CrowdStrike Plunges 7.05% on Missed Earnings, Guidance

CrowdStrike Holdings, a prominent cybersecurity company, experienced a significant drop of 7.05% in pre-market trading on June 4, 2025. This decline came after the company released its first-quarter financial results, which, while meeting revenue expectations, fell short in terms of earnings per share and second-quarter guidance.

CrowdStrike reported revenue of $1.1 billion for the first quarter, a 20% year-over-year increase, but its adjusted earnings per share of $0.73 missed analysts' expectations of $0.81. The company's second-quarter revenue guidance of $11.4 billion to $11.5 billion also fell short of the $11.6 billion expected by analysts. This shortfall in guidance, coupled with increased operational costs due to a major software outage last summer, contributed to the stock's decline.

In response to the financial challenges, CrowdStrike announced plans to lay off approximately 500 employees, aiming to achieve an annual recurring revenue target of $100 billion. The company also faced scrutiny from U.S. prosecutors and regulators over a $32 million deal with technology distributor Carahsoft Technology Corp. Additionally, the company's decision to terminate its "Customer Commitment Package" program, introduced to retain customers affected by the software outage, further impacted investor sentiment.