What happened

Shares of cloud-based cybersecurity specialist CrowdStrike Holdings (CRWD -3.90%) were up on Wednesday after the company reported financial results for the fourth quarter of its fiscal 2023. As of noon ET, CrowdStrike stock was up about 3.5%, but it had been up as much as 8% earlier in the trading session.

So what

In Q4, CrowdStrike generated revenue of $637 million, up 48% year over year and well ahead of management's guidance of $619.1 million to $628.2 million. Encouragingly, the company was able to add nearly 1,900 net new customers during the quarter, boosting its customer count nearly 9% quarter over quarter.

The majority of CrowdStrike's revenue is subscription-based, making annual recurring revenue (ARR) an important metric to monitor. In Q4, the company added $222 million in net ARR -- its highest for a single quarter -- bringing its ARR total to $2.56 billion.

Thanks to its strong growth, the vast majority of analysts are raising their price targets for CrowdStrike stock today. Interestingly, an overwhelming majority lowered price targets just three months ago when CrowdStrike's top-line growth underwhelmed. To me, this demonstrates that it's important for investors to shift their focus beyond the current quarter of financial results, thinking in terms of years.

Now what

Looking ahead, the market likes what it sees. With its Q4 financial results, CrowdStrike management put out official financial targets for its fiscal 2024, which include full-year revenue guidance of about $3 billion. That represents about 34% year-over-year growth, which is a slowdown from its growth of 54% in fiscal 2023. However, this guidance is modestly ahead of Wall Street's expectations and it contributed to the gains today for CrowdStrike stock.

As a reminder, CrowdStrike hopes to get to $5 billion in ARR by the end of its fiscal 2026 -- about three years away. To get there in time, it will need to grow ARR by at least 33% annually. Its ARR was up 48% year over year in fiscal 2023. But considering its slowdown in revenue growth, it could be challenging -- not impossible -- to reach its goal on time. And if it doesn't reach its goal on time, that could disappoint investors.

That said, it was a good year for CrowdStrike and it's understandable for the stock to be up today.