Nearly Half of Enterprise Endpoint Security Systems Still Need Upgrading! CrowdStrike (CRWD.US) Targets Market Share Expansion, BNP Paribas Says Long-term Growth Target May Be Conservative

According to Zhitong Finance APP, cybersecurity company CrowdStrike (CRWD.US) believes that as enterprises gradually phase out traditional security systems, the company still has significant room to expand its share in the Endpoint Detection and Response (EDR) market. Following a recent call with CrowdStrike's Investor Relations executives, BNP Paribas stated that the company’s long-term growth opportunities remain considerable and that CrowdStrike’s fiscal 2030 and 2035 annual recurring revenue (ARR) targets may even be conservative. CrowdStrike did not revise its existing financial guidance. In early trading on Monday, the stock once rose by about 1%.

Nearly Half of the EDR Market Still Uses Traditional Products—CrowdStrike Targets Replacement Demand

CrowdStrike estimates that approximately 48% of the EDR market is still using traditional security products, providing the company an opportunity to further win market share. The relevant enterprise customer contracts usually last about five years, so as existing contracts gradually expire and businesses upgrade their cybersecurity systems, CrowdStrike is expected to acquire new customers and orders.

EDR, or Endpoint Detection and Response, is a cybersecurity solution that continuously monitors end-user devices, primarily designed to detect and respond to cyber threats such as ransomware and malware.

BNP Paribas states that CrowdStrike believes there are still significant opportunities to gain additional market share with its EDR business following “Mythos.” For CrowdStrike, the renewal of traditional EDR products not only brings opportunities for new customers but may also create room for selling more security modules to clients, further driving annual recurring revenue growth.

CrowdStrike has proposed raising ARR to $10 billion in fiscal year 2030 and to $20 billion by fiscal year 2035. At the same time, the company expects net new ARR growth in fiscal 2028 to exceed 20%.

Long-term ARR Targets May Be Conservative—AI Security Market Offers Greater Growth Potential

BNP Paribas believes that these long-term growth targets for CrowdStrike may ultimately prove conservative. Based on the company's long-term targets, CrowdStrike assumes it will capture about a 3.5% share of the estimated $565 billion AI-related security product market. In comparison, CrowdStrike’s current market share in related areas is about 4%.

This means that if CrowdStrike is able to maintain its current market share, rather than the 3.5% implied by the long-term targets, the company’s eventual revenue scale could surpass the level currently reflected in the long-term goals.

In addition to the traditional endpoint security business, the rapid adoption of AI applications is also creating new demand within the cybersecurity industry. As enterprises increasingly deploy AI agents, monitoring their behaviors and preventing them from executing malicious or unauthorized operations is becoming a new security challenge.

CrowdStrike is also actively developing security products targeted at AI agents, aiming to extend its existing cybersecurity capabilities into the field of AI applications.

Increasing Focus on AI Agent Security—Guardian Product Now Fully Launched

BNP Paribas stated that CrowdStrike’s Guardian product is now fully available, while another offering, SafeMind, utilizes Nvidia’s (NVDA.US) Nemotron model to detect potentially malicious behaviors in AI agents. This strategy means CrowdStrike is extending its security platform from traditional endpoint devices to AI agents, providing security protection as enterprises adopt generative AI and autonomous AI systems.

As AI agents gain access to enterprise data, can call software tools, and execute increasingly complex tasks, their potential security risks rise as well. CrowdStrike aims to identify abnormal or malicious behavior with these solutions, participating in the emerging AI security market competition.

It is worth noting that Nvidia has also recently released its own security products. However, CrowdStrike told BNP Paribas that SafeMind is not positioned as a direct competitor to Nvidia’s newly launched security products. On the contrary, SafeMind itself leverages Nvidia’s Nemotron model, reflecting CrowdStrike’s greater tendency in the AI security domain to utilize existing AI infrastructure and model capabilities to develop security solutions targeted at enterprise customers.

BNP Paribas believes that CrowdStrike’s long-term goals of achieving $10 billion ARR by fiscal year 2030 and $20 billion by fiscal year 2035 may be conservative, and whether the company can continue to expand its EDR market share and capture AI security demand will be key to its long-term growth.