CrowdStrike Holdings, Inc. (CRWD): A Bull Case Theory

We came across a bullish thesis on CrowdStrike Holdings, Inc. on Compounding Your Wealth’s Substack by Sergey. In this article, we will summarize the bulls’ thesis on CRWD. CrowdStrike Holdings, Inc.’s share was trading at $413.50 as of September 2^nd. CRWD’s trailing and forward P/E were 401.83 and 121.95, respectively according to Yahoo Finance.

CrowdStrike delivered a strong second quarter of fiscal 2025, posting revenue of $1.17 billion, up 21% year over year and ahead of expectations, with subscription revenue reaching $1.1 billion and professional services revenue setting a record at $66 million. Annual recurring revenue rose 20% to $4.66 billion, with net new ARR of $221 million, signaling reacceleration earlier than anticipated. Profitability was healthy, with non-GAAP operating income of $255 million, free cash flow of $284 million, and EPS of $0.93, topping estimates by 12%. While GAAP results showed a net loss due to outage and restructuring costs, cash and equivalents approached $5 billion, providing ample flexibility.

The Falcon platform continues to underpin growth, driving deeper module adoption as 60% of large customers now use eight or more modules. Key businesses performed strongly, with cloud ARR surpassing $700 million (+35% YoY), identity protection reaching $435 million (+21%), exposure management exceeding $300 million, and next-gen SIEM nearly doubling to $430 million. Charlotte AI adoption rose 85% sequentially, embedding automation across the platform and reinforcing Falcon as an AI-native security operating system. Falcon Flex also passed 1,000 customers, with strong reflex expansion delivering significant ARR uplift. The ONEM acquisition further enhances SIEM capabilities, reducing costs and response times.

Customer expansion remained robust, with 800 clients now generating over $1 million ARR, and partner contributions driving over 60% of new business. Retention remained above 95% once modules are adopted, underscoring stickiness. Despite near-term headwinds in GAAP margins, extended CAC payback, and softer U.S. growth, CrowdStrike guided FY25 revenue in line with estimates and reiterated its path to $10 billion ARR by FY31, supported by AI-driven demand, consolidation, and sustained platform adoption.

Previously we covered a bullish thesis on CrowdStrike Holdings, Inc. (CRWD) by Bulls On Parade in February 2025, which highlighted recovery from the “Blue Screen of Death” incident, strong balance sheet, and leadership in cybersecurity consolidation. The company’s stock price has appreciated by approximately 8% since our coverage. Sergey shares a similar view but emphasizes ARR reacceleration, module expansion, and Charlotte AI adoption.

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Disclosure: None.