Q4 Revenue of $123.6 million, Up 53%
year-over-year (57% in constant currency)
Q4 SaaS Revenue of $29.0 million, Up 110%
year-over-year (120% in constant currency)
FY20 Revenue of $427.6 million, Up 57%
year-over-year (60% in constant currency)
Elastic N.V. (NYSE: ESTC) (“Elastic”), the company behind
Elasticsearch and the Elastic Stack, announced strong results for
its fourth quarter and full fiscal year (ended April 30, 2020).
Fourth Quarter Fiscal 2020 Financial Highlights
- Total revenue was $123.6 million, an increase of 53%
year-over-year, or 57% on a constant currency basis.
- SaaS revenue was $29.0 million, an increase of 110%
year-over-year, or 120% on a constant currency basis.
- Calculated billings was $175.1 million, an increase of 52%
year-over-year, or 55% on a constant currency basis.
- Deferred revenue was $259.7 million, an increase of 52%
year-over-year.
- GAAP operating loss was $34.6 million; GAAP operating margin
was -28%.
- Non-GAAP operating loss was $12.7 million; non-GAAP operating
margin was -10%.
- GAAP net loss per share was $0.38; non-GAAP net loss per share
was $0.12.
- Operating cash flow was -$5.9 million with free cash flow of
-$6.8 million.
- Cash and cash equivalents were $297.1 million as of April 30,
2020.
Full Fiscal 2020 Financial Highlights
- Total revenue was $427.6 million, an increase of 57%
year-over-year, or 60% on a constant currency basis.
- SaaS revenue was $92.3 million, an increase of 101%
year-over-year, or 109% on a constant currency basis.
- GAAP operating loss was $171.1 million; GAAP operating margin
was -40%.
- Non-GAAP operating loss was $75.6 million; Non-GAAP operating
margin was -18%.
- GAAP net loss per share was $2.12; Non-GAAP net loss per share
was $0.93.
- Operating cash flow was -$30.6 million with free cash flow of
-$35.6 million, or -8% free cash flow margin.
“Despite a challenging environment, Q4 was an amazing ending to
a strong fiscal year,” said Shay Banon, Elastic’s founder and chief
executive officer. “I am extremely proud of how Elastic employees
continue to support our community of users, partners, and
customers, and my heart goes out to those impacted by the COVID-19
situation. Our distributed-by-design approach, rapid pace of
innovation, development of customer-focused solutions, our large
and geographically diverse customer base, efficient go-to-market,
solid customer expansion, and strong balance sheet give us
confidence as we address the rich market opportunity ahead of
us.”
Fourth Quarter Fiscal 2020 Key Metrics and Recent Business
Highlights
Key Customer Metrics:
- Total subscription customer count was over 11,300, compared to
over 10,500 in Q3 FY20, and over 8,100 in Q4 FY19.
- Total customer count with Annual Contract Value (ACV) greater
than $100,000 was over 610, compared to over 570 in Q3 FY20, and
over 440 in Q4 FY19.
- Subscription revenue represented 92% of total revenue.
- Net Expansion Rate continued to be greater than 130%.
Product Releases and Other Business Highlights:
- Released version 7.7 of the Elastic Stack, bringing strong
enhancements and integrations across the Elastic solutions
portfolio, including:
- General availability of Elastic Workplace Search, a modern,
unified search experience built to enable organizations of all
sizes with a clean, simple, and easily deployable enterprise search
solution.
- Integrated alerting features across the Elastic Stack, bringing
alerting workflows directly to the user, tailored to their context
and use case.
- Asynchronous search, enabling users to run long queries in the
background, letting teams track progress and retrieve partial
results as they become available.
- Embedded case management, helping security teams develop
standard operating procedures for incident investigation and
response.
- Service maps to Elastic APM, for full visibility of live data
and system dependencies to speed the troubleshooting of issues in
today’s distributed and cloud-native environments.
- Released Elastic Cloud Enterprise (ECE) 2.5, including:
- Dedicated coordinating layer, driving increased performance and
scalability.
- Support for snapshot lifecycle management (SLM) in ECE-hosted
deployments.
- Automated migration from index curation to index lifecycle
management (ILM), using a one-click migration path.
- Released Elastic Cloud on Kubernetes (ECK) 1.1.0, including:
- Support for remote clusters, enabling cross-cluster search and
replication across multiple global Kubernetes environments.
- Out-of-the-box Elastic APM instrumentation of the ECK
operator.
- Introduced expanded capabilities on Elastic Cloud, including:
- General availability of Elasticsearch Service public API, which
includes an easy-to-use, programmatic way to provision and
configure Elasticsearch Service deployments.
- FedRAMP “In Process” status for FedRAMP Moderate, signifying
the addition of Elastic Cloud to the FedRAMP marketplace.
- Beta availability of our new government region, AWS GovCloud
(US East), for the Elasticsearch Service on Elastic Cloud.
- Ability for Google customers to purchase annual subscriptions
of Elasticsearch Service on Elastic Cloud through Google Cloud
Marketplace.
- Availability of Elasticsearch Service on Google Cloud in South
Carolina, Finland, Taiwan, the Netherlands, São Paulo, and
Singapore; Microsoft Azure in London and Ireland; AWS in Ohio.
- Held four successful Elastic{ON} Tour events to educate and
engage with Elastic’s community of users, customers, and partners
in San Francisco, Brazil, US Gov Summit, and Americas East.
- Ranked #4 in the Fast Company enterprise technology category on
its 2020 Most Innovative Companies list.
Financial Outlook
The Company is providing the following guidance:
For its first quarter of fiscal 2021 (ending July 31, 2020):
- Total revenue is expected to be between $119 million and $122
million.
- Non-GAAP operating margin is expected to be between -12% and
-11%.
- Non-GAAP net loss per share is expected to be between $0.19 and
$0.17, assuming between 83 million and 84 million weighted average
ordinary shares outstanding.
For its fiscal year 2021 (ending April 30, 2021):
- Total revenue is expected to be between $530 million and $540
million.
- Non-GAAP operating margin is expected to be between -15% and
-13%.
- Non-GAAP net loss per share is expected to be between $0.98 and
$0.85, assuming between 85 million and 87 million weighted average
ordinary shares outstanding.
We believe it is prudent to expect some near-term business
headwinds as the economic impact from the COVID-19 situation
further unfolds. As such, our guidance includes the expected impact
of COVID‑19 on our business and results of operations based on
information available to us today.
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
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/ 11:00 p.m. Amsterdam time 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.
About Elastic
Elastic is a search company built on a free and open heritage.
Everyone can get started with Elastic products and solutions
quickly and frictionlessly. Elastic offers three solutions for
enterprise search, observability, and security built on one
technology stack that can be deployed anywhere. From finding
documents to monitoring infrastructure to hunting for threats,
Elastic makes data usable in real time and at scale. Founded in
2012, Elastic is a distributed company with Elasticians around the
globe. 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 U.S. 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 that
involve substantial risk and uncertainties, which include, but are
not limited to, our expected financial results for the fiscal
quarter ending July 31, 2020 and the fiscal year ending April 30,
2021, our expectations regarding the impact of the COVID-19
pandemic, our customer base, potential market and growth
opportunities, and our go-to-market strategy. These forward-looking
statements are subject to the safe harbor provisions under the
Private Securities Litigation Reform Act of 1995. Our expectations
and beliefs in light of currently available information regarding
these matters may not materialize. 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: the
impact of COVID-19 on our business, operations, hiring and
financial results, and on businesses of our customers and partners,
including the effect of governmental lockdowns, restrictions and
new regulations; 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 successfully develop new offerings,
including security-related product offerings and SaaS offerings;
customer acceptance and purchase of our existing offerings and new
offerings, including the expansion and adoption of our SaaS
offerings; our ability to maintain and expand our user and customer
base; the impact of foreign currency exchange rate and interest
rate fluctuations on our results; our international expansion
strategy; our operating results and cash flows; our beliefs and
objectives for future operations; the sufficiency of our capital
resources; our ability to successfully execute our go-to-market
strategy and expand in our existing markets and into new markets;
and general market, political, economic and business conditions
(including developments and volatility arising from the COVID-19
pandemic).
Any additional or unforeseen effect from the COVID-19 pandemic
may exacerbate these risks. Additional risks and uncertainties that
could cause actual outcomes and results to differ materially are
included in our filings with the Securities and Exchange Commission
(the “SEC”), including the quarterly report on Form 10-Q for the
quarter ended January 31, 2020 and any 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.
Contact Information
Anthony Luscri Elastic Investor Relations ir@elastic.co
(650) 695-1055
Lisa Boughner Elastic Corporate Communications
lisa.boughner@elastic.co
Elastic N.V.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(amounts in thousands, except
share and per share amounts)
(Unaudited)
Three Months Ended April
30,
Year Ended April 30,
2020
2019
2020
2019
Revenue
License - self-managed
$
16,862
$
12,624
$
53,536
$
39,474
Subscription - self-managed and SaaS
97,041
60,999
338,634
208,780
Total subscription revenue
113,903
73,623
392,170
248,254
Professional services
9,720
6,976
35,450
23,399
Total revenue
123,623
80,599
427,620
271,653
Cost of revenue
Cost of license - self-managed
346
97
948
387
Cost of subscription - self-managed and
SaaS
23,987
16,548
84,819
53,560
Total cost of revenue - subscription
24,333
16,645
85,767
53,947
Cost of professional services
9,940
6,797
36,923
24,063
Total cost of revenue
34,273
23,442
122,690
78,010
Gross profit
89,350
57,157
304,930
193,643
Operating expenses
Research and development
45,591
31,004
165,370
101,167
Sales and marketing
58,180
45,044
219,040
147,296
General and administrative
20,153
13,194
91,625
46,536
Total operating expenses
123,924
89,242
476,035
294,999
Operating loss
(34,574
)
(32,085
)
(171,105
)
(101,356
)
Other income, net
687
704
1,963
3,441
Loss before income taxes
(33,887
)
(31,381
)
(169,142
)
(97,915
)
Provision for (benefit from) income
taxes
(2,736
)
3,454
(1,968
)
4,388
Net loss
$
(31,151
)
$
(34,835
)
$
(167,174
)
$
(102,303
)
Net loss per share attributable to
ordinary shareholders, basic and diluted
$
(0.38
)
$
(0.48
)
$
(2.12
)
$
(1.86
)
Weighted-average shares used to compute
net loss per share attributable to ordinary shareholders, basic and
diluted
82,123,381
72,307,990
78,799,732
54,893,365
Elastic N.V.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(amounts in thousands, except
share and per share amounts)
(Unaudited)
April 30,
Assets
2020
2019
Current assets:
Cash and cash equivalents
$
297,081
$
298,000
Restricted cash
2,308
2,280
Accounts receivable, net of allowance for
doubtful accounts of $1,247 and $1,411 as of April 30, 2020 and
April 30, 2019, respectively
128,690
81,274
Deferred contract acquisition costs
19,537
17,215
Prepaid expenses and other current
assets
32,623
30,872
Total current assets
480,239
429,641
Property and equipment, net
7,760
5,448
Goodwill
197,877
19,846
Operating lease right-of-use assets
32,783
-
Intangible assets, net
50,455
6,723
Deferred contract acquisition costs,
non-current
24,012
8,935
Deferred tax assets
3,164
1,748
Other assets
7,621
13,397
Total assets
$
803,911
$
485,738
Liabilities and Shareholders’
Equity
Current liabilities:
Accounts payable
$
11,485
$
4,450
Accrued expenses and other liabilities
22,210
18,740
Accrued compensation and benefits
48,409
22,147
Operating lease liabilities
7,639
-
Deferred revenue
231,681
158,243
Total current liabilities
321,424
203,580
Deferred revenue, non-current
28,021
12,423
Operating lease liabilities,
non-current
27,827
-
Other liabilities, non-current
12,992
6,723
Total liabilities
390,264
222,726
Commitments and contingencies
Shareholders’ equity:
Convertible preference shares, €0.01 par
value; 165,000,000 shares authorized, 0 shares issued and
outstanding as of April 30, 2020 and April 30, 2019
-
-
Ordinary shares, par value €0.01 per
share: 165,000,000 shares authorized; 82,856,978 shares issued and
outstanding as of April 30, 2020 and 73,675,083 shares issued and
outstanding as of April 30, 2019
856
754
Treasury stock, 35,937 shares (repurchased
at an average price of $10.30 per share)
(369
)
(369
)
Additional paid-in capital
898,788
581,135
Accumulated other comprehensive loss
(1,377
)
(1,431
)
Accumulated deficit
(484,251
)
(317,077
)
Total shareholders’ equity
413,647
263,012
Total liabilities and shareholders’
equity
$
803,911
$
485,738
Elastic N.V.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(amounts in thousands)
(Unaudited)
Three Months Ended April
30,
Year Ended April 30,
2020
2019
2020
2019
Cash flows from operating
activities
Net loss
$
(31,151
)
$
(34,835
)
$
(167,174
)
$
(102,303
)
Adjustments to reconcile net loss to cash
used in operating activities:
Depreciation and amortization
4,286
1,309
12,859
5,695
Amortization of deferred contract
acquisition costs
7,733
6,656
28,314
21,374
Non-cash operating lease cost
2,252
-
7,422
-
Stock-based compensation expense
17,232
11,927
60,007
39,942
Non-cash acquisition expense settled with
shares
-
-
8,834
-
Deferred income taxes
(918
)
2,733
(1,539
)
3,621
Other
(9
)
3
1,123
69
Changes in operating assets and
liabilities, net of impact of business acquisitions:
Accounts receivable, net
(57,626
)
(27,576
)
(46,753
)
(29,804
)
Deferred contract acquisition costs
(19,776
)
(9,592
)
(46,217
)
(30,006
)
Prepaid expenses and other current
assets
1,395
(8,451
)
(2,950
)
(18,049
)
Other assets
1,823
(5,035
)
5,603
(3,292
)
Accounts payable
(1,136
)
2,592
5,968
2,226
Accrued expenses and other liabilities
3,700
4,142
5,220
10,872
Accrued compensation and benefits
16,333
1,772
19,710
3,842
Operating lease liabilities
(2,075
)
-
(6,661
)
-
Deferred revenue
52,004
34,565
85,670
71,876
Net cash used in operating activities
(5,933
)
(19,790
)
(30,564
)
(23,937
)
Cash flows from investing
activities
Purchases of property and equipment
(826
)
(1,088
)
(5,063
)
(3,447
)
Business acquisitions, net of cash
acquired
-
-
(24,373
)
(1,986
)
Other
249
(2,850
)
249
(2,850
)
Net cash used in investing activities
(577
)
(3,938
)
(29,187
)
(8,283
)
Cash flows from financing
activities
Net proceeds from issuance of ordinary
shares in initial public offering
-
-
-
269,514
Proceeds from issuance of ordinary shares
upon exercise of stock options
10,841
15,015
61,463
18,552
Repurchase of early exercised options
-
-
-
(500
)
Repayment of notes payable
-
(33
)
(90
)
(106
)
Payment of deferred offering costs
-
1
-
(5,672
)
Payment of withholding taxes related to
acquisition expense settled in shares
-
-
(2,834
)
-
Net cash provided by financing
activities
10,841
14,983
58,539
281,788
Effect of exchange rate changes on cash,
cash equivalents, and restricted cash
(1,309
)
535
321
(897
)
Net increase (decrease) in cash, cash
equivalents, and restricted cash
3,022
(8,210
)
(891
)
248,671
Cash, cash equivalents, and restricted
cash, beginning of period
296,367
308,490
300,280
51,609
Cash, cash equivalents, and restricted
cash, end of period
$
299,389
$
300,280
$
299,389
$
300,280
Elastic N.V.
REVENUE BY TYPE
(amounts in thousands, except
percentages)
(Unaudited)
Three Months Ended April
30,
Year Ended April 30,
2020
2019
2020
2019
% of
% of
% of
% of
Total
Total
Total
Total
Amount
Revenue
Amount
Revenue
Amount
Revenue
Amount
Revenue
Self-managed subscription
$
84,933
69
%
$
59,855
74
%
$
299,880
70
%
$
202,419
74
%
License
16,862
14
%
12,624
16
%
53,536
12
%
39,474
14
%
Subscription
68,071
55
%
47,231
58
%
246,344
58
%
162,945
60
%
SaaS
28,970
23
%
13,768
17
%
92,290
22
%
45,835
17
%
Total subscription revenue
113,903
92
%
73,623
91
%
392,170
92
%
248,254
91
%
Professional services
9,720
8
%
6,976
9
%
35,450
8
%
23,399
9
%
Total revenue
$
123,623
100
%
$
80,599
100
%
$
427,620
100
%
$
271,653
100
%
Elastic N.V.
RECONCILIATION OF GAAP TO
NON-GAAP DATA
CALCULATED BILLINGS
(amounts in thousands)
(Unaudited)
Three Months Ended April
30,
Year Ended April 30,
2020
2019
2020
2019
Total revenue
$
123,623
$
80,599
$
427,620
$
271,653
Add: Increase in total deferred
revenue
52,004
34,565
85,670
71,876
Less: Decrease (increase) in unbilled
accounts receivable
(528
)
223
(592
)
(571
)
Calculated billings
$
175,099
$
115,387
$
512,698
$
342,958
Elastic N.V.
RECONCILIATION OF GAAP TO
NON-GAAP DATA
FREE CASH FLOW
(amounts in thousands, except
percentages)
(Unaudited)
Three Months Ended April
30,
Year Ended April 30,
2020
2019
2020
2019
Net cash used in operating activities
$
(5,933
)
$
(19,790
)
$
(30,564
)
$
(23,937
)
Less: Purchases of property and
equipment
(826
)
(1,088
)
(5,063
)
(3,447
)
Free cash flow
$
(6,759
)
$
(20,878
)
$
(35,627
)
$
(27,384
)
Net cash used in investing activities
$
(577
)
$
(3,938
)
$
(29,187
)
$
(8,283
)
Net cash provided by financing
activities
$
10,841
$
14,983
$
58,539
$
281,788
Net cash used in operating activities (as
a percentage of total revenue)
(5
)%
(25
)%
(7
)%
(9
)%
Less: Purchases of property and equipment
(as a percentage of total revenue)
0
%
(1
)%
(1
)%
(1
)%
Free cash flow margin
(5
)%
(26
)%
(8
)%
(10
)%
Elastic N.V.
RECONCILIATION OF GAAP TO
NON-GAAP DATA
(amounts in thousands, except
percentages, share and per share amounts)
(Unaudited)
Three Months Ended April
30,
Year Ended April 30,
2020
2019
2020
2019
Gross Profit Reconciliation:
GAAP gross profit
$
89,350
$
57,157
$
304,930
$
193,643
Stock-based compensation expense
2,180
1,635
7,127
4,591
Employer payroll taxes on employee stock
transactions
70
38
527
38
Amortization of acquired intangibles
2,109
667
6,768
2,808
Non-GAAP gross profit
$
93,709
$
59,497
$
319,352
$
201,080
Gross Margin Reconciliation(1):
GAAP gross margin
72.3
%
70.9
%
71.3
%
71.3
%
Stock-based compensation expense
1.8
%
2.0
%
1.7
%
1.7
%
Employer payroll taxes on employee stock
transactions
0.1
%
0.0
%
0.1
%
0.0
%
Amortization of acquired intangibles
1.7
%
0.8
%
1.6
%
1.0
%
Non-GAAP gross margin
75.8
%
73.8
%
74.7
%
74.0
%
Operating Loss Reconciliation:
GAAP operating loss
$
(34,574
)
$
(32,085
)
$
(171,105
)
$
(101,356
)
Stock-based compensation expense
17,232
11,927
60,007
39,942
Employer payroll taxes on employee stock
transactions
845
1,814
7,493
1,814
Amortization of acquired intangibles
3,550
700
10,068
2,956
Acquisition-related expenses
212
168
17,974
948
Non-GAAP operating loss
$
(12,735
)
$
(17,476
)
$
(75,563
)
$
(55,696
)
Operating Margin
Reconciliation(1):
GAAP operating margin
(28.0
)%
(39.8
)%
(40.0
)%
(37.3
)%
Stock-based compensation expense
13.9
%
14.8
%
14.0
%
14.7
%
Employer payroll taxes on employee stock
transactions
0.7
%
2.3
%
1.8
%
0.7
%
Amortization of acquired intangibles
2.9
%
0.9
%
2.4
%
1.1
%
Acquisition-related expenses
0.2
%
0.2
%
4.2
%
0.3
%
Non-GAAP operating margin
(10.3
)%
(21.7
)%
(17.7
)%
(20.5
)%
Net Loss Reconciliation:
GAAP net loss
$
(31,151
)
$
(34,835
)
$
(167,174
)
$
(102,303
)
Stock-based compensation expense
17,232
11,927
60,007
39,942
Employer payroll taxes on employee stock
transactions
845
1,814
7,493
1,814
Amortization of acquired intangibles
3,550
700
10,068
2,956
Acquisition-related expenses
212
168
17,974
948
Income tax(2)
(458
)
(246
)
(1,623
)
(4,384
)
Non-GAAP net loss
$
(9,770
)
$
(20,472
)
$
(73,255
)
$
(61,027
)
Non-GAAP net loss per share
attributable to ordinary shareholders, basic and diluted(1)
$
(0.12
)
$
(0.28
)
$
(0.93
)
$
(1.11
)
Weighted-average shares used to compute
net loss per share attributable to ordinary shareholders, basic and
diluted
82,123,381
72,307,990
78,799,732
54,893,365
(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 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
(amounts in thousands)
(Unaudited)
Three Months Ended April
30,
Year Ended April 30,
2020
2019
2020
2019
Cost of revenue reconciliation:
GAAP cost of license - self-managed
$
346
$
97
$
948
$
387
Amortization of acquired intangibles
(346
)
(97
)
(948
)
(387
)
Non-GAAP cost of license - self
-managed
$
-
$
-
$
-
$
-
GAAP cost of subscription - self-managed
and SaaS
$
23,987
$
16,548
$
84,819
$
53,560
Stock-based compensation expense
(1,278
)
(1,195
)
(4,147
)
(3,383
)
Employer payroll taxes on employee stock
transactions
(28
)
(28
)
(349
)
(28
)
Amortization of acquired intangibles
(1,763
)
(570
)
(5,820
)
(2,421
)
Non-GAAP cost of subscription -
self-managed and SaaS
$
20,918
$
14,755
$
74,503
$
47,728
GAAP cost of professional services
$
9,940
$
6,797
$
36,923
$
24,063
Stock-based compensation expense
(902
)
(440
)
(2,980
)
(1,208
)
Employer payroll taxes on employee stock
transactions
(42
)
(10
)
(178
)
(10
)
Non-GAAP cost of professional services
$
8,996
$
6,347
$
33,765
$
22,845
Operating expenses
reconciliation:
GAAP research and development expense
$
45,591
$
31,004
$
165,370
$
101,167
Stock-based compensation expense
(6,534
)
(4,714
)
(23,621
)
(16,100
)
Employer payroll taxes on employee stock
transactions
(293
)
(939
)
(2,179
)
(939
)
Acquisition-related expenses
-
(168
)
(34
)
(689
)
Non-GAAP research and development
expense
$
38,764
$
25,183
$
139,536
$
83,439
GAAP sales and marketing expense
$
58,180
$
45,044
$
219,040
$
147,296
Stock-based compensation expense
(5,828
)
(3,911
)
(19,334
)
(11,996
)
Employer payroll taxes on employee stock
transactions
(421
)
(747
)
(3,237
)
(747
)
Amortization of acquired intangibles
(1,441
)
(33
)
(3,300
)
(148
)
Acquisition-related expenses
(14
)
-
(522
)
-
Non-GAAP sales and marketing expenses
$
50,476
$
40,353
$
192,647
$
134,405
GAAP general and administrative
expense
$
20,153
$
13,194
$
91,625
$
46,536
Stock-based compensation expense
(2,690
)
(1,667
)
(9,925
)
(7,255
)
Employer payroll taxes on employee stock
transactions
(61
)
(90
)
(1,550
)
(90
)
Acquisition-related expenses
(198
)
-
(17,418
)
(259
)
Non-GAAP general and administrative
expense
$
17,204
$
11,437
$
62,732
$
38,932
About 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 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, employer payroll taxes on
employee stock transactions, 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, employer payroll taxes
on employee stock transactions, 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.
Non-GAAP Net Loss Per Share
We define non-GAAP net loss per share as GAAP net loss per
share, excluding stock-based compensation expense, employer payroll
taxes on employee stock transactions, amortization of acquired
intangible assets, acquisition-related expenses and the tax effects
related to the foregoing. We believe non-GAAP net loss 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.
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. Calculated
billings exclude the effects of deferred revenue and unbilled
accounts receivable acquired through acquisitions. 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.
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.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200603005774/en/
Anthony Luscri Elastic Investor Relations ir@elastic.co
(650) 695-1055
Lisa Boughner Elastic Corporate Communications
lisa.boughner@elastic.co
Elastic NV (NYSE:ESTC)
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