I'm calling Q3 the quarter of rebounds, as many previously punished stocks have seen their fortunes turn around considerably after posting Q3 results. This has been especially true in the tech sector, and Elastic (NYSE: ESTC ) is one of theWith combined experience of covering technology companies on Wall Street and working in Silicon Valley, and serving as an outside adviser to several seed-round startups, Gary Alexander has exposure to many of the themes shaping the industry today. He has been a regular co ...

Financial Data and Key Metrics Changes - Revenue grew by 18% year-over-year, totaling $365 million in Q2 [9][40] - Cloud revenue increased by 25% year-over-year, amounting to $169 million, representing 46% of total revenue [9][41] - Non-GAAP operating margin was 18%, with a diluted earnings per share of $0.59 [9][47][56] - Adjusted free cash flow was approximately $38 million, translating to a 10% adjusted free cash flow margin [47] Business Line Data and Key Metrics Changes - Subscription revenue totaled $341 million, up 18% year-over-year [40] - Professional services revenue grew by 7% year-over-year, reaching $25 million [42] - The search business saw significant growth, driven by generative AI, with new customer commitments nearly doubling in dollar volume compared to Q1 [12][40] Market Data and Key Metrics Changes - The Americas region experienced the fastest growth, followed by EMEA and APJ [44] - The company ended Q2 with over 1,420 customers with annual contract values exceeding $100,000, and over 4,480 customers above $10,000 in ACV [45] Company Strategy and Development Direction - The company is focusing on enterprise and high-potential mid-market customers, with a strategy to consolidate workloads onto the Elastic platform [10][15] - Innovations in generative AI and search capabilities are seen as key growth drivers, with a strong emphasis on becoming the platform of choice for AI applications [11][12][20] - The company plans to selectively increase investments in the second half of the year, particularly in areas driving growth, such as generative AI [54][155] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in returning to historical levels of sales execution, citing strong performance in Q2 as a positive indicator [33][56] - The company raised its full-year total revenue outlook, expecting continued growth despite potential headwinds from prior customer commitment shortfalls [48][131] - Management noted that the current business environment is expected to remain stable, with a focus on maintaining strong execution [50][54] Other Important Information - Janesh Moorjani, the CFO, announced his departure, with Eric Prengel stepping in as Interim CFO [29][31] - The company introduced new AI capabilities and features to enhance its vector database performance, positioning itself as a leader in the market [20][21] Q&A Session Summary Question: Insights on larger enterprise consumption patterns - Management noted strong consumption across enterprise and commercial segments, with larger customers accelerating their usage of the Elasticsearch AI platform [58][59] Question: Factors driving better sales execution - Management attributed improved sales execution to changes made at the beginning of the fiscal year, focusing on enterprise and mid-market segments [62][64] Question: Clarification on cloud consumption trends - Management confirmed that the strong cloud consumption observed in Q2 was broad-based and not a one-time occurrence, reflecting ongoing customer commitments [86][87] Question: Competitive landscape and displacement opportunities - Management identified incumbent vendors like Splunk and QRadar as competitors, emphasizing their differentiation as a next-generation SIEM and security analytics product [124][126] Question: Metrics for tracking generative AI success - Management tracks customer usage specifically for generative AI and customer commitments related to AI use cases, although revenue from these applications is harder to disaggregate [146][148]

Elastic (ESTC) reported $365.36 million in revenue for the quarter ended October 2024, representing a year-over-year increase of 17.6%. EPS of $0.59 for the same period compares to $0.37 a year ago.The reported revenue compares to the Zacks Consensus Estimate of $354.24 million, representing a surprise of +3.14%. The company delivered an EPS surprise of +55.26%, with the consensus EPS estimate being $0.38.While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall S ...

Elastic (ESTC) came out with quarterly earnings of $0.59 per share, beating the Zacks Consensus Estimate of $0.38 per share. This compares to earnings of $0.37 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 55.26%. A quarter ago, it was expected that this software developer would post earnings of $0.25 per share when it actually produced earnings of $0.35, delivering a surprise of 40%.Over the last four quarters, the company ...

Corporate Overview and Q2FY25 Financial Results November 21, 2024 Forward Looking Statements; Use of Non-GAAP Measures This presentation and the accompanying oral presentation contain 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 ending January 31, 2025 and the fiscal year ending April 30, 2025, our strategic areas of focus, expectations and plans regarding our fut ...

Wall Street analysts expect Elastic (ESTC) to post quarterly earnings of $0.38 per share in its upcoming report, which indicates a year-over-year increase of 2.7%. Revenues are expected to be $354.24 million, up 14.1% from the year-ago quarter.The consensus EPS estimate for the quarter has undergone a downward revision of 0.7% in the past 30 days, bringing it to its present level. This represents how the covering analysts, as a whole, have reassessed their initial estimates during this timeframe.Prior to a ...

The market expects Elastic (ESTC) to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended October 2024. This widely-known consensus outlook is important in assessing the company's earnings picture, but a powerful factor that might influence its near-term stock price is how the actual results compare to these estimates.The earnings report, which is expected to be released on November 21, 2024, might help the stock move higher if these key numbers are ...

Tired of losing money? Our Tech Contrarians team of Wall Street analysts sifts through the noise in the tech industry and captures outperformers through a coveted research process. We let the work speak for itself here .We're picking up our coverage of Elastic (NYSE: ESTC ), an enterprise search software company, after a stale period since our last article in 2021, during the pandemic days. Elastic stock underperformed the S&P 500 by aAnalyst’s Disclosure: I/we have no stock, option or similar derivative po ...

Core Viewpoint - Elastic (ESTC) has experienced a significant downtrend, with a 25.2% decline over the past four weeks, but it is now in oversold territory, suggesting a potential turnaround due to analysts' positive earnings outlook [1]. Group 1: Technical Analysis - The Relative Strength Index (RSI) for ESTC is currently at 27.49, indicating that the heavy selling pressure may be exhausting, which could lead to a price rebound [5]. - The RSI is a momentum oscillator that ranges from 0 to 100, with a reading below 30 typically indicating that a stock is oversold [2]. - Technical indicators like RSI can help identify potential entry points for investors looking to benefit from a rebound after unwarranted selling [3]. Group 2: Fundamental Analysis - There has been a strong consensus among sell-side analysts to raise earnings estimates for ESTC, resulting in a 17.9% increase in the consensus EPS estimate over the last 30 days [5]. - An upward trend in earnings estimate revisions is generally associated with price appreciation in the near term [5]. - ESTC holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimate trends and EPS surprises, indicating a strong potential for a turnaround [6].

It has been almost 2 years since I last wrote about Elastic in an article published on SA. Over that span, the shares rallied substantially, rising by more Bert Hochfeld graduated with a degree in economics from the University of Pennsylvania and received an MBA from Harvard. Mr. Hochfeld has enjoyed a long career in the tech world, working for IBM, Memorex/Telex, Raytheon Data Systems, and BMC Software. Starting in the 1990s, Mr. Hochfeld worked as a sell-side analyst and won awards from the Wall Street Jo ...