest	(8,711)
Present value of operating lease liabilities	$	73,963

As of July 31, 2026, the Company has entered into four non-cancelable operating leases, with lease terms greater than 12 months that have not yet commenced, with undiscounted future minimum payments of $117.5 million, which have been excluded from the table above. The operating leases are expected to commence between October 2026 and August 2027, with lease terms between 5.0 and 11.3 years.

9. 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”), performance-based stock units (“PSUs”), and the Special PSU Awards (as defined below). A total of 35,000,000 shares of Class A common stock (after giving effect to the Stock Split) 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 initial public offering (“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, 2026 were immaterial. There were no stock options granted during the six months ended July 31, 2025.

The following table is a summary of stock option activity for the six months ended July 31, 2026:


	Number of Shares	Weighted-Average Exercise Price Per Share
	(in thousands)
Options outstanding at January 31, 2026	3,729	$	3.10
Granted	362	$	4.44
Exercised	(636)	$	2.62
Canceled	(8)	$	3.84
Options outstanding at July 31, 2026	3,447	$	3.32
Options vested and expected to vest at July 31, 2026	3,447	$	3.32
Options exercisable at July 31, 2026	3,052	$	2.93

There were no options that were unvested and exercisable as of July 31, 2026.

The aggregate intrinsic value of options vested and exercisable was $573.5 million and $381.0 million as of July 31, 2026 and January 31, 2026, respectively. The weighted-average remaining contractual term of options vested and exercisable was 2.4 years and 2.6 years as of July 31, 2026 and January 31, 2026, respectively.

The per share weighted-average grant date fair value of all options granted was $95.50 during the six months ended July 31, 2026 and none during the six months ended July 31, 2025. The total intrinsic value of all options exercised was $65.7 million and $91.3 million during the three months ended July 31, 2026 and July 31, 2025, respectively, and $91.7 million and $118.0 million during the six months ended July 31, 2026 and July 31, 2025, respectively.

The aggregate intrinsic value of stock options outstanding as of July 31, 2026 and January 31, 2026 was $646.3 million and $399.9 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 3.1 years and 2.9 years as of July 31, 2026 and January 31, 2026, respectively.

Total unrecognized stock-based compensation expense related to unvested options was $36.1 million as of July 31, 2026. This expense is expected to be amortized over a weighted-average vesting period of 2.3 years.

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, or (ii) vesting in sixteen equal quarterly installments, 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 $2.3 billion as of July 31, 2026. This expense is expected to be amortized over a weighted-average vesting period of 2.5 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 $309.5 million as of July 31, 2026, 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 1.3 years.

Special PSU Awards

In fiscal 2026 and 2027, the Company’s board of directors approved performance-based equity awards (the “2026 Special PSU Award” and “2027 Special PSU Awards,” respectively) under the Company’s 2019 Plan, consisting of PSUs with targets of 1,200,000 and 700,000 PSUs, respectively, that can result in as few as zero shares of the Company’s Class A common stock being issued if the Company’s stock price performance is below the 25th percentile of the companies in the S&P 500 over a three-year period beginning on December 22, 2025 and ending on December 22, 2028, and up to 2,400,000 and 1,400,000 shares, respectively, being issued if the Company’s stock price performance meets or exceeds the 90th percentile of the companies in the S&P 500. The 2027 Special PSU Awards are subject to an additional service condition following the performance period, which will be satisfied in four equal quarterly installments on March 20, June 20, September 20, and December 20, 2029, subject to the grantees’ continued employment with the Company through each applicable vesting date.

The Company measured the fair value of each award on the respective grant date using a Monte Carlo simulation valuation model. The risk-free interest rates used were 3.50% and 3.73%, respectively, based on the term-matched zero-coupon-risk-free interest rate derived from the Treasury Constant Maturities yield curve for a period commensurate with the expected term of the award on the grant date. The expected volatilities used were 44.83% and 45.95%, respectively, calculated based on the daily stock price returns for the Company over a lookback period commensurate with the expected term of the award on the grant date.

In fiscal 2022 the Company’s board of directors granted 2,620,000 PSUs (the “2022 Special PSU Awards” and, together with the 2026 Special PSU Award and 2027 Special PSU Awards, the “Special PSU Awards”). The 2022 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 2022 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 2022 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 2022 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 2022 Special PSU Awards on the respective grant dates 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 a period commensurate with the expected term of the award on the grant date. The expected volatilities used were 54.89% - 55.36%, which were calculated based on an equal blend of the Company’s historical volatility calculated from daily stock price returns over a 2.21 - 2.58 year lookback from the grant date and 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 $234.5 million as of July 31, 2026. This expense is expected to be amortized over a weighted-average vesting period of 2.4 years.

The following table is a summary of RSUs, PSUs and the Special PSU Awards activities for the six months ended July 31, 2026:


	Number of Shares	Weighted- Average Grant Date Fair Value Per Share
	(in thousands)
RSUs and PSUs outstanding at January 31, 2026	31,410	$	74.41
Granted	12,323	$	112.13
Released	(9,376)	$	63.38
Performance adjustment (1)	1,147	$	96.78
Forfeited	(1,021)	$	74.19
RSUs and PSUs outstanding at July 31, 2026	34,483	$	91.64
RSUs and PSUs expected to vest at July 31, 2026 (2)	33,126	$	91.16

(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 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 14,000,000 shares of Class A common stock (after giving effect to the Stock Split) 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 20,000,000 shares of the Company’s Class A common stock (after giving effect to the Stock Split) 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 10,000 shares of common stock (after giving effect to the Stock Split) 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, 2026 were $2.8 million, which are 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, 2026 and January 31, 2026 totaled $25.4 million and $36.2 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,
	2026		2025
Expected term (in years)	0.5 – 2.0		0.5 – 2.0
Risk-free interest rate	3.5% – 4.7%		3.9% – 5.3%
Expected stock price volatility	41.0% – 54.4%		44.5% – 59.8%
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,
	2026		2025		2026		2025

Subscription cost of revenue	$	29,032	$	23,639	$	51,333	$	46,716
Professional services cost of revenue	12,556		9,895		22,022		19,275
Sales and marketing	90,737		71,790		160,636		136,569
Research and development	151,382		111,659		277,153		215,748
General and administrative	93,207		62,648		163,473		108,984
Total stock-based compensation expense	$	376,914	$	279,631	$	674,617	$	527,292

10. 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,
	2026				2025				2026				2025
	Amount		% Revenue		Amount		% Revenue		Amount		% Revenue		Amount		% Revenue

United States	$	954,464	65	%	$	784,675	67	%	$	1,868,189	65	%	$	1,526,527	67	%
Europe, Middle East, and Africa	263,698		18	%	188,423		16	%	499,037		17	%	364,865		16	%
Asia Pacific	157,893		11	%	117,538		10	%	304,069		11	%	230,365		10	%
Other	94,842		6	%	78,316		7	%	185,231		7	%	150,629		7	%
Total revenue	$	1,470,897	100	%	$	1,168,952	100	%	$	2,856,526	100	%	$	2,272,386	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, 2026 and July 31, 2025.

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 $1.3 billion and $1.0 billion for the three months ended July 31, 2026 and July 31, 2025, respectively, and $2.2 billion and $1.7 billion during the six months ended July 31, 2026 and July 31, 2025, 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,
	2026		2025		2026		2025
Beginning balance	$	4,722,193	$	3,771,395	$	4,753,438	$	3,728,677
Additions to deferred revenue	1,590,914		1,232,414		2,945,298		2,378,566
Recognition of deferred revenue	(1,470,897)		(1,168,952)		(2,856,526)		(2,272,386)
Ending balance	$	4,842,210	$	3,834,857	$	4,842,210	$	3,834,857

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-cancelable. 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, 2026, the aggregate amount of the transaction price allocated to remaining performance obligations was $10.7 billion. The Company expects to recognize approximately 46% of the remaining performance obligations in the 12 months following July 31, 2026. The majority of the non-current remaining performance obligations are expected to be recognized over the next 13 to 36 months.

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 five 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 less than one year. Commissions 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, 2026 or July 31, 2025.

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


	Three Months Ended July 31,				Six Months Ended July 31,
	2026		2025		2026		2025

Beginning balance	$	1,097,069	$	847,850	$	1,103,113	$	847,950

Capitalization of contract acquisition costs	205,734		148,819		298,546		251,622
Amortization of deferred contract acquisition costs	(108,196)		(107,038)		(207,052)		(209,941)
Ending balance	$	1,194,607	$	889,631	$	1,194,607	$	889,631

Deferred contract acquisition costs, current	$	389,070	$	372,543	$	389,070	$	372,543
Deferred contract acquisition costs, noncurrent	805,537		517,088		805,537		517,088
Total deferred contract acquisition costs	$	1,194,607	$	889,631	$	1,194,607	$	889,631

11. Commitments and Contingencies

July 19 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 “July 19 Incident”). The Company is subject to a number of legal proceedings in connection with the July 19 Incident, including:

On August 5, 2024, a putative class action was filed against CrowdStrike, Inc. in the Western District of Texas in relation to passenger airline flight disruptions allegedly caused by the July 19 Incident. On August 19, 2024, a second putative class action was filed against the Company and CrowdStrike, Inc. in the Western District of Texas, making similar allegations in relation to passenger airline flight disruptions. On November 6, 2024, these

two lawsuits were consolidated, and interim class counsel was appointed. On December 6, 2024, a consolidated class action complaint was filed, which, among other things, asserts causes of action for negligence and public nuisance, and seeks certification of a nationwide class, as well as several state sub-classes of citizens of California, Ohio, Pennsylvania, Iowa, and Nevada. The putative classes are comprised of individuals who allegedly had a flight delayed or canceled as a result of the July 19 Incident. The consolidated complaint seeks unspecified monetary damages, certain injunctive relief, costs, and attorneys’ fees. On February 4, 2025, the Company and CrowdStrike, Inc. filed a motion to dismiss the consolidated complaint. On June 18, 2025, the district court granted the Company and CrowdStrike, Inc.’s motion to dismiss the consolidated complaint and entered a final judgment. On June 25, 2025, the plaintiffs filed a notice of appeal to the United States Court of Appeals for the Fifth Circuit (the “Fifth Circuit”). On May 20, 2026, the Fifth Circuit affirmed the district court’s dismissal. On June 15, 2026, the Fifth Circuit denied the plaintiffs’ petition for panel or en banc rehearing.

On September 4, September 11, and September 20, 2024, three derivative lawsuits were filed against certain of the Company’s officers and directors, and against the Company as nominal defendant, in federal court in the Western District of Texas alleging various claims, including breach of fiduciary duty, unjust enrichment, and violations of federal securities laws. On November 21, 2024, all three cases were consolidated and stayed pending resolution of the putative securities class action described above. On April 16, 2026, the court ordered the consolidated lawsuits dismissed. On April 10, 2025, two additional derivative lawsuits were filed against certain of the Company’s officers and directors, and against the Company as nominal defendant, in federal court in the Western District of Texas, asserting similar claims and seeking similar relief as the previously filed derivative lawsuits. On May 23, 2025, these lawsuits were consolidated with each other. On July 18, 2025, these consolidated lawsuits were stayed pending resolution of the putative securities class action described above. On April 7, 2026, the court ordered the consolidated lawsuits dismissed. On July 3 and July 17, 2025, two additional derivative lawsuits were filed against certain of the Company’s officers and directors, and against the Company as a nominal defendant, in the Delaware Court of Chancery, asserting similar claims and seeking similar relief as the previously filed derivative lawsuits. On August 18, 2025, these two lawsuits were consolidated and stayed pending resolution of the putative securities class action described above. On March 18, 2026, the court ordered the consolidated lawsuits dismissed.
On October 25, 2024, Delta Airlines, Inc. (“Delta”) filed a complaint against CrowdStrike, Inc. in the Superior Court for Fulton County, Georgia, alleging, among other things, computer trespass, trespass to personalty, breach of contract, intentional misrepresentation/fraud by omission, strict-liability product defect, gross negligence, and deceptive and unfair business practices. Delta is seeking unspecified monetary damages, attorneys’ fees and unspecified punitive damages. The matter has been transferred to the Metro Atlanta Business Case Division. On December 16, 2024, CrowdStrike, Inc. filed a motion to dismiss. On May 16, 2025, CrowdStrike, Inc.’s motion to dismiss was granted in part and denied in part. Discovery is ongoing.

The Company has received requests for information from the U.S. Department of Justice and the U.S. Securities and Exchange Commission relating to the Company’s recognition of revenue and reporting of ARR for transactions with certain customers, the July 19 Incident and related matters. The Company is cooperating and providing information in response to these requests.

Additionally, some customers and third parties have asserted claims against the Company. The Company has also received inquiries from other governmental authorities and third parties related to the July 19 Incident. The Company has cooperated and provided 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 current 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 July 19 Incident and related matters 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 July 19 Incident. Any amounts recoverable under such policies will be reflected in future periods in which recovery is considered probable.

Amounts accrued and expenses incurred, net of insurance receivable recorded, associated with the July 19 Incident and related matters during the six months ended July 31, 2026 were as follows (in thousands):



	Amounts
Balance at January 31, 2026	$	15,498
Expenses incurred, net of insurance receivable recorded (1)	3,600
Payments made / cash received	(5,959)
Balance at July 31, 2026	$	13,139

(1) These expenses are included in the Company’s condensed consolidated statements of operations as sales and marketing expenses, research and development expenses, and general and administrative expenses. Accruals are recorded in accrued expenses in the Company’s condensed consolidated balance sheets. Insurance receivable is recorded in prepaid expenses and other current assets in the Company’s condensed consolidated balance sheets.

In addition to customer commitment packages, the Company has made an immaterial amount of settlement offers to certain customers in response to the July 19 Incident. These amounts are, or will be, entirely offset by recoveries under the Company’s insurance policies. Accordingly, there is no impact on the Company’s condensed consolidated statement of operations during the three and six months ended July 31, 2026. The customer payables and insurance receivables were recorded as accrued expenses and as prepaid expenses and other current assets in the Company’s condensed consolidated balance sheet as of July 31, 2026, respectively.

Other Legal Proceedings

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-cancelable 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-cancelable purchase obligations in excess of one year as of July 31, 2026, with expected date of payment is as follows (in thousands):


	Total Commitments

Fiscal 2027 (remaining six months)	$	186,109
Fiscal 2028	843,076
Fiscal 2029	844,454
Fiscal 2030	651,501
Fiscal 2031	377,684
Thereafter	1,238,703
Total purchase commitments	$	4,141,527

In July 2026, the Company signed a definitive agreement to acquire the technology assets of XM Cyber Ltd., a Schwarz Digits company recognized for its advanced attack path visualization and offensive simulation technologies. At closing, the Company expects to pay consideration of $145.0 million in a combination of cash and shares of the Company’s Class A common stock, plus additional shares of the Company’s Class A common stock in an amount to be determined on the closing date. The transaction is expected to close in the second half of fiscal 2027, subject to customary closing conditions and regulatory requirements.

Subsequent to July 31, 2026, the Company has committed to an additional $2.9 billion of non-cancelable purchase obligations from fiscal 2027 to fiscal 2034. These commitments are excluded from the table above and will be included in the table in subsequent periods.

Unfunded Loan Commitments

The Company provides financing arrangements for certain qualified end-users to purchase its products and services. When the Company enters into these financing arrangements with the end-users, the funds provided by the Company for the sales transactions do not always occur immediately upon signing, depending on the terms of the arrangements. The Company estimates an allowance for credit losses on these off-balance sheet credit exposures at each reporting period on the contractual period over which the Company is exposed to credit risk via a contractual obligation to extend credit, unless that obligation is unconditionally cancelable by the Company. As of July 31, 2026, the Company had non-cancelable unfunded commitments totaling approximately $69.7 million.

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, 2026 or January 31, 2026.

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, 2026 or January 31, 2026.

12. Acquisitions

SGNL.AI, Inc.

On February 20, 2026, the Company acquired 100% of the equity interest of SGNL.AI, Inc. (“SGNL”), a leader in continuous identity security.

The acquisition has been accounted for as a business combination. The total consideration transferred consisted of $627.9 million in cash, net of $9.4 million of cash and restricted cash acquired, and $9.2 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 remaining fair value of these replacement awards attributed to post-combination service was excluded from the purchase price. The cash consideration included cash held back in an escrow fund for a partial security for post-closing true-up adjustments and post-closing indemnification claims. The purchase price was allocated on a preliminary basis, subject to working

capital adjustment and continuing management analysis, to developed technology of $87.9 million with a useful life of 96 months, net tangible liabilities of $11.9 million, and goodwill of $561.1 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 fair value of the developed technology was estimated using the relief-from-royalty method under the income approach. The goodwill was primarily attributable to the assembled workforce of SGNL, planned growth in new markets, and synergies expected to be achieved from the integration of SGNL. Goodwill is not deductible for income tax purposes.

Per the terms of the merger agreement with SGNL, certain unvested stock options held by SGNL employees were canceled and exchanged for replacement stock options under the 2019 Plan. Additionally, certain shares of SGNL stock held by SGNL employees were exchanged for the right to receive shares of the Company’s common stock, subject to service-based vesting 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 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, 2026 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 SGNL, individually or in the aggregate with other fiscal 2027 acquisitions, 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.

Seraphic Algorithms Ltd.

On February 3, 2026, the Company completed the acquisition of the remaining 90.6% of the equity interest in Seraphic Algorithms Ltd. (“Seraphic”), a leader in browser runtime security. Prior to the acquisition, the Falcon Funds held 9.4% of the outstanding equity interests of Seraphic, which was accounted for under the measurement alternative.

The acquisition has been accounted for as a business combination. The total consideration transferred consisted of $327.5 million in cash, net of $1.1 million of cash and restricted cash acquired, and $13.7 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 remaining fair value of these replacement awards attributed to post-combination service was excluded from the purchase price. On the acquisition date, CrowdStrike remeasured its previously held equity interest in Seraphic to a fair value of $38.1 million, resulting in a realized gain of $15.5 million, net of non-controlling interest of $15.5 million. The purchase price was allocated on a preliminary basis, subject to working capital adjustment and continuing management analysis, to developed technology of $69.8 million with a useful life of 96 months, net tangible liabilities of $16.0 million, and goodwill of $325.5 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 fair value of the developed technology was estimated using the relief-from-royalty method under the income approach. The goodwill was primarily attributable to the assembled workforce of Seraphic, planned growth in new markets, and synergies expected to be achieved from the integration of Seraphic. Goodwill is not deductible for income tax purposes.

Per the terms of the merger agreement with Seraphic, certain unvested stock options held by Seraphic employees were canceled and exchanged for replacement stock options under the 2019 Plan. Additionally, certain shares of Seraphic stock held by Seraphic employees were exchanged for the right to receive shares of the Company’s common stock, subject to service-based vesting 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 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, 2026 were $1.6 million.

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 Seraphic, individually or in the aggregate with other fiscal 2027 acquisitions, 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.

Pangea Cyber Corporation

On September 26, 2025, the Company acquired 100% of the equity interest of Pangea Cyber Corporation (“Pangea”), a company that offers AI detection and response solutions.

The acquisition has been accounted for as a business combination. The total consideration transferred consisted of $212.1 million in cash, net of $9.4 million of cash and restricted cash acquired, and $0.3 million and $10.3 million representing the fair value of replacement equity and liability awards, respectively, 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 cash consideration included (i) cash held back in an escrow fund for a partial security for post-closing true-up adjustments, which was released from escrow in January 2026, and (ii) cash held back in an escrow fund for a partial security for post-closing indemnification claims, which is expected to be released in fiscal 2028 and is reflected within restricted cash. The purchase price was allocated on a preliminary basis, subject to working capital adjustment and continuing management analysis, to developed technology of $13.2 million with a useful life of 72 months, net tangible liabilities of $0.4 million, and goodwill of $209.9 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 fair value of the developed technology was estimated using the relief-from-royalty method under the income approach. The goodwill was primarily attributable to the assembled workforce of Pangea, planned growth in new markets, and synergies expected to be achieved from the integration of Pangea. Goodwill is not deductible for income tax purposes.

Per the terms of the merger agreement with Pangea, certain unvested stock options held by Pangea employees were canceled and exchanged for replacement stock options under the 2019 Plan. Additionally, certain shares of Pangea stock held by Pangea employees were exchanged for the right to receive shares of the Company’s common stock, subject to service-based vesting 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 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, 2026 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 Pangea 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.

Onum Technology Inc.

On September 12, 2025, the Company acquired 100% of the equity interest of Onum Technology Inc. (“Onum”), a leader in real-time telemetry pipeline management.

The acquisition has been accounted for as a business combination. The total consideration transferred consisted of $252.7 million in cash, net of $15.2 million of cash and restricted cash acquired, and $2.0 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 cash consideration included cash held back in an escrow fund for a partial security for post-closing indemnification claims. Escrow amounts are reflected within restricted cash and are expected to be released in fiscal 2028. The purchase price was allocated on a preliminary basis, subject to working capital adjustment and continuing management analysis, to identifiable intangible assets, which include developed technology and customer relationships of $21.4 million, net tangible assets acquired of $0.2 million, and goodwill of $233.1 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 fair value of the developed technology was estimated using the relief-from-royalty method under the income approach. In addition, the fair value of customer relationships was estimated using the with-and-without method. The goodwill was primarily attributable to the assembled workforce of Onum, planned growth in new markets, and synergies expected to be achieved from the integration of Onum. Goodwill is not deductible for income tax purposes.

Per the terms of the merger agreement with Onum, certain unvested stock options held by Onum employees were canceled and exchanged for replacement stock options under the 2019 Plan. Additionally, certain shares of Onum stock held by Onum employees were exchanged for shares or the right to receive shares of the Company’s common stock, subject to service-based vesting 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 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.

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	$	20,600	84
Customer relationships	800		24
Total intangible assets acquired	$	21,400

Acquisition costs incurred during the six months ended July 31, 2026 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 Onum 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.

13. Net Income (Loss) Per Share Attributable to Common Stockholders

Basic and diluted net income (loss) per share attributable to CrowdStrike’s common stockholders is computed in conformity with the two-class method required for participating securities. Basic net income (loss) per share attributable to CrowdStrike common stockholders is computed by dividing the net income (loss) 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 PSU Awards, ESPP obligations, and founders holdbacks, and are computed using the treasury stock method. The effects of the outstanding stock options, RSUs, PSUs, Special PSU Awards, 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 antidilutive. Diluted net loss per share is the same as basic net loss per share for the three and six months ended July 31, 2025, because the effects of potentially dilutive items were antidilutive given the Company’s net loss position during that period.

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


	Three Months Ended July 31,				Six Months Ended July 31,
	2026		2025		2026		2025
Numerator:
Net income (loss) attributable to CrowdStrike	$	5,306	$	(70,153)	$	33,080	$	(174,417)
Denominator:
Weighted-average shares used in computing net income (loss) per share attributable to CrowdStrike common stockholders, basic	1,019,448		999,634		1,017,225		996,730
Dilutive effect of common stock equivalents	25,021		—		20,808		—
Weighted-average shares used in computing net income (loss) per share attributable to CrowdStrike common stockholders, dilutive	1,044,469		999,634		1,038,033		996,730
Net income (loss) per share attributable to CrowdStrike common stockholders, basic	$	0.01	$	(0.07)	$	0.03	$	(0.17)
Net income (loss) per share attributable to CrowdStrike common stockholders, diluted	$	0.01	$	(0.07)	$	0.03	$	(0.17)

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


	Three Months Ended July 31,		Six Months Ended July 31,
	2026	2025	2026	2025

RSUs and PSUs subject to future vesting	53	35,672	1,774	35,672
Shares of common stock issuable from stock options	—	3,852	10	3,852
Share purchase rights under the Employee Stock Purchase Plan	140	2,223	476	2,223
Potential common shares excluded from diluted net income (loss) per share	193	41,747	2,260	41,747

Founders holdbacks related to business combinations, where a variable number of shares will be issued upon vesting to settle a fixed monetary amount of $42.3 million, are 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, 2026, 9,224 and 23,192 shares were issued to settle founders holdbacks at a weighted average price of $166.31 and $132.29 per share, respectively.

As of July 31, 2026, the above table excludes 1,357,459 outstanding shares of in progress PSUs where pre-defined targets have not yet been achieved.

14. Segment Information

CrowdStrike’s Chief Operating Decision Maker (“CODM”), the Chief Executive Officer, manages the Company’s business activities as a single operating and reportable segment at the consolidated level. Accordingly, the CODM uses consolidated net income (loss) to measure segment profit or loss, evaluate financial performance, and allocate resources. Consolidated net income (loss) is evaluated on a monthly basis by comparing actual results against budgeted or forecasted net income (loss), facilitating the analysis of the Company’s financial trends.

Significant expenses within net income (loss) include cost of revenue for subscription and professional services, sales and marketing expenses, research and development expenses, and general and administrative expenses. Other segment items within net income (loss) include interest expense, interest income, other income (expense), net, and provision for income taxes, which are each separately disclosed and presented in the condensed consolidated statements of operations.

The Company’s property and equipment, net and operating lease right-of-use assets are summarized by geographic area as follows (in thousands):


	July 31, 2026		January 31, 2026
United States	$	1,050,688	$	855,312
Germany	103,710		106,657
Other countries	88,842		84,222
Total property and equipment, net and operating lease right-of-use assets	$	1,243,240	$	1,046,191

See Note 10 for additional information about the Company’s revenue by geographic region.

15. Strategic Plan

On May 6, 2025, the Company announced a strategic plan (the “Strategic Plan”) to evolve its operations to yield greater efficiencies as the Company continues to scale its business with focus and discipline to meet its goals. The Strategic Plan resulted in a reduction of roles representing approximately 500 positions, or 5%, of the Company’s global workforce.

The actions associated with the Strategic Plan were completed as of July 31, 2026.

There were no charges related to the Strategic Plan during the three and six months ended July 31, 2026.

Charges related to the Strategic Plan included in the condensed consolidated statements of operations during the three and six months ended July 31, 2025 were as follows (in thousands):


	Three Months Ended July 31, 2025		Six Months Ended July 31, 2025
Subscription cost of revenue	$	3,563	$	3,563
Professional services cost of revenue	3,345		3,345
Sales and marketing	8,723		8,723
Research and development	16,696		16,696
General and administrative	6,057		12,678
Total	$	38,384	$	45,005

The following table summarizes the activities related to the Strategic Plan for the six months ended July 31, 2026 and July 31, 2025 (in thousands):


	July 31, 2026			July 31, 2025
		Severance and Related Costs		Non-Employee Costs		Total		Severance and Related Costs		Non-Employee Costs		Total
Liability, beginning of the period		$	30	$	36	$	66	$	—	$	—	$	—
Charges (benefits)		—		—		—		37,983		7,022		45,005
Payments		(30)		(36)		(66)		(17,989)		(6,976)		(24,965)
Non-cash items		—		—		—		(17,901)		—		(17,901)
Liability, end of the period		$	—	$	—	$	—	$	2,093	$	46	$	2,139

There was no liability associated with the Strategic Plan as of July 31, 2026. As of July 31, 2025, the liability associated with the Strategic Plan is included in accrued payroll and benefits and accounts payable on the condensed consolidated balance sheet.

16. Share Repurchases

On June 3, 2025, the Company announced that its board of directors approved a share repurchase program for the repurchase of up to $1.0 billion of the Company’s Class A common stock (the “Share Repurchase Program”). On April 6, 2026, the Company announced that its board of directors authorized the repurchase of up to an additional $500.0 million of the Company’s Class A common stock, bringing the total authorization under the Share Repurchase Program to $1.5 billion. The Share Repurchase Program does not have a fixed expiration date and does not obligate the Company to acquire any specific number of shares. The Company may repurchase shares of Class A common stock from time to time using a variety of methods, including through open market purchases, privately negotiated transactions, and other means, including through the use of trading plans intended to qualify under Rule 10b5-1 under the Exchange Act.

The timing, manner, price, and amount of any repurchases will be determined by the Company at its discretion and will depend on a variety of factors, including legal requirements, price, and economic and market conditions. No repurchases were made under the Share Repurchase Program during the three months ended July 31, 2026. As of July 31, 2026, $1.3 billion remained available for future share repurchases under the Share Repurchase Program.

The following table presents shares repurchased and subsequently retired (in thousands):


	Three Months Ended July 31, 2026			Six Months Ended July 31, 2026
	Shares	Amount		Shares	Amount
Share repurchases	—	$	—	1,920	$	175,622
Total share repurchases	—	$	—	1,920	$	175,622

17. Revision of Prior Period Financial Statements

As discussed in Note 1, during the fourth quarter of the fiscal year ended January 31, 2026, the Company identified an immaterial error related to the timing of recognition of stock-based compensation expense in prior periods associated with certain awards granted in the fiscal years ended January 31, 2022 and 2023. To correct the immaterial error, the Company revised its previously issued unaudited Condensed Consolidated Financial Statements as of and for the three and six months ended July 31, 2025.

The following tables reflect the impacts of the revision to the previously filed financial statements for the three and six months ended July 31, 2025 (in thousands, except per share data):

Consolidated Statements of Stockholders’ Equity


	As of July 31, 2025
	As previously reported, adjusted for the Stock Split		Adjustments		As revised
Additional paid-in capital	$	5,016,167	$	28,968	$	5,045,135
Accumulated deficit	$	(1,265,989)	$	(28,968)	$	(1,294,957)

Consolidated Statements of Operations


	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, adjusted for the Stock Split:
Basic	$	(0.08)	$	0.01	$	(0.07)	$	(0.19)	$	0.02	$	(0.17)
Diluted	$	(0.08)	$	0.01	$	(0.07)	$	(0.19)	$	0.02	$	(0.17)

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 loss as detailed above.

Previous: Cover and table of contents · Next: Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS