EX-99.1 2 a25q3erex991.htm EX-99.1 Document
Exhibit 99.1
Elastic Reports Third Quarter Fiscal 2025 Financial Results

Q3 Revenue of $382 million, up 17% year-over-year (17% in constant currency)
Q3 Elastic Cloud Revenue of $180 million, up 26% year-over-year (26% in constant currency)

SAN FRANCISCO, Calif., Feb 27, 2025 -- Elastic (NYSE: ESTC) (“Elastic”), the company behind Elasticsearch®, announced financial results for its third quarter of fiscal 2025 ended January 31, 2025.

Third Quarter Fiscal 2025 Financial Highlights

•Total revenue was $382 million, an increase of 17% year-over-year, as reported and on a constant currency basis
•Elastic Cloud revenue was $180 million, an increase of 26% year-over-year, as reported and on a constant currency basis
•GAAP operating loss was $5 million; GAAP operating margin was -1%
•Non-GAAP operating income was $64 million; non-GAAP operating margin was 17%
•GAAP net loss per share was $0.16; non-GAAP diluted earnings per share was $0.63
•Operating cash flow was $88 million with adjusted free cash flow of $99 million
•Cash, cash equivalents, and marketable securities were $1.284 billion as of January 31, 2025

“We exceeded guidance across all revenue and profitability metrics in the third quarter. Our results reflect ongoing momentum across all aspects of our business, led by our strong sales execution, continued market demand for our products, and our relentless pace of innovation, reinforcing Elastic as the leader in Search AI,” said Ash Kulkarni, Chief Executive Officer, Elastic. “Continued interest from customers building Generative AI applications and consolidating onto a single platform helped drive our outperformance during the quarter.”

Third Quarter Fiscal 2025 Key Metrics and Recent Business Highlights

Key Customer Metrics
•Total customer count with Annual Contract Value (ACV) greater than $100,000 was over 1,460 compared to over 1,420 in Q2 FY25, and over 1,270 in Q3 FY24
•Total subscription customer count was approximately 21,350 compared to approximately 21,300 in Q2 FY25, and approximately 20,800 in Q3 FY24
•Net Expansion Rate was approximately 112%

Product Innovations and Updates
•Announced general availability of Elastic Cloud Serverless on AWS with availability in 4 regions and technical preview on Azure
•Delivered Elasticsearch logsdb index mode available in Enterprise tier, which allows security and observability teams to optimize storage and extend log retention while keeping all data accessible for analysis in real-time
•Launched the Elastic Rerank Model that enhances search experiences for users, improving search accuracy and relevance across their Elasticsearch data




Other Business Highlights
•Appointed Navam Welihinda, a HashiCorp and IBM veteran, as chief financial officer to lead the finance function and play a key role in driving the Company’s next phase of growth
•Awarded the AWS Global Generative AI Infrastructure and Data Partner of the Year 2024
•Named a 2024 Future 50 Company by Boston Consulting Group and Fortune, a list which identifies companies with the greatest potential for future growth
•Engaged with thousands of customers and partners across ElasticONs in Amsterdam, Paris, and London, and the AWS re:Invent industry conference




Financial Outlook

The Company is providing the following guidance:

For the fourth quarter of fiscal 2025 (ending April 30, 2025):

•Total revenue is expected to be between $379 million and $381 million, representing 13% year-over-year growth at the midpoint (15% year-over-year constant currency growth at the midpoint)
•Non-GAAP operating margin is expected to be approximately 13.5%
•Non-GAAP diluted earnings per share is expected to be between $0.36 and $0.37, assuming between 107.5 million and 108.5 million diluted weighted average ordinary shares outstanding



For fiscal 2025 (ending April 30, 2025):

•Total revenue is expected to be between $1.474 billion and $1.476 billion, representing 16% 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 14.7%
•Non-GAAP diluted earnings per share is expected to be between $1.91 and $1.96, assuming between 106.0 million and 108.0 million diluted weighted average ordinary shares outstanding


The guidance assumes, among others, the following exchange rates: 1 Euro = 1.040 US Dollars; and 1 Great British Pound = 1.260 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” below 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 (loss)/earnings 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.


About Elastic

Elastic (NYSE: ESTC), the Search AI Company, enables everyone to find the answers they need in real-time using all their data, at scale. Elastic’s solutions for search, observability and security are built on the Elastic Search AI 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 fiscal year ending April 30, 2025, the expected performance or benefits of our offerings, our product strategy and innovation, changes in leadership, expected market opportunities, and our ability to execute on those market opportunities. 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 our licensing model on the use and adoption of our software; 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 effects 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, 2024 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. generally accepted accounting principles (“GAAP”), we believe the non-GAAP measures discussed 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 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 (loss)/income, excluding stock-based compensation expense and related employer taxes, amortization of acquired intangible assets, acquisition-related expenses, restructuring and other related charges, the related income tax effect of the foregoing adjustments, and the income tax impact 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 on long-term debt 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


Alexia Russell
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,
 2025202420252024
Revenue  
Subscription$358,198 $307,632 $1,022,779 $865,622 
Services23,885 20,325 72,085 66,700 
Total revenue382,083 327,957 1,094,864 932,322 
Cost of revenue
Subscription72,205 63,976 210,493 181,238 
Services24,947 20,666 71,595 60,970 
Total cost of revenue97,152 84,642 282,088 242,208 
Gross profit284,931 243,315 812,776 690,114 
Operating expenses
Research and development93,598 87,202 271,093 248,000 
Sales and marketing153,749 141,621 455,380 408,020 
General and administrative42,222 40,896 128,980 117,530 
Restructuring and other related charges— — 225 754 
Total operating expenses289,569 269,719 855,678 774,304 
Operating loss(4,638)(26,404)(42,902)(84,190)
Other income, net
Interest expense(6,475)(6,368)(19,463)(19,023)
Other income, net15,184 8,568 35,498 24,107 
Income (loss) before income taxes4,071 (24,204)(26,867)(79,106)
Provision for (benefit from) income taxes21,127 (200,328)64,866 (181,926)
Net (loss) income$(17,056)$176,124 $(91,733)$102,820 
Net (loss) earnings per share attributable to ordinary shareholders
Basic$(0.16)$1.76 $(0.89)$1.04 
Diluted$(0.16)$1.69 $(0.89)$1.00 
Weighted-average shares used to compute net (loss) earnings per share attributable to ordinary shareholders
Basic104,085,183 100,282,179 103,202,786 99,099,210 
Diluted104,085,183 104,503,290 103,202,786 103,149,384 



Elastic N.V.
Condensed Consolidated Balance Sheets
(in thousands, except share and per share data)
(unaudited)
 
As of
January 31, 2025		As of
April 30, 2024
Assets
Current assets:  
Cash and cash equivalents$584,010 $540,397 
Restricted cash3,597 2,692 
Marketable securities700,029 544,002 
Accounts receivable, net of allowance for credit losses of $5,322 and $4,979 as of January 31, 2025 and April 30, 2024, respectively270,430 323,011 
Deferred contract acquisition costs79,761 78,030 
Prepaid expenses and other current assets55,609 42,765 
Total current assets1,693,436 1,530,897 
Property and equipment, net5,105 5,453 
Goodwill319,417 319,380 
Operating lease right-of-use assets15,547 20,506 
Intangible assets, net12,929 20,620 
Deferred contract acquisition costs, non-current107,791 114,509 
Deferred tax assets169,146 225,544 
Other assets6,776 5,657 
Total assets$2,330,147 $2,242,566 
Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable$9,122 $26,075 
Accrued expenses and other liabilities73,783 75,292 
Accrued compensation and benefits83,313 93,691 
Operating lease liabilities9,941 12,187 
Deferred revenue660,873 663,846 
Total current liabilities837,032 871,091 
Deferred revenue, non-current46,053 30,293 
Long-term debt, net569,445 568,612 
Operating lease liabilities, non-current8,347 12,898 
Other liabilities, non-current10,164 21,487 
Total liabilities1,471,041 1,504,381 
Shareholders’ equity:
Preference shares, €0.01 par value; 165,000,000 shares authorized, 0 shares issued and outstanding as of January 31, 2025 and April 30, 2024— — 
Ordinary shares, par value €0.01 per share: 165,000,000 shares authorized; 104,412,717 shares issued and outstanding as of January 31, 2025 and 101,705,935 shares issued and outstanding as of April 30, 20241,100 1,070 
Treasury stock(369)(369)
Additional paid-in capital1,961,418 1,750,729 
Accumulated other comprehensive loss(19,703)(21,638)
Accumulated deficit(1,083,340)(991,607)
Total shareholders’ equity859,106 738,185 
Total liabilities and shareholders’ equity$2,330,147 $2,242,566 



Elastic N.V.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)

 Three Months Ended January 31,Nine Months Ended January 31,
 2025202420252024
Cash flows from operating activities  
Net (loss) income$(17,056)$176,124 $(91,733)$102,820 
Adjustments to reconcile net (loss) income to cash provided by operating activities:
Depreciation and amortization2,286 4,072 10,024 13,853 
Amortization of premium and accretion of discount on marketable securities, net(1,659)(2,750)(5,785)(6,396)
Amortization of deferred contract acquisition costs24,312 20,440 71,487 56,392 
Amortization of debt issuance costs280 269 833 798 
Non-cash operating lease cost2,305 2,878 7,760 8,148 
Stock-based compensation expense64,634 62,762 192,242 176,344 
Deferred income taxes17,799 (210,705)56,175 (210,278)
Unrealized foreign currency transaction (gain) loss(914)1,845 1,302 2,267 
Other— (16)(14)(34)
Changes in operating assets and liabilities, net of impact of business acquisitions:
Accounts receivable, net(16,544)4,072 51,537 31,044 
Deferred contract acquisition costs(29,792)(30,668)(66,970)(74,089)
Prepaid expenses and other current assets(14,080)(7,655)(12,906)(5,512)
Other assets(1,267)(917)(2,719)639 
Accounts payable(14,375)(25,330)(16,710)(25,212)
Accrued expenses and other liabilities(4,664)2,821 (12,800)1,428 
Accrued compensation and benefits11,269 12,282 (10,211)1,509 
Operating lease liabilities(3,082)(2,902)(9,489)(9,096)
Deferred revenue68,606 45,767 17,166 23,189 
Net cash provided by operating activities88,058 52,389 179,189 87,814 
Cash flows from investing activities
Purchases of property and equipment(766)(1,077)(2,228)(2,605)
Business acquisitions, net of cash acquired— (18,951)— (18,951)
Purchases of marketable securities(222,518)(179,972)(388,771)(358,273)
Sales, maturities, and redemptions of marketable securities64,506 74,931 242,988 150,223 
Net cash used in investing activities(158,778)(125,069)(148,011)(229,606)
Cash flows from financing activities
Proceeds from issuance of ordinary shares under employee stock purchase plan— — 10,464 9,111 
Proceeds from issuance of ordinary shares upon exercise of stock options1,486 8,847 8,013 19,490 
Net cash provided by financing activities1,486 8,847 18,477 28,601 
Effect of exchange rate changes on cash, cash equivalents, and restricted cash(4,987)1,008 (5,137)(3,782)
Net (decrease) increase in cash, cash equivalents, and restricted cash(74,221)(62,825)44,518 (116,973)
Cash, cash equivalents, and restricted cash, beginning of period661,828 592,492 543,089 646,640 
Cash, cash equivalents, and restricted cash, end of period$587,607 $529,667 $587,607 $529,667 



Elastic N.V.
Revenue by Type
(in thousands, except percentages)
(unaudited)
 
Three Months Ended January 31,Nine Months Ended January 31,
2025202420252024
Amount% of
Total
Revenue		Amount% of
Total
Revenue		Amount% of
Total
Revenue		Amount% of
Total
Revenue
Elastic Cloud$179,996 47 %$143,379 44 %$506,112 46 %$399,540 43 %
Other subscription178,202 47 %164,253 50 %516,667 47 %466,082 50 %
Total subscription358,198 94 %307,632 94 %1,022,779 93 %865,622 93 %
Services23,885 6 %20,325 6 %72,085 7 %66,700 7 %
Total revenue$382,083 100 %$327,957 100 %$1,094,864 100 %$932,322 100 %




Elastic N.V.
Reconciliation of GAAP to Non-GAAP Data
Supplementary Information
(in thousands, except percentages)
(unaudited)

 Three Months Ended
January 31, 2025		% 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$179,996 26%26%7%7%
Other subscription$178,202 8%9%4%5%
Total subscription$358,198 16%17%5%6%
Total revenue$382,083 17%17%5%5%
Total deferred revenue$706,926 21%22%9%11%
Total remaining performance obligations$1,354,345 15%16%7%8%

 Nine Months Ended
January 31, 2025		% Change Year Over Year% Change
Year Over Year Excluding Currency Changes
Revenue
Elastic Cloud$506,112 27%27%
Other subscription$516,667 11%11%
Total subscription$1,022,779 18%18%
Total revenue$1,094,864 17%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,
 2025202420252024
Net cash provided by operating activities$88,058 $52,389 $179,189 $87,814 
Less: Purchases of property and equipment(766)(1,077)(2,228)(2,605)
Add: Interest paid on long-term debt11,859 11,859 23,719 23,719 
Adjusted free cash flow (1)
$99,151 $63,171 $200,680 $108,928 
Net cash used in investing activities$(158,778)$(125,069)$(148,011)$(229,606)
Net cash provided by financing activities$1,486 $8,847 $18,477 $28,601 
Net cash provided by operating activities (as a percentage of total revenue)23 %16 %16 %9 %
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 %3 %2 %3 %
Adjusted free cash flow margin26 %19 %18 %12 %
(1) Adjusted free cash flow includes cash paid for restructuring and other charges of $0.3 million and $3.8 million during the three and nine months ended January 31, 2025, respectively, and $0.8 million and $1.5 million during the three and nine months ended January 31, 2024, respectively.


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,
 2025202420252024
Gross Profit Reconciliation:  
GAAP gross profit$284,931 $243,315 $812,776 $690,114 
Stock-based compensation expense and related employer taxes6,654 5,902 18,871 16,483 
Amortization of acquired intangibles1,577 3,186 7,687 9,139 
Non-GAAP gross profit$293,162 $252,403 $839,334 $715,736 
Gross Margin Reconciliation(1):
 
GAAP gross margin74.6 %74.2 %74.2 %74.0 %
Stock-based compensation expense and related employer taxes1.7 %1.8 %1.7 %1.8 %
Amortization of acquired intangibles0.4 %1.0 %0.7 %1.0 %
Non-GAAP gross margin76.7 %77.0 %76.7 %76.8 %
Operating (Loss) Income Reconciliation: 
GAAP operating loss$(4,638)$(26,404)$(42,902)$(84,190)
Stock-based compensation expense and related employer taxes67,054 65,847 200,302 183,564 
Amortization of acquired intangibles1,577 3,186 7,687 11,282 
Acquisition-related expenses29 682 181 2,240 
Restructuring and other related charges— — 225 754 
Non-GAAP operating income$64,022 $43,311 $165,493 $113,650 
Operating Margin Reconciliation(1):
 
GAAP operating margin(1.2)%(8.1)%(3.9)%(9.0)%
Stock-based compensation expense and related employer taxes17.5 %20.1 %18.3 %19.7 %
Amortization of acquired intangibles0.4 %1.0 %0.7 %1.2 %
Acquisition-related expenses— %0.2 %— %0.2 %
Restructuring and other related charges— %— %— %0.1 %
Non-GAAP operating margin16.8 %13.2 %15.1 %12.2 %
Net (Loss) Income Reconciliation:
GAAP net (loss) income$(17,056)$176,124 $(91,733)$102,820 
Stock-based compensation expense and related employer taxes67,054 65,847 200,302 183,564 
Amortization of acquired intangibles1,577 3,186 7,687 11,282 
Acquisition-related expenses29 682 181 2,240 
Restructuring and other related charges— — 225 754 
Income tax effects related to the above adjustments(2)
15,579 (780)50,543 7,988 
Income tax benefit from the release of a valuation allowance against deferred tax assets— (207,456)— (207,456)
Non-GAAP net income$67,183 $37,603 $167,205 $101,192 
Non-GAAP earnings per share attributable to ordinary
    shareholders, basic(1)
$0.65 $0.37 $1.62 $1.02 
Non-GAAP earnings per share attributable to ordinary
    shareholders, diluted(1)
$0.63 $0.36 $1.57 $0.98 
Weighted-average shares used to compute non-GAAP earnings per share attributable to ordinary shareholders, basic104,085,183 100,282,179 103,202,786 99,099,210 
Weighted-average shares used to compute non-GAAP earnings per share attributable to ordinary shareholders, diluted106,884,748 104,503,290 106,439,570 103,149,384 
(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 (loss) 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,
 2025202420252024
Cost of revenue reconciliation:  
GAAP subscription$72,205 $63,976 $210,493 $181,238 
Stock-based compensation expense and related employer taxes(2,597)(2,400)(7,478)(6,989)
Amortization of acquired intangibles(1,577)(3,186)(7,687)(9,139)
Non-GAAP subscription$68,031 $58,390 $195,328 $165,110 
GAAP services$24,947 $20,666 $71,595 $60,970 
Stock-based compensation expense and related employer taxes(4,057)(3,502)(11,393)(9,494)
Non-GAAP services$20,890 $17,164 $60,202 $51,476 
Operating expenses reconciliation: 
GAAP research and development expense$93,598 $87,202 $271,093 $248,000 
Stock-based compensation expense and related employer taxes(25,900)(25,989)(76,399)(71,956)
Acquisition-related expenses(22)— (76)(1,175)
Non-GAAP research and development expense$67,676 $61,213 $194,618 $174,869 
GAAP sales and marketing expense$153,749 $141,621 $455,380 $408,020 
Stock-based compensation expense and related employer taxes(22,946)(21,142)(66,829)(59,541)
Amortization of acquired intangibles— — — (2,143)
Non-GAAP sales and marketing expenses$130,803 $120,479 $388,551 $346,336 
GAAP general and administrative expense$42,222 $40,896 $128,980 $117,530 
Stock-based compensation expense and related employer taxes(11,554)(12,814)(38,203)(35,584)
Acquisition-related expenses(7)(682)(105)(1,065)
Non-GAAP general and administrative expense$30,661 $27,400 $90,672 $80,881