GALWAY, Ireland--(BUSINESS WIRE)---- $ESTC #AIForGood--Siren, the all-in-one investigation company, today announced a strategic investment from Elastic (NYSE: ESTC), the company behind Elasticsearch. The investment deepens a decade-long partnership between the two companies and accelerates development of Siren's AI-driven platform, including Siren's newly launched K9 AI Companion, used by national security, law enforcement, and financial crime agencies worldwide. The partnership combines the Elasticsearch P ...

SAN FRANCISCO--(BUSINESS WIRE)--Elastic (NYSE: ESTC), the Search AI Company, announced today that it has achieved the Amazon Web Services (AWS) Agentic AI Specialization, a new category launched within the AWS AI Competency. This specialization recognizes Elastic as an AWS Partner that enables customers to deploy smart, self-operating AI systems that can process, plan, and work independently to execute complex business processes. The AWS AI Specialization in Agentic AI distinguishes Elastic as. ...

SAN FRANCISCO--(BUSINESS WIRE)--Elastic (NYSE: ESTC), the Search AI Company, today announced a new integration for Amazon Bedrock AgentCore that brings observability for AI agents and applications directly into the Elasticsearch platform. The integration allows site reliability engineers (SREs) and developers to monitor, optimize and troubleshoot agents running on Amazon Bedrock AgentCore. Elastic Observability monitors AI agents and applications by ingesting all logs and metric signals to help. ...

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Core Insights - Elastic will present at the Barclays 23rd Annual Global Technology Conference on December 10, 2025, at 8:05 a.m. PT / 11:05 a.m. ET [1] - The company integrates search technology with artificial intelligence to transform data into actionable insights [2] - Elastic's Search AI Platform is utilized by thousands of companies, including over 50% of the Fortune 500 [2] Financial Performance - For the second quarter of fiscal 2026, Elastic reported total revenue of $423 million, marking a 16% year-over-year increase, or 15% on a constant currency basis [6] - Subscription revenue reached $398 million, reflecting a 17% year-over-year growth, or 16% on a constant currency basis [6] Industry Recognition - Elastic has been named a Leader in the 2025 IDC MarketScape for Worldwide Observability Platforms, highlighting its open standards-first architecture [7] - The company was also recognized as a Leader in the 2025 IDC MarketScape for Worldwide General-Purpose Knowledge Discovery, with Elasticsearch noted for its capabilities in search and analytics [8]

Revenue and Growth - Subscription revenue accounted for 94% and 93% of total revenue for the six months ended October 31, 2025 and 2024, respectively [124]. - The number of customers with annual contract value over $100,000 increased to over 1,600 as of October 31, 2025, up from over 1,420 in 2024 [126]. - Elastic Cloud contributed 48% and 46% of total revenue for the six months ended October 31, 2025 and 2024, respectively [140]. - The Net Expansion Rate was approximately 112% as of October 31, 2025, indicating growth in customer spending [138]. - Total revenue for the three months ended October 31, 2025, was $423.5 million, representing a 16% increase from $365.4 million in the same period of 2024 [159]. - Subscription revenue increased by $56.9 million, or 17%, driven by a 22% growth in Elastic Cloud revenue and a 12% increase in Other subscriptions [159]. - Subscription revenue increased by $121.7 million, or 18%, for the six months ended October 31, 2025, driven by a 23% growth in Elastic Cloud revenue [173]. - Total revenue for the six months ended October 31, 2025, was $838.8 million, an increase of $126.0 million, or 18%, compared to the same period of the prior year [173]. Expenses and Profitability - Gross profit for the three months ended October 31, 2025, was $321.5 million, with a gross margin of 76%, compared to 74% in the same period of 2024 [155][157]. - Research and development expenses for the three months ended October 31, 2025, were $108.2 million, up from $88.2 million in 2024, reflecting ongoing investment in new technology [148][155]. - Sales and marketing expenses increased to $173.6 million for the three months ended October 31, 2025, compared to $144.3 million in 2024, as the company expanded its sales force [149][155]. - General and administrative expenses rose to $48.0 million for the three months ended October 31, 2025, from $44.1 million in 2024, supporting business growth [150][155]. - The net loss for the three months ended October 31, 2025, was $51.3 million, compared to a net loss of $25.5 million in the same period of 2024 [155]. - Research and development expenses rose by $39.8 million, or 22%, for the six months ended October 31, 2025, primarily due to a $28.1 million increase in personnel and related costs [178]. - Sales and marketing expenses increased by $46.0 million, or 15%, for the six months ended October 31, 2025, mainly due to a $34.4 million rise in personnel and related costs [179]. - Gross profit for the six months ended October 31, 2025, was $640.0 million, reflecting a 21% increase compared to the prior year [176]. - Subscription gross margin improved to 81% for the six months ended October 31, 2025, up from 79% in the same period of the prior year [176]. - Total cost of revenue for the six months ended October 31, 2025, was $198.8 million, an increase of $13.8 million, or 7%, compared to the prior year [176]. Tax and Other Income - The effective tax rate was influenced by various factors, including non-deductible stock-based compensation and one-time tax benefits, leading to a provision for income taxes of $52.6 million for the three months ended October 31, 2025 [153][155]. - Provision for income taxes increased by $28.9 million, or 122%, for the three months ended October 31, 2025, compared to the same period of the prior year [171]. - Other income, net increased by $6.7 million, or 74%, for the three months ended October 31, 2025, primarily due to a $4.0 million increase in interest and other investment income [169]. - Other income, net rose by $11.3 million, or 56%, to $31.6 million for the six months ended October 31, 2025, driven by an $8.0 million increase in interest and other investment income and a $3.3 million increase in net foreign currency exchange gains [184]. - Provision for income taxes increased by $33.4 million, or 76%, to $77.2 million for the six months ended October 31, 2025, compared to $43.7 million in the prior year [185]. Cash Flow and Financial Position - As of October 31, 2025, the company had cash, cash equivalents, and marketable securities totaling $1.396 billion [188]. - The company reported an accumulated deficit of $1.176 billion as of October 31, 2025, reflecting significant operating losses [189]. - Net cash provided by operating activities was $131.4 million for the six months ended October 31, 2025, compared to $91.1 million in the prior year [196]. - Net cash provided by investing activities was $38.4 million for the six months ended October 31, 2025, primarily from sales and maturities of marketable securities [199]. - Net cash used in financing activities was $96.7 million for the six months ended October 31, 2025, mainly due to repurchases of ordinary shares totaling $109.2 million [201]. - The company authorized a Share Repurchase Program for up to $500.0 million of its outstanding ordinary shares in October 2025 [194]. - Foreign currency transaction losses were $1.1 million for the six months ended October 31, 2025, compared to $2.0 million in the prior year [208]. - As of October 31, 2025, the company's cash, cash equivalents, restricted cash, and marketable securities were primarily denominated in U.S. dollars, Euros, and British Pound Sterling [209]. - A 10% increase or decrease in exchange rates would have impacted the company's cash and marketable securities balances by approximately $8.2 million [209]. Strategic Initiatives - The company plans to continue investing in developing new features for its platform to drive growth [133]. - The company aims to convert free users of its software into paid subscribers, which is critical for financial performance [135]. - The company continues to monitor macroeconomic conditions that may impact sales cycles and customer spending behavior [129]. - The company expects research and development expenses to continue increasing in absolute dollars as it invests further in existing products and new technology [148]. - The company anticipates that revenue from Elastic Cloud will continue to grow as a percentage of total revenue, which may have a modest unfavorable impact on gross margin due to third-party hosting costs [147].

Core Insights - Elastic N.V. shares fell over 12% intra-day despite reporting fiscal Q2 2026 results that exceeded analyst expectations, as investors expressed concerns about the company's long-term growth trajectory [1] Financial Performance - The company reported adjusted earnings of $0.64 per share for the quarter ended October 31, surpassing the consensus estimate of $0.58 [2] - Revenue increased by 16% year over year to $423 million, or 15% in constant currency, exceeding expectations of $418.23 million [2] - Elastic Cloud revenue, a key growth component, rose 22% year over year to $206 million [2] Future Outlook - Management described the quarter as "outstanding" and raised the full-year revenue forecast by $18 million, now guiding to $1.715–$1.721 billion, compared to prior consensus expectations of $1.706 billion [3] - For Q3, Elastic projected revenue of $437–$439 million, above the $429.9 million consensus, and adjusted earnings of $0.63–$0.65 per share, ahead of analyst expectations of $0.60 [3]

Group 1 - Elastic's Q2 sales increased by 16% year over year, reaching $423 million, with adjusted earnings rising from $0.59 to $0.64 per share, surpassing analyst expectations of $0.58 per share on revenue of approximately $418 million [2][8] - Despite strong earnings, Elastic's stock fell significantly, dropping as much as 16.2% due to concerns over low adoption of generative AI tools among large customers (only 23%) and delays in expected contracts caused by a recent government shutdown [3][8] - The company is transitioning customers from monthly to annual contracts, which is expected to enhance revenue predictability and customer loyalty, alongside new product offerings like the DiskBBQ search algorithm and Agent Builder [5] Group 2 - Elastic's stock is down 26% year-to-date and is currently trading at 4.8 times trailing sales, which is considered a low valuation for an AI specialist with double-digit sales growth [6][8] - The modest adoption of Elastic's generative AI tools may represent an untapped growth opportunity, suggesting potential for recovery and long-term investment appeal [6] - The recent government shutdown has delayed several expected contracts, impacting short-term financial projections [8]

Core Viewpoint - Elastic N.V. was downgraded to Neutral by Monness due to a perceived lack of excitement in its Q2 performance, despite showing positive financial results [1][5] Financial Performance - Elastic reported adjusted earnings of 64 cents per share, exceeding the analyst estimate of 58 cents [2][5] - The company's quarterly revenue reached $423 million, surpassing the expected $418 million, marking a 16% increase year-over-year, or 15% when adjusted for constant currency [2][5] - Subscription revenue grew to $398 million, reflecting a 17% year-over-year increase, or 16% on a constant currency basis [3][5] Stock Performance - The stock price declined to $82.08, a decrease of 7.02% with a change of $6.20, fluctuating between a low of $82.01 and a high of $91.09 on the earnings call day [3][4] - Elastic's market capitalization is approximately $8.72 billion, with a trading volume of 2,974,153 shares on the NYSE [4]

Market Overview - The three major stock indexes are expected to close the week sharply lower, with the S&P 500 and Nasdaq on track for their largest weekly losses since April [1][3] - The Dow Jones Industrial Average advanced 0.8% after a significant drop earlier in the week, while the S&P 500 and Nasdaq also saw slight increases [2][3] - Concerns about AI spending and valuations of major tech firms have contributed to the recent sell-off in equities [1][3] Federal Reserve Insights - New York Fed President John Williams indicated support for a potential interest rate cut "in the near term," leading to a 73.1% likelihood of a rate cut at the next Federal Reserve meeting [2][17] - The Fed's policy committee remains divided on whether to cut rates to support the job market or maintain higher rates to combat inflation [18] Cryptocurrency Trends - Bitcoin has continued its decline, reaching approximately $80,600, its lowest level since April 11, down from an overnight high of over $88,000 [4] Corporate Earnings Highlights - Walmart shares rose 6.5% after reporting better-than-expected third-quarter results and raising its fiscal 2026 outlook [6] - Gap Inc. reported third-quarter adjusted earnings per share of $0.62, exceeding analyst expectations, and raised its guidance for fiscal 2025 [9][10] - Elastic shares fell 15% despite reporting better-than-expected results and raising its outlook for fiscal 2026 [12][13] - BJ's Wholesale Club raised its full-year profit forecast after reporting better-than-expected third-quarter net income [23] Sector Performance - The S&P 500's Health Care Index has risen 5% this month, outperforming the broader market, which is down more than 4% [14][15] - Eli Lilly briefly reached a market capitalization of $1 trillion, becoming the first healthcare firm to do so [19]