According to a report from Zhitong Finance APP, cybersecurity company CrowdStrike (CRWD.US) believes it still has significant room to expand its share in the endpoint detection and response (EDR) market as enterprises gradually phase out traditional security systems. After a recent conference call with CrowdStrike's investor relations executives, BNP Paribas said the company's long-term growth opportunity remains substantial and that CrowdStrike's fiscal 2030 and fiscal 2035 annual recurring revenue (ARR) targets may even prove conservative. CrowdStrike did not adjust its existing financial guidance. In early trading on Monday, the stock rose about 1%.

Nearly half of the EDR market still uses legacy products, and CrowdStrike is targeting replacement demand

CrowdStrike estimates that about 48% of the EDR market still relies on traditional security products, giving the company an opportunity to further compete for market share. Enterprise customer contracts typically run for about five years, so as existing contracts expire and companies upgrade their cybersecurity systems, CrowdStrike is expected to win new customers and orders. EDR, or endpoint detection and response, is a cybersecurity solution that continuously monitors end-user devices, mainly to detect and respond to cyber threats such as ransomware and malware. BNP Paribas said CrowdStrike believes that after "Mythos," the company still has a major opportunity to gain more market share through its EDR business. For CrowdStrike, the replacement of legacy EDR products not only means new customer opportunities but may also create room to sell more security modules to customers, further driving annual recurring revenue growth. CrowdStrike currently aims to raise ARR to $10 billion by fiscal 2030 and further to $20 billion by fiscal 2035. At the same time, the company expects net new ARR growth of more than 20% in fiscal 2028.

Long-term ARR targets may be conservative, and the AI security market offers more growth room

BNP Paribas believes CrowdStrike's long-term growth targets may ultimately prove conservative. Based on the company's long-term targets, it assumes CrowdStrike will capture about 3.5% of an AI-related security products market estimated at roughly $565 billion. By comparison, CrowdStrike's current share of the relevant market is about 4%. This means that if CrowdStrike can maintain its current market share rather than the 3.5% implied by its long-term targets, the revenue it ultimately achieves could exceed the level corresponding to its existing long-term targets. In addition to its traditional endpoint security business, the rapid adoption of AI applications is also creating new demand for the cybersecurity industry. As enterprises deploy more AI agents, how to monitor their behavior and prevent them from carrying out malicious or unauthorized actions is becoming a new security challenge. CrowdStrike is also actively developing security products for AI agents, hoping to extend its existing cybersecurity capabilities into AI applications.

Expanding into AI agent security, with the Guardian product now fully available

BNP Paribas said CrowdStrike's Guardian product is now fully available, while another product, SafeMind, uses Nvidia (NVDA.US)'s Nemotron model to detect potentially malicious behavior by AI agents. This positioning means CrowdStrike is further extending its security platform from traditional endpoint devices to AI agents, providing security protection for enterprises adopting generative AI and autonomous AI systems. As AI agents gain the ability to access corporate data, call software tools, and perform increasingly complex tasks, their potential security risks also increase. CrowdStrike hopes to identify abnormal or malicious behavior through related products and thereby compete in this emerging AI security market. It is worth noting that Nvidia recently released its own security product. However, CrowdStrike told BNP Paribas that SafeMind is not positioned to compete directly with Nvidia's newly launched security products. Instead, SafeMind itself uses Nvidia's Nemotron model, reflecting CrowdStrike's preference in the AI security field to use existing AI infrastructure and model capabilities to develop security solutions for enterprise customers. BNP Paribas believes CrowdStrike's long-term targets of reaching $10 billion in ARR by fiscal 2030 and $20 billion in ARR by fiscal 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 achieving long-term growth.