CrowdStrike Holdings, Inc. (CRWD) Earnings Call Transcript & Summary

Thanks very much for joining us. Again, I'm going to advertise, like I do in all our sessions. If you didn't see, I'm going to advertise our primers. You can find them downstairs. We have a few primers that we published recently. One of them, which is very relevant for this space is the endpoint primer that we speak about CrowdStrike and their position as well as the competition, et cetera. So I'm very pleased to host George Kurtz, Co-Founder and CEO of CrowdStrike. We -- I have a list of many, many questions. I'm sure we're not going to cover even half of it. And that's why I ask you if there is any question -- if we touch a topic and there is any question from the audience, just raise your hand. That's going to be the easiest one. And we have a microphone, and we'll get you a microphone instead of me allocating time for questions at the end. Okay? So George, thanks so much for doing it with us.

I wanted to start with basic. As always, I always start with kind of the basics. And can you take us from the IPO until now, to the evolution of the company, evolution in strategy, evolution in execution, evolution in addressable market you're going after? Just what happened to the company basically since you went public?

Sure. So first, thanks for having me here. And I got to tell you, it's been so inspiring to meet with customers and be back in action. And I met a lot of folks that are a lot taller than I thought, they look as tall on Zoom. So I was like, "Oh, I didn't realize how tall you were." So it's good to be here. And when you think about CrowdStrike and the strategy when I started the company, it was always to be that foundational platform company. We talked many times about the sales force of security. And when you looked at ServiceNow and Workday and Salesforce, there really was no platform company in security, and I thought there needed to be one. So when I started the company, we had like 1 module because we're just getting everything up and running. And then over the years, we broke that out. At the time of IPO, we were 10. Now we're 22. And we've gone into different adjacencies that are relevant and related to what we do. And we've extended out the utility of this incredible agent cloud architecture that we built, which is probably one of our secret sauces to be able to get that level of visibility at scale and be able to operate that very quickly. So our whole goal is to continue to expand out in the areas that we focus on, endpoints, workloads, cloud workloads, data, identity. And we think there's a huge market in front of us.

So I mean the best thing is to quote your numbers for total addressable market, what you estimated to be TAM. At the time of IPO, it was $25 billion. Then it was $58 billion. You expect it to grow to $71 billion by 2024, and you expect it to grow to $126 billion. So that's with -- between the time you went public in 2025, that's a 5x growth in the TAM. At what point do you say, I'm going to focus on what I do and I'm going to expand within the current TAM? Because so far, you've been expanding the TAM almost every year. When do you think you'll get to a maturity level where you say, "I'm not going to go after new businesses. I'm going to focus on greater penetration within the existing TAM, existing businesses."?

Well, it's really driven by our customers. And when you think about something like expanding into vulnerability management, it's a space I know pretty well because I had a company that I started called Foundstone. So it was -- I always wish I could have done at Foundstone what we can do here with our agent architecture, but it's really driven by customers that say, "Hey, you already have this data. Can't you create a workflow that addresses these vulnerabilities and misconfigurations?" Yes, we can. We have the data, so we build a workflow around it. And I think that's the beauty of the platform. When we expand into an adjacency, we don't have to build yet another product, right? We already have most of the apparatus built, and we got to build a new workflow around it. And we want to stick with stuff that is relevant to what we've collected and then create outcomes that are good for customers. So again, it's driven by customers. It's important to say what we're in versus what we're not in. We're not a network company. We're not an e-mail company. We're not a whole bunch of other things that are out there. And security, as you know, is a big market. Just walk the show floor. So we want to be the best in endpoints and workloads and data and identity specific to workloads and endpoints, not what Okta does. And that's our core market, and we continue to grow that out into that $126 billion. So it's really creating workflows around the data that we collect at scale and giving customer the right outcome. Staying safe, protecting them, but also giving them visibility into things that are security-related. But even things like assets, and we announced our asset graph this week, that's really important for IT organizations.

What do you need to do on managing -- I'm not talking about R&D now. You're addressing new opportunities and you're going after new markets. You made some acquisitions. But there is also the operational side. You need to go after the opportunities. What did you have to do when it comes to channels, go-to-market, operationally within the company in order to grow the number of markets you're going after, right, such a big factor?

Well, I think it really starts with the platform itself, and we try to stick to things that we can attach into the core base. I'll use identity as an example. We acquired a company called Preempt. It is real fantastic organization, great technology, great people. And actually funny, I was just over there visiting them, first time I met them in 3 years, we'd acquired them over Zoom, which is kind of a weird thing. But it was great to meet them in person. But when you think about identity, specific to what we do, endpoints and workloads in this kind of Zero Trust concept that prevents lateral movement, it's very easy to attach. It's -- you have your core endpoint modules, and people realize that identity is a key driver to breaches, let's attach it. So I think your question is really centered around like how do you operationalize it, what happens with the sales force, how do you get your channels educated. We try to pick things that are relevant and related to what we do from a platform perspective. Identity is a great use case for that.

Got it. We'll get to the product in a second. I want to maybe stay in the level of channels because a lot of us are doing what we call channel checks, meaning we're calling distributors. We're asking them about their views and who do they like to work with, et cetera. And over the years, I have to say that with CrowdStrike, you have lot of followers. But new players are coming in like SentinelOne, and the channel does like to work with them. What do you need to do -- or what are you doing, not what do you need, what are you doing in order to maintain a healthy and happy channel? What are the big kind of points that you're focusing on to make sure that your channel supports you?

I think this is really one question on the channel is how do you make the money, right? And it's pretty -- it's all about gross profit for the channel. So it's, a, having the right product, having customer pull, which we have, and then working with them to make sure that they're successful. If you look at -- AWS is a great example. We talked about at the end of Q4, that's over $100 million business for us growing at 100%. They're making a lot of money. It's a great opportunity. If you look at some of our other managed service providers, we went through some of that in one of the prior reportings, 200% growth in managed service providers. Why are they using us? A, they're making money. It's easy to operationalize. It works. And most importantly, you have customers that want our technology. So it's keeping them happy. And then you take companies like Mandiant. We partnered up with Mandiant, who, again, is a leader in incident response. We have our own practice there. But the goal for us is to take the best technology and allow managed service providers, incident responders, to use our technology to make money in their own engagements and then be able to cross-sell that in their customer base. If we can replicate what we do internally, for every dollar of services, we turned that in $5.71 of subscription revenue. So by creating this multiplier effect with folks like Mandiant and others, it really is a great opportunity to grow our base, and at the same time, making them successful and allowing them to make a bunch of money.

Got it. So I want to maybe ask you a little bit about some of your target markets given that there's such a big factor of your growth. And I want to start with cloud, cloud security. We hosted a panel this morning about cloud security. We maybe understand what drives it. But from your point of view, what is the opportunity in cloud security? What are you going after? And what's the difference between what you're doing and what maybe Palo Alto is doing with their Prisma product? Is it competition? Or is it add-on like it's happening in identity?

Sure. Well, I think when you look at cloud and the opportunity there, I think it's really underrepresented in the current forecast with like an IDC. And we went through this probably a year ago in one of our webinars, where we looked at the cloud growth and we looked at the security spend. And literally out of the cloud growth, the security spend was 1.1% going to 0.9%. So I don't see cloud security spend going down to 0.9%. I see it going up. And if you just applied a Gartner number of 5.7%, you've got a massive multi, multi, tens of billion dollar opportunity in front of us. And by the way, nobody is there. It's not like we're replacing McAfee and Symantec. There's just nothing there. Folks like us, Palo Alto and others that are focused on that market. And I think we have a great opportunity because from a product perspective, when we think about CNAP as a category. We not only have an agentless solution in Falcon Horizon, but we've got our cloud workload protection, which is needed. So a lot of the start-up players, they only essentially just integrate with APIs. Gives a pretty low barrier to entry to just integrate with APIs. But by having an agent and giving full visibility across both the posture elements as well as the run time protection, we think that's a real benefit for customers. So it's a big opportunity. There's going to be a lot of people that are successful there. We think we can take an outsized share of that market and focus on not only run time, but it's the shift-left concept. How do you make sure that the containers are secure before they get implemented? We've got vulnerability management within the containers. How do you operationalize making changes? We've got things like Fusion, which is our workflow product. So we've got a lot of the pieces that we need, and we've seen tremendous growth there. The stat that we put out I think at the last -- one of the last investor events of our quarterly report was $106 million of cloud revenue, which is pretty big and growing at a really rapid clip. So great opportunity there. And I think we've got great products that set to take advantage of it.

Got it. The Zero Trust, another big concept. Everyone defines Zero Trust a little bit different. Nikesh had a great quote today. He said it's like love. Everyone views it a little bit differently. And I'm going to ask you the same question that I asked him. How do -- what does it mean Zero Trust for you? Meaning how do you participate in the market? What kind of opportunities you see? And do you displace or replace someone? Or is it kind of greenfield, brand-new opportunity for you?

Sure. So let me -- I'm going to answer that question, but I want to zoom out for a little bit because I want to talk about key elements of Zero Trust. Zero Trust is an architecture. That's also philosophy, and there's products that enable it. So when we think about what customers want today, in my opinion, they want best-of-breed platforms. It started with -- sorry, it's like day 1, I'm already losing my voice. It started with best-of-breed products, and it went to best-of-suite, and then it became really what I call best-of-platform. When we think about Zero Trust and where we operate, we are focused on implementing a Zero Trust architecture on the endpoints and workloads themselves and integrating with the network providers. So Palo Alto, Zscaler, Cloudflare, others, we're essentially focused on preventing lateral movement and giving great visibility into directory services and providing a trust score back to some of the network providers so they can make decisions. And that's -- we play in the endpoints and workloads.

Got it. How big of an opportunity do you think there is in the concept? Are there products -- specific products that you sell? Or is it, by the way, a byproduct of your solution, meaning if you take the platform, you get the visibility that you need for Zero Trust?

Well, it's really the Preempt technology, which would give you visibility into identity, directory services. And then one of the biggest areas of breaches is the abuse of identity and lateral movement. So if you got to phish and somebody stole your credentials and they got into a system, there's no malware prevention technology in the world that's going to prevent that because there's no malware. Somebody got credentials and got on. What we can do, though, is -- and take 2-factor aside. I mean you have abuse of that and just assume somebody gone because it happens every day. If you -- if the adversary tried to move laterally within your organization, we would actually identify that and understand that it's not you, there's an AI layer on top of it and then generate a multifactor response, which is you need to re-authenticate yourself. And that's a big part of what we do to stop breaches, but it's focused on the workloads, the endpoints, the real human identities as well as the machine identities. And then anything outside of that on the network, on the applications, firewalls, we integrate, and we allow other partners to be able to take care of their piece of the architecture that we are 1 component of it.

Got it. I want to go back to a question I asked you before but ask it differently, and it's about competition. There is -- on one hand, there is the displacement of legacy solutions. On the other hand, there are a lot more players in endpoint protection. And if we take Cortex from Palo Alto or almost any other -- any security vendor has some kind of endpoint protection. Do you see any pricing pressure that is abnormal to the endpoint market versus before? And if yes, how do you offset? And the reason why I'm asking it is because there were some concerns a few months ago that the new players, especially SentinelOne that is coming to the market, are coming with much lower price. So what do you say about the pricing environment? And how do you address any pressure that you see in the market?

Well, I would start with saying that customers want to buy outcomes and actually have technology that works. When you look at CrowdStrike, it's easy to deploy, it's operational and it works. We're #1 in market share. IDC just came out with corporate endpoint market share, we're 12.6%. Palo Alto is 1.9%. They didn't even make the top 7 -- or actually 14. So there's a lot of players that are out there, but it's always been a competitive market. And it was that way when I started the company in 2011. It's that way in 2022. But there's been a big sea change. So think about when I started the company, even say since 2017, let's go through all of the M&A activity: McAfee, sold; Symantec, sold; Carbon Black, sold; Endgame, sold; Cylance, sold. There's a reason why you've seen that level of turnover because in part the success of the technology that we've built and the fact that organizations are looking for a much more modern architecture with better outcomes, which is stopping the breach. Most of the players still have and continue to focus on prevention-only and just malware detection. If prevention-only was the solution, Cylance wouldn't be called BlackBerry.

Yes. I understand. So you're growing extremely fast. Your net retention rate is extremely high. Can you break it down for us? Can you tell us, for example, what are the big modules that are selling? And how do you -- how companies prioritize? What do you land with and what do you expand with kind of with these companies?

Sure. In our April investor deck, we actually have a really good slide on the hyper-growth modules and the core modules. The core modules today are things like antivirus, things like EDR, OverWatch. When you look at some of the hyper-growth areas, identity is just unbelievable, 30% quarter-over-quarter growth. It has been -- I think it's the new EDR. I think every -- it's really important. I think every CrowdStrike Falcon customer should be an identity customer. You've got things like Spotlight. If you go back a few months ago with Log4j and that vulnerability, people were just running around. The Internet was melting. And we were there. I had dinner with a customer -- a bunch of customers last night in prospects, and we had one customer say, "You were the -- CrowdStrike was the only solution that gave us visibility on Log4j." And they actually weren't a Spotlight customer, which is the vulnerability management module. So let me just take a little bit of a detail and explain why this is relevant. Log4j happened, and we've taken an approach where we've consumerized the enterprise experience. Somebody has an iPhone, iPad, Android, whatever. People want stuff. They click it works and it just happens. And in that particular case with Log4j, customers logged in, and we knew if they were a Spotlight customer or not. We have that visibility. And then we presented them with the fact that, "Hey, we know Log4j is a real problem right now. We understand you're not a Spotlight customer. Would you like a free 15-day trial?" And the only thing they needed to do is click Okay. We already had all of their data. It's already provisioned, ready to go. And obviously, that leads to a very efficient sales model where we converted them, which gets to some of the metrics when we talk about magic numbers of 1.4. It's the platform helping sell itself. But getting back to my point, these hyper-growth modules, whether it's Falcon Complete, we talked about in the last earnings call, identity, others, have really allowed us to expand into these adjacencies and grow very quickly.

Got it. I want to go over kind of the last quarter a little bit and ask some questions that were not asked about it. But before that, I want to understand your go-to-market strategy and the split between where do you direct versus indirect channels, cloud? Can you take us through a journey of go-to-market strategy? How do you sell your solutions? What are the strong channels? And what are the channels that are growing and important?

So we're a channel-first company, just about all the deals go through the channel at some capacity. You've got different channel providers and channels in general. So you have folks like the hyperscalers, right? You've got the AWS world, GCPs world, et cetera. We talked about AWS, $100 million-plus business growing 100%. The marketplace is really where that happens, right? So that's a great opportunity in these cloud marketplaces. Then you have traditional resellers, the Optivs, Guide Points, et cetera, very successful in all of those areas as a value-added reseller. You've got managed service providers, 200% growth year-over-year managed service providers. Why are they using us? It works, it's easy to scale, customers want it. And then you have maybe just the SIs and some of the other consulting partners. We talked about E&Y and Accenture. Going to market with them where they can take our technology wrap other services around it has been very effective. They're all growing in different areas. And I think the opportunity for us is to continue to grow in North America, but also expand the reach of these partnerships and create new partnerships in rest of world. And that -- if you look at our revenue, we're 71% in North America and 29% rest of the world. We have a great opportunity to expand there, and it's going to take the partner network in those areas to be able to do that.

Got it. And are you investing in international expansion?

Absolutely. We invest in sales capacity. By the way, I would be remiss to say that like we don't have our own sales force, which is huge, which covers enterprise all the way to SMB. But that helps drive what we do in the channel, and it takes 2 parties. So when we think about internationally, we're putting more salespeople internationally. We're establishing more channel partners. The big thing, too, is enablement. And every tech company sort of suffers from, "Hey, we're in North America and how do you make sure the message in North America gets across the pond and doesn't get diluted." So making sure that we've got that enablement is really important. And that's really what we've been focused on. And a lot more opportunities, there's a lot more that we can do there.

Yes. Okay. I'm going to just take a pause from product discussions. We'll get back to it. I want to maybe speak about the environment and then go back to speak about products. And the first question I have is, are you concerned about lower demand because of economic cycle or -- because -- and the reason why I'm asking is, in Q1 '21, you beat revenues by $10 million, give or take. You raised the guidance for the year by $40 million, so 4x the beat of Q1. In Q1 '22, you beat the numbers by $22 million, but you only grew the overall guidance for the year by $40 million, meaning you didn't grow it by 4x Q1, like before you grew it by 2x Q1. And that happens when companies are worrying about visibility, ability to grow, et cetera. So the question is whether this is just conservatism because the numbers are much bigger? Or that you have any concerns about the environment, then it doesn't have to be CrowdStrike-specific, it could be just in general?

Well, I think what's important to remember is that in Q4 of last year, we had 2 big 8-figure deals, right? So people have short-term memories. They tend to forget that. You have to take those out, right? First of all, you take that out and then seasonally adjust it for Q1. So when you look at those numbers, we had really nice ARR growth. But then you also have to remember, that's going to roll over to Q4. So it's important to look at those. And I think when you look at what we've done and how we've raised our guidance -- and Burt's not here. So I was talking about Burt, he's very prudent. We don't guide to running the table. And I think, again, what I've talked about is a really strong demand environment, record pipeline. And we think even in a macro that could be challenging, we think we have a great opportunity to consolidate in those areas where people want to spend more with smaller number of players, and we have the ability to get stronger in that environment. So I think it's just prudent the way we've looked at it. And again, I want to reinforce those 2 big 8-figure deals. You got to just reflect on that.

Yes. I turned 54 2 days ago, so my memory is not that good.

I know. We have to keep reminding everybody.

You also -- so you beat the EBIT number by $17 million, and you raised the year by $6 million. So that means you essentially -- just from a numbers perspective, you reduced the EBIT estimate for the rest of the year. And the question is, what is your plan on profitability? And I'm not asking about the numbers. I'm more asking about kind of your vision for profitability. Are you focusing on profitability? Is this something that you want to increase? What are you doing in order to increase profitability? We're in a different era now and investors do focus more on cash flow and profitability. So what's your strategy?

They do. It's a good question. So there's really 2 things that Burt and I talk about almost on a daily basis: it's ARR and that is cash. If you asked RPO, I couldn't even tell you the number because it's not how we manage the business. So when you think about that -- and thankfully, Burt and I have been through a lot of cycles. It's not our first rodeo. I remember raising money in 2001. First, it's growth, then it's profitability. It goes all over the place. The great news is we've got a business model that supports both. Take the Rule of 40. If you calculate that on a free cash flow basis, we were at 93% at scale, almost $2 billion ARR company, which is incredible, with free cash flow margins of 32%. We talked about $157 million -- $157.5 million of free cash flow. So our goal and what our guidance has been is 30% -- at least 30% free cash flow. What Burt talked about is the fact that we had a record hiring quarter. I think it's the first time we've ever hit our goal, and we hired like crazy. And that's reflective, I think, of a good now hiring environment. So obviously, that's going to ripple in through the whole year. And where we have the opportunity to invest and grab market share and grab people and take advantage of that, we're going to do it. And I think in this environment, particularly as the macro maybe shifts a bit, the stronger are going to get stronger. We're going to be prudent about how we invest still focusing on that 30% free cash flow.

Got it. Is there any other question from the audience about the short term before I go back to the long term? Here we go.

Over the next kind of 12 to 24 months, what do you see as the biggest opportunities from a consolidation angle?

Certainly, from a consolidation perspective, I would say things like -- there's not much to consolidate on identity, but we're going to -- we're killing it on that. So -- but if you think about things like Spotlight, even Falcon Complete is a bit of a consolidation play because people can spend more with us. We have a greater percentage of share of wallet. But overall, we can return more back to the business. And we spend a lot of time with customers who have 10, 12, 13 different agents, right? And we map that out into what we can consolidate. And our share of wallet goes up, but their overall spend can go down -- it's not going to go down. They can repurpose the dollars. And when you look at the ROI, and we compute ROI for -- we've done it for almost 3,000 customers, a big part of our selling methodology. On average, it's 150% ROI within the first year. So we can take a $1 million or $2 million deal and turn in a $5 million deal, return money back to the business. And we got a much bigger share of wallet, and they're able to repurpose that. And that will be a big part of our -- it has been, but I think it even gets even stronger in a challenging environment where people want to do more with less.

I want to go back and ask some questions about products is our -- some of them are small products, some of them are bigger products. I just want to understand the portfolio better. The first question is about Humio. Can you talk about -- first of all, what is it? And how is it synergistic for the business?

Yes. It's a good question. So when we think about what CrowdStrike is really focused on today, it's endpoint protection and hygiene workloads, right? Are they protected? What's the visibility? We've added identity specific to workloads and endpoints. And then there's this data element, and CrowdStrike is a data company. We handle about 7 trillion events per week, and it drives a lot of our AI algorithms. A lot of what people want to do is they want to go back. They want to search, they want to figure out what they have. They want information about their security posture, but as well, they've expanded data out into IT and IT hygiene. So Humio, from my perspective, it falls in a log management category. But I think that's evolving into more of an observability platform, right? These are customer words. We're a telemetry platform. Where everyone wants to log everything, you want to put it in 1 spot, they want to archive it and then you want to search it. They want to be able to correlate and search for as long as they want to go back, and they don't want to wait a day for a search to return. So when you think about what Humio has the ability to do, real-time ingestion so you get immediate results, very performant. It's a more modern architecture that works in the cloud, and it's super cost-effective. And what customers have said over time is that we generate a lot of data. There's a lot of data that is being generated from other systems. They want to be able to have this data platform make sense of it, and they want to go beyond security. Now if you look at Humio, when we bought them, a lot of their customers weren't even security. They were, hey, what's the performance of my Kubernetes cluster, and what's this application and logging from anything. We have a company that logs their train schedules and the trains send out telemetry. So you can log anything you want to answer any question. And what we've announced this week at RSA is Humio for Falcon. And essentially, that means that all the data that we generate, we generate a lot of it, can be stored in Humio up to a year or more. And then you can slice and dice that, and that will be attached into the CrowdStrike base. And then the overall goal is to be able to sell them into attaching all the other logs that they want to have. So it's synergistic to what we're focused on, which is security and asset information. And that provides, I think, a great consolidation type play for our customers.

Is this a product you sell, you charge for separately? Or that's a product that just comes in a bundle?

No. It will be a module. So if you want Humio log management, there will be a separate module-type price.

Got it. Okay. We spoke a lot about the concept of identity and what you're doing in identity. And I want to understand this concept and I want to understand -- maybe explain it to those who don't know the market. So we know Okta. We know basically authentication -- identity authentication companies, whether it's Okta or Ping. There is also tomorrow I'm hosting a panel of companies that do more verification and authorization. They don't do authentication. They do authorization more. But I want to understand where is CrowdStrike in identity, meaning what is -- how do you interact with the others? And if you can explain basically what kind of identity service you give to companies and how does it fit in the big market of identity?

So it's a good question. It's one we get a lot. This concept of identity is kind of a broad topic. If you look at Okta or Ping, they're obviously managing identity and -- the identity and the users themselves and then being able to provide some level of access to different applications, particularly cloud applications and beyond that. That is an identity access broker. What we're focused on is the machine itself and the directory is like active directory in Azure AD. So let's start with the directories. Just providing visibility into directory is really hard. That's not what others do. And understanding how it's configured or misconfigured and where vulnerabilities are critical. We take a look at SolarWinds and even some of the Microsoft, their own issues. They were really around issues with directory services and service providers and misconfigurations. So that represents a huge risk and exposure into being breached. The second area then is, without fail, any incident response that we've ever been called into a non-CrowdStrike customers have had credential theft and abuse. And that really is a key part of breaches. So with our identity solution, we create a trust score. And if we think it's Tal, great, you can do what you want on that system, not at the application layer, on the system layer. And if we don't think it's you and there's an AI layer on top of it, we'll actually give you an MFA challenge or Okta will do that. And we create a score and we pass it off to them. So you can think of us as implementing the Zero Trust identity piece on endpoints and workloads. And then there are other players that focus on the broader identity access brokering piece.

Got it. Companies -- again, same question that I had before. This is a separate module that is being paid for separately?

It is a separate module. It is 1 of the 22 modules that's out there, growing 30% quarter-over-quarter.

How early are we on the curve of growth for identity? Because you mentioned it so many times and you said that this could be actually 1 of the biggest modules out there. So how early are we on the curve? And what's the visibility or what's the sustainability of this kind of growth that you have?

Well, we're super early on. In the market today, there are really -- it's us. One of the player has more deception technology but try to couch as identity. So it's really us as the leader in the endpoint workload agent-based identity solution as we've talked about. Super early on, but we see a lot of similarities to the EDR market early on where people didn't have visibility in it. It was that aha moment, "Wow, I didn't realize how much I didn't know that EDR." Now we see -- we had no idea how misconfigured our directory services are. We had no idea of what these privileged accounts were doing. And we had no idea that we can actually stop lateral movement. We had no idea that our developers were using PowerShell script with credentials -- admin credentials. And you guys can actually see that and allow us to do that in a secure way. So for us, we look at it and believe that every CrowdStrike customer should be an identity customer, and we're really in the early innings of that. And we see it as a huge opportunity. And by the way, there's not much competition in this area.

Got it. When we talk -- one of the challenges we have on our end is we hear your conference call, we talk to you. We hear SentinelOne conference call, we talk to them. If I take what you say and what they say and just change their names, I'll never know. The concepts that are being broadcasted are exactly the same, even the areas of growth, identity, cloud security, endpoint protection, it's the same. And the question is twofold. Number one, when you go and you bid your solutions against your competition, is there really differentiation of 1 product versus another? Can you actually demonstrate the differentiation to customers? And is what we're hearing is just marketing? And I want to understand kind of the real thing in the market.

It's a good question. As they say imitation is the sincerest form of flattery. You can't just paint something purple from red and call it good. And I've said it before, there's a difference between a Fiero and a Ferrari. They're both red, they kind of look the same, but big difference. There's so many architectural differences in our technology that allow us to scale to operate. Why are we replacing others that fail in this area? They can't even get more than 5,000 of these servers up and running. And we come in and we replace them time and time again. We can operationalize our technology. And the biggest thing is, this is kind of a secret weapon and it kind of goes back to -- I'll make an analogy back to ServiceNow. ServiceNow created a solution that was focused on ITSM. And what they figured out is they built a really scalable cloud workload platform. What we did is we started with the agent cloud architecture, and we collected data at scale. And what we figured out is we can do a lot more than just security. So the fact that we build real time, not batch, streaming to the cloud with smart filtering with a single data store that allows all these modules is something that has not been replicated. If you look at -- you asked about SentinelOne. That was an AV product that was on-prem that they bolted a bunch of stuff on, and it never was born in the cloud. It's kind of bolted stuff on top of it. So again, when you -- and this is the hard part about being an analyst, a customer, industry analyst, is things all sound the same because people generally just copy what we put out there. But when you get into production, there's a big difference between what we do and the outcomes. And I'll take Complete, which I highlighted in the earnings call. Nobody has anything even close to that. People will tell you have a problem. We have a mean time of remediation within 30 minutes, okay? And the fact -- we're not just telling you we have a problem. We're going to tell you, "Oh, by the way, we fixed that." Nobody is doing that, not Microsoft, not SentinelOne, not others. It's just truly differentiated. And the only way that works is because of the platform itself.

Got it. They talk a lot about their ability to basically do automated mitigation, that there's no need for human intervention. Is this -- and they say that this is a big differentiating factor versus you. Is this something that -- what's your response? I'll ask...

I'm going to repeat my response. If that's all you needed, Cylance will be called BlackBerry. It's impossible. It's people process technology. It's the oldest sort of paradigm in security. Why -- if your credentials get stolen, there is no prevention for that, right? Somebody used it. I mean you could say 2-factor, but believe me, this not 2-factor everywhere and it gets abused. Someone gets on to a system, there is nothing to prevent. You can have all the AI and machine learning malware protection in the world, it's not going to happen. So when you look at what people are buying their outcomes, we're stopping the breach. And I can tell you, we've cleaned up a lot of messes from competitors that were preventionally focused, and it didn't work. The second piece is, when we think about automation, I think we have the most automation in the industry. You look at Falcon Fusion. Nobody has an integrated store built into their platform. It's actually just part of it. Today, starting with CrowdStrike technology and then extending out to the XDR partners. But there's a reason that the technology works, and it's the architecture, and it's reflected in the numbers. And yes, I don't think the scoreboard lies.

Got it. So my last question just as a kind of point of interest is IoT. IoT is becoming bigger and bigger. Companies talk about it. What do we do with IoT? How do you deploy your solution on IoT?

We think our IoT is a great future opportunity for us. We're doing some of it now. And I would say IoT is the smallest/largest word in the IT stack and the vernacular because is it IoT for a car? Is it medical devices? Is it IP cameras? What is it? I think you really have to focus. We spend a lot of time in the medical device area. We spent a lot of time in looking at manufacturing and even in some cars. So how do you create an ecosystem where you can get built in on the front end of it? Because once it's built, it's hard to put on there. So we have a group internally that's focused on IoT. And we're not going to be able to do every device. It doesn't make sense. But in the core devices like medical, we think there's a great opportunity to be built into these machines that don't change in 20 years. You look at an imaging machine. Nobody is buying a new 1 for 20 years. You're going to buy it, you got to certify with the FDA, and you're going to have to run. So we think it's an emerging space for us. We have people working on it, but we're going to be very focused in those areas.

Got it. Yes. Don't wait for the microphone. We have 26 seconds left.

[indiscernible]

I can only focus on our execution in the short term and the long term. And obviously, from a market perspective, market demand, we think it's there. And if something changes, it changes. But I think overall, given how big the market is -- and we'll have 18,000 customers, pretty impressive. But Symantec before they got acquired at 300,000 customers that were outside of consumer. So I can only control what we can control. And I don't have a crystal ball, so it's hard to answer that question and what's going to happen there.

Great. We ran out of time.

All right. Fantastic.

Thanks, George.

Thank you so much. Real pleasure. Thanks.

Take care.