CrowdStrike Holdings (CRWD 0.17%) has developed a unique cybersecurity platform called Falcon, which is an all-in-one solution capable of protecting an entire company, from cloud networks to endpoints (computers and devices). It uses artificial intelligence (AI) to automate everything, including threat detection and incident response, giving business owners more time to focus on their operations.
CrowdStrike stock is currently down 22% from its record high as investors grow weary of its valuation, which remains much higher than all of its peers in the cybersecurity space. But on March 3, the company will release operating results for its fiscal 2026 fourth quarter (ended Jan. 31), which will likely show strong revenue growth fueled by soaring Falcon demand.
Should investors buy CrowdStrike on the dip ahead of the report?
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Shaping the future of cybersecurity
Falcon uses a cloud-based architecture that only requires the installation of a sensor on each computer and device. This allows CrowdStrike to push over-the-air updates in the background without interrupting its customers.
Businesses can choose from 32 Falcon modules (products) to craft a cybersecurity solution that best fits their needs, and with the Falcon Flex subscription option, they can even add and remove modules during their contract period as their needs change.
But AI is shifting the cybersecurity landscape completely. Every time a business adopts an AI model, launches an AI chatbot, or deploys an AI agent, it is creating new attack surfaces for hackers to exploit. Agents pose some of the biggest risks because they need access to sensitive internal systems and data to complete the tasks assigned by their human managers.
NASDAQ: CRWD
Key Data Points
An AI agent typically doesn't have its own identity or credentials, which creates a huge security gap. If hackers were to gain control over an agent, they could potentially compromise systems and harvest a significant amount of sensitive data without the business even knowing.
Last August, CrowdStrike launched Falcon Next-Gen Identity Security to cover this threat. It uses what it calls a "zero standing privileges" approach, meaning it revokes access to sensitive applications and data for both human and digital identities when it is no longer required, reducing the risk of unauthorized access. And it uses the company's industry-leading threat intelligence to authenticate trusted users and flag uncharacteristic behavior.
These constant innovations will ensure Falcon remains a go-to cybersecurity platform for businesses.
Revenue growth is accelerating
CrowdStrike brought in $1.23 billion in revenue during its fiscal 2026 third quarter (ended Oct. 31), which was a 22% increase from the year-ago period. It was the second consecutive quarter in which that growth rate accelerated, highlighting the company's momentum.
According to management's guidance, the company likely generated $1.3 billion in revenue during the fourth quarter, which would be a year-over-year increase of more than 22%. It would take the full-year revenue for fiscal 2026 to a record $4.8 billion.
On March 3, investors should also look for an update on the Falcon Flex subscription product, which has been a major growth driver since it was introduced in 2023. During the recent third quarter, it was responsible for $1.35 billion in annual recurring revenue (ARR), which was up 200% year over year. It turns out customers really like being able to adjust Falcon's capabilities as their businesses grow, without having to negotiate an entirely new contract.
The stock is still relatively expensive
One single quarterly result is unlikely to alter CrowdStrike's positive long-term trajectory, but whether or not investors should buy its stock ahead of March 3 could depend on their time horizon.
Despite its recent 22% decline, the stock still trades at a pricey 23.4 times revenue, making it far more expensive than its competitors -- including its closest rival, Palo Alto Networks, which trades at 12.3 times revenue.
Data by YCharts; PS = price to sales.
As a result, investors who are looking for strong returns in the next 12 months or so should probably steer clear of CrowdStrike stock, even with a potentially strong fourth-quarter result coming up on March 3. Instead, this opportunity is better suited for those who can hold the stock for five years or more, which will give the company time to grow into its valuation.
In fact, CrowdStrike believes it can quadruple its ARR to $20 billion over the next decade (by fiscal 2036) as the rise of agentic AI fuels a surge in demand for advanced cybersecurity. If that happens, its current stock price will probably look like an absolute bargain when investors reflect back on this moment in 10 years' time.
