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  "notes": "CrowdStrike investor presentation appendix slide defining ARR, retention rates, churn, Rule of 40, and module adoption.",
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      "text": "Calculation of metrics\n\nAnnual Recurring Revenue (ARR).\nARR is calculated as the annualized value of our customer subscription contracts as of the measurement date, assuming any contract that expires during the next 12 months is renewed on its existing terms. To the extent that we are negotiating a renewal with a customer after the expiration of the subscription, we continue to include that revenue in ARR if we are actively in discussion with such an organization for a new subscription or renewal, or until such organization notifies us that it is not renewing its subscription.\n\nDollar-Based Net Retention Rate.\nOur dollar-based net retention rate compares our ARR from a set of subscription customers against the same metric for those subscription customers from the prior year. Our dollar-based net retention rate reflects customer renewals, expansion, contraction and churn, and excludes revenue from our incident response and proactive services. We calculate our dollar-based net retention rate as of period end by starting with the ARR from all subscription customers as of 12 months prior to such period end, or Prior Period ARR. We then calculate the ARR from these same subscription customers as of the current period end, or Current Period ARR. Current Period ARR includes any expansion and is net of contraction or churn over the trailing 12 months but excludes revenue from new subscription customers in the current period. We then divide the total Current Period ARR by the total Prior Period ARR to arrive at our dollar-based retention rate.\n\nDollar-Based Gross Retention Rate.\nWe calculate our dollar-based gross retention rate as of the period end by starting with the ARR from all subscription customers as of 12 months prior to such period, or Prior Period ARR. We then deduct from the Prior Period ARR any ARR from subscription customers who are no longer customers as of the current period end, or Current Period Remaining ARR. We then divide the total Current Period Remaining ARR by the total Prior Period ARR to arrive at our dollar-based gross retention rate, which is the percentage of ARR from all subscription customers as of the year prior that is not lost to customer churn.\n\nGross Churn.\nOur dollar-based gross churn rate is equal to 1 - Dollar-Based Gross Retention Rate.\n\nFree Cash Flow Rule of 40.\nFree cash flow rule of 40 is calculated by taking the Current Quarter Total Revenue YoY Growth Rate + Current Quarter Free Cash Flow Margin.\n\nModule Adoption Rates.\nModule adoption rates are calculated by taking the total number of customers with five or more, six or more, and seven or more modules, respectively, divided by the total number of subscription customers (excluding Falcon Go customers). Falcon Go customers are defined as customers who have subscribed with the Falcon Go bundle, a package designed for organizations with 100 endpoints or less.\nWhite circle on slide 11 represents the percentage of customers with $100K or more in ending ARR that have 8 adopted or more modules as of Q2 FY25.\n\nCloud Security.\nWe use the term \"Cloud Security\" on slides 12, 13, and 17 to refer to a category previously referred to as \"Public Cloud Deployed\".",
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