Elastic Reports Second Quarter Fiscal 2026 Financial Results
SAN FRANCISCO--( BUSINESS WIRE)--Elastic (NYSE: ESTC) (“Elastic”), the Search AI Company, announced financial results for its second quarter of fiscal 2026 ended October 31, 2025.
Second Quarter Fiscal 2026 Financial Highlights
“Q2 was an outstanding quarter for Elastic. We beat the high end of our guidance across all metrics. Our strength was driven by robust growth across the company with AI positively impacting all areas of our business,” said Ash Kulkarni, chief executive officer, Elastic. “Our deep expertise in managing unstructured data, combined with our clear product differentiation and context engineering leadership, positions Elastic as the natural leader for search, AI, observability, and security.”
Second Quarter Fiscal 2026 Key Metrics and Recent Business Highlights
Key Customer Metrics
Product Innovations and Updates
Other Business Highlights
Share Repurchase Program
In October 2025, Elastic announced a share repurchase program pursuant to which the Company may repurchase up to $500 million of the Company’s outstanding ordinary shares. As part of this program, during the second quarter of fiscal 2026, Elastic repurchased approximately 1.4 million ordinary shares at an average price per share of $84.45 on the open market, representing an aggregate value of approximately $114 million.
Financial Outlook
The Company is providing the following guidance:
For the third quarter of fiscal 2026 (ending January 31, 2026):
For fiscal 2026 (ending April 30, 2026):
The diluted weighted average ordinary shares outstanding reflect only share buybacks completed as of October 31, 2025.
The guidance assumes, among others, the following exchange rates: 1 Euro = 1.155 US Dollars; and 1 Great British Pound = 1.315 US Dollars.
See the section titled “Forward-Looking Statements” below for information on the risks and uncertainties 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 sales-led subscription revenue, 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
As previously announced, 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, integrates its deep expertise in search technology with artificial intelligence to help everyone transform all of their data into answers, actions and outcomes. Elastic's Search AI Platform — the foundation for its search, observability, and security solutions — is 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 ending January 31, 2026 and fiscal year ending April 30, 2026, the expected performance or benefits of and demand for our offerings, our product strategy and innovation, and our views regarding the impact of our expertise and product differentiation on our position as a leader in the market. 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; 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 foreign currency exchange rate fluctuations, the uncertain inflation and interest rate environment, and tariffs and other international trade policies on our results; 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; our international expansion strategy; the impact of our licensing model on the use and adoption of our software; 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; risks affecting continuation of our share repurchase program; 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, 2025 and subsequent quarterly and current 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 and financial results.
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.
Sales-led Subscription Revenue
Sales-led subscription revenue is a non-GAAP financial measure that we calculate as total subscription revenue excluding Monthly Elastic Cloud. We believe sales-led subscription revenue provides management and our investors with a consistent metric with which to measure the health of 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 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, excluding stock-based compensation expense and related employer taxes, amortization of acquired intangible assets, acquisition-related expenses, and restructuring and other related charges. Additionally, non-GAAP net income and non-GAAP earnings per share are adjusted for an assumed provision for income taxes based on a projected non-GAAP annual effective tax rate of 13%. 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
Elastic Investor Relations
ir@elastic.co
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 October 31,
Six Months Ended October 31,
2025
2024
2025
2024
Revenue
Subscription
$
397,699
$
340,807
$
786,282
$
664,581
Services
25,782
24,554
52,487
48,200
Total revenue
423,481
365,361
838,769
712,781
Cost of revenue
Subscription
76,522
69,941
145,940
138,288
Services
25,505
23,238
52,833
46,648
Total cost of revenue
102,027
93,179
198,773
184,936
Gross profit
321,454
272,182
639,996
527,845
Operating expenses
Research and development
108,152
88,163
217,274
177,495
Sales and marketing
173,576
144,274
347,630
301,631
General and administrative
47,962
44,085
92,768
86,758
Restructuring and other related charges
—
86
—
225
Total operating expenses
329,690
276,608
657,672
566,109
Operating loss
(8,236
)
(4,426
)
(17,676
)
(38,264
)
Other income, net
Interest expense
(6,292
)
(6,462
)
(12,643
)
(12,988
)
Other income, net
15,836
9,106
31,618
20,314
Income (loss) before income taxes
1,308
(1,782
)
1,299
(30,938
)
Provision for income taxes
52,592
23,668
77,186
43,739
Net loss
$
(51,284
)
$
(25,450
)
$
(75,887
)
$
(74,677
)
Net loss per share attributable to ordinary shareholders, basic and diluted
$
(0.48
)
$
(0.25
)
$
(0.71
)
$
(0.73
)
Weighted-average shares used to compute net loss per share attributable to ordinary shareholders, basic and diluted
106,586,670
103,238,740
106,274,275
102,761,588
Elastic N.V.
Condensed Consolidated Balance Sheets
(in thousands, except share and per share data)
(unaudited)
As of
October 31, 2025
As of
April 30, 2025
Assets
Current assets:
Cash and cash equivalents
$
800,586
$
727,543
Restricted cash
3,468
3,671
Marketable securities
595,485
669,717
Accounts receivable, net of allowance for credit losses of $5,947 and $5,510 as of October 31, 2025 and April 30, 2025, respectively
260,949
375,613
Deferred contract acquisition costs
86,795
86,205
Prepaid expenses and other current assets
78,209
68,258
Total current assets
1,825,492
1,931,007
Property and equipment, net
6,073
6,589
Goodwill
359,706
319,417
Operating lease right-of-use assets
17,682
22,334
Intangible assets, net
18,170
11,404
Deferred contract acquisition costs, non-current
118,920
117,762
Deferred tax assets
113,402
168,045
Other assets
17,125
16,295
Total assets
$
2,476,570
$
2,592,853
Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable
$
37,235
$
17,150
Accrued expenses and other liabilities
100,926
86,347
Accrued compensation and benefits
89,501
93,714
Operating lease liabilities
6,716
8,928
Deferred revenue
692,666
802,117
Total current liabilities
927,044
1,008,256
Deferred revenue, non-current
39,845
50,340
Long-term debt, net
570,306
569,729
Operating lease liabilities, non-current
13,685
16,357
Other liabilities, non-current
34,578
20,937
Total liabilities
1,585,458
1,665,619
Shareholders’ equity:
Preference shares, €0.01 par value; 165,000,000 shares authorized, 0 shares issued and outstanding as of October 31, 2025 and April 30, 2025
—
—
Ordinary shares, par value €0.01 per share: 165,000,000 shares authorized; 107,207,662 shares issued and 105,820,073 shares outstanding as of October 31, 2025; 105,534,887 shares issued and outstanding as of April 30, 2025
1,131
1,112
Treasury stock, at cost; 1,387,589 shares held as of October 31, 2025 and 35,937 shares held as of April 30, 2025
(114,545
)
(369
)
Additional paid-in capital
2,204,689
2,049,416
Accumulated other comprehensive loss
(24,555
)
(23,204
)
Accumulated deficit
(1,175,608
)
(1,099,721
)
Total shareholders’ equity
891,112
927,234
Total liabilities and shareholders’ equity
$
2,476,570
$
2,592,853
Elastic N.V.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
Three Months Ended
October 31,
Six Months Ended
October 31,
2025
2024
2025
2024
Cash flows from operating activities
Net loss
$
(51,284
)
$
(25,450
)
$
(75,887
)
$
(74,677
)
Adjustments to reconcile net loss to cash provided by operating activities:
Depreciation and amortization
2,894
3,565
5,210
7,738
Amortization of premium and accretion of discount on marketable securities, net
(1,124
)
(1,926
)
(2,517
)
(4,126
)
Amortization of deferred contract acquisition costs
27,005
23,994
53,178
47,175
Amortization of debt issuance costs
290
278
577
553
Non-cash operating lease cost
3,168
2,617
5,484
5,455
Stock-based compensation expense
72,893
64,065
142,828
127,608
Deferred income taxes
33,160
23,653
54,722
38,376
Unrealized foreign currency transaction loss (gain)
189
2,397
(175
)
2,216
Other
33
(14
)
33
(14
)
Changes in operating assets and liabilities, net of impact of business acquisitions:
Accounts receivable, net
(38,615
)
(59,122
)
115,367
68,081
Deferred contract acquisition costs
(32,877
)
(23,278
)
(55,161
)
(37,178
)
Prepaid expenses and other current assets
(4,488
)
998
(9,554
)
1,174
Other assets
1,990
487
915
(1,452
)
Accounts payable
10,648
14,065
20,218
(2,335
)
Accrued expenses and other liabilities
23,033
892
8,141
(8,136
)
Accrued compensation and benefits
6,747
(3,691
)
(4,240
)
(21,480
)
Operating lease liabilities
(3,124
)
(3,033
)
(5,854
)
(6,407
)
Deferred revenue
(23,926
)
17,880
(121,838
)
(51,440
)
Net cash provided by operating activities
26,612
38,377
131,447
91,131
Cash flows from investing activities
Purchases of property and equipment
(605
)
(715
)
(1,261
)
(1,462
)
Business acquisitions, net of cash acquired
(28,339
)
—
(36,828
)
—
Purchases of marketable securities
(40,977
)
(71,090
)
(289,573
)
(166,253
)
Sales, maturities, and redemptions of marketable securities
279,222
86,092
366,588
178,482
Other
(521
)
—
(521
)
—
Net cash provided by investing activities
208,780
14,287
38,405
10,767
Cash flows from financing activities
Proceeds from issuance of ordinary shares under employee stock purchase plan
11,501
10,464
11,501
10,464
Proceeds from issuance of ordinary shares upon exercise of stock options
637
1,782
963
6,527
Repurchases of ordinary shares
(109,175
)
—
(109,175
)
—
Net cash (used in) provided by financing activities
(97,037
)
12,246
(96,711
)
16,991
Effect of exchange rate changes on cash, cash equivalents, and restricted cash
(291
)
(1,389
)
(301
)
(150
)
Net increase in cash, cash equivalents, and restricted cash
138,064
63,521
72,840
118,739
Cash, cash equivalents, and restricted cash, beginning of period
665,990
598,307
731,214
543,089
Cash, cash equivalents, and restricted cash, end of period
$
804,054
$
661,828
$
804,054
$
661,828
Elastic N.V.
Revenue by Type
(in thousands, except percentages)
(unaudited)
Three Months Ended October 31,
Six Months Ended October 31,
2025
2024
2025
2024
Amount
% of
Total
Revenue
Amount
% of
Total
Revenue
Amount
% of
Total
Revenue
Amount
% of
Total
Revenue
Annual Elastic Cloud
$
156,868
37
%
$
123,402
34
%
$
302,780
36
%
$
234,433
33
%
Monthly Elastic Cloud
48,783
12
%
45,433
12
%
98,645
12
%
91,683
13
%
Total Elastic Cloud
205,651
49
%
168,835
46
%
401,425
48
%
326,116
46
%
Other subscription
192,048
45
%
171,972
47
%
384,857
46
%
338,465
47
%
Total subscription
397,699
94
%
340,807
93
%
786,282
94
%
664,581
93
%
Services
25,782
6
%
24,554
7
%
52,487
6
%
48,200
7
%
Total revenue
$
423,481
100
%
$
365,361
100
%
$
838,769
100
%
$
712,781
100
%
Elastic N.V.
Reconciliation of GAAP to Non-GAAP Data
Supplementary Information
(in thousands, except percentages)
(unaudited)
Three Months Ended
October 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
Annual Elastic Cloud
$
156,868
27
%
27
%
8
%
8
%
Monthly Elastic Cloud
48,783
7
%
7
%
(2
)%
(2
)%
Total Elastic Cloud
205,651
22
%
22
%
5
%
5
%
Other subscription
192,048
12
%
10
%
—
%
(1
)%
Total subscription
397,699
17
%
16
%
2
%
2
%
Total revenue
$
423,481
16
%
15
%
2
%
2
%
Total sales-led subscription revenue
$
348,916
18
%
17
%
3
%
3
%
Total deferred revenue
$
732,511
13
%
12
%
(3
)%
(3
)%
Total remaining performance obligations
$
1,506,725
19
%
17
%
3
%
3
%
Remaining performance obligations due within 12 months
$
971,467
17
%
15
%
2
%
1
%
Revenue
Annual Elastic Cloud
$
302,780
29
%
29
%
Monthly Elastic Cloud
98,645
8
%
8
%
Total Elastic Cloud
401,425
23
%
23
%
Other subscription
384,857
14
%
12
%
Total subscription
786,282
18
%
17
%
Total revenue
$
838,769
18
%
17
%
Total sales-led subscription revenue
$
687,637
20
%
19
%
Elastic N.V.
Reconciliation of GAAP to Non-GAAP Data
Adjusted Free Cash Flow
(in thousands, except percentages)
(unaudited)
Three Months Ended October 31,
Six Months Ended October 31,
2025
2024
2025
2024
Net cash provided by operating activities
$
26,612
$
38,377
$
131,447
$
91,131
Less: Purchases of property and equipment
(605
)
(715
)
(1,261
)
(1,462
)
Add: Interest paid on long-term debt
—
—
11,859
11,859
Adjusted free cash flow
$
26,007
$
37,662
$
142,045
$
101,528
Net cash provided by investing activities
$
208,780
$
14,287
$
38,405
$
10,767
Net cash (used in) provided by financing activities
$
(97,037
)
$
12,246
$
(96,711
)
$
16,991
Net cash provided by operating activities (as a percentage of total revenue)
6
%
10
%
16
%
13
%
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)
—
%
—
%
1
%
1
%
Adjusted free cash flow margin
6
%
10
%
17
%
14
%
Elastic N.V.
Reconciliation of GAAP to Non-GAAP Data
(in thousands, except percentages, share and per share data)
(unaudited)
Three Months Ended October 31,
Six Months Ended October 31,
2025
2024
2025
2024
Gross Profit Reconciliation:
GAAP gross profit
$
321,454
$
272,182
$
639,996
$
527,845
Stock-based compensation expense and related employer taxes
6,460
5,908
13,303
12,217
Amortization of acquired intangibles
2,158
2,835
3,734
6,110
Non-GAAP gross profit
$
330,072
$
280,925
$
657,033
$
546,172
Gross Margin Reconciliation (1):
GAAP gross margin
75.9
%
74.5
%
76.3
%
74.1
%
Stock-based compensation expense and related employer taxes
1.5
%
1.6
%
1.6
%
1.7
%
Amortization of acquired intangibles
0.5
%
0.8
%
0.4
%
0.9
%
Non-GAAP gross margin
77.9
%
76.9
%
78.3
%
76.6
%
Operating (Loss) Income Reconciliation:
GAAP operating loss
$
(8,236
)
$
(4,426
)
$
(17,676
)
$
(38,264
)
Stock-based compensation expense and related employer taxes
75,243
65,681
148,106
133,248
Amortization of acquired intangibles
2,158
2,835
3,734
6,110
Acquisition-related expenses
632
104
759
152
Restructuring and other related charges
—
86
—
225
Non-GAAP operating income
$
69,797
$
64,280
$
134,923
$
101,471
Operating Margin Reconciliation (1):
GAAP operating margin
(1.9
)%
(1.2
)%
(2.1
)%
(5.4
)%
Stock-based compensation expense and related employer taxes
17.8
%
18.0
%
17.7
%
18.7
%
Amortization of acquired intangibles
0.5
%
0.8
%
0.4
%
0.9
%
Acquisition-related expenses
0.1
%
—
%
0.1
%
—
%
Restructuring and other related charges
—
%
—
%
—
%
—
%
Non-GAAP operating margin
16.5
%
17.6
%
16.1
%
14.2
%
Net (Loss) Income Reconciliation:
GAAP net loss
$
(51,284
)
$
(25,450
)
$
(75,887
)
$
(74,677
)
Stock-based compensation expense and related employer taxes
75,243
65,681
148,106
133,248
Amortization of acquired intangibles
2,158
2,835
3,734
6,110
Acquisition-related expenses
632
104
759
152
Restructuring and other related charges
—
86
—
225
Income tax effects and adjustments (2)
42,278
19,650
57,180
34,964
Non-GAAP net income
$
69,027
$
62,906
$
133,892
$
100,022
Non-GAAP earnings per share attributable to ordinary
shareholders, basic (1)
$
0.65
$
0.61
$
1.26
$
0.97
Non-GAAP earnings per share attributable to ordinary
shareholders, diluted (1)
$
0.64
$
0.59
$
1.24
$
0.94
Weighted-average shares used to compute non-GAAP earnings per share attributable to ordinary shareholders, basic
106,586,670
103,238,740
106,274,275
102,761,588
Weighted-average shares used to compute non-GAAP earnings per share attributable to ordinary shareholders, diluted
108,402,116
105,827,936
108,230,913
106,006,894
(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) Effective May 1, 2025, we use a projected non-GAAP annual effective tax rate of 13% for the purpose of determining non-GAAP net income and non-GAAP earnings per share, basic and diluted, across the interim period. We believe this approach provides investors with a more consistent view of our underlying operating performance. Our annual projected non-GAAP tax rate excludes the impact from stock-based compensation expense and related employer taxes, amortization of acquired intangible assets, acquisition-related expenses, restructuring and other related charges, discrete tax items, valuation allowances against deferred tax assets, and other non-recurring tax adjustments, which may vary in size and frequency. Our annual projected non-GAAP tax rate may change due to factors such as new tax legislation, shifts in the geographic mix of earnings, or other significant business developments. We assess this rate as needed to ensure it reflects current conditions. Applying a consistent annual rate improves comparability across reporting periods by excluding the effects of discrete or non-recurring tax items.
Elastic N.V.
Reconciliation of GAAP to Non-GAAP Data
(in thousands)
(unaudited)
Three Months Ended October 31,
Six Months Ended October 31,
2025
2024
2025
2024
Cost of revenue reconciliation:
GAAP subscription
$
76,522
$
69,941
$
145,940
$
138,288
Stock-based compensation expense and related employer taxes
(2,563
)
(2,361
)
(5,216
)
(4,881
)
Amortization of acquired intangibles
(2,158
)
(2,835
)
(3,734
)
(6,110
)
Non-GAAP subscription
$
71,801
$
64,745
$
136,990
$
127,297
GAAP services
$
25,505
$
23,238
$
52,833
$
46,648
Stock-based compensation expense and related employer taxes
(3,897
)
(3,547
)
(8,087
)
(7,336
)
Non-GAAP services
$
21,608
$
19,691
$
44,746
$
39,312
Operating expenses reconciliation:
GAAP research and development expense
$
108,152
$
88,163
$
217,274
$
177,495
Stock-based compensation expense and related employer taxes
(28,434
)
(24,777
)
(56,207
)
(50,499
)
Acquisition-related expenses
(64
)
(6
)
(72
)
(54
)
Non-GAAP research and development expense
$
79,654
$
63,380
$
160,995
$
126,942
GAAP sales and marketing expense
$
173,576
$
144,274
$
347,630
$
301,631
Stock-based compensation expense and related employer taxes
(24,186
)
(21,434
)
(48,255
)
(43,883
)
Non-GAAP sales and marketing expenses
$
149,390
$
122,840
$
299,375
$
257,748
GAAP general and administrative expense
$
47,962
$
44,085
$
92,768
$
86,758
Stock-based compensation expense and related employer taxes
(16,163
)
(13,562
)
(30,341
)
(26,649
)
Acquisition-related expenses
(568
)
(98
)
(687
)
(98
)
Non-GAAP general and administrative expense
$
31,231
$
30,425
$
61,740
$
60,011