Total Revenue of $63.6 million, Growing 72%
year-over-year
Calculated Billings of $88.5 million, Growing
73% year-over-year
Raised $264 million in Initial Public
Offering
Elastic N.V. (NYSE: ESTC) (“Elastic”), the company behind
Elasticsearch and the Elastic Stack, today announced strong results
for its fiscal second quarter ended October 31, 2018.
Second Quarter Fiscal 2019 Financial Highlights
- Total revenue was $63.6 million,
growing 72% year-over-year.
- Calculated billings was $88.5 million,
growing 73% year-over-year.
- Deferred revenue was $127.3 million,
growing 78% year-over-year.
- GAAP operating loss was $27.1 million;
GAAP operating margin was -42.6%.
- Non-GAAP operating loss was $14.8
million; Non-GAAP operating margin was -23.3%.
- GAAP net loss per share was $0.63;
Non-GAAP net loss per share was $0.38.
- Operating cash flow was -$0.6 million
with free cash flow of -$1.4 million.
- Cash and cash equivalents were $318.6
million as of October 31, 2018.
“We are very pleased with our Q2 results; our team delivered
strong revenue growth of 72% year-over-year,” said Shay Banon,
founder and chief executive officer at Elastic. “Search is an
incredible foundation to enable our users and customers to address
a variety of use cases. We’re proud of the pace of innovation
across our self-managed and SaaS offerings and the rapid adoption
of the Elastic Stack and our solutions by our users and
customers.”
Second Quarter Fiscal 2019 Key Metrics and Recent Business
Highlights
- Total subscription customer count was
over 6,300.
- Total customer count with ACV greater
than $100,000 was over 340.
- Subscription revenue represented 92% of
total revenue.
- Net Expansion Rate remained over 130%
for the eighth consecutive quarter.
- Released versions 6.4 and 6.5 of the
Elastic Stack with many new features including support for Kerberos
and FIPS (Federal Information Processing Standard) 140-2, Kibana
spaces for better multitenancy, Canvas for pixel-perfect
visualizations, cross-cluster replication to support disaster
recovery and data locality, curated UIs for log and infrastructure
data, and APM support for new programming languages like Java and
Go.
- Released new SaaS features on
Elasticsearch Service, the official hosted and managed
Elasticsearch offering on Elastic Cloud, including custom
topologies for hot-warm architectures, deployment templates for use
cases like logging or security, machine learning, and a revised,
more flexible pricing model.
- Released version 2.0 of Elastic Cloud
Enterprise (ECE) bringing all the new SaaS features to hybrid and
on-premise environments.
- Held 11 successful Elastic{ON} Tour
events to engage with our community of users, customers, and
partners in Melbourne, Sydney, Boston, Chicago, Toronto,
Minneapolis, Denver, Washington DC, Stockholm, Frankfurt, and Santa
Clara, with waitlists driven by strong demand.
- Appointed Jonathan Chadwick Audit
Committee Chair to the Elastic Board of Directors. Jonathan is a
former Executive Vice President, CFO, and COO of VMware, CFO of
Skype, Corporate Vice President of Microsoft and Executive Vice
President and CFO of McAfee.
Financial Outlook
The Company is providing the following guidance:
For its third quarter of fiscal 2019 (ending January 31,
2019):
- Total revenue is expected to be between
$64 million and $66 million.
- Non-GAAP operating margin is expected
to be between -30% and -28%.
- Non-GAAP net loss per share is expected
to be between $0.32 and $0.30, assuming approximately 71 million
ordinary shares outstanding.
For its fiscal year 2019 (ending April 30, 2019):
- Total revenue is expected to be between
$254 million and $258 million.
- Non-GAAP operating margin is expected
to be between -26.0% and -25.0%.
- Non-GAAP net loss per share is expected
to be between $1.35 and $1.30, assuming approximately 56 million
ordinary shares outstanding.
See the section titled “Forward-Looking Statements” below for
information on the factors that could cause our actual results to
differ materially. A reconciliation of non-GAAP guidance measures
to corresponding GAAP measures is not available on a
forward-looking basis without unreasonable effort due to the
uncertainty regarding, and the potential variability of, many of
these costs and expenses that may be incurred in the future.
Conference Call and Webcast
Elastic’s executive management team will host a conference call
today beginning 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. Slides will accompany
the webcast. The replay of the webcast and slides will be available
for two months.
Lock-Up Release Extension
Lock-up agreements executed in connection with the Company’s
initial public offering provided for early release of 25% of the
shares if certain price and other conditions are met on or after
January 2, 2019. However, since the Company will be in its standard
quarterly trading blackout period on that date, this early lock-up
release date will be extended (even if the early release conditions
are met) until at least the second business day following the end
of its blackout period. The Company expects to announce its
earnings results for its fiscal quarter ending January 31, 2019 in
late February 2019 or early March 2019. The Company will announce
the lock-up release date at least two business days in advance.
About Elastic
Elastic is a search company. As the creators of the Elastic
Stack (Elasticsearch, Kibana, Beats, and Logstash), Elastic builds
self-managed and SaaS offerings that make data usable in real time
and at scale for search, logging, security, and analytics use
cases. Elastic is a distributed company with Elasticians working in
countries around the world. 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.
Use of Non-GAAP Financial Measures
Reconciliations of non-GAAP financial measures to Elastic’s
financial results as determined in accordance with GAAP are
included at the end of this press release following the
accompanying financial data. For a description of these non-GAAP
financial measures, including the reasons management uses each
measure, please see the section of this press release titled “About
Non-GAAP Financial Measures.”
Forward-Looking Statements
This press release contains forward-looking statements which
include, but are not limited to, expected financial results for the
fiscal quarter ending January 31, 2019 and the fiscal year ending
April 30, 2019. These forward-looking statements are subject to the
safe harbor provisions under the Private Securities Litigation
Reform Act of 1995. Our expectations and beliefs regarding these
matters may not materialize. Actual outcomes and results may differ
materially from those contemplated by these forward-looking
statements as a result of uncertainties, risks, and changes in
circumstances, including but not limited to risks and uncertainties
related to: our ability to continue to deliver and improve our
offerings and successfully develop new offerings; customer
acceptance and purchase of our existing offerings and new
offerings; our ability to maintain and expand our customer base;
the market for our products not continuing to develop; competition
from other products; the impact of foreign currency exchange rate
and interest rate fluctuations on our results; our business
strategy and our plan to build our business; our ability to
effectively manage our growth; the pace of change and innovation in
the markets in which we participate and the competitive nature of
those markets; our international expansion strategy; our service
performance and security, including the resources and costs
required to prevent, detect and remediate potential security
breaches; our operating results and cash flows; our strategy of
acquiring complementary businesses and our ability to successfully
integrate acquired businesses and technologies; our relationships
with third parties, including partners; our ability to protect our
intellectual property rights; our ability to develop our brands;
our ability to attract and retain qualified employees and key
personnel; the impact of expensing stock options and other equity
awards; the sufficiency of our capital resources; and general
market, political, economic and business conditions. Additional
risks and uncertainties that could cause actual outcomes and
results to differ materially from those contemplated by the
forward-looking statements are included under the caption “Risk
Factors” and elsewhere in our most recent filings with the
Securities and Exchange Commission (the “SEC”), including our
prospectus filed with the SEC pursuant to Rule 424(b)(4) dated
October 4, 2018. 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 after the date of this release, except as required by
law.
Contact Information
Anthony LuscriElastic Investor
Relationsir@elastic.co(650) 695-1055
Deborah WiltshireElastic Corporate
Communicationspress@elastic.co
Elastic N.V. CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS (amounts in thousands, except share and per share
amounts) (Unaudited)
Three Months Ended October 31,
Six Months Ended October
31,
2018 2017 2018 2017
Revenue License - self-managed $ 10,204 $ 6,456 $ 17,444 $ 11,105
Subscription - self-managed and SaaS 48,232
28,326 92,601 53,068 Total
subscription revenue 58,436 34,782 110,045 64,173 Professional
services 5,139 2,256 10,174
4,509 Total revenue 63,575
37,038 120,219 68,682
Cost of revenue Cost of license - self-managed 97 97 194 194 Cost
of subscription - self-managed and SaaS 12,870
6,254 23,071 11,236 Total cost
of revenue - subscription 12,967 6,351 23,265 11,430 Cost of
professional services 5,620 2,609
10,879 4,944 Total cost of revenue
18,587 8,960 34,144
16,374 Gross profit 44,988
28,078 86,075 52,308 Operating
expenses Research and development 25,332 12,182 44,313 23,006 Sales
and marketing 34,634 16,905 65,056 33,952 General and
administrative 12,092 6,117
22,191 11,650 Total operating expenses
72,058 35,204 131,560
68,608 Operating loss (27,070 ) (7,126 ) (45,485 ) (16,300 )
Other income (expense), net 264 86
860 (638 ) Loss before income taxes (26,806 )
(7,040 ) (44,625 ) (16,938 ) Provision for income taxes 733
987 1,492 1,056
Net loss $ (27,539 ) $ (8,027 ) $ (46,117 ) $ (17,994 )
Net loss per share attributable to
ordinaryshareholders, basic and diluted
$ (0.63 ) $ (0.25 ) $ (1.20 ) $ (0.57 )
Weighted-average shares used to compute
net lossper share attributable to ordinary shareholders,basic and
diluted
43,978,770 31,684,020 38,471,641
31,561,588
Elastic N.V.
CONDENSED CONSOLIDATED BALANCE SHEETS (amounts in
thousands, except share and per share amounts)
(Unaudited)
October 31,
April
30,
2018 2018 Assets Current assets: Cash and cash
equivalents $ 318,564 $ 50,941 Restricted cash 2,283 668
Accounts receivable, net of allowance for
doubtful accounts of $1,604and $776 as of October 31, 2018 and
April 30, 2018, respectively
54,512 53,233 Deferred contract acquisition costs 15,721 12,125
Prepaid expenses and other current assets 18,524
15,261 Total current assets 409,604 132,228 Property
and equipment, net 4,104 4,536 Goodwill 19,964 19,182 Intangible
assets, net 8,176 8,297 Deferred contract acquisition costs,
non-current 7,147 5,954 Deferred offering costs - 242 Deferred tax
assets 3,036 3,946 Other assets 7,500 8,628
Total assets $ 459,531 $ 183,013
Liabilities, Redeemable Convertible
Preferred Shares and Shareholders’ (Deficit) Equity
Current liabilities: Accounts payable $ 9,827 $ 2,176 Accrued
expenses and other liabilities 16,866 11,816 Accrued compensation
and benefits 16,458 15,191 Deferred revenue 116,255
95,929 Total current liabilities 159,406 125,112
Deferred revenue, non-current 11,024 6,632 Other liabilities,
non-current 5,215 3,877 Total
liabilities 175,645 135,621 Commitments
and contingencies
Redeemable convertible preference shares,
par value €0.001 per share;No shares authorized, issued, or
outstanding as of October 31, 2018;29,026,193 shares authorized;
28,939,466 shares issued andoutstanding as of April 30, 2018
- 200,921 Shareholders’ (deficit)
equity:
Convertible preference shares, €0.01 par
value; 165,000,000 shares authorized, 0 sharesissued and
outstanding as of October 31, 2018; 0 shares authorized, issued
andoutstanding as of April 30, 2018
- -
Ordinary shares, par value €0.01 per
share: 165,000,000 shares authorized;70,948,987 shares issued and
outstanding as of October 31, 2018
722 -
Ordinary shares, par value of €0.001 per
share; 72,000,000 shares authorized;0 and 33,232,955 shares issued
and outstanding as of October 31, 2018and April 30, 2018,
respectively
- 33
Treasury stock; 35,937 shares (repurchased
at an average price of $10.30 per share)
(369 ) (369 ) Additional paid-in capital 546,219 62,542 Accumulated
other comprehensive loss (1,795 ) (961 ) Accumulated deficit
(260,891 ) (214,774 ) Total shareholders’ (deficit) equity
283,886 (153,529 )
Total liabilities, redeemable convertible
preference shares and shareholders’(deficit) equity
$ 459,531 $ 183,013
Elastic N.V.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (amounts
in thousands) (Unaudited)
Three Months Ended
Six Months
Ended
October 31, October 31, 2018
2017 2018
2017
Cash flows from operating activities Net loss $ (27,539 ) $
(8,027
) $ (46,117 ) $ (17,994 )
Adjustments to reconcile net loss to cash
(used in) provided by operating activities:
Depreciation and amortization 1,466 1,072 3,008 2,095 Amortization
of deferred contract acquisition costs 4,829 2,996 8,848 5,598
Stock-based compensation expense 11,239 2,769 16,904 5,024 Other 15
2 15 2
Changes in operating assets and
liabilities, net of impact of business acquisition:
Accounts receivable, net (11,772 ) (6,700 ) (2,624 ) (2,092 )
Deferred contract acquisition costs (9,617 ) (4,552 ) (14,136 )
(7,253 ) Prepaid expenses and other current assets (5,900 ) (1,476
) (4,857 ) (1,917 ) Other assets 110 44 1,643 (1,827 ) Accounts
payable 1,685 (957 ) 4,867 398 Accrued expenses and other
liabilities 4,778 1,767 7,655 4,786 Accrued compensation and
benefits 4,820 2,935 1,666 2,381 Deferred revenue 25,310
14,213 27,678 15,735
Net cash (used in) provided by operating
activities
(576 ) 4,086 4,550 4,936
Cash flows from investing activities Purchases of
property and equipment (836 ) (502 ) (1,172 ) (896 ) Maturities of
short-term investments - 7,500 - 15,000 Business acquisitions, net
of cash acquired - (651 ) (1,986 )
(3,702 ) Net cash (used in) provided by investing activities
(836 ) 6,347 (3,158 ) 10,402
Cash flows from financing activities
Net proceeds from issuance of common stock
in initial public offering
269,514 - 269,514 -
Proceeds from issuance of ordinary shares
upon exercise of stock options
2,133 771 2,782 1,328 Repurchase of ordinary shares - (344 ) - (344
) Repurchase of early exercised options - - (500 ) - Repayment of
notes payable - (31 ) (20 ) (59 ) Payments of deferred offering
costs (2,302 ) - (2,302 ) -
Net cash provided by financing activities 269,345
396 269,474 925
Effect of exchange rate changes on cash,
cash equivalents, and restricted cash
(449 ) (1,565 ) (1,628 ) (584 )
Net increase in cash, cash equivalents,
and restricted cash
267,484 9,264 269,238
15,679
Cash, cash equivalents, and restricted
cash, beginning of period
53,363 66,305 51,609
59,890
Cash, cash equivalents, and restricted
cash, end of period
$ 320,847 $
75,569
$ 320,847 $ 75,569
Elastic N.V.
REVENUE BY TYPE (amounts in thousands, except
percentages) (Unaudited)
Three Months Ended October 31,
Six Months Ended October
31,
2018 2017 2018
2017 % of % of
% of % of Total
Total Total Total Amount Revenue
Amount Revenue Amount Revenue
Amount Revenue Self-managed subscription $ 48,406
76 % $ 29,169 79 % $ 89,718 75 % $ 53,831
78 % License 10,204 16 % 6,456 17 % 17,444 15 % 11,105 16 %
Subscription 38,202 60 % 22,713 62 % 72,274 60 % 42,726 62 % SaaS
10,030 16 % 5,613 15 % 20,327
17 % 10,342 15 % Total subscription revenue
58,436 92 % 34,782 94 % 110,045 92 % 64,173 93 % Professional
services 5,139 8 % 2,256 6 %
10,174 8 % 4,509 7 % Total revenue $ 63,575
100 % $ 37,038 100 % $ 120,219 100 % $ 68,682
100 %
Elastic N.V. RECONCILIATION OF GAAP
TO NON-GAAP DATA CALCULATED BILLINGS (amounts in
thousands) (Unaudited)
Three Months Ended October 31,
Six Months Ended October
31,
2018
2017
2018 2017 Total revenue $ 63,575 $
37,038
$ 120,219 $
68,682
Add: Increase in total deferred revenue 25,310 14,213 27,678
15,735
Less: (Increase) decrease in
unbilled accounts receivable
(361 ) 22 (155 ) 508
Calculated billings $ 88,524 $
51,273
$ 147,742 $
84,925
Elastic N.V. RECONCILIATION OF GAAP TO
NON-GAAP DATA FREE CASH FLOW (amounts in thousands,
except percentages) (Unaudited) Three
Months Ended October 31,
Six Months Ended October
31,
2018 2017 2018 2017 Net
cash provided by (used in) operating activities $ (576 ) $ 4,086 $
4,550 $ 4,936 Less: Purchases of property and equipment (836
) (502 ) (1,172 ) (896 ) Free cash flow $
(1,412 ) $ 3,584 $ 3,378 $ 4,040 Net cash
provided by (used in) investing activities $ (836 ) $ 6,347 $
(3,158 ) $ 10,402 Net cash provided by financing activities $
269,345 $ 396 $ 269,474 $ 925
Net cash provided by (used in) operating
activities(as a percentage of total revenue)
(1 )% 11 % 4 % 7 %
Less: Purchases of property and
equipment(as a percentage of total revenue)
(1 )% (1 )% (1 )% (1 )% Free cash flow
margin (2 )% 10 % 3 % 6 %
Elastic N.V. RECONCILIATION OF GAAP TO NON-GAAP DATA
For the three months ended October 31, 2018 (amounts in
thousands, except percentages, share and per share amounts)
(Unaudited) GAAP
Stock-BasedCompensationExpense
Amortization of Acquired
Intangibles
Acquisition Related
Expenses
Tax Adjustment
(1)
Non-GAAP (2) Cost of revenue Cost of license -
self-managed $ 97 - (97 ) - - $ -
Cost of subscription - self-managedand
SaaS
$ 12,870 (680 ) (637 ) - - $ 11,553 Total cost of revenue -
subscription $ 12,967 (680 ) (734 ) - - $ 11,553 Cost of
professional services $ 5,620 (227 ) - - - $ 5,393 Total cost of
revenue $ 18,587 (907 ) (734 ) - - $ 16,946 Gross profit $ 44,988
907 734 - - $ 46,629 Gross margin (2) 70.8 % 1.4 % 1.2 % 0.0 % 73.3
% Operating expenses Research and development $ 25,332 (4,685 ) -
(174 ) - $ 20,473 Sales and marketing $ 34,634 (2,762 ) (40 ) - - $
31,832 General and administrative $ 12,092 (2,885 ) - (53 ) - $
9,154 Total operating expenses $ 72,058 (10,332 ) (40 ) (227 ) - $
61,459 Operating loss $ (27,070 ) 11,239 774 227 - $ (14,830 )
Operating margin (2) (42.6 )% 17.7 % 1.2 % 0.4 % (23.3 )% Other
income, net $ 264 - - - - $ 264 Loss before income taxes
$
(26,806 ) 11,239 774 227 - $ (14,566 ) Provision for income taxes $
733 - - - 1,611 $ 2,344 Tax rate (2) (2.7 )% (16.1 )% Net loss $
(27,539 ) 11,239 774 227 (1,611 ) $ (16,910 )
Net loss per share attributable to
ordinaryshareholders, basic and diluted (2)(3)
$ (0.63 ) $ 0.26 $ 0.02 $ 0.01 $ (0.04 ) $ (0.38 )
(1)
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 significant tax adjustments,
such as adjustments resulting from the 2017 Tax Act. 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.
(2) Totals may not sum, due to rounding. Gross margin, operating
margin, tax rate and earnings per share are calculated based upon
the respective underlying, non-rounded data. (3) Calculated based
upon 43,978,770 weighted-average shares, basic and diluted.
Elastic N.V. RECONCILIATION OF GAAP TO NON-GAAP DATA
For the three months ended October 31, 2017 (amounts in
thousands, except percentages, share and per share amounts)
(Unaudited)
GAAP
Stock-Based Compensation
Expense
Amortization of Acquired
Intangibles
Acquisition Related
Expenses
Tax Adjustment
(1)
Non-GAAP (2)
Cost of revenue Cost of license - self-managed $ 97 - (97 ) - - $ -
Cost of subscription - self-managedand
SaaS
$ 6,254 (136 ) (216 ) - - $ 5,902 Total cost of revenue -
subscription $ 6,351 (136 ) (313 ) - - $ 5,902 Cost of professional
services $ 2,609 (70 ) - - - $ 2,539 Total cost of revenue $ 8,960
(206 ) (313 ) - - $ 8,441 Gross profit $ 28,078 206 313 - - $
28,597 Gross margin (2) 75.8 % 0.6 % 0.8 % 0.0 % 77.2 % Operating
expenses Research and development $ 12,182 (1,092 ) - (174 ) - $
10,916 Sales and marketing $ 16,905 (756 ) (22 ) - - $ 16,127
General and administrative $ 6,117 (716 ) - (303 ) - $ 5,098 Total
operating expenses $ 35,204 (2,564 ) (22 ) (477 ) - $ 32,141
Operating loss $ (7,126 ) 2,770 335 477 - $ (3,544 ) Operating
margin (2) (19.2 )% 7.5 % 0.9 % 1.3 % (9.6 )% Other income, net $
86 - - - - $ 86 Loss before income taxes $ (7,040 ) 2,770 335 477 -
$ (3,458 ) Provision for income taxes $ 987 - - - 820 $ 1,807 Tax
rate (2) (14.0 )% (52.3 )% Net loss $ (8,027 ) 2,770 335 477 (820 )
$ (5,265 )
Net loss per share attributable to
ordinaryshareholders, basic and diluted (2)(3)
$ (0.25 ) $ 0.09 $ 0.01 $ 0.02 $ (0.03 ) $ (0.17 ) (1)
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 significant tax adjustments, such as adjustments resulting
from the 2017 Tax Act. 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. (2) Totals may not sum, due to
rounding. Gross margin, operating margin, tax rate and earnings per
share are calculated based upon the respective underlying,
non-rounded data. (3) Calculated based upon 31,684,020
weighted-average shares, basic and diluted.
Elastic
N.V. RECONCILIATION OF GAAP TO NON-GAAP DATA For the
six months ended October 31, 2018 (amounts in thousands,
except percentages, share and per share amounts)
(Unaudited) GAAP
Stock-Based Compensation
Expense
Amortization of Acquired
Intangibles
Acquisition Related
Expenses
Tax Adjustment
(1)
Non-GAAP (2)
Cost of revenue Cost of license - self-managed $ 194 - (194 ) - - $
-
Cost of subscription - self-managedand
SaaS
$ 23,071 (1,093 ) (1,213 ) - - $ 20,765 Total cost of revenue -
subscription $ 23,265 (1,093 ) (1,407 ) - - $ 20,765 Cost of
professional services $ 10,879 (404 ) - - - $ 10,475 Total cost of
revenue $ 34,144 (1,497 ) (1,407 ) - - $ 31,240 Gross profit $
86,075 1,497 1,407 - - $ 88,979 Gross margin (2) 71.6 % 1.2 % 1.2 %
0.0 % 74.0 % Operating expenses Research and development $ 44,313
(6,782 ) - (348 ) - $ 37,183 Sales and marketing $ 65,056 (4,614 )
(77 ) - - $ 60,365 General and administrative $ 22,191 (4,011 ) -
(259 ) - $ 17,921 Total operating expenses $ 131,560 (15,407 ) (77
) (607 ) - $ 115,469 Operating loss $ (45,485 ) 16,904 1,484 607 -
$ (26,490 ) Operating margin (2) (37.8 )% 14.1 % 1.2 % 0.5 % (22.0
)% Other income, net $ 860 - - - - $ 860 Loss before income taxes $
(44,625 ) 16,904 1,484 607 - $ (25,630 ) Provision for income taxes
$ 1,492 2,282 $ 3,774 Tax rate (2) (3.3 )% (14.7 )% Net loss $
(46,117 ) 16,904 1,484 607 (2,282 ) $ (29,404 )
Net loss per share attributable to
ordinaryshareholders, basic and diluted (2)(3)
$ (1.20 ) $ 0.44 $ 0.04 $ 0.02 $ (0.06 ) $ (0.76 ) (1)
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 significant tax adjustments, such as adjustments resulting
from the 2017 Tax Act. 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. (2) Totals may not sum, due to
rounding. Gross margin, operating margin, tax rate and earnings per
share are calculated based upon the respective underlying,
non-rounded data. (3) Calculated based upon 38,471,641
weighted-average shares, basic and diluted.
Elastic
N.V. RECONCILIATION OF GAAP TO NON-GAAP DATA For the
six months ended October 31, 2017 (amounts in thousands,
except percentages, share and per share amounts)
(Unaudited) GAAP
Stock-Based Compensation
Expense
Amortization of Acquired
Intangibles
Acquisition Related
Expenses
Tax Adjustment
(1)
Non-GAAP (2) Cost of revenue Cost of license -
self-managed $ 194 - (194 ) - - $ -
Cost of subscription - self-managedand
SaaS
$ 11,236 (255 ) (413 ) - - $ 10,568 Total cost of revenue -
subscription $ 11,430 (255 ) (607 ) - - $ 10,568 Cost of
professional services $ 4,944 (112 ) - - - $ 4,832 Total cost of
revenue $ 16,374 (367 ) (607 ) - - $ 15,400 Gross profit $ 52,308
367 607 - - $ 53,282 Gross margin (2) 76.2 % 0.5 % 0.9 % 0.0 % 77.6
% Operating expenses Research and development $ 23,006 (2,075 ) -
(314 ) - $ 20,617 Sales and marketing $ 33,952 (1,488 ) (44 ) - - $
32,420 General and administrative $ 11,650 (1,094 ) - (608 ) - $
9,948 Total operating expenses $ 68,608 (4,657 ) (44 ) (922 ) - $
62,985 Operating loss $ (16,300 ) 5,024 651 922 - $ (9,703 )
Operating margin (2) (23.7 )% 7.3 % 0.9 % 1.3 % (14.1 )% Other
income, net $ (638 ) - - - - $ (638 ) Loss before income taxes $
(16,938 ) 5,024 651 922 - $ (10,341 ) Provision for income taxes $
1,056 1,720 $ 2,776 Tax rate (2) (6.2 )% (26.8 )% Net loss $
(17,994 ) 5,024 651 922 (1,720 ) $ (13,117 )
Net loss per share attributable to
ordinaryshareholders, basic and diluted (2)(3)
$ (0.57 ) $ 0.16 $ 0.02 $ 0.03 $ (0.05 ) $ (0.42 ) (1)
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 significant tax adjustments, such as adjustments resulting
from the 2017 Tax Act. 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. (2) Totals may not sum, due to
rounding. Gross margin, operating margin, tax rate and earnings per
share are calculated based upon the respective underlying,
non-rounded data. (3) Calculated based upon 31,561,588
weighted-average shares, basic and diluted.
About Non-GAAP Financial Measures
In addition to our results determined in accordance with U.S.
GAAP, we believe the following non-GAAP measures are useful in
evaluating our operating performance. We use the following non-GAAP
financial information 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 particular,
free cash flow is not a substitute for cash used in operating
activities. Additionally, the utility of free cash flow as a
measure of our liquidity is further limited as it does not
represent the total increase or decrease in our cash balance for a
given period. 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. A
reconciliation of our historical non-GAAP financial measures to
their most directly comparable financial measure stated in
accordance with U.S. GAAP has been provided in the financial
statement tables included in this press release. 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 these
reconciliations, and not to rely on any single financial measure to
evaluate our business.
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 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 Loss and Non-GAAP Operating Margin
We define non-GAAP operating loss and non-GAAP operating margin
as GAAP operating loss and GAAP operating margin, respectively,
excluding stock-based compensation expense, amortization of
acquired intangible assets, and acquisition-related expenses. We
believe non-GAAP operating loss 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.
Free Cash Flow and Free Cash Flow Margin
Free cash flow is a non-GAAP financial measure that we define as
net cash (used in) provided by operating activities less purchases
of property and equipment. Free cash flow margin is calculated as
free cash flow divided by total revenue. We believe that free cash
flow and free cash flow margin are useful indicators of liquidity
that provide information to management and investors about the
amount of cash generated from our core operations that, after the
purchases of property and equipment, can be used for strategic
initiatives, including investing in our business and selectively
pursuing acquisitions and strategic investments.
Calculated Billings
We define calculated billings as total revenue plus the increase
in total deferred revenue as presented on or derived from our
consolidated statements of cash flows less the (increase) decrease
in total unbilled accounts receivable in a given period. We
typically invoice our customers annually in advance, and to a
lesser extent multi-year in advance, quarterly in advance, monthly
in advance, monthly in arrears or upon delivery. Our management
uses calculated billings to understand and evaluate our near term
cash flows and operating results.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20181204006030/en/
Anthony LuscriElastic Investor
Relationsir@elastic.co(650) 695-1055
Deborah WiltshireElastic Corporate
Communicationspress@elastic.co
Elastic NV (NYSE:ESTC)
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