Artificial intelligence is one of the hottest topics these days. ChatGPT has demonstrated the power of using AI to generate content on par with human writing. There is an explosion of interest in this technology.
in the meantime AI is a new topic for many investors, but it is not new. cloud strike (CRWD -0.83%)The company is a pioneer in using AI. cyber securityIts AI-driven Falcon platform continues to win new customers, expand existing customer relationships, and enable vigorous growth. With further growth potential, it’s a very easy stock to buy for anyone looking to add his AI strategy to their portfolio.
AI-powered cybersecurity pioneer
CrowdStrike’s Falcon platform is a leader in the cybersecurity industry. The company’s state-of-the-art technology is regularly awarded for its ability to deliver superior results.
On the Q4 conference call, co-founder and CEO George Kurtz highlighted the role AI plays in providing industry-leading protection.Kurtz said the company has a “long track record of disruptive innovation, including the use of AI and attack indicators to stop cyber attackers in real time.”
“The use of AI is a new topic of the day, but nothing new for CrowdStrike. We were pioneers in applying AI to cybersecurity.”
The Falcon platform was designed from the ground up to effectively process and correlate the massive amounts of data needed for effective AI and leverage it across the platform, from prevention to detection to response. This allows Falcon to detect weaker signals and identify activity earlier in the kill chain. We’ve become experts in leveraging data science to provide optimal attack detection and prevention for over 23,000 customers. This drives tremendous leverage across the platform, resulting in better, more efficient outcomes for our customers.
AI has given the company a technological advantage over competing cybersecurity platforms. This has led to more customers adopting the platform and subscribing to additional modules provided by the company to consolidate their security architecture.
No hype.just the result
Increased adoption of CrowdStrike’s AI-driven platform is driving strong growth. Kurtz said on the fourth-quarter conference call that the company achieved “a record new net annual recurring revenue (ARR) of $222 million and his record net new customers of 1,873.” rice field. This resulted in total ARR of $2.56 billion, up 48% year-on-year, and the number of customers exceeded 23,000 han, up 41% year-on-year.
In the meantime, the company continues to retain customers and expand existing relationships. CrowdStrike achieved best-in-class gross retention of 98% and net retention of 125% in dollar terms, demonstrating its ability to grow customer relationships.These strong growth rates drove ‘record operating profit’ [and] It posted free cash flow of $209 million, according to Kurtz.
The company’s highly efficient, low-cost platform encourages customers to consolidate their security architectures into CrowdStrike. “CrowdStrike’s growing market share demonstrates the advanced AI and technology leadership of the Falcon platform, driving security outcomes, automation, and lower total cost of ownership for our customers,” said Kurtz. increase.
Further growth in the future
CrowdStrike’s CEO firmly believes that his company’s already expanding opportunities will continue to grow in the future. “We see great opportunities to grow our share across the market leveraging AI-driven ‘collect data once, reuse many times’ platforms,” he said. I was. The company’s current addressable market opportunity totals more than $75 billion. That number is expected to grow to $158 billion by 2026.
This strengthens the company’s view that it can nearly double its ARR to $5 billion by the end of 2026. On the other hand, we believe that scale will enable us to achieve our target operating model of 20%+ operating margin and 30%+ free cash. This allows us to realize significant earnings and free cash flow growth.
Outstanding stocks powered by AI
CrowdStrike is a pioneer in applying AI to cybersecurity. This has allowed us to build a best-in-class platform that customers have been flocking to recently. But that’s just scratching the surface of the potion. Considering the stock is currently trading about 60% away from its peak, it’s a great AI stock to buy, especially since it hasn’t caught the attention of the Hype Train yet. It’s an easy choice.