Q3 Revenue of $328 million, up 19%
year-over-year (18% in constant currency)
Q3 Elastic Cloud Revenue of $143 million, up
29% year-over-year (29% in constant currency)
Elastic (NYSE: ESTC) (“Elastic”), the company behind
Elasticsearch®, announced financial results for its third quarter
of fiscal 2024 ended January 31, 2024.
Third Quarter Fiscal 2024 Financial Highlights
- Total revenue was $328 million, an increase of 19%
year-over-year, or 18% on a constant currency basis
- Elastic Cloud revenue was $143 million, an increase of 29%
year-over-year as reported and on a constant currency basis
- GAAP operating loss was $26 million; GAAP operating margin was
-8%
- Non-GAAP operating income was $43 million; non-GAAP operating
margin was 13%
- GAAP diluted earnings per share was $1.69(1); non-GAAP diluted
earnings per share was $0.36
- Operating cash flow was $52 million with adjusted free cash
flow of $63 million
- Cash, cash equivalents, and marketable securities were $1.015
billion as of January 31, 2024
“Elastic delivered another strong quarter and I'm pleased with
our momentum and execution that drove our third quarter results,”
said Ash Kulkarni, CEO, Elastic. “Customer interest in Generative
AI, platform consolidation, and stability in cloud consumption
patterns continued to drive momentum in our business in Q3. This
reinforces our confidence in the business, and in our future growth
as more companies choose our search analytics platform as a core
part of their IT infrastructure stack for building GenAI
applications.”
Third Quarter Fiscal 2024 Key Metrics and Recent Business
Highlights
Key Customer Metrics
- Total customer count with Annual Contract Value (ACV) greater
than $100,000 was over 1,270 compared to over 1,220 in Q2 FY24, and
over 1,110 in Q3 FY23
- Total subscription customer count was approximately 20,800
compared to approximately 20,700 in Q2 FY24, and over 19,900 in Q3
FY23
- Net Expansion Rate was approximately 109%
Product Innovations and Updates
- Delivered scalar quantization for vector search, which provides
significantly faster performance at a lower total cost
- Introduced real time alerts with natural language interactions
for the Elastic AI Assistant for security
- Delivered cloud security posture management for Microsoft
Azure, now integrated with the three largest cloud
hyperscalers
- Announced the general availability of the Elastic AI Assistant
for observability, which provides site reliability engineers (SREs)
with actionable operational insights that are specific to their IT
environment
- Delivered general availability of Service Level Objective (SLO)
monitoring which allows SREs to manage business operations by
tracking service performance, error budgets, reliability, and
business goals
- Delivered deeper integration between Elasticsearch and Hugging
Face, to simplify the developer experience by allowing direct
embedding of large language models and other machine learning
models hosted on Hugging Face into custom GAI applications built
with Elasticsearch
Other Business Highlights
- Appointed Mark Dodds as Chief Revenue Officer to lead all
customer facing functions
- Participated in AWS re:Invent as a Diamond sponsor and hosted
ElasticON London and Sydney events as part of our twelve city
customer conference series
Financial Outlook
The Company is providing the following guidance:
For the fourth quarter of fiscal 2024 (ending April 30,
2024):
- Total revenue is expected to be between $328 million and $330
million, representing 18% year-over-year growth at the midpoint
(18% year-over-year constant currency growth at the midpoint)
- Non-GAAP operating margin is expected to be between 7.4% and
7.8%
- Non-GAAP diluted earnings per share is expected to be between
$0.18 and $0.20, assuming between 105.5 million and 106.5 million
diluted weighted average ordinary shares outstanding
For fiscal 2024 (ending April 30, 2024):
- Total revenue is expected to be between $1.260 billion and
$1.262 billion, representing 18% year-over-year growth at the
midpoint (17% year-over-year constant currency growth at the
midpoint)
- Non-GAAP operating margin is expected to be approximately
11%
- Non-GAAP diluted earnings per share is expected to be between
$1.15 and $1.18, assuming between 103.0 million and 104.0 million
diluted weighted average ordinary shares outstanding
The guidance assumes, among others, the following exchange
rates: 1 Euro = 1.082 US Dollars; and 1 Great British Pound = 1.267
US Dollars.
See the section titled “Forward-Looking Statements” below for
information on the factors that could cause our actual results to
differ materially from those expressed or implied in our
forward-looking statements. We present historical and
forward-looking non-GAAP financial measures in addition to, and not
as a substitute for, or superior to, financial measures calculated
in accordance with GAAP. See the section entitled “Statement
Regarding Use of Non-GAAP Financial Measures” for an explanation of
these non-GAAP measures. A reconciliation of forward-looking
non-GAAP measures to the corresponding GAAP measures for operating
margin and net earnings/(loss) per share is not available without
unreasonable effort due to the uncertainty regarding, and the
potential variability of, many of the costs and expenses that may
be incurred in the future. These items necessary to reconcile such
non-GAAP measures could be material and have a significant impact
on the Company’s results computed in accordance with GAAP.
Conference Call and Webcast
Elastic’s executive management team will host a conference call
today at 2:00 p.m. PT/5:00 p.m. ET to discuss the Company’s
financial results and business outlook. A live audio webcast of the
conference call will be available through Elastic’s Investor
Relations website at ir.elastic.co. A presentation containing
financial and operating information will be available at the same
website. The replay of the webcast will also be available on the
investor relations website.
(1)
GAAP diluted earnings per share includes
the impact of a discrete income tax benefit of approximately $207
million related to the release of a valuation allowance against
certain deferred tax assets. There was no impact to operating
results, non-GAAP diluted earnings per share, adjusted free cash
flow or cash and cash equivalents.
About Elastic
Elastic (NYSE: ESTC), the leading search analytics company,
securely harnesses search-powered AI to enable everyone to find the
answers they need in real-time using all their data, at scale.
Elastic’s solutions for security, observability and search are
built on the Elasticsearch platform, the development platform used
by thousands of companies, including more than 50% of the Fortune
500. Learn more at elastic.co.
Elastic and associated marks are trademarks or registered
trademarks of Elastic N.V. and its subsidiaries. All other company
and product names may be trademarks of their respective owners.
Forward-Looking Statements
This press release contains forward-looking statements that
involve substantial risks and uncertainties, which include, but are
not limited to, statements regarding our expected financial results
for the fiscal quarter and the fiscal year ending April 30, 2024,
the expected performance or benefits of our offerings, expected
market opportunities, and our expectations regarding our growth.
Actual outcomes and results may differ materially from those
contemplated by these forward-looking statements due to
uncertainties, risks, and changes in circumstances, including but
not limited to those related to: our future financial performance,
including our expectations regarding our revenue, cost of revenue,
gross profit or gross margin, operating expenses (which include
changes in sales and marketing, research and development and
general and administrative expenses), and our ability to achieve
and maintain future profitability; our ability to continue to
deliver and improve our offerings and develop new offerings
(including innovations around AI use cases); customer acceptance
and purchase of our new and existing offerings; the expansion and
adoption of our Elastic Cloud offerings; our ability to realize
value from investments in the business; our ability to maintain and
expand our user and customer base; the impact of the evolving
macroeconomic and geopolitical environments on our business,
operations, hiring and financial results, and on businesses and
spending priorities of our customers and partners; the impact of
our pricing model strategies on our business; the impact of foreign
currency exchange rate fluctuations and the uncertain inflation and
interest rate environment on our results; our international
expansion strategy; our operating results and cash flows; the
sufficiency of our capital resources; our ability to successfully
execute our go-to-market strategy, our forecasts regarding our
business; and general market, political, economic and business
conditions.
Any additional or unforeseen effect from the evolving
macroeconomic and geopolitical environments may exacerbate these
risks. Additional risks and uncertainties that could cause actual
outcomes and results to differ materially from those expressed or
implied in our forward-looking statements are included in our
filings with the Securities and Exchange Commission (the “SEC”),
including our Annual Report on Form 10-K for the fiscal year ended
April 30, 2023 and subsequent reports filed with the SEC. SEC
filings are available on the Investor Relations section of
Elastic’s website at ir.elastic.co and the SEC’s website at
www.sec.gov. Elastic assumes no obligation to, and does not
currently intend to, update any such forward-looking statements,
except as required by law.
Statement Regarding Use of Non-GAAP Financial
Measures
In addition to our results determined in accordance with U.S.
GAAP, we believe the non-GAAP measures listed below are useful in
evaluating our operating performance. We use these non-GAAP
financial measures to evaluate our ongoing operations and for
internal planning and forecasting purposes. We believe that
non-GAAP financial information, when taken collectively, may be
helpful to investors because it provides consistency and
comparability with past financial performance. However, non-GAAP
financial information is presented for supplemental informational
purposes only, has limitations as an analytical tool and should not
be considered in isolation or as a substitute for financial
information presented in accordance with U.S. GAAP. In addition,
other companies, including companies in our industry, may calculate
similarly-titled non-GAAP measures differently or may use other
measures to evaluate their performance, all of which could reduce
the usefulness of our non-GAAP financial measures as tools for
comparison. Investors are cautioned that there are a number of
limitations associated with the use of non-GAAP financial measures
and key metrics as analytical tools. Investors are encouraged to
review the differences between GAAP financial measures and the
corresponding non-GAAP financial measures, and not to rely on any
single financial measure to evaluate our business.
Reconciliations of historical GAAP financial measures to their
respective historical non-GAAP financial measures are included
below. In relation to constant currency non-GAAP financial
measures, the only reconciling item between GAAP financial measures
and non-GAAP financial measures is the effect of foreign currency
rate fluctuations. Further details on how we calculate such effects
can be found in the definition of “Constant Currency” below.
Non-GAAP Gross Profit and Non-GAAP Gross Margin
We define non-GAAP gross profit and non-GAAP gross margin as
GAAP gross profit and GAAP gross margin, respectively, excluding
stock-based compensation expense and related employer taxes and
amortization of acquired intangible assets. We believe non-GAAP
gross profit and non-GAAP gross margin provide our management and
investors consistency and comparability with our past financial
performance and facilitate period-to-period comparisons of
operations, as these metrics generally eliminate the effects of
certain variables from period to period for reasons unrelated to
overall operating performance.
Non-GAAP Operating Income and Non-GAAP Operating
Margin
We define non-GAAP operating income and non-GAAP operating
margin as GAAP operating loss and GAAP operating margin,
respectively, excluding stock-based compensation expense and
related employer taxes, amortization of acquired intangible assets,
acquisition-related expenses, and restructuring and other related
charges. We believe non-GAAP operating income and non-GAAP
operating margin provide our management and investors consistency
and comparability with our past financial performance and
facilitate period-to-period comparisons of operations, as these
metrics generally eliminate the effects of certain variables from
period to period for reasons unrelated to overall operating
performance.
Non-GAAP Net Income and Non-GAAP Earnings Per Share
We define non-GAAP net income as GAAP income/(loss), excluding
stock-based compensation expense and related employer taxes,
amortization of acquired intangible assets, acquisition-related
expenses, restructuring and other related charges, litigation
settlement, the related income tax effect of the foregoing
adjustments, and the income tax benefit from the release of any
valuation allowance against deferred tax assets. We define non-GAAP
earnings per share, basic, as non-GAAP net income divided by
weighted average shares outstanding and non-GAAP earnings per
share, diluted, as non-GAAP net income divided by weighted average
diluted shares outstanding, which includes the potentially dilutive
effect of the company’s employee equity incentive plan awards. We
believe non-GAAP earnings per share provides our management and
investors consistency and comparability with our past financial
performance and facilitates period-to-period comparisons of
operations, as this metric generally eliminates the effects of
certain variables from period to period for reasons unrelated to
overall operating performance.
Adjusted Free Cash Flow and Adjusted Free Cash Flow
Margin
Adjusted free cash flow is a non-GAAP financial measure that we
define as net cash provided by operating activities adjusted for
cash paid for interest less cash used for investing activities for
purchases of property and equipment. Adjusted free cash flow margin
is calculated as adjusted free cash flow divided by total revenue.
Adjusted free cash flow does not represent residual cash flow
available for discretionary expenditures since, among other things,
we have mandatory debt service requirements.
Constant Currency
We compare the percent change in certain results from one period
to another period using constant currency information to provide a
framework for assessing how our business performed excluding the
effect of foreign currency rate fluctuations. In presenting this
information, current and comparative prior period results are
converted into United States dollars at the exchange rates in
effect on the last day of our prior fiscal year, rather than the
actual exchange rates in effect during the respective periods.
Contact Information
Anthony Luscri Elastic Investor Relations
ir@elastic.co
Madge Miller Elastic Corporate Communications
PR-Team@elastic.co
Elastic N.V.
Condensed Consolidated
Statements of Operations
(in thousands, except share and
per share data)
(unaudited)
Three Months Ended January
31,
Nine Months Ended January
31,
2024
2023
2024
2023
Revenue
Subscription
$
307,632
$
255,613
$
865,622
$
728,638
Services
20,325
18,953
66,700
60,410
Total revenue
327,957
274,566
932,322
789,048
Cost of revenue
Subscription
63,976
56,146
181,238
164,798
Services
20,666
19,062
60,970
58,146
Total cost of revenue
84,642
75,208
242,208
222,944
Gross profit
243,315
199,358
690,114
566,104
Operating expenses
Research and development
87,202
77,472
248,000
231,689
Sales and marketing
141,621
126,717
408,020
379,902
General and administrative
40,896
34,711
117,530
103,724
Restructuring and other related
charges
—
29,805
754
29,805
Total operating expenses
269,719
268,705
774,304
745,120
Operating loss
(26,404
)
(69,347
)
(84,190
)
(179,016
)
Other income (expense), net
Interest expense
(6,368
)
(6,265
)
(19,023
)
(18,875
)
Other income, net
8,568
5,460
24,107
20,774
Loss before income taxes
(24,204
)
(70,152
)
(79,106
)
(177,117
)
(Benefit from) provision for income
taxes
(200,328
)
2,422
(181,926
)
12,313
Net income (loss)
$
176,124
$
(72,574
)
$
102,820
$
(189,430
)
Net earnings (loss) per share attributable
to ordinary shareholders
Basic
$
1.76
$
(0.76
)
$
1.04
$
(1.99
)
Diluted
$
1.69
$
(0.76
)
$
1.00
$
(1.99
)
Weighted-average shares used to compute
net earnings (loss) per share attributable to ordinary
shareholders
Basic
100,282,179
96,052,025
99,099,210
95,327,131
Diluted
104,503,290
96,052,025
103,149,384
95,327,131
Elastic N.V.
Condensed Consolidated Balance
Sheets
(in thousands, except share and
per share data)
(unaudited)
As of January 31,
2024
As of April 30,
2023
Assets
Current assets:
Cash and cash equivalents
$
526,893
$
644,167
Restricted cash
2,774
2,473
Marketable securities
488,133
271,041
Accounts receivable, net of allowance for
credit losses of $3,865 and $3,409 as of January 31, 2024 and April
30, 2023, respectively
229,946
260,919
Deferred contract acquisition costs
68,937
55,813
Prepaid expenses and other current
assets
45,440
39,867
Total current assets
1,362,123
1,274,280
Property and equipment, net
5,512
5,092
Goodwill
319,546
303,642
Operating lease right-of-use assets
23,088
19,997
Intangible assets, net
23,822
29,104
Deferred contract acquisition costs,
non-current
100,389
95,879
Deferred tax assets
218,693
7,412
Other assets
5,749
8,076
Total assets
$
2,058,922
$
1,743,482
Liabilities and Shareholders’
Equity
Current liabilities:
Accounts payable
$
10,935
$
35,151
Accrued expenses and other liabilities
64,835
63,532
Accrued compensation and benefits
78,049
76,483
Operating lease liabilities
12,788
12,749
Deferred revenue
561,665
528,704
Total current liabilities
728,272
716,619
Deferred revenue, non-current
23,521
34,248
Long-term debt, net
568,341
567,543
Operating lease liabilities,
non-current
15,297
13,942
Other liabilities, non-current
15,654
12,233
Total liabilities
1,351,085
1,344,585
Shareholders’ equity:
Preference shares, €0.01 par value;
165,000,000 shares authorized, 0 shares issued and outstanding as
of January 31, 2024 and April 30, 2023
—
—
Ordinary shares, par value €0.01 per
share: 165,000,000 shares authorized; 100,792,010 shares issued and
outstanding as of January 31, 2024 and 97,366,947 shares issued and
outstanding as of April 30, 2023
1,060
1,024
Treasury stock
(369
)
(369
)
Additional paid-in capital
1,676,493
1,471,584
Accumulated other comprehensive loss
(18,840
)
(20,015
)
Accumulated deficit
(950,507
)
(1,053,327
)
Total shareholders’ equity
707,837
398,897
Total liabilities and shareholders’
equity
$
2,058,922
$
1,743,482
Elastic N.V.
Condensed Consolidated
Statements of Cash Flows
(in thousands)
(unaudited)
Three Months Ended January
31,
Nine Months Ended January
31,
2024
2023
2024
2023
Cash flows from operating
activities
Net income (loss)
$
176,124
$
(72,574
)
$
102,820
$
(189,430
)
Adjustments to reconcile net income (loss)
to cash provided by operating activities:
Depreciation and amortization
4,072
5,045
13,853
15,475
Amortization of discounts or premiums on
marketable securities
(2,750
)
—
(6,396
)
—
Amortization of deferred contract
acquisition costs
20,440
15,821
56,392
51,495
Amortization of debt issuance costs
269
257
798
763
Non-cash operating lease cost
2,878
2,705
8,148
8,354
Asset impairment charges
—
6,242
—
6,242
Stock-based compensation expense
62,762
54,456
176,344
148,626
Deferred income taxes
(210,705
)
148
(210,278
)
68
Foreign currency transaction loss
1,845
2,213
2,267
2,261
Other
(16
)
—
(34
)
67
Changes in operating assets and
liabilities, net of impact of business acquisitions:
Accounts receivable, net
4,072
(11,143
)
31,044
14,050
Deferred contract acquisition costs
(30,668
)
(24,615
)
(74,089
)
(68,184
)
Prepaid expenses and other current
assets
(7,655
)
(238
)
(5,512
)
7,671
Other assets
(917
)
2,297
639
7,106
Accounts payable
(25,330
)
(11,809
)
(25,212
)
511
Accrued expenses and other liabilities
2,821
(4,627
)
1,428
(6,272
)
Accrued compensation and benefits
12,282
5,786
1,509
(161
)
Operating lease liabilities
(2,902
)
(2,831
)
(9,096
)
(8,404
)
Deferred revenue
45,767
40,037
23,189
17,869
Net cash provided by operating
activities
52,389
7,170
87,814
8,107
Cash flows from investing
activities
Purchases of property and equipment
(1,077
)
(197
)
(2,605
)
(1,019
)
Purchases of marketable securities
(179,972
)
—
(358,273
)
—
Maturities of marketable securities
74,931
—
150,223
—
Business acquisitions, net of cash
acquired
(18,951
)
—
(18,951
)
—
Net cash used in investing activities
(125,069
)
(197
)
(229,606
)
(1,019
)
Cash flows from financing
activities
Proceeds from issuance of ordinary shares
under employee stock purchase plan
—
—
9,111
—
Proceeds from issuance of ordinary shares
upon exercise of stock options
8,847
4,510
19,490
12,234
Net cash provided by financing
activities
8,847
4,510
28,601
12,234
Effect of exchange rate changes on cash,
cash equivalents, and restricted cash
1,008
9,940
(3,782
)
(2,914
)
Net (decrease) increase in cash, cash
equivalents, and restricted cash
(62,825
)
21,423
(116,973
)
16,408
Cash, cash equivalents, and restricted
cash, beginning of period
592,492
858,622
646,640
863,637
Cash, cash equivalents, and restricted
cash, end of period
$
529,667
$
880,045
$
529,667
$
880,045
Elastic N.V.
Revenue by Type
(in thousands, except
percentages)
(unaudited)
Three Months Ended January
31,
Nine Months Ended January
31,
2024
2023
2024
2023
Amount
% of Total
Revenue
Amount
% of Total
Revenue
Amount
% of Total
Revenue
Amount
% of Total
Revenue
Elastic Cloud
$
143,379
44
%
$
110,743
40
%
$
399,540
43
%
$
311,709
40
%
Other subscription
164,253
50
%
144,870
53
%
466,082
50
%
416,929
52
%
Total subscription
307,632
94
%
255,613
93
%
865,622
93
%
728,638
92
%
Services
20,325
6
%
18,953
7
%
66,700
7
%
60,410
8
%
Total revenue
$
327,957
100
%
$
274,566
100
%
$
932,322
100
%
$
789,048
100
%
Elastic N.V.
Reconciliation of GAAP to
Non-GAAP Data
Supplementary
Information
(in thousands, except
percentages)
(unaudited)
Three Months Ended
January 31, 2024
% Change Year Over
Year
% Change Year Over Year
Excluding Currency Changes
% Change Quarter Over
Quarter
% Change Quarter Over
Quarter Excluding Currency Changes
Revenue
Elastic Cloud
$
143,379
29
%
29
%
6
%
6
%
Other subscription
$
164,253
13
%
12
%
8
%
7
%
Total subscription
$
307,632
20
%
19
%
7
%
7
%
Total revenue
$
327,957
19
%
18
%
6
%
6
%
Total deferred revenue
$
585,186
21
%
21
%
9
%
9
%
Total remaining performance
obligations
$
1,176,486
18
%
18
%
5
%
5
%
Nine Months Ended
January 31, 2024
% Change Year Over
Year
% Change Year Over Year
Excluding Currency Changes
Revenue
Elastic Cloud
$
399,540
28
%
28
%
Other subscription
$
466,082
12
%
11
%
Total subscription
$
865,622
19
%
18
%
Total revenue
$
932,322
18
%
17
%
Elastic N.V.
Reconciliation of GAAP to
Non-GAAP Data
Adjusted Free Cash
Flow
(in thousands, except
percentages)
(unaudited)
Three Months Ended January
31,
Nine Months Ended January
31,
2024
2023
2024
2023
Net cash provided by operating
activities
$
52,389
$
7,170
$
87,814
$
8,107
Less: Purchases of property and
equipment
(1,077
)
(197
)
(2,605
)
(1,019
)
Add: Interest paid on long-term debt
11,859
11,859
23,719
23,719
Adjusted free cash flow (1)
$
63,171
$
18,832
$
108,928
$
30,807
Net cash used in investing activities
$
(125,069
)
$
(197
)
$
(229,606
)
$
(1,019
)
Net cash provided by financing
activities
$
8,847
$
4,510
$
28,601
$
12,234
Net cash provided by operating activities
(as a percentage of total revenue)
16
%
3
%
9
%
1
%
Less: Purchases of property and equipment
(as a percentage of total revenue)
—
%
—
%
—
%
—
%
Add: Interest paid on long-term debt (as a
percentage of total revenue)
3
%
4
%
3
%
3
%
Adjusted free cash flow margin
19
%
7
%
12
%
4
%
(1) Adjusted free cash flow includes cash
paid for restructuring and other charges of $0.8 million and $1.5
million during the three and nine months ended January 31, 2024,
respectively, and $18.0 million during the three and nine months
ended January 31, 2023.
Elastic N.V.
Reconciliation of GAAP to
Non-GAAP Data
(in thousands, except
percentages, share and per share data)
(unaudited)
Three Months Ended January
31,
Nine Months Ended January
31,
2024
2023
2024
2023
Gross Profit Reconciliation:
GAAP gross profit
$
243,315
$
199,358
$
690,114
$
566,104
Stock-based compensation expense and
related employer taxes
5,902
4,947
16,483
14,124
Amortization of acquired intangibles
3,186
2,977
9,139
8,902
Non-GAAP gross profit
$
252,403
$
207,282
$
715,736
$
589,130
Gross Margin Reconciliation(1):
GAAP gross margin
74.2
%
72.6
%
74.0
%
71.7
%
Stock-based compensation expense and
related employer taxes
1.8
%
1.8
%
1.8
%
1.8
%
Amortization of acquired intangibles
1.0
%
1.1
%
1.0
%
1.1
%
Non-GAAP gross margin
77.0
%
75.5
%
76.8
%
74.7
%
Operating Income
Reconciliation:
GAAP operating loss
$
(26,404
)
$
(69,347
)
$
(84,190
)
$
(179,016
)
Stock-based compensation expense and
related employer taxes
65,847
56,155
183,564
153,507
Amortization of acquired intangibles
3,186
4,209
11,282
12,597
Acquisition-related expenses
682
899
2,240
5,100
Restructuring and other related
charges
—
29,805
754
29,805
Non-GAAP operating income
$
43,311
$
21,721
$
113,650
$
21,993
Operating Margin
Reconciliation(1):
GAAP operating margin
(8.1
)%
(25.3
)%
(9.0
)%
(22.7
)%
Stock-based compensation expense and
related employer taxes
20.1
%
20.4
%
19.7
%
19.4
%
Amortization of acquired intangibles
1.0
%
1.5
%
1.2
%
1.6
%
Acquisition-related expenses
0.2
%
0.3
%
0.2
%
0.6
%
Restructuring and other related
charges
—
%
10.9
%
0.1
%
3.8
%
Non-GAAP operating margin
13.2
%
7.9
%
12.2
%
2.8
%
Net Income (Loss)
Reconciliation:
GAAP net income (loss)
$
176,124
$
(72,574
)
$
102,820
$
(189,430
)
Stock-based compensation expense and
related employer taxes
65,847
56,155
183,564
153,507
Amortization of acquired intangibles
3,186
4,209
11,282
12,597
Acquisition-related expenses
682
899
2,240
5,100
Restructuring and other related
charges
—
29,805
754
29,805
Litigation settlement
—
—
—
(10,150
)
Income tax effects related to the above
adjustments(2)
(780
)
(1,599
)
7,988
1,929
Discrete income tax benefit from the
release of a valuation allowance against deferred tax assets
(207,456
)
—
(207,456
)
—
Non-GAAP net income
$
37,603
$
16,895
$
101,192
$
3,358
Non-GAAP earnings per share
attributable to ordinary
shareholders, basic(1)
$
0.37
$
0.18
$
1.02
$
0.04
Non-GAAP earnings per share
attributable to ordinary
shareholders, diluted(1)
$
0.36
$
0.17
$
0.98
$
0.03
Weighted-average shares used to compute
earnings per share attributable to ordinary shareholders, basic
100,282,179
96,052,025
99,099,210
95,327,131
Weighted-average shares used to compute
earnings per share attributable to ordinary shareholders,
diluted
104,503,290
98,902,515
103,149,384
98,834,408
(1) Totals may not sum, due to rounding.
Gross margin, operating margin, and earnings per share are
calculated based upon the respective underlying, non-rounded
data.
(2) Non-GAAP financial information for the
quarter is adjusted for a tax rate equal to our annual estimated
tax rate on non-GAAP income. This rate is based on our estimated
annual GAAP income tax rate forecast, adjusted to account for items
excluded from GAAP income in calculating the non-GAAP financial
measures presented above as well as other significant tax
adjustments. Our estimated tax rate on non-GAAP income is
determined annually and may be adjusted during the year to take
into account events or trends that we believe materially impact the
estimated annual rate including, but not limited to, significant
changes resulting from tax legislation, material changes in the
geographic mix of revenue and expenses and other significant
events. Due to the differences in the tax treatment of items
excluded from non-GAAP earnings, as well as the methodology applied
to our estimated annual tax rates as described above, our estimated
tax rate on non-GAAP income may differ from our GAAP tax rate and
from our actual tax liabilities.
Elastic N.V.
Reconciliation of GAAP to
Non-GAAP Data
(in thousands)
(unaudited)
Three Months Ended January
31,
Nine Months Ended January
31,
2024
2023
2024
2023
Cost of revenue reconciliation:
GAAP subscription
$
63,976
$
56,146
$
181,238
$
164,798
Stock-based compensation expense and
related employer taxes
(2,400
)
(2,291
)
(6,989
)
(6,733
)
Amortization of acquired intangibles
(3,186
)
(2,977
)
(9,139
)
(8,902
)
Non-GAAP subscription
$
58,390
$
50,878
$
165,110
$
149,163
GAAP services
$
20,666
$
19,062
$
60,970
$
58,146
Stock-based compensation expense and
related employer taxes
(3,502
)
(2,656
)
(9,494
)
(7,391
)
Non-GAAP services
$
17,164
$
16,406
$
51,476
$
50,755
Operating expenses
reconciliation:
GAAP research and development expense
$
87,202
$
77,472
$
248,000
$
231,689
Stock-based compensation expense and
related employer taxes
(25,989
)
(21,462
)
(71,956
)
(60,220
)
Acquisition-related expenses
—
(870
)
(1,175
)
(5,034
)
Non-GAAP research and development
expense
$
61,213
$
55,140
$
174,869
$
166,435
GAAP sales and marketing expense
$
141,621
$
126,717
$
408,020
$
379,902
Stock-based compensation expense and
related employer taxes
(21,142
)
(19,883
)
(59,541
)
(52,584
)
Amortization of acquired intangibles
—
(1,232
)
(2,143
)
(3,695
)
Non-GAAP sales and marketing expenses
$
120,479
$
105,602
$
346,336
$
323,623
GAAP general and administrative
expense
$
40,896
$
34,711
$
117,530
$
103,724
Stock-based compensation expense and
related employer taxes
(12,814
)
(9,863
)
(35,584
)
(26,579
)
Acquisition-related expenses
(682
)
(29
)
(1,065
)
(66
)
Non-GAAP general and administrative
expense
$
27,400
$
24,819
$
80,881
$
77,079
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240228788857/en/
Anthony Luscri Elastic Investor Relations
ir@elastic.co
Madge Miller Elastic Corporate Communications
PR-Team@elastic.co
Elastic NV (NYSE:ESTC)
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