ESTC · Elastic N.V.

Elastic delivered a strong finish to fiscal 2026, with Q4 revenue of $451 million exceeding its guidance range. Subscription revenue, which constitutes 94% of total revenue, grew 17% year-over-year driven by a 26% increase in Annual Elastic Cloud revenue, reflecting customer commitments to larger, longer-term deals. The company's non-GAAP operating margin improved to 14.8% from 15.3% a year ago, despite higher investment in R&D and sales. GAAP net income was boosted by a $435 million tax benefit from releasing a valuation allowance, but non-GAAP net income increased to $64 million, up from $51 million. Key operational metrics were robust: cRPO grew 20% to $1.203 billion, and the net expansion rate remained healthy at approximately 112%. Management attributed results to organizations consolidating on Elastic's platform for search, security, and observability, positioning the company as a critical AI infrastructure component. Looking ahead, Elastic guided Q1 FY2027 revenue between $469-$470 million, and full FY2027 revenue of $1.985-$2.000 billion, implying approximately 14-15% growth at the midpoints. Non-GAAP operating margin is expected to expand to 19% for the full year, signaling continued operating leverage. The company also executed $40 million in share repurchases during Q4, leaving $160 million remaining under its $500 million authorization.