CrowdStrike logo is seen in this illustration taken July 29, 2024. REUTERS/Dado Ruvic/Illustration
(Reuters) -CrowdStrike reiterated its fiscal 2026 first quarter and annual forecasts on Wednesday and announced a plan to cut about 500 roles, roughly 5% of its workforce, to streamline operations and reduce costs.
The cybersecurity company will incur about $36 million to $53 million in charges related to the layoffs, of which about $7 million will be recognized in the first quarter ended April 30, it said in a regulatory filing.
Austin, Texas-based CrowdStrike said the rest of the charges will be seen in the second quarter. The charges primarily consist of future cash expenditure related to severance payments, employee benefits and related costs.
The company's shares were down nearly 4% in morning trading.
CrowdStrike had 10,118 full-time employees as of January 31, according to its annual report.
"While we will continue to prudently hire, primarily in customer-facing and product engineering roles, we are reducing roles in some areas of the business," CEO George Kurtz said in a note to the company's employees.
Cybersecurity remains a priority for businesses and governments at a time when high-profile hacking incidents have hit companies such as Microsoft, UnitedHealth Group and Walt Disney.
Analysts have said CrowdStrike's prompt handling of the Windows outage last year, which disrupted internet services globally, helped the company maintain customer trust.
CrowdStrike reiterated its full-year 2026 revenue forecast to be between $4.74 billion and $4.81 billion and reaffirmed its annual adjusted profit per share estimate of $3.33 to $3.45.
The company's forecast for first-quarter revenue was between $1.10 billion and $1.11 billion.
"This will likely spark debate on if this announcement is coming from a place of weakness or strength - to which we broadly believe it is the latter," Piper Sandler said in a note.
CrowdStrike will release financial results for its first quarter on June 3.
(Reporting by Jaspreet Singh in Bengaluru; Editing by Krishna Chandra Eluri)
