CrowdStrike Holdings reported a 26% year-over-year increase in total revenue for the second quarter of fiscal 2027, reaching $1.47 billion, while ending annual recurring revenue (ARR) climbed 25% to $5.84 billion. The company posted net new ARR of $333 million, up 51% from the prior year, as demand for AI security capabilities accelerated platform adoption.
Subscription revenue, which accounts for the bulk of CrowdStrike's business, grew 27% to $1.40 billion, while non-GAAP operating income rose 46% to $372 million, expanding margins by 350 basis points to 25%. Diluted earnings per share came in at $0.31, beating analyst expectations of $0.29 and marking a 34% increase year-over-year. Free cash flow totaled $377 million, a 33% rise with margins up 140 basis points to 26%.
The company highlighted strong performance in its AI-driven modules, with combined ARR for Cloud Security, LogScale Next-Gen SIEM, and Next-Gen Identity exceeding $2.18 billion, growing more than 39% year-over-year. Cloud Security ARR surpassed $905 million, while LogScale Next-Gen SIEM and Next-Gen Identity reached $695 million and $585 million, respectively. AI Detection and Response (AIDR) ARR nearly tripled quarter-over-quarter.
CrowdStrike's Falcon Flex commercial model continued to gain traction, with ending ARR from Flex accounts rising 101% year-over-year to $2.29 billion. The company now counts over 2,900 Flex customers and more than 630 Re-Flex customers. Customers converting from standard contracts to Flex saw an average ARR uplift of over 40%, while those completing multiple Re-Flex contracts reported uplifts of 25% to 53%.
Looking ahead, Crowdrike guided for third-quarter revenue of $1.523 billion to $1.529 billion and adjusted EPS of approximately $0.31. For the full fiscal year 2027, revenue is projected between $5.991 billion and $6.011 billion, with non-GAAP diluted EPS expected to range from $1.25 to $1.26. The company targets ending ARR of $6.603 billion to $6.612 billion for FY27 and aims for subscription gross margins of 82-85%, operating margins of 28-32%, and free cash flow margins of 34-38% by fiscal 2029.
Shares of CrowdStrike surged 10.38% in after-hours trading to $208.81, following the release of the results.
