The company, which has positioned itself as an expert in SaaS marketing, had higher revenue and earnings than expected in the third quarter in late November. It had a record number of new customers, generating at least $1 million in annual recurring revenue.
However, overall net ARR growth was lower than management expected, the company said, “as increased macroeconomic headwinds lengthened sales cycles with smaller customers and forced some larger customers to stick to multi-step subscription start dates, delaying ARR recognition until future quarters.”
Cloud services stocks have been struggling lately because corporate demand seems to be weakening . sales department CRM -1.55% (CRM), another cloud software company projected lower-than-expected revenue for the January quarter . Management said they were starting to see “a tougher buying environment.”
Despite CrowdStrike’s pessimistic comments and earnings outlook, the quarterly earnings and revenue data gave Bercy enough reason to raise its stock rating. “A good quarter provides a solid foundation for the entire fiscal year,” he wrote in a research note.