Don’t start betting on Crowdstrike competitors just yet
$CrowdStrike(CRWD.US$ Implementing an EDR solution like Crowdstrike into organisations takes a lot of time and resources, even more so the larger the organisation. The only reason why Crowdstrike caused as much damage as it did is because the Crowdstrike agent is rolled out across almost all devices in client organisations.
This means that companies looking to make the switch to competitors have to take the time to offboard Crowdstrike from each and every system, on top of the the time required to trial and procure competitor solutions. For large clients like Amazon, such a move would likely take months and cause additional business disruptions. And time also = $$$
Of course, an independent digital forensics investigation into the root cause of the colossal “bug” has yet to be completed. Were the outage to be caused by gross negligence and deeply flawed internal procedures by Crowdstrike, it just might spell certain doom for the company; you don’t just cost the world economy billions of dollars and walk away unscathed.
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MomentumPython1337 : the switching cost is there but look. you're a multibillion cybersec company and you let an engineer push a bug and not only that you let him deploy this bug to all devices worldwide.
i work in tech and this stuff doesn't just happen by chance. it's not just 1 guy's negligence. it is evidence of severe problems in the protocols in the company. it is evidence of incompetent managers and incompetent quality control measures. when you let one push affect so many devices it's just a big nono.
the reputational damage is done and it will be very hard to get it back.
don't get me wrong i have been a crwd bull for years but this is a breaking point for me to be honest.
i sold all my shares as I said elsewhere i sold 85% last week before the outage and 15% today after the outage. i have 0 shares now and i took profits i was sitting on triple digit gains.
I'm not touching this until at least the next earnings where we have better clarity what exaclty is the damage not only the litigation damage but the damage to forward guidance because customer acquisition rates will go down and customer retention rates will go down.
at that point the stock price might also have tanked below 270 maybe even 220-250 and so it may again offer an attractive valuation at that point if the damage to forward guidance is not as bad as people think. then that valuation will be attractive again and I will reenter my long position.
MomentumPython1337 : it pains me to see some furus on fintwit (X) preaching crwd saying buy the dip or hodl without giving convincing reasons why. it really pains me to see that.
MomentumPython1337 : amazon already has their own protection service called amazon shield. it's not that hard to find replacement it's a matter of convenience and when push comes to shove people will do it. the moat for crwd is not wide imo it's just narrow if we go by morningstar moat levels: none, narrow, wide.