What Happened?

Shares of cybersecurity company CrowdStrike (NASDAQ:CRWD) fell 8% in the morning session after markets tumbled, extending the weakness from the previous week as concerns over the ongoing trade war continued to spread. On Sunday, March 9, 2025, President Trump fielded questions regarding recession worries on FOX News, calling the market struggle "a period of transition," but that didn't do much to calm investors. The sell-off was particularly pronounced in the tech sector, with the Nasdaq falling 3% into correction territory, while the S&P 500 also posted a 2% decline.

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What The Market Is Telling Us

CrowdStrike’s shares are somewhat volatile and have had 13 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business. 

The previous big move we wrote about was 5 days ago when the stock dropped 10.8% on the news that the company reported mixed fourth quarter (fiscal 2025) results: Its full-year revenue guidance was just in line, while full-year operating profit guidance missed Wall Street's estimates. The profit guidance miss was due to investments in platform resiliency, AI efficiencies, and sales and marketing costs, some of which are from CCPs (customer compensation packages) following the July 19th 2024 outage. 

On the other hand, CrowdStrike beat analysts' annual recurring revenue (ARR), revenue, and operating profit expectations during the quarter. Sales climbed 25% year-on-year, largely driven by a 27% growth in subscription revenue as companies leaned more on its Falcon platform. Overall, the quarter was solid, but the guidance was mixed, and the latter weighed on shares.

CrowdStrike is down 11.3% since the beginning of the year, and at $308.16 per share, it is trading 32.3% below its 52-week high of $455.36 from February 2025. Investors who bought $1,000 worth of CrowdStrike’s shares 5 years ago would now be looking at an investment worth $6,569.

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