KEY TAKEAWAYS
- CrowdStrike shares are falling more than 4% in premarket trading, extending Friday's large declines, after the cybersecurity firm's software update caused a global outage in Microsoft’s cloud services.
- Meanwhile, shares of CrowdStrike's rivals Palo Alto Networks and SentinelOne are extending their gains.
- Deutsche Bank analysts said CrowdStrike's competitors "will look to seize on CrowdStrike's misfortune."
CrowdStrike (CRWD) shares are falling more than 4% less than an hour before the opening bell Monday, extending Friday's 11% declines, after an update to thecybersecurity firm's software caused an outagein Microsoft’s (MSFT) cloud services and disrupted businesses worldwide.
Meanwhile, theshares of CrowdStrike competitorsPalo Alto Networks (PANW) and SentinelOne (S), which rose Friday in the wake of the outage, continued their gains in premarket trading. SentinelOne shares are up about 5% and Palo Alto Networks 1%.
Rivals 'Will Look to Seize on CrowdStrike's Misfortune'
In a note Monday, Deutsche Bank analysts said that CrowdStrike shares face a "non-trivial downside risk" given that it's a "premium company" whose stock trades at 15 times 2025 revenue.
"No doubt competitors like SentinelOne, Microsoft, and even Palo Alto Networks will look to seize on CrowdStrike's misfortune," they said.
CrowdStrikeshort sellersmade more than $373 million Friday after the cybersecurity firm's stock plunged, according to research firm S3 Partners.
Despite their recent declines, CrowdStrike shares are up almost 20% this year through Friday's close. CrowdStrike providessecurity softwareto customers and apart from Microsoft Azure, its cloud platform partners include Alphabet's (GOOGL) Google Cloud, and Amazon's (AMZN)Amazon Web Services (AWS).
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FAQs
KEY TAKEAWAYS
What is the problem with CrowdStrike? ›
At issue was a flawed update to CrowdStrike Falcon, the company's popular endpoint detection and response (EDR) platform, which crashed Windows machines and sent them into an endless reboot cycle, taking down servers and rendering 'blue screens of death' on displays across the world.
Why is CrowdStrike better than competitors? ›
Is CrowdStrike Better Than Competitors? The top endpoint security and EDR platforms excel in different areas, including detection, protection, threat intelligence, and research. CrowdStrike is particularly renowned for its defense capabilities.
What is the growth forecast for CrowdStrike? ›
We forecast CrowdStrike's revenue to see a 29% compound annual growth rate over the next five years. We expect the firm to continually expand its client base while maintaining strong upselling performance with existing clients.
Why did CrowdStrike stock fall today? ›
CrowdStrike's stock has fallen after its technology caused a major outage, presenting a potential opportunity for investors.
How bad is the CrowdStrike outage? ›
A CrowdStrike update caused a massive IT outage, crashing millions of Windows systems. Critical services and business operations were disrupted, revealing tech reliance risks.
Is CrowdStrike losing money? ›
Net Income/Loss Attributable to CrowdStrike : GAAP net income attributable to CrowdStrike was $89.3 million , compared to a loss of $183.2 million in fiscal 2023. GAAP net income per share attributable to CrowdStrike , diluted, was $0.37 , compared to a loss of $0.79 in fiscal 2023.
Can CrowdStrike survive? ›
CrowdStrike will likely survive and move forward, but, reputationally, it can't afford another incident like this, said William MacMillan, a former CISO at the CIA.
Will CrowdStrike recover? ›
CrowdStrike Stock And The Long Road To Recovery
Analysts and crisis management counselors agree potential litigation stands as one element that will prevent the company, and CrowdStrike stock, from completely recovering for some time. The company contends it is operating as normal.
Who competes with CrowdStrike? ›
Top CrowdStrike Alternatives
- Microsoft.
- SentinelOne.
- Sophos.
- Cisco Systems.
- Malwarebytes.
- Palo Alto Networks.
- Bitdefender.
- Trend Micro.
Key Takeaways. CrowdStrike shares continued to fall after last week's outage. Analysts indicated that the outage and subsequent issues are likely to affect CrowdStrike stock in the near term—but also that there may be an opportunity to buy the shares on a dip.
Who is the biggest investor in CrowdStrike? ›
According to the latest TipRanks data, approximately 37.92% of CrowdStrike Holdings (CRWD) stock is held by retail investors. VANGUARD INDEX FUNDS owns the most shares of CrowdStrike Holdings (CRWD).
Will CrowdStrike shares bounce back? ›
“[CrowdStrike] will quickly regain their footing & and momentum given their still strong reputation & best-of-breed cybersecurity platform,” Kessinger wrote in a note reiterating a Buy rating on Tuesday evening. Out of 51 analysts covering the stock, 40 rate it Buy or Overweight, according to FactSet.
What really happened with CrowdStrike? ›
“The system was sent an update, and that update had a software bug in it and caused an issue with the Microsoft operating system.” The CrowdStrike outage affected more than CrowdStrike. It caused Windows computers running Falcon to crash, hampering, or stopping the business processes running on those computers.
What is the root cause of the CrowdStrike issue? ›
The crash occurred because there was a mismatch between the 21 inputs passed to the CrowdStrike content validator and the 20 supplied to the content interpreter.
What is the global issue with CrowdStrike? ›
The main issue was a mismatch between the input fields expected by CrowdStrike's Falcon driver and the ones supplied in a content update. CrowdStrike is now promising to better test updates and is using two independent third-party software security vendors to review its sensor code and release processes.
Can CrowdStrike be trusted? ›
Yes, CrowdStrike can be trusted. It is highly regarded in the cybersecurity industry for its advanced threat detection capabilities and real-time response.
