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What changed in Elastic N.V.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Elastic N.V.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+524 added−550 removedSource: 10-K (2025-06-10) vs 10-K (2024-06-14)

Top changes in Elastic N.V.'s 2025 10-K

524 paragraphs added · 550 removed · 438 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

101 edited+34 added−54 removed32 unchanged
Biggest changeOur AI-driven security analytics solution includes: Security Information and Event Management (“SIEM”), with integrations to network, host, user, and cloud data sources, as well as workflow and operations, shareable analytics, incident management, and investigations; extended protection with both third party integrations as well as first party protections for both Endpoint Security (prevention, detection, and response) and Cloud Security (cloud posture assessment, vulnerability management, and cloud workload protection). 6 Table of Contents Our Deployment Options The Elastic Stack and our solutions can be deployed in public or private clouds, in hybrid environments, or in multi-cloud environments, to satisfy various user and customer needs.
Biggest changeElastic Security enables investigations, incident management, shareable analytics, and workflow automation through Security Orchestration, Automation, and Response (“SOAR”); and extended protection within SIEM with third party integrations and first party protections for both Endpoint Security (prevention, detection, and response); and Cloud Security (cloud posture assessment, vulnerability management, and cloud workload protection).
The principal competitive factors for companies in our industry are: • product capabilities, including speed, scale, and relevance, with which to power search AI experiences; • an extensible product “stack” that enables developers to build a wide variety of solutions; • powerful and flexible technology that can manage a broad variety and large volume of data; • ease of deployment and ease of use; • ability to address a variety of evolving customer needs and use cases; • strength and execution of sales and marketing strategies; • flexible deployment model across public or private clouds, hybrid environments, or multi-cloud environments; • productized solutions engineered to be rapidly adopted to address specific applications; • mindshare with developers and IT and security executives; • adoption of products by many types of users and decision makers (developers, architects, DevOps personnel, IT professionals, security analysts, and departmental and organizational leaders); • enterprise-grade technology that is secure and reliable; • size of customer base and level of user adoption; • quality of training, consulting, and customer support; • brand awareness and reputation; and • low total cost of ownership.
The principal competitive factors for companies in our industry are: • product capabilities, including speed, scale, and relevance, with which to power search AI experiences; • an extensible product “stack” that enables developers to build a wide variety of solutions; • powerful and flexible technology that can manage a broad variety and large volume of data; • ease of deployment and ease of use; • ability to address a variety of evolving customer needs and use cases; • strength and execution of sales and marketing strategies; • flexible deployment model across public or private clouds, hybrid environments, or multi-cloud environments; • productized solutions engineered to be rapidly adopted to address specific applications; • mindshare with developers and IT and security executives; • adoption of products by many types of users and decision makers (including developers, architects, DevOps personnel, IT professionals, security analysts, and departmental and organizational leaders); • enterprise-grade technology that is secure and reliable; • size of customer base and level of user adoption; • quality of training, consulting, and customer support; • brand awareness and reputation; and • low total cost of ownership.
We work with many of the major cloud providers to increase awareness of our products and make it easy to access our software. We partner with Amazon, Google, and Microsoft to offer Elastic Cloud on AWS, GCP, and Microsoft Azure, through direct purchase from us or their respective marketplaces.
We work with many of the major cloud providers to increase awareness of our products and make it easy to access our software. We partner with Amazon, Google, and Microsoft to offer Elastic Cloud on AWS, GCP, and Microsoft Azure, respectively, through direct purchase from us or their respective marketplaces.
OEM or MSP partners are able to include Elastic’s proprietary features in their product, receive ongoing support from Elastic for product development, and receive support for end customer issues related to Elastic. • Technology partners. Our technology partners collaborate with Elastic to create a standardized solution for end users that includes technology from both Elastic and the partner.
OEM and MSP partners are able to include Elastic’s proprietary features in their product, receive ongoing support from Elastic for product development, and receive support for end customer issues related to Elastic. • Technology partners. Our technology partners collaborate with Elastic to create a standardized solution for end users that includes technology from both Elastic and the partner.
We help organizations, their employees, and their customers find what they need faster, while keeping mission-critical applications running smoothly, and protecting against cyber threats.
We help organizations, their employees, and their customers find what they need faster, while keeping mission-critical applications and infrastructure running smoothly and protecting against cyber threats.
In Elastic Cloud, our family of cloud-based offerings, we offer various subscription tiers tied to different features. For users who download our software, we make some of the features of our software available free of charge, allowing us to engage with a broad community of developers and practitioners and introduce them to the value of the Elastic Stack.
In Elastic Cloud, our family of cloud-based offerings, we offer various subscription tiers tied to different features. For users who download our software, we make some of the features of our software available free of charge, allowing us to engage with a broad community of developers and practitioners and introduce them to the value of our platform.
In addition, we maintain a policy requiring our employees, contractors, and consultants to enter into confidentiality and invention assignment agreements. As of April 30, 2024, we had a number of active patents, issued in both the United States and outside of the United States, with expirations ranging from 2031 to 2042.
In addition, we maintain a policy requiring our employees, contractors, and consultants to enter into confidentiality and invention assignment agreements. As of April 30, 2025, we had a number of active patents, issued in both the United States and outside of the United States, with expirations ranging from 2031 to 2042.
We will continue to engage our community and our partners to drive awareness and to invest in our sales and marketing team to grow our customer base. Through Elastic Cloud, we provide the fastest and easiest way to get started with a free trial. However, there is no free subscription tier in Elastic Cloud.
We engage our community and our partners to drive awareness and to invest in our sales and marketing team to grow our customer base. Through Elastic Cloud, we provide the fastest and easiest way to get started with a free trial. However, there is no free subscription tier in Elastic Cloud.
Examples of these capabilities, all with a single search, include tracking the top ten users by expenditure level, looking at data week over week, analyzing data across geographies, and drilling down into details with specific filters. • Developer friendliness.
Examples of these capabilities, all with a single search, include tracking the top ten users by expenditure level, looking at data week over week, analyzing data across geographies, and drilling down into details with specific filters. • Developer centricity.
Our business model is based primarily on a combination of a paid Elastic-managed hosted service offering and paid and free proprietary self-managed software. Our paid offerings for our platform are sold via subscription through resource-based pricing, and all customers and users have access to varying levels of features across all solutions.
Our business model is based primarily on a combination of paid service offerings (Elastic Cloud Hosted and Elastic Cloud Serverless) and free and paid proprietary self-managed software (Elastic Self-Managed). Our paid offerings for our platform are sold via subscription through resource-based pricing, and all customers and users have access to varying levels of features across all solutions.
We also engage with our customers on an ongoing basis through a customer success team, to ensure customer satisfaction and expand their use of our technology. Partners We maintain partner relationships that help us market and deliver our products to our customers and complement our community. Our partner relationships include the following: • Cloud providers.
We also engage with our customers on an ongoing basis through a customer success team, to ensure customer satisfaction and expand their use of our technology. Partners We maintain partner relationships that help us market and deliver our products to our customers and complement our community. Our partner relationships include the following: 9 Table of Contents • Cloud providers.
It offers an easy getting-started experience, featuring streamlined download and deployment, sensible defaults, a simple and intuitive query language, and no need to define a schema up front. Administrative tasks such as securing the Elastic Stack are intuitive and integrated into the user experience, as are investigative tasks such as data visualization. • Flexibility.
It offers an easy getting-started experience, featuring streamlined download and deployment, sensible defaults, a simple and intuitive query language, and no need to define a schema up front. Administrative tasks such as securing the platform are intuitive and integrated into the user experience, as are investigative tasks such as data visualization. • Flexibility.
Elasticsearch combines powerful parts of traditional search engines, such as an inverted index to power fast full-text search and a column store for analytics, with native support for a wide range of data types, including text, dates, numbers, geospatial data, date/numeric ranges, and IP addresses.
Our platform combines powerful parts of traditional search engines, such as an inverted index to power fast full-text search and a column store for analytics, with native support for a wide range of data types, including text, dates, numbers, geospatial data, date/numeric ranges, and IP addresses.
Diverse user needs are supported by a variety of data visualization types, such as simple line and bar charts, purpose-built geospatial and time series visualizations, tree diagrams, network diagrams, heatmaps, scatter plots, and histograms. • Incorporation of advanced analytics and machine learning from Elasticsearch.
Diverse user needs are supported by a variety of data visualization types, such as simple line and bar charts, purpose-built geospatial and time series visualizations, tree diagrams, network diagrams, heatmaps, scatter plots, and histograms. 11 Table of Contents • Incorporation of advanced analytics and machine learning from Elasticsearch.
As digital transformation drives mission-critical business functions to the cloud, we believe that every company must incorporate search AI capabilities across IT and line-of-business organizations to find the answers that matter from all of its data in real-time and at scale.
As digital transformation continues to drive mission-critical business functions to the cloud, we believe that every company must incorporate search AI capabilities across IT and line-of-business organizations to find the answers that matter from all of its data in real time and at scale.
Our partners assist us in driving awareness of Elastic and our products, using the Elastic Stack to address customer requirements, and extending our reach in geographic areas and verticals where we do not have a formal sales presence. • Selectively pursue strategic acquisitions. We intend to continue to pursue acquisitions selectively.
Our partners assist us in driving awareness of Elastic and our products, using our platform to address customer requirements, and extending our reach in geographic areas and verticals where we do not have a formal sales presence. • Selectively pursue strategic acquisitions. We intend to continue to pursue acquisitions selectively.
Research and Development We intend to continue to invest in our research and development capabilities to extend our products. Research and development expense totaled $342.0 million and $313.5 million for the years ended April 30, 2024 and 2023, respectively. We plan to continue to devote significant resources to research and development.
Research and Development We intend to continue to invest in our research and development capabilities to extend our products. Research and development expense totaled $365.8 million, $342.0 million, and $313.5 million for the years ended April 30, 2025, 2024, and 2023, respectively. We plan to continue to devote significant resources to research and development.
Our compliance with existing or future governmental regulations, including, but not limited to, those pertaining to global trade, business acquisitions, consumer and data protection, and taxes, could have material impacts on our business. See Item 1A, “Risk Factors” of this Annual Report on Form 10-K for a discussion of these potential impacts.
Our compliance with existing or future governmental regulations, including, but not limited to, those pertaining to global trade, business acquisitions, consumer and data protection, and taxes, could have material impacts on our business. See Item “1A. Risk Factors” of this Annual Report on Form 10-K for a discussion of these potential impacts.
As users and customers increasingly want to consume highly-scalable cloud solutions, we believe that Elastic Cloud represents a significant growth opportunity. We plan to continue to invest resources in driving further innovation and increasing the adoption of Elastic Cloud.
As users and customers increasingly want to consume highly-scalable cloud solutions, we believe that Elastic Cloud continues to represent a significant growth opportunity. We plan to continue to invest resources in driving further innovation and increasing the adoption of Elastic Cloud.
Developers can instrument apps and see the lifecycle of a transaction across services from front end to back end. This can give developers confidence in the code they ship, and can give operational teams visibility into code-level errors and performance bottlenecks to accelerate root cause analysis and resolution during an investigation. • Synthetic Monitoring.
Users can instrument apps and see the lifecycle of a transaction across services from front end to back end. This can give developers confidence in the code they ship, and can give operational teams visibility into code-level errors and performance bottlenecks to accelerate root cause analysis and resolution during an investigation. • Digital experience monitoring.
We make available free of charge through our website our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and all amendments to these reports, as soon as reasonably practicable after we electronically file such materials with, or furnish them to, the SEC.
We make available, free of charge through our website, our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and all amendments to these reports as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC.
We make our platform available as a hosted, managed service across major cloud providers (Amazon Web Services (“AWS”), Google Cloud Platform (“GCP”), and Microsoft Azure) in more than 55 public cloud regions globally. Customers can also deploy our platform across hybrid clouds, public or private clouds, and multi-cloud environments.
We make our platform available as a service across major cloud providers (Amazon Web Services (“AWS”), Google Cloud Platform (“GCP”), and Microsoft (“Azure”)) in more than 55 public cloud regions globally. Customers can also deploy our platform across hybrid clouds, public or private clouds, and multi-cloud environments.
Just as distributed systems are more resilient, we believe that a distributed workforce helps build a strong company that can scale and adapt as new challenges arise. Our distributed model also expands our reach to a global candidate pool, broadening our ability to attract diverse talent across regions.
Just as distributed systems are more resilient, we believe that a distributed workforce helps build a strong company that can scale and adapt as new challenges arise. Our distributed model also expands our reach, broadening our ability to attract talent across regions.
We will continue to engage with developers globally to grow our user community through a wide range of touch points such as community meetups, global community groups, hackathons, our global events, our user conferences, which we call ElasticON, and engagement on our website, user forums, and code repositories. 7 Table of Contents • Expand our customer base by acquiring new customers.
We plan to continue to engage with developers globally to grow our user community through a wide range of touch points such as community meetups, global community groups, hackathons, our global events, our user conferences, which we call ElasticON, and engagement on our website, user forums, and code repositories. • Expand our customer base by acquiring new customers.
In addition, as of April 30, 2024, we had numerous U.S. and international trademark registrations. The laws, procedures and restrictions on which we rely may provide only limited protection, and any of our intellectual property rights may be challenged, invalidated, circumvented, infringed or misappropriated.
In addition, as of April 30, 2025, we had numerous U.S. and international trademark registrations. 14 Table of Contents The laws, procedures and restrictions on which we rely may provide only limited protection, and any of our intellectual property rights may be challenged, invalidated, circumvented, infringed or misappropriated.
Securities and Exchange Commission (“SEC”), press releases, public conference calls, our website (www.elastic.co), the investor relations section of our website (https://ir.elastic.co), our blog (www.elastic.co/blog), and/or social media, including our account on X (formerly known as Twitter) (https://x.com/elastic), our Facebook page (www.facebook.com/elastic.co), and/or LinkedIn account (www.linkedin.com/company/elastic-co), in order to achieve broad, non-exclusionary distribution of information to the public.
Securities and Exchange Commission (“SEC”), press releases, public conference calls, our website (www.elastic.co), the investor relations section of our website (https://ir.elastic.co), our blog (www.elastic.co/blog), and/or social media, including our account on X (https://x.com/elastic), our Facebook page (www.facebook.com/elastic.co), and/or LinkedIn account (www.linkedin.com/company/elastic-co) to achieve broad, non-exclusionary distribution of information to the public.
Our net cash provided by operating activities was $148.8 million, $35.7 million, and $5.7 million for the years ended April 30, 2024, 2023, and 2022 respectively. 5 Table of Contents Our Products Our products enable our customers and users to find relevant information and insights nearly instantly in large amounts of data across a broad range of business and consumer use cases.
Our net cash provided by operating activities was $266.2 million, $148.8 million, and $35.7 million for the years ended April 30, 2025, 2024, and 2023 respectively. Our Products Our products enable our customers and users to find relevant information and insights nearly instantly in large amounts of data across a broad range of business and consumer use cases.
Our Search solution provides a powerful search platform for building search AI applications. Key use cases for Search include: generative AI and retrieval-augmented generation, search applications, and foundational capabilities for building search experiences to support websites and portals, e-commerce, mobile app search, customer support, and workplace search. • Observability.
Our search solution provides a powerful foundation for building search AI-powered applications. Key use cases for Elasticsearch include generative AI and retrieval-augmented generation, search applications, and foundational capabilities for building search experiences to support websites and portals, e-commerce, mobile app search, customer support, and workplace search. • Elastic Observability.
The Elastic Stack is able to ingest, filter, store, search, and analyze data in any form, whether structured or unstructured. These capabilities enable the Elastic Stack to generate insights from a wide variety of data sources for a broad range of use cases.
Our platform is able to ingest, filter, store, search, and analyze data in any form, whether structured or unstructured. These capabilities enable our platform to generate insights from a wide variety of data sources for a broad range of use cases.
With a globally distributed engineering team, we are able to recruit, hire, and retain high-quality, experienced developers, technology leads, and product managers, and operate at a rapid pace to drive product releases, fix bugs, and create new product offerings. 8 Table of Contents Our software development process is based on iterative releases of the Elastic Stack.
With a globally distributed engineering team, we are able to recruit, hire, and retain high-quality, experienced developers, technology leads, and product managers, and operate at a rapid pace to drive product releases, fix bugs, and create new product offerings. Our software development process is based on iterative releases of our platform.
Elasticsearch serves as the central authentication hub for the entire Elastic Stack. Security features include encrypted communications and encryption-at-rest; role-based access control; single sign-on and authentication; field-level, attribute-level, and document-level security; and audit logging. Kibana is the user interface for the Elastic Stack. It allows users to manage the Elastic Stack and visualize data.
Elasticsearch serves as the central authentication hub for our entire platform. Security features include encrypted communications and encryption-at-rest; role-based access control; single sign-on and authentication; field-level, attribute-level, and document-level security; and audit logging. Kibana, our platform’s user interface, allows users to manage our platform and to visualize data.
The flexibility of the Elastic Stack also enables users to begin using our products along with their existing systems, which lowers barriers to adoption. • Extensibility. Developers can use the Elastic Stack as a foundation for addressing a wide variety of use cases.
The flexibility of our platform also enables users to begin using our products along with their existing systems, which lowers barriers to adoption. • Extensibility. Our platform can be used by developers as a foundation for addressing a wide variety of use cases.
Subscriptions accounted for 93%, 92% and 93% of our total revenue for the years ended April 30, 2024, 2023 and 2022, respectively. Revenue from outside the United States accounted for 42%, 41% and 44% of our total revenue for the years ended April 30, 2024, 2023 and 2022, respectively.
Subscriptions accounted for 93% of our total revenue for the years ended April 30, 2025 and 2024, and 92% of our total revenue for the year ended April 30, 2023. Revenue from customers located outside the United States accounted for 44%, 42%, and 41% of our total revenue for the years ended April 30, 2025, 2024, and 2023, respectively.
Users interested in a highly specialized visualization type not distributed with Kibana by default can customize experiences through a Kibana plugin and make the plugin available to the community. Dozens of Kibana plugins have been shared by the community via Elastic documentation and code sharing platforms such as GitHub.
Users interested in a highly specialized visualization type not distributed by default can customize experiences and make these customizations available to the community. Dozens of customizations have been shared by the community via Elastic documentation and code sharing platforms such as GitHub.
Community gives us the ability to get their candid feedback, creating a direct line of communication between our users and the builders of our products across all of our features — including both free and paid capabilities — and enabling us to make our products simpler and better.
Community is core to our identity, binding our products closely together with our users. Community gives us the ability to get their candid feedback, creating a direct line of communication between our users and the builders of our products across all of our features—including both free and paid capabilities—and enabling us to make our products simpler and better.
We have a global network of systems integrators, channel partners, and referral partner relationships that help deliver our products to business and government customers around the world. • OEM and MSP partners. Our original equipment manufacturing (“OEM”) and managed service provider (“MSP”) partners embed an Elastic subscription into the products or services they offer to their customers.
We have a global network of systems integrators, channel partners, and referral partner relationships that help deliver our products to business and government customers around the world. • OEM and MSP partners. Our OEM and MSP partners embed an Elastic subscription into the products or services they offer to their customers.
As of April 30, 2024, we had approximately 21,000 customers compared to approximately 20,200 customers and over 18,600 customers as of April 30, 2023 and 2022, respectively. One customer, a channel partner, accounted for 11% of total revenue for the year ended April 30, 2024.
As of April 30, 2025, we had approximately 21,500 customers compared to approximately 21,000 and approximately 20,200 customers as of April 30, 2024 and 2023, respectively. One customer, a channel partner, accounted for 12% of total revenue for the year ended April 30, 2025 and 11% of total revenue for the year ended April 30, 2024.
Machine learning capabilities such as anomaly detection, forecasting, and categorization are tightly integrated with the Elastic Stack to automatically model the behavior of data, such as trends and periodicity, in real time to identify issues faster, streamline root cause analysis, and reduce false positives.
Machine learning capabilities such as anomaly detection, forecasting, and categorization are a tightly integrated part of our platform so as to automatically model the behavior of data, such as trends and periodicity, in real time, to identify issues faster, streamline root cause analysis, and reduce false positives.
We do not sell support separately and, as such, it is only available for customers who license one or more of our product offerings. Our Technology Our platform consists of the Elastic Stack, our solutions, and software that supports our various deployment alternatives.
We do not sell support independently and, as such, it is only available for customers who license one or more of our product offerings. Our Technology Our platform consists of our three solutions (Elasticsearch, Elastic Observability, and Elastic Security), and software that supports our various deployment alternatives.
We encourage investors and others to review the information it makes public in these locations, as such information could be deemed to be material information. Please note that this list may be updated from time to time.
We encourage investors and others to review the information we make public in these locations, as such information could be deemed to be material information. This list may be updated from time to time.
The source code of features in the Elastic Stack is generally visible to the public in the form of “open code.” Our Solutions We have built a number of solutions into the Elastic Stack to make it easier for organizations to use our software for common use cases. Our solutions include the following: • Search.
The source code of features included as part of our platform is generally visible to the public in the form of “open source.” Our Solutions We have built a number of solutions into our platform to make it easier for organizations to use our software for common use cases. Our solutions include the following: • Elasticsearch.
No customer accounted for 10% or more of our total revenue for the years ended April 30, 2023 and 2022.
No customer accounted for 10% or more of our total revenue for the year ended April 30, 2023.
As nodes join a cluster, data is automatically re-balanced and queries and indexing are spread across the new nodes seamlessly. This makes it easy to add hardware to increase indexing throughput or improve query throughput.
Elasticsearch is designed to scale horizontally and be resilient to node or hardware failures. As nodes join a cluster, data is automatically re-balanced and queries and indexing are spread across the new nodes seamlessly. This makes it easy to add hardware to increase indexing throughput or improve query throughput.
We have built our processes, systems, and teams so that employees can generally perform their jobs without needing to be physically present in the same room - or even in the same time zone - as their colleagues.
Distributed Workforce Elastic originated as a distributed company and continues to be distributed by design. We have built our processes, systems, and teams so that employees can generally perform their jobs without needing to be physically present in the same room—or even in the same time zone—as their colleagues.
We support both with human capital management efforts focused on: • Attracting, engaging and retaining a talented and diverse employee base • Maintaining our strong company culture • Enhancing our commitment to diversity, equity, and inclusion (“DEI”) • Facilitating strong employee engagement • Promoting continuous employee learning and development • Providing a comprehensive total rewards package that seeks to offer fair and consistent pay practices with an emphasis on employee well-being Our management regularly updates our board of directors and its committees on human capital trends and employee-focused activities and initiatives.
We support both with human capital management efforts focused on: • Attracting, engaging and retaining a talented employee base that values different perspectives, experiences, and backgrounds • Facilitating strong employee engagement • Promoting continuous employee learning and development • Providing a comprehensive total rewards package that seeks to offer fair and consistent pay practices with an emphasis on employee well-being Our management regularly updates our board of directors and its committees on human capital trends and employee-focused activities and initiatives.
Our global support organization consists of engineers who provide technical support services including troubleshooting, technical audits, cluster tuning, and upgrade assistance. Our support team is globally distributed and provides coverage 24 hours per day, 365 days per year, across multiple languages.
Accordingly, we include support as part of the subscriptions we sell for our products. Our global support organization consists of engineers who provide technical support services including troubleshooting, technical audits, cluster tuning, and upgrade assistance. Our support team is globally distributed and provides coverage 24 hours per day, 365 days per year, across multiple languages.
Because our solutions are built into the Elastic Stack, innovations and new capabilities in the Elastic Stack may benefit many of our solutions. Our customers can customize and extend our solutions to fit their needs by leveraging the power of the Elastic Stack and our developer capabilities.
Because our solutions are built on top of a common platform, innovations and new capabilities in our platform may benefit many of our solutions. Our customers can customize and extend our solutions to fit their needs by leveraging the power of our platform and our developer capabilities.
Our platform, available as both a hosted, managed service across public clouds as well as self-managed software, allows our customers to find insights and drive AI and machine learning use cases from large amounts of data. We offer three search-powered solutions – Search, Observability, and Security – that are built on the platform.
Our platform, available as either a cloud service or a self-managed software, allows our customers to find insights and drive AI and machine learning use cases from large amounts of data. We offer three Search AI-powered solutions—Elasticsearch, Elastic Observability, and Elastic Security—that are built on our platform.
Our total revenue was $1.267 billion, $1.069 billion, and $862.4 million for the years ended April 30, 2024, 2023 and 2022, respectively, representing year-over-year growth of 19% for the year ended April 30, 2024 and 24% for the year ended April 30, 2023.
Our total revenue was $1.483 billion, $1.267 billion, and $1.069 billion for the years ended April 30, 2025, 2024, and 2023, respectively, representing year-over-year growth of 17% for the year ended April 30, 2025 and 19% for the year ended April 30, 2024.
Self-managed users can easily download our software directly from our website and access many features free of charge, which also facilitates adoption. Our sales and marketing team conducts campaigns to drive further awareness and adoption within the user community.
Self-managed users can easily download our software directly from our website and access many features free of charge, which also facilitates adoption. We offer varied deployment options to cater to a wide range of customer use cases. Our sales and marketing team conducts campaigns to drive further awareness and adoption within the user community.
We will continue to invest in our products and services to extend into new use cases, industries, geographies, and customers. We regularly deliver new and enhanced capabilities to our customers through regular releases, to which everyone has access based on our subscription model.
We continue to invest in our platform, solutions, and services to extend into new use cases, industries, geographies, and customers. We regularly deliver new and enhanced capabilities to our customers, such as the enhanced AI technology now integrated in our platform, through regular releases, to which everyone has access based on our subscription model.
Our principal competitors include: • For Search and other platform use cases: offerings such as Lucidworks Fusion and Apache Solr (open source offering), search tools including Algolia, Coveo, and Google. • For Observability: software vendors with specific observability solutions to analyze logging data, metrics, APM data, or infrastructure uptime, such as AppDynamics (owned by Cisco Systems), Datadog, Dynatrace, New Relic, and Splunk (owned by Cisco Systems). 13 Table of Contents • For Security: security vendors such as Azure Sentinel (by Microsoft), Broadcom (which owns Carbon Black and Symantec), CrowdStrike, McAfee, and Splunk (owned by Cisco Systems). • Certain cloud hosting providers and managed service providers, including AWS, that offer products or services based on a forked version of the Elastic Stack.
Our principal competitors include: • For Elasticsearch and other platform use cases: offerings such as Apache Solr (open source offering), Lucidworks Fusion, and MongoDB Atlas, and search tools including Algolia, Coveo, Google, Pinecone, and Microsoft Azure Cognitive Search. 13 Table of Contents • For Elastic Observability: software vendors with specific observability solutions, such as AppDynamics (owned by Cisco Systems), Datadog, Dynatrace, New Relic, and Splunk (owned by Cisco Systems). • For Elastic Security: security vendors such as Azure Sentinel (by Microsoft), CrowdStrike, Google SecOps, Palo Alto Networks. and Splunk (owned by Cisco Systems). • Certain cloud hosting providers and managed service providers, including AWS, which offer products or services based on a forked version of our platform.
Since inception, we have selectively pursued strategic acquisitions to drive product and market expansion. The focus of our most recent acquisitions has been to enhance the technology underlying our Security and Observability offerings. Customers Organizations of all sizes, across many industries, including enterprises, educational institutions and government entities, purchase our products for a variety of use cases.
The focus of our most recent acquisitions has been to enhance the technology underlying our Security and Observability offerings. 8 Table of Contents Customers Organizations of all sizes, across many industries, including enterprises, educational institutions and government entities, purchase our products for a variety of use cases.
Elastic has spent years infusing both Elasticsearch and Kibana with a foundation of AI and machine learning built on ESRE, from support for external machine learning models to native vector search capabilities, supervised and unsupervised machine learning, and solution capabilities that improve search relevance and identify anomalies.
Elastic has spent years infusing its platform with a strong foundational suite of AI and machine learning capabilities—from support for external machine learning models to native vector search capabilities, supervised and unsupervised machine learning, and solution capabilities that improve search relevance and identify anomalies.
We offer the Elastic Stack, a powerful set of software products that ingest and store data from any source, in any format, and perform search, analysis, and visualization, usually in milliseconds. The Elastic Stack can be used by developers and IT decision makers to power a variety of use cases.
Our platform includes a powerful set of solutions able to ingest and store data from any source, in any format, and perform search, analysis, and visualization, usually in milliseconds. Our platform can be used by developers and IT decision makers to power a variety of use cases.
We also offer software solutions built in the Elastic Stack that address a wide variety of use cases. The Elastic Stack and our solutions are designed to run in public or private clouds, in hybrid environments, or in multi-cloud environments. The Elastic Stack The Elastic Stack is primarily composed of the following products: • Elasticsearch.
We also offer software solutions built on the Search AI Platform that address a wide variety of use cases. Our platform and each of our solutions (Elasticsearch, Elastic Observability, and Elastic Security) are designed to run in public or private clouds, in hybrid environments, or in multi-cloud environments.
We obtain many components from software developed and released by contributors for independent open source components of our technology. Open source licenses grant licensees broad permissions to use, copy, modify and redistribute our platform. As a result, open source development and licensing practices can limit the value of our software copyright assets.
Open source licenses grant licensees broad permissions to use, copy, modify and redistribute our platform. As a result, open source development and licensing practices can limit the value of our software copyright assets.
Additionally, the speed of the Elastic Stack permits query iteration, further enhancing the relevance of search results. • Ease of Use. The Elastic Stack is engineered to take a user from data to dashboard or inquiry to insight in minutes.
Its sophisticated yet developer-friendly query language permits advanced search and analytics. Additionally, the speed of our platform permits query iteration, further enhancing the relevance of search results. • Ease of Use. Our platform is engineered to take a user from data to dashboard or inquiry to insight in minutes.
To promote and reinforce our high standards of ethics and integrity throughout the entire company, we require all employees to acknowledge their compliance with our Code of Business Conduct and Ethics and complete mandatory training on this code, and on whistleblowing, anti-harassment, discrimination, anti-retaliation, and other key policies and standards.
To promote and reinforce our high standards of ethics and integrity throughout the entire company, we require all employees to acknowledge their compliance with our Code of Business Conduct and Ethics and complete mandatory training on this code, and on whistleblowing, anti-harassment, discrimination, anti-retaliation, and other key policies and standards. 15 Table of Contents Total Rewards We aim to provide all our employees with a total rewards package that is market-competitive, emphasizing global consistency and local relevance.
We believe in the importance of an open software development model, and we develop the majority of our software in public repositories as open code under a proprietary license. Unlike some companies, we do not build an enterprise version that is separate from our free distribution. We maintain a single code base across both our self-managed software and Elastic-hosted services.
We believe in the importance of an open software development model, and we develop the majority of our software in public repositories under an open source GNU Affero General Public License v3 (“AGPL”) license, as well as under a proprietary license. Unlike some companies, we do not build an enterprise version that is separate from our free distribution.
Paid proprietary features in the Elastic Stack enable capabilities such as automating anomaly detection on time series data at scale through machine learning, facilitating compliance with data security and privacy regulations, supporting search across low cost cold and frozen data tiers, and allowing real-time notifications and alerts.
Elastic enables organizations to integrate generative AI and large language models by building key capabilities into its products. Paid features enable capabilities such as automating anomaly detection on time-series data at scale through machine learning, facilitating compliance with data security and privacy regulations, supporting search across low-cost cold and frozen data tiers, and allowing real-time notifications and alerts.
Everything stored in Elasticsearch is indexed by default, so users do not need to decide in advance what queries they will want to run. Our architecture optimizes throughput, time-to-data availability and query latency.
Everything stored in Elasticsearch is indexed by default, so users do not need to decide in advance what queries they will want to run. Our architecture optimizes throughput, time-to-data availability, and query latency. Elasticsearch can index millions of events per second, and newly added data can be available for search nearly instantly. • High scale and availability.
Our open approach to building the Elastic Stack empowers developers to innovate and utilize it to fit their specific needs. Additionally, our developer community actively engages with us to improve and expand the Elastic Stack. Our Growth Strategies We pursue the following growth strategies: • Increase usage of Elastic Cloud.
Our open approach to building our platform empowers developers to innovate and utilize it to fit their specific needs. Additionally, our developer community actively engages with us to improve and expand our platform. 7 Table of Contents Our Growth Strategies We pursue the following growth strategies: • Extend our product leadership through continued investment in our technology.
Kibana’s query, filtering, and data summarization capabilities reflect Elasticsearch’s powerful query domain specific language and aggregation framework while making it interactive. • Management of the Elastic Stack. Kibana presents a broad user interface showing the health of Elastic Stack components and provides cluster alerts to notify administrators of problems.
Our platform’s user interface query, filtering, and data summarization capabilities reflect Elasticsearch’s powerful query domain-specific language and aggregation framework while making it interactive. • Management of the Search AI Platform. Our user interface illustrates the health of our platform’s various components and provides timely alerts to notify administrators of any problems.
It has the ability to subdivide search indices into multiple pieces called shards, which enables data volume to be scaled horizontally and operations to be distributed across hundreds of systems or more. A developer running hundreds of nodes has the same user experience as a developer running a single node on a laptop. • Relevance.
Our platform is a distributed system and can scale. It has the ability to subdivide search indices into multiple pieces called shards, which enables data volume to be scaled horizontally and operations to be distributed across hundreds of systems or more.
Our out-of-the-box solutions deliver fast time to value for common use cases and, paired with our developer-centric platform which is extensible and customizable, allow us to innovate fast and differentiate our offerings at every level.
It delivers the comprehensive set of capabilities developers need to build, maintain, and secure next-generation applications and services. In addition, our out-of-the-box solutions (Elastic Observability and Elastic Security) deliver fast time-to-value for common use cases and, paired with our developer-centric platform which is extensible and customizable, allow us to innovate quickly and differentiate our offerings at every level.
This means paying people fairly for the job they perform without regard to gender, race, or ethnicity. We partner with an external firm to conduct pay equity analysis on a regular basis using established job groupings and control factors to promote appropriate comparisons. We look at gender globally and race and ethnicity for employees in the U.S.
We are committed to fair pay without regard to gender, race, or ethnicity. We partner with an external firm to conduct pay equity analysis on a regular basis using established job groupings and control factors to promote appropriate comparisons.
We often enter an organization through a single developer or a small team for an initial project or use case with an objective to quickly solve a technical challenge or business problem.
We view initial success with our products as a path to drive expansion to new use cases and projects and larger deployments within organizations. We often enter an organization through a single developer or a small team for an initial project or use case with an objective to quickly solve a technical challenge or business problem.
Our user community enables users to engage in self-help and collaboration. 9 Table of Contents However, in many situations, such as those involving complex enterprise IT environments, large deployments and novel use cases, our users require our support. Accordingly, we include support as part of the subscriptions we sell for our products.
Customer Support We endeavor to make it easy for users to download, install, deploy, and use our platform and our solutions. Our user community enables users to engage in self-help and collaboration. However, in many situations, such as those involving complex enterprise IT environments, large deployments, and novel use cases, our users require our support.
Its central management user interfaces make it easier to operate the Elastic Stack at scale. • Home for solutions. Kibana is where our users and customers access the user interfaces for our Search, Observability, and Security solutions. Kibana provides core services, like security, alerting, and data visualization components.
Its central management user interfaces make it easier to operate our platform at scale. • Home for solutions. Our user interface is where our users and customers access our three solutions: Elasticsearch, Elastic Observability, and Elastic Security.
Because our business model provides access to all solutions with resource-based pricing, we make it easy for customers to expand across use cases. Our business has experienced rapid growth around the world. As of April 30, 2024, we had approximately 21,000 customers compared to approximately 20,200 customers and over 18,600 customers as of April 30, 2023 and 2022, respectively.
Because our business model provides access to all solutions with resource-based pricing, we make it easy for customers to expand across use cases. 5 Table of Contents Our business has experienced rapid growth around the world.
In addition, the laws of certain countries do not protect proprietary rights to the same extent as the laws of the United States or other jurisdictions, and we therefore may be unable to protect our proprietary technology in certain jurisdictions. 14 Table of Contents In addition, our technology incorporates software components licensed to the general public under open source software licenses such as the Apache Software License Version 2.0 (“Apache 2.0”).
In addition, the laws of certain countries do not protect proprietary rights to the same extent as the laws of the United States or other jurisdictions, and we therefore may be unable to protect our proprietary technology in certain jurisdictions.
While we recorded net income of $61.7 million for the year ended April 30, 2024, we incurred net losses of $236.2 million and $203.8 million for the years ended April 30, 2023 and 2022, respectively. Although we recorded net income for the year ended April 30, 2024, we expect to incur net losses for the foreseeable future.
We recorded a net loss of $108.1 million for the year ended April 30, 2025, a net income of $61.7 million for the year ended April 30, 2024, and a net loss of $236.2 million for the year ended April 30, 2023. We may incur net losses in the foreseeable future.
At the core of the Elastic Stack is Elasticsearch - a highly scalable document store and search engine, and the unified data store for all of our solutions and use cases.
Our platform is able to ingest data from any source, in any format, and perform search, analysis, and visualization of that data. With Elasticsearch at its core, our platform is a highly scalable document store and search engine, and is the unified data store for all of our solutions and use cases.
Elasticsearch uses multiple analytical techniques, including both traditional and AI-powered relevance techniques, to determine the similarity between stored data and queries, generating highly relevant results reflecting a deep understanding of text and context. Its sophisticated yet developer-friendly query language permits advanced search and analytics.
A developer running hundreds of nodes has the same user experience as a developer running a single node on a laptop. • Relevance. Our platform uses multiple analytical techniques, including both traditional and AI-powered relevance techniques, to determine the similarity between stored data and queries, generating highly relevant results reflecting a deep understanding of text and context.
As a result, many of our sales prospects are already familiar with our technology prior to entering into a commercial relationship with us. Additionally, we leverage our network of partners to drive awareness and expand our sales and marketing reach to target new customers. • Expand within our existing customer base through new use cases and larger deployments.
Additionally, we leverage our network of partners to drive awareness and expand our sales and marketing reach to target new customers. • Expand within our existing customer base through new use cases and larger deployments. We continue to invest in helping users and customers be successful with our products.
Each download of the Elastic Stack is a new opportunity to educate our next contributor, hear about a new use case, explore the need for a new feature, or meet a future member of the team. Community is core to our identity, binding our products closely together with our users.
To build products that best meet our users’ needs, we focus on, and invest in, building a strong community. Each download of our platform is a new opportunity to educate our next contributor, hear about a new use case, explore the need for a new feature, or meet a future member of the team.
Technology partners represent a deeper collaboration than community contributions and are distinct from distribution-oriented relationships like OEMs and MSP partners. Services We offer consulting and training to assist customers in accelerating their success with our software. Our consulting team consists of engineers and architects who bring hands-on experience and deep technical knowledge to a project.
Services We offer consulting and training to assist customers in accelerating their success with our software. Our consulting team consists of engineers and architects who bring hands-on experience and deep technical knowledge to a project. Our training offerings enable our users to gain the skills necessary to develop, deploy, and manage our software.
Item 1. Business Elastic, the Search AI Company, enables our customers to find the answers they need in real time, using all of their data, at scale. The Elastic Search AI Platform (“our platform”), combines the power of search with AI to help companies solve real-time business problems, unlock potential value, and achieve better outcomes.
Elastic’s Search AI Platform (“our platform”) combines the precision of search with the intelligence of AI to help our customers and community solve real-time business problems, unlock potential value, and achieve better outcomes.
With our engineering efforts focused on the user experience, we will continue to develop software that makes our products easier to use and adopt for both developers and non-developers.
Our technology investments include foundational platform capabilities as well as solution enhancements for our target use cases. • Increase product adoption by improving ease of use and growing our user community. With our engineering efforts focused on the user experience, we continue to develop software that makes our products easier to use and adopt for both developers and non-developers.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeIn addition, changing laws, regulations and standards relating to ESG matters are evolving, creating uncertainty for public companies, increasing legal and financial compliance costs and making some activities more time-consuming. We communicate certain ESG-related initiatives and goals regarding ESG in our annual sustainability report, on our website, in our filings with the SEC, and elsewhere.
Biggest changeGiven the divergent nature of regulations and a lack of harmonization of ESG legal and regulatory environments across the jurisdictions in which we operate, we may experience enhanced compliance risks and costs as well as opposing views from various stakeholders who may disagree with our actual or perceived positions on these matters. 47 Table of Contents In addition, changing laws, regulations and standards relating to ESG matters are evolving, creating uncertainty for public companies, increasing legal and financial compliance costs and making some activities more time-consuming.
We do not have an adequate history with our consumption-based arrangements for our Elastic Cloud offerings to predict accurately the long-term rate of customer adoption or renewal, or the impact those arrangements will have on our near-term or long-term revenue or operating results.
We do not have an adequate history with our consumption-based arrangements for our Elastic Cloud offerings to accurately predict the long-term rate of customer adoption or renewal, or the impact those arrangements will have on our near-term or long-term revenue or operating results.
The variation in our revenue also may result from the growth of consumption-based arrangements for our Elastic Cloud offerings, where the revenue we recognize is tied to our customers’ actual usage of our products, and further reduction in usage by customers already using a consumption-based arrangement due to the uncertain macroeconomic environment.
The variation in our revenue also may result from the growth of consumption-based arrangements for our Elastic Cloud offerings, where the revenue we recognize is tied to our customers’ actual usage of our products, and from a further reduction in usage by customers already using a consumption-based arrangement due to the uncertain macroeconomic environment.
If we are unable to hire and train sufficient numbers of effective sales personnel, our new and existing sales personnel are unable to achieve desired productivity levels in a reasonable period of time, our sales personnel are not successful in obtaining new customers or increasing sales to our existing customer base, or our sales and marketing programs, including our sales compensation plans, are not effective, our growth and results of operations could be negatively impacted.
Our growth and results of operations could be negatively impacted if we are unable to hire and train sufficient numbers of effective sales personnel, our new and existing sales personnel are unable to achieve desired productivity levels in a reasonable period of time, our sales personnel are not successful in obtaining new customers or increasing sales to our existing customer base, or our sales and marketing programs, including our sales compensation plans, are not effective.
We may need to raise additional funds in the future, and we may not be able to obtain additional debt or equity financing on favorable terms, if at all, particularly during times of market volatility, changes in the interest rate environment, and general economic instability.
We may need to raise additional funds in the future, and may not be able to obtain additional debt or equity financing on favorable terms, if at all, particularly during times of market volatility, changes in the interest rate environment, and general economic instability.
We may also be required to take other actions that would otherwise be in the interests of the debt holders and force us to maintain specified liquidity or other ratios, any of which could harm our business, results of operations, and financial condition.
We may also be required to take other actions that would otherwise be in the interests of the debt holders and force us to maintain specified liquidity or other financial ratios, any of which could harm our business, results of operations, and financial condition.
Attempting to ensure compliance of integrating such open source and generative AI components with licensing terms, regulatory changes, and our required intellectual property guidelines and legal requirements to do business may result in the expenditure of significant resources and in our failure to meet all relevant, material software release timetables and requirements.
Attempting to ensure our compliance in integrating such open source and generative AI components with licensing terms, regulatory changes, and our required intellectual property guidelines and legal requirements to do business may result in the expenditure of significant resources and in our failure to meet all relevant, material software release timetables and requirements.
Since our projections may differ from our actual business results and our market capitalization and value of our assets may fluctuate, we cannot assure you that we will not be or become a PFIC in the current taxable year or any future taxable year.
Since our projections may differ from our actual business results and our market capitalization and the value of our assets may fluctuate, we cannot assure you that we will not be or become a PFIC in the current taxable year or any future taxable year.
A U.S. person should consult its advisors regarding the potential application of these rules to an investment in our ordinary shares. We may not be able to make distributions or repurchase shares without subjecting our shareholders to Dutch withholding tax.
A U.S. person should consult its tax advisors regarding the potential application of these rules to an investment in our ordinary shares. We may not be able to make distributions or repurchase our shares without subjecting our shareholders to Dutch withholding tax.
A qualifying jurisdiction is a jurisdiction other than a member state of the EU/EEA which does not impose a withholding tax on distributions, or that does impose such tax but that grants a step-up for earnings attributable to the period before we become exclusively a resident in such jurisdiction.
A qualifying jurisdiction is a jurisdiction other than a member state of the EU/EEA which does not impose a withholding tax on distributions, or that does impose such a tax but that grants a step-up for earnings attributable to the period before we become exclusively a resident in such jurisdiction.
In the United States, many states have enacted such legislation. These laws and regulations may include a private right of action for certain data breaches or noncompliance with privacy or security obligations, may provide for penalties and other remedies, and may require us to incur substantial costs and expenses and liabilities in connection with our compliance.
In the United States, many states have enacted such legislation. These laws and regulations may include a private right of action for certain data breaches or for noncompliance with privacy or security obligations, may provide for penalties and other remedies, and may require us to incur substantial costs and expenses and liabilities in connection with our compliance.
Obtaining the necessary export license for a particular sale or offering may not be possible and may be time-consuming and may result in the delay or loss of sales opportunities.
Obtaining the necessary export license for a particular sale or offering may not be possible, may be time-consuming and may result in the delay or loss of sales opportunities.
Changes in our products or changes in export and import regulations in such countries may create delays in the introduction of our products and services into international markets, prevent our end customers with international operations from deploying our products globally or, in some cases, prevent or delay the export or import of our products and services to certain countries, governments or persons altogether.
Changes in our products or changes in export and import regulations in such countries may create delays in the introduction of our products and services into international markets, prevent our end customers with international operations from deploying our products globally or, in some cases, prevent or delay altogether the export or import of our products and services to certain countries, governments, or persons.
We also have invested, and may continue to invest, in the acquisition of complementary businesses, technologies, services, products and other assets that expand the products that we can offer our customers. We may make these investments without being certain that they will result in products or enhancements that will be accepted by existing or prospective customers.
We also have invested, and may continue to invest, in the acquisition of complementary businesses, technologies, services, products, and other assets that we expect will expand the products that we can offer our customers. We may make these investments without being certain that they will result in products or enhancements that will be accepted by existing or prospective customers.
As a Dutch company, we are subject to the Dutch Corporate Governance Code (“DCGC”). The DCGC contains both principles and suggested governance provisions for management boards, supervisory boards, shareholders and general meetings, financial reporting, auditors, disclosure, compliance and enforcement standards. The DCGC is based on a “comply or explain” principle.
As a Dutch company, we are subject to the Dutch Corporate Governance Code. The DCGC contains both principles and suggested governance provisions for management boards, supervisory boards, shareholders and general meetings, financial reporting, auditors, disclosure, compliance and enforcement standards. The DCGC is based on a “comply or explain” principle.
In addition, there can be no assurance that a Dutch court would impose civil liability on us, the members of our board of directors, our officers or certain experts named in our filings with the SEC in an original action predicated solely upon the U.S. federal securities laws brought in a court of competent jurisdiction in the Netherlands against us or such members, officers or experts. 44 Table of Contents If industry or financial analysts do not publish research or reports about our business, or if they issue inaccurate or unfavorable research regarding our ordinary shares, our share price and trading volume could decline, which could adversely affect our business.
In addition, there can be no assurance that a Dutch court would impose civil liability on us, the members of our board of directors, our officers or certain experts named in our filings with the SEC in an original action predicated solely upon the U.S. federal securities laws brought in a court of competent jurisdiction in the Netherlands against us or such members, officers or experts. 43 Table of Contents If industry or financial analysts do not publish research or reports about our business, or if they issue inaccurate or unfavorable research regarding our ordinary shares, our share price and trading volume could decline, which could adversely affect our business.
Furthermore, in July 2023, the European Commission adopted its adequacy decision on data transfers under the EU-U.S. Data Privacy Framework (“DPF”). The adequacy decision provides a new lawful basis for trans-Atlantic data transfers from data exporters in the EU to U.S. data importers who certify compliance with the DPF principles.
In July 2023, the European Commission adopted its adequacy decision on data transfers under the EU-U.S. Data Privacy Framework (“DPF”). The adequacy decision provides a new lawful basis for trans-Atlantic data transfers from data exporters in the EU to U.S. data importers who certify compliance with the DPF principles.
In such proceedings, however, a Dutch court may be expected to recognize the binding effect of a judgment of a federal or state court in the United States without re-examination of the substantive matters adjudicated thereby, if (i) the jurisdiction of the U.S. federal or state court has been based on internationally accepted principles of private international law, (ii) the judgment resulted from legal proceedings compatible with Dutch notions of due process, (iii) the judgment does not contravene public policy of the Netherlands and (iv) the judgment is not incompatible with (x) an earlier judgment of a Dutch court between the same parties, or (y) an earlier judgment of a foreign court between the same parties in a dispute regarding the same subject and based on the same cause, if that earlier foreign judgment is recognizable in the Netherlands.
In such proceedings, however, a Dutch court may be expected to recognize the binding effect of a judgment of a federal or state court in the United States without re-examination of the substantive matters adjudicated thereby, if (i) the jurisdiction of the U.S. federal or state court has been based on internationally accepted principles of private international law, (ii) the judgment resulted from legal proceedings compatible with Dutch notions of due process, (iii) the judgment does not contravene public policy of the Netherlands and (iv) the judgment is not incompatible with an earlier judgment of a Dutch court between the same parties, or an earlier judgment of a foreign court between the same parties in a dispute regarding the same subject and based on the same cause, if that earlier foreign judgment is recognizable in the Netherlands.
We do not maintain key person life insurance policies on any of our employees. The loss of services of senior management could significantly delay or prevent the achievement of our development and strategic objectives, which could adversely affect our business, financial condition, and results of operations.
We do not maintain key person life insurance policies on any of our employees. The loss of services of members of our senior management could significantly delay or prevent the achievement of our development and strategic objectives, which could adversely affect our business, financial condition, and results of operations.
If we are unable to successfully enhance our existing products to meet evolving customer requirements, increase adoption and usage of our products, develop new products, or if our efforts to increase the usage of our products are more expensive than we expect, our business, results of operations, and financial condition could be adversely affected.
If we are unable to enhance our existing products to meet evolving customer requirements, increase adoption and usage of our products, or develop new products, or if our efforts to increase the usage of our products are more expensive than we expect, our business, results of operations, and financial condition could be adversely affected.
A customer’s decision to use our solutions may be an enterprise-wide decision, which may require greater levels of education regarding the use cases of our products or protracted negotiations. In addition, larger customers may demand more configuration, integration services and features.
A customer’s decision to use our solutions may be an enterprise-wide decision, which could require greater levels of education regarding the use cases of our products or protracted negotiations. In addition, larger customers may demand more configuration, integration services, and features.
Further, our ability to attract additional qualified personnel may be impacted by the economic uncertainty and insecurity caused by macroeconomic factors and geopolitical events. The loss of services of any of our key personnel also increases our dependency on other key personnel who remain with us.
Our ability to attract additional qualified personnel may be impacted by the economic uncertainty and insecurity caused by macroeconomic factors and geopolitical events. The loss of services of any of our key personnel also increases our dependency on other key personnel who remain with us.
We maintain partnership relationships with a variety of partners, including cloud providers such as Amazon, Google, and Microsoft, systems integrators, channel partners, referral partners, OEM and MSP partners, and technology partners, to deliver offerings to our end customers and complement our broad community of users.
We maintain partnership relationships with a variety of enterprises, including cloud providers such as Amazon, Google, and Microsoft, systems integrators, channel partners, referral partners, OEM and MSP partners, and technology partners, to deliver offerings to our end customers and complement our broad community of users.
For example, the Organisation for Economic Co-operation and Development (“OECD”)/G20 Inclusive Framework has been working on addressing the tax challenges arising from the digitalization of the economy, including by releasing the OECD’s Pillar One and Pillar Two blueprints on October 12, 2020.
For example, the Organisation for Economic Co-operation and Development (“OECD”)/G20 Inclusive Framework has been addressing the tax challenges arising from the digitalization of the economy, including by releasing the OECD’s Pillar One and Pillar Two blueprints on October 12, 2020.
Bribery Act or other applicable anti-bribery, anti-corruption laws, and anti-money laundering laws could result in whistleblower complaints, adverse media coverage, investigations, loss of export privileges, severe criminal or civil sanctions, or suspension or debarment from U.S. government contracts, all of which may have an adverse effect on our reputation, business, operating results and prospects. 41 Table of Contents Risks Related to Ownership of our Ordinary Shares The market price for our ordinary shares has been and is likely to continue to be volatile or may decline regardless of our operating performance.
Bribery Act, or other applicable anti-bribery, anti-corruption laws, and anti-money laundering laws could result in whistleblower complaints, adverse media coverage, investigations, loss of export privileges, severe criminal or civil sanctions, or suspension or debarment from U.S. government contracts, all of which may have an adverse effect on our reputation, business, operating results, and prospects. 40 Table of Contents Risks Related to Ownership of our Ordinary Shares The market price for our ordinary shares has been and is likely to continue to be volatile or may decline regardless of our operating performance.
These provisions include: • the staggered three-year terms of the members of our board of directors, as a result of which only approximately one-third of the members of our board of directors may be subject to election in any one year; • a provision that the members of our board of directors may only be removed by a general meeting by a two-thirds majority of votes cast representing at least 50% of our issued share capital if such removal is not proposed by our board of directors; • a provision that the members of our board of directors may only be appointed upon binding nomination of the board of directors, which can only be overruled with a two-thirds majority of votes cast representing at least 50% of our issued share capital; • requirements that certain matters, including an amendment of our articles of association, may only be brought to our shareholders for a vote upon a proposal by our board of directors; and • minimum shareholding thresholds, based on nominal value, for shareholders to call general meetings of our shareholders or to add items to the agenda for those meetings. 43 Table of Contents We are subject to the Dutch Corporate Governance Code but do not comply with all the suggested governance provisions of the Dutch Corporate Governance Code, which may affect your rights as a shareholder.
These provisions include: • the staggered three-year terms of the members of our board of directors, as a result of which only approximately one-third of the members of our board of directors may be subject to election in any one year; • a provision that the members of our board of directors may only be removed by a general meeting by a two-thirds majority of votes cast representing at least 50% of our issued share capital if such removal is not proposed by our board of directors; • a provision that the members of our board of directors may only be appointed upon binding nomination of the board of directors, which can only be overruled with a two-thirds majority of votes cast representing at least 50% of our issued share capital; • requirements that certain matters, including an amendment of our articles of association, may only be brought to our shareholders for a vote upon a proposal by our board of directors; and • minimum shareholding thresholds, based on nominal value, for shareholders to call general meetings of our shareholders or to add items to the agenda for those meetings. 42 Table of Contents We are subject to the Dutch Corporate Governance Code but do not comply with all the suggested governance provisions of that law, which may affect your rights as a shareholder.
Under a proposal of law currently pending before the Dutch Parliament, the Emergency act conditional exit dividend withholding tax ( Spoedwet conditionele eindafrekening dividendbelasting , “DWT Exit Tax”), we will be deemed to have distributed an amount equal to our entire market capitalization less recognized paid-up capital immediately before the occurrence of certain events, including if we cease to be a Dutch tax resident for purposes of a tax treaty concluded by the Netherlands with another jurisdiction and become, for purposes of such tax treaty, exclusively a tax resident of that other jurisdiction which is a qualifying jurisdiction.
Under a proposal of law currently pending before the Dutch Parliament, referred to as the Emergency act conditional exit dividend withholding tax ( Spoedwet conditionele eindafrekening dividendbelasting , “DWT Exit Tax”), we will be deemed to have distributed an amount equal to our entire market capitalization less recognized paid-up capital immediately before the occurrence of certain events, including if we cease to be a Dutch tax resident for purposes of a tax treaty concluded by the Netherlands with another jurisdiction and become, for purposes of such tax treaty, exclusively a tax resident of that other jurisdiction which is a qualifying jurisdiction.
Any decrease in the sales prices for our offerings may reduce our revenue and gross profit, unless accompanied by an increase in volume to offset the effects of such price decreases, or in the case of gross profit, unless accompanied by a corresponding decrease of sufficient magnitude in costs.
Any decrease in the sales prices for our offerings may reduce our revenue and gross profit, unless accompanied by an increase in volume to offset the effects of price decreases or, in the case of gross profit, unless accompanied by a corresponding decrease of sufficient magnitude in costs.
Our failure to offer high-quality customer support could have an adverse effect on our business and results of operations. After our products are deployed within our customers’ IT environments, our customers depend on our technical support services to resolve issues relating to our products.
Our failure to offer high-quality customer support could have an adverse effect on our business and results of operations. After our products are deployed within our customers’ IT environments, our customers depend upon our technical support services to resolve issues relating to our products.
Some of these partners may also market, sell, and support offerings that compete with ours, may devote more resources to the marketing, sales, and support of such competitive offerings, may have incentives to promote our competitors’ offerings to the detriment of our own or may cease selling our offerings altogether.
Some of these partners may also market, sell, and support offerings that compete with ours, may devote more resources to the marketing, sales, and support of such competitive offerings, may have incentives to promote our competitors’ offerings to the detriment of our offerings or may cease selling our offerings altogether.
If our website fails to rank prominently in unpaid search results, traffic to our website could decline and revenue could be adversely affected. Our success depends in part on our ability to attract users through unpaid Internet search results on traditional web search engines, such as Google.
If our website fails to rank prominently in unpaid (organic) search results, traffic to our website could decline and revenue could be adversely affected. Our success depends in part on our ability to attract users through unpaid (organic) Internet search results on traditional web search engines, such as Google.
We do not intend to pay dividends in the foreseeable future, so your ability to achieve a return on your investment will depend on appreciation in the price of our ordinary shares. We have never declared or paid any cash dividends on our shares.
We do not intend to pay cash dividends in the foreseeable future, so your ability to achieve a return on your investment will depend upon appreciation in the price of our ordinary shares. We have never declared or paid any cash dividends on our shares.
Based on currently applicable rates, the overall effective rate of withholding of Regular Dividend Withholding Tax and Alternative Withholding Tax will not exceed the highest corporate income tax rate in effect at the time of the distribution (currently 25.8%). 37 Table of Contents If we cease to be a Dutch tax resident for the purposes of a tax treaty concluded by the Netherlands and in certain other events, we could potentially be subject to a proposed Dutch dividend withholding tax in respect of a deemed distribution of our entire market value less paid-up capital.
Based on currently applicable rates, the overall effective rate of withholding of Regular Dividend Withholding Tax and Alternative Withholding Tax will not exceed the highest corporate income tax rate in effect at the time of the distribution (currently 25.8%). 36 Table of Contents If we cease to be a Dutch tax resident for the purposes of a tax treaty concluded by the Netherlands and in certain other events, we could potentially be subject to a proposed Dutch dividend withholding tax in respect of a deemed distribution of our entire market value less paid-up capital.
Our channel partner sales structure could subject us to lawsuits, potential liability, misstatement of revenue, and reputational harm, if, for example, any of our channel partners misrepresents the functionality of our offerings to customers or violates laws or our or their corporate policies, including our terms of business, which in turn could impact reported revenue, deferred revenue, and remaining performance obligations. 29 Table of Contents Our decision to no longer offer Elasticsearch and Kibana under an open source license may harm the adoption of Elasticsearch and Kibana.
Our channel partner sales structure could subject us to lawsuits, potential liability, misstatement of revenue, and reputational harm, if, for example, any of our channel partners misrepresents the functionality of our offerings to customers or violates laws or our or their corporate policies, including our terms of business, which in turn could impact reported revenue, deferred revenue, and remaining performance obligations. 28 Table of Contents Our decision to no longer offer Elasticsearch and Kibana under an open source license may harm the adoption of Elasticsearch and Kibana.
Social, ethical, and regulatory issues relating to the use of AI and similar evolving technologies in our offerings may result in new or enhanced governmental or regulatory scrutiny, reputational harm, damage to our competitive position, and liability.
Ethical and regulatory issues relating to the use of AI and similar evolving technologies in our offerings may result in new or enhanced governmental or regulatory scrutiny, reputational harm, damage to our competitive position, and liability.
Reduced use of our products and services by, or decreased ability by us to export or sell our products to, existing or potential end customers with international operations could result from changes in export or import laws or regulations, economic sanctions or related legislation; shifts in the enforcement or scope of existing export, import or sanctions laws or regulations; or changes in the countries, governments, persons, or technologies targeted by such export, import or sanctions laws or regulations. 40 Table of Contents Failure to comply with anti-bribery, anti-corruption, and anti-money laundering laws could subject us to penalties and other adverse consequences.
Reduced use of our products and services by, or decreased ability by us to export or sell our products to, existing or potential end customers with international operations could result from changes in export or import laws or regulations, economic sanctions, or related legislation; shifts in the enforcement or scope of existing export, import, or sanctions, laws or regulations; or changes in the countries, governments, persons, or technologies targeted by such export, import or sanctions laws or regulations. 39 Table of Contents Failure to comply with anti-bribery, anti-corruption, and anti-money laundering laws could subject us to penalties and other adverse consequences.
Any failure to meet our customers’ requirements may adversely affect our revenues and prospects for growth. 39 Table of Contents We also expect that there will continue to be changes in interpretations of existing or new laws and regulations, proposed laws, and other obligations, which could impair our or our customers’ ability to process personal data, decrease demand for our offerings, impact our marketing efforts, increase our costs, and impair our ability to maintain and grow our customer base and increase our revenue.
Any failure to meet our customers’ requirements may adversely affect our revenues and prospects for growth. 38 Table of Contents We also expect that there will continue to be changes in interpretations of existing or new laws and regulations, proposed laws, and other obligations, which could impair our or our customers’ ability to process personal data, decrease demand for our offerings, impact our marketing efforts, increase our costs, and impair our ability to maintain and grow our customer base and increase our revenue.
If our products are not implemented, configured, updated, or used correctly or as intended, or in a timely manner, inadequate performance, errors, loss of data, corruptions, and/or security vulnerabilities may result.
If our products are not implemented, configured, updated, or used correctly or as intended, or in a timely manner, inadequate performance, errors, loss of data, corruptions, or security vulnerabilities may result.
Brand promotion activities may not generate user or customer awareness or increase revenue. Even if they do, any increase in revenue may not offset the expenses we incur in building our brand.
Brand promotion activities may not generate user or customer awareness or increase revenue. Even if they do increase revenue, any such increase may not offset the expenses we incur in building our brand.
If enacted in its present form, the DWT Exit Tax will have retroactive effect as from December 8, 2021. 38 Table of Contents Risks Related to Regulatory Matters Any actual or perceived failure by us to comply with government or other obligations related to privacy, data protection and information security could adversely affect our business.
If enacted in its present form, the DWT Exit Tax will have retroactive effect as from December 8, 2021. 37 Table of Contents Risks Related to Regulatory Matters Any actual or perceived failure by us to comply with government or other obligations related to privacy, data protection, and information security could adversely affect our business.
To the extent that we do not effectively upgrade our systems as needed and continually develop our technology to accommodate actual and anticipated changes in technology, our business and results of operations may be harmed. 31 Table of Contents Incorrect implementation or use of our software, or our customers’ failure to update our software, could result in customer dissatisfaction and negatively affect our reputation and growth prospects.
To the extent that we do not effectively upgrade our systems as needed and continually develop our technology to accommodate actual and anticipated changes in technology, our business and results of operations may be harmed. 30 Table of Contents Incorrect implementation or use of our software, or our customers’ failure to update our software, could result in customer dissatisfaction and negatively affect our reputation and growth prospects.
We have not paid a dividend on our ordinary shares in the past and we do not intend to pay any dividends to holders of our ordinary shares in the foreseeable future.
We have not paid a cash dividend on our ordinary shares in the past and we do not intend to pay any cash dividends to holders of our ordinary shares in the foreseeable future.
Any damage to our reputation and brand from defective implementations of our open source software could result in lost sales and lack of market acceptance of our products and could adversely affect our business and growth prospects. 30 Table of Contents Limited technological barriers to entry into the markets in which we compete may facilitate entry by other enterprises into our markets to compete with us.
Any damage to our reputation and brand from defective implementations of our open source software could result in lost sales and lack of market acceptance of our products and could adversely affect our business and growth prospects. 29 Table of Contents Limited technological barriers to entry into the markets in which we compete may facilitate entry by other enterprises into our markets to compete with us.
Some of our management members and other employees are located in the San Francisco Bay Area, a region known for seismic activity, wildfires and other extreme weather events. If our or our partners’ abilities are hindered by any of the foregoing events, we could experience sales delays, supply chain disruptions, and other negative impacts on our business.
Some of our management members and other employees are located in the San Francisco Bay Area, a region known for seismic activity, wildfires and other extreme weather events. If our or our partners’ operations are hindered by any of the foregoing events, we could experience sales delays, supply chain disruptions, and other negative impacts on our business.
As a provider of security solutions, we have been and may continue to be specifically targeted by threat actors for attacks intended to circumvent our security capabilities as an entry point into customers’ endpoints, networks, or systems. Our industry continues to see a large volume of unauthorized scans of systems searching for vulnerabilities or misconfigurations to exploit.
We have been and may continue to be specifically targeted by threat actors for attacks intended to circumvent our security capabilities as an entry point into customers’ endpoints, networks, or systems. Our industry continues to see a large volume of unauthorized scans of systems searching for vulnerabilities or misconfigurations to exploit.
If we do not succeed in helping our customers quickly resolve post-deployment issues or provide effective ongoing support and education on our products, our ability to renew or sell additional subscriptions to existing customers or expand the value of existing customers’ subscriptions would be adversely affected and our reputation with potential customers could be damaged.
If we do not succeed in helping our customers quickly resolve post-deployment issues or provide effective ongoing support and education with respect to our products, our ability to renew or sell additional subscriptions to existing customers or expand the value of existing customers’ subscriptions would be adversely affected and our reputation with potential customers could be damaged.
Negative conditions in the general economy both in the United States and in international markets, including conditions resulting from changes in gross domestic product growth, financial and credit market fluctuations, international trade relations, changes in inflation, foreign exchange and interest rate environments, recessionary fears, supply chain constraints, energy costs, political instability, natural catastrophes, warfare, infectious diseases and terrorist attacks, could cause a decrease in business investments by our customers and potential customers, including spending on information technology, and negatively affect the growth of our business.
Negative conditions in the general economy both in the United States and in international markets, including conditions resulting from changes in gross domestic product growth, financial and credit market fluctuations, international trade policies, changes in inflation, foreign exchange and interest rate environments, recessionary fears, supply chain constraints, energy costs, political instability and conflict, natural catastrophes, warfare, infectious diseases and terrorist attacks, could cause a decrease in business investments by our customers and potential customers, including spending on information technology, and negatively affect the growth of our business.
Our ability to restructure or refinance our debt will depend on, among other factors, the condition of the capital markets and our financial condition at such time. Any refinancing of our debt could be at higher interest rates and may require us to comply with more onerous covenants, which could further restrict our business operations.
Our ability to restructure or refinance our debt will depend upon, among other factors, the condition of the capital markets and our financial condition at such time. Any refinancing of our debt could be at higher interest rates and may require us to comply with more onerous covenants, which could further restrict our business operations.
Any such issuance could result in 42 Table of Contents substantial dilution to our existing shareholders unless pre-emptive rights exist and cause the market price of our ordinary shares to decline. Certain holders of our ordinary shares may not be able to exercise pre-emptive rights and as a result may experience substantial dilution upon future issuances of ordinary shares.
Any such issuance could result in substantial dilution to our existing shareholders unless pre-emptive rights exist and cause the market price of our ordinary shares to decline. 41 Table of Contents Certain holders of our ordinary shares may not be able to exercise pre-emptive rights and as a result may experience substantial dilution upon future issuances of ordinary shares.
Further, AI presents risks, challenges, and unintended consequences that could affect our ability to continue to incorporate the use of AI successfully in our business and solutions in new and novel ways. In addition, given the complex nature of AI technology, we face an evolving regulatory landscape and significant competition from other companies.
Further, AI presents risks, challenges, and unintended consequences that could affect our ability to continue to incorporate the use of AI successfully in our business and solutions in new ways. Further, given the complex nature of AI technology, we face an evolving regulatory landscape and significant competition from other companies.
Seasonality may cause fluctuations in our sales and results of operations. Historically, we have experienced quarterly fluctuations and seasonality in our sales and results of operations based on the timing of our entry into agreements with new and existing customers, customer usage patterns for our consumption-based arrangements, and the mix between annual and monthly contracts entered into each reporting period.
Historically, we have experienced quarterly fluctuations and seasonality in our sales and results of operations based on the timing of our entry into agreements with new and existing customers, customer usage patterns for our consumption-based arrangements, and the mix between annual and monthly contracts entered into each reporting period.
As we continue to grow rapidly, a large percentage of our sales force will have relatively little experience working with us, our subscriptions, and our business model. Additionally, we may need to evolve our sales compensation plans to drive the growth of our Elastic Cloud offerings with consumption-based arrangements.
As we continue to grow rapidly, a large portion of our sales force will have relatively little experience working with us, our subscriptions, and our business model. Additionally, we may need to evolve our sales compensation plans to drive the growth of our Elastic Cloud offerings with consumption-based arrangements.
Federal, state, or non-U.S. government bodies or agencies have in the past adopted, and may in the future adopt, new laws and regulations or may make amendments to existing laws and regulations affecting data protection, data privacy and/or information security and/or regulating the use of the Internet as a commercial medium.
Federal, state, or non-U.S. government bodies or agencies have in the past adopted, and may in the future adopt, new laws and regulations or may enact amendments to existing laws and regulations affecting data protection, data privacy, or information security or regulating the use of the Internet as a commercial medium.
If any of the analysts who cover us issues an inaccurate or unfavorable opinion regarding our company, our stock price would likely decline. Furthermore, investors and analysts may not understand how our consumption-based arrangements differ from a typical subscription-based pricing model.
If any of the analysts who cover us issues an inaccurate or unfavorable opinion regarding our company, our stock price would likely decline. Further, investors and analysts may not understand how our consumption-based arrangements differ from a typical subscription-based pricing model.
The length of our sales cycle, from initial contact with our sales team to contractually committing to our subscriptions, can vary substantially from customer to customer based on deal complexity as well as whether a sale is made directly by us or through a channel partner.
The length of our sales cycle, from initial contact with our sales team to contractually committing to our subscriptions, can vary substantially from customer to customer based on the complexity of our offerings as well as whether a sale is made directly by us or through a channel partner.
Accordingly, public companies are required to disclose in their annual reports, filed in the Netherlands, whether they comply with the suggested governance provisions of the DCGC. If they do not comply with those provisions, such as because of a conflicting requirement, companies are required to give the reasons for such noncompliance.
Accordingly, public companies are required to disclose in their annual reports, filed in the Netherlands, whether they comply with the suggested governance provisions of the DCGC. If they do not comply with those provisions, for example because of a conflicting requirement, companies are required to give the reasons for such noncompliance.
Companies providing software are increasingly bringing and becoming subject to suits alleging infringement, misappropriation or violation of proprietary rights, particularly patent rights, and to the extent we gain greater market visibility, we face a higher risk of being the subject of intellectual property infringement, misappropriation or violation claims.
Companies providing software are increasingly bringing and becoming subject to suits alleging infringement, misappropriation, or violation of proprietary rights, particularly patent rights, and to the extent we gain greater market prominence, we face a higher risk of being the subject of intellectual property infringement, misappropriation, or violation claims.
In any of these events, we and our customers could be required to seek licenses from third parties in order to continue offering our products, and to re-engineer our products or discontinue the sale of our products in the event re-engineering cannot be accomplished on a timely basis.
In any of these events, we and our customers could be required to seek licenses from third parties in order to continue offering our products, and to re-engineer our products or discontinue the sale of our products if re-engineering cannot be accomplished on a timely basis.
We have a substantial amount of indebtedness and we may incur additional indebtedness in the future. As of April 30, 2024, we had $575.0 million aggregate principal amount of our 4.125% Senior Notes due July 15, 2029 (the “Senior Notes”) outstanding.
We have a substantial amount of indebtedness and we may incur additional indebtedness in the future. As of April 30, 2025, we had $575.0 million aggregate principal amount of our 4.125% Senior Notes due July 15, 2029 (the “Senior Notes”) outstanding.
Our results of operations, including our revenue, cost of revenue, gross margin, operating expenses, cash flow and deferred revenue, have fluctuated from quarter-to-quarter in the past and may continue to vary significantly in the future so that period-to-period comparisons of our results of operations may not be meaningful.
Our results of operations, including our revenue, cost of revenue, gross margin, operating expenses, cash flows and deferred revenue, have fluctuated from quarter to quarter in the past and may continue to vary significantly in the future so that period-to-period comparisons of our results of operations may not be meaningful.
In line with market practice for Dutch publicly traded companies, we expect to renew this authorization annually at our general meeting. As of April 30, 2024, there were no preference shares issued or outstanding.
In line with market practice for Dutch publicly traded companies, we expect to renew this authorization annually at our general meeting. As of April 30, 2025, there were no preference shares issued or outstanding.
In addition, a critical reaction from authorities to the latest proposal of law have been published. It is therefore not certain whether the DWT Exit Tax will be enacted and if so, in what form.
In addition, a critical reaction from authorities to the latest proposal of law has been published. It is therefore not certain whether the DWT Exit Tax will be enacted and if so, in what form.
Furthermore, if we make downward revisions of our previously announced guidance or other expectations, if we withdraw our previously announced guidance or other expectations, or if our publicly announced guidance or other expectations of future operating results fail to meet expectations of securities analysts, investors or other interested parties, the price of our ordinary shares could decline.
Further, if we make downward revisions of our previously announced guidance or other expectations, if we withdraw our previously announced guidance or other expectations, or if our publicly announced guidance or other expectations of future operating results fail to meet expectations of securities analysts, investors or other interested parties, the price of our ordinary shares could decline.
Our results of operations may fluctuate, in part, because of the length and variability of the sales cycle of our subscriptions and the difficulty in making short-term adjustments to our operating expenses. Our results of operations depend in part on sales to new customers, including large customers, and increasing sales to existing customers.
Our results of operations may fluctuate, in part, because of the length and variability of the sales cycle of our subscriptions and the difficulty in making short-term adjustments to our operating expenses. Our results of operations depend upon sales to new customers, including large customers, and increasing sales to existing customers.
Also, to the extent we hire personnel from competitors, we may be subject to allegations that they have been improperly solicited, that they have divulged proprietary or other confidential information, or that their former employers own their inventions or other work product.
Further, to the extent we hire personnel from competitors, we may be subject to allegations that they have been improperly solicited, that they have divulged proprietary or other confidential information, or that their former employers own their inventions or other work product.
These offerings are not supported by us and come without any of our proprietary features, whether free or paid. We do not control how these third parties may use or offer our open source technology.
These offerings are not supported by us and are delivered without any of our proprietary features, whether free or paid. We do not control how these third parties may use or offer our open source technology.
The taxing authorities of some of such jurisdictions may challenge our methodologies for valuing developed technology or intercompany arrangements, which could increase our worldwide effective tax rate and harm our financial position and results of operations.
The taxing authorities of some of such jurisdictions may contest our methodologies for valuing developed technology or intercompany arrangements, which could increase our worldwide effective tax rate and harm our financial position and results of operations.
Holders of our ordinary shares in principle have a pro rata pre-emptive right with respect to any issue of ordinary shares or the granting of rights to subscribe for ordinary shares, unless Dutch law or our articles of association state otherwise or unless explicitly provided otherwise in a resolution by our general meeting of shareholders (“general meeting”), or if authorized by the annual general meeting or an extraordinary general meeting, by a resolution of our board of directors.
Holders of our ordinary shares in principle have a pro rata pre-emptive right with respect to any issue of ordinary shares or the granting of rights to subscribe for ordinary shares, unless Dutch law or our articles of association state otherwise or unless explicitly provided otherwise in a resolution by our general meeting, or if authorized by the annual general meeting or an extraordinary general meeting, by a resolution of our board of directors.
Our ability to expand internationally involves various risks, including the need to invest significant resources in such expansion, and the possibility that returns on such investments will not be achieved in the near future or at all in these less familiar competitive environments. We may also choose to conduct our international business through other partnerships.
International expansion involves various risks, including the need to invest significant resources in such expansion, and the possibility that returns on such investments will not be achieved in the near future or at all in these less familiar competitive environments. We may also choose to conduct our international business through other partnerships.
The source code of proprietary features for some versions of the Elastic Stack offered under certain licenses is publicly available, which may enable others to replicate our proprietary technology and compete more effectively with us. If we fail to protect our intellectual property rights adequately, our competitors may gain access to our proprietary technology and our business may be harmed.
The source code of proprietary features for some versions of our platform offered under certain licenses is publicly available, which may enable others to replicate our proprietary technology and compete more effectively with us. If we fail to protect our intellectual property rights adequately, our competitors may gain access to our proprietary technology and our business may be harmed.
Furthermore, legal standards relating to the validity, enforceability, and scope of protection of intellectual property rights are uncertain and will vary by jurisdiction. Despite our precautions, it may be possible for unauthorized third parties to copy our products and use information that we regard as proprietary to create offerings that compete with ours.
Further, legal standards relating to the validity, enforceability, and scope of protection of intellectual property rights are uncertain and vary by jurisdiction. Despite our precautions, it may be possible for unauthorized third parties to copy our products and use information that we regard as proprietary to create offerings that compete with ours.
The covenants in the indenture that governs the Senior Notes are subject to important exceptions and qualifications described in such indenture. As a result of these restrictions, we are limited as to how we conduct our business and we may be unable to raise additional debt or equity financing to compete effectively or to take advantage of new business opportunities.
The covenants in the indenture that governs the Senior Notes are subject to important exceptions and qualifications described in such indenture. 45 Table of Contents As a result of these restrictions, we are limited as to how we conduct our business and we may be unable to raise additional debt or equity financing to compete effectively or to take advantage of new business opportunities.
Data protection authorities and other regulatory bodies are increasingly focused on the use of online tracking tools and have issued or plan to issue rulings which may impact our marketing practices.
Data protection authorities and other regulatory bodies are increasingly focused on the use of online tracking tools and have issued or plan to issue rulings which may affect our marketing practices.
Because we recognize revenue under a consumption-based arrangement based on actual customer consumption, we do not have the same ability to predict the timing of revenue recognition as we do under subscription arrangements where revenue is recognized on a predetermined schedule over the subscription term. Moreover, customers may consume our products at a different pace than we expect.
Because we recognize revenue under a consumption-based arrangement based on actual customer consumption, we do not have the same ability to predict the timing of revenue recognition as we do under subscription arrangements in which revenue is recognized on a predetermined schedule over the subscription term. Moreover, customers may consume our products at a different pace than we expect.
Investors, customers, regulators, employees, and other stakeholders have focused increasingly on ESG issues, including, among other matters, climate change and greenhouse gas emissions, human and civil rights, and DEI matters. Expectations surrounding appropriate corporate behavior in these areas are continually evolving and often reflect a wide spectrum of viewpoints and interests.
Investors, customers, regulators, employees, and other stakeholders have focused increasingly on ESG issues, including, among other matters, climate change and greenhouse gas emissions, human and civil rights, and diversity and inclusion matters. Expectations surrounding appropriate corporate behavior in these areas are continually evolving and often reflect a wide spectrum of viewpoints and interests.
The steps we take to protect our intellectual property rights may be inadequate. 32 Table of Contents We will not be able to protect our intellectual property rights if we are unable to enforce our rights or if we do not detect unauthorized use of our intellectual property rights.
The steps we take to protect our intellectual property rights may be inadequate. 31 Table of Contents We will not be able to protect our intellectual property rights if we are unable to enforce our rights or if we do not detect unauthorized use of our intellectual property rights.
Further, the determination of our worldwide provision for, or benefit from, income taxes and other tax liabilities requires significant judgment by management, and there are transactions where the ultimate tax determination is uncertain.
Further, the determination of our worldwide provision for, or benefit from, income taxes and other tax liabilities requires significant judgment by management, and there are transactions for which the ultimate tax determination is uncertain.
Furthermore, export control laws and economic sanctions in many cases prohibit the export of software and services to certain embargoed or sanctioned countries, governments and persons, as well as for prohibited end-uses.
Further, export control laws and economic sanctions in many cases prohibit the export of software and services to certain embargoed or sanctioned countries, governments, and persons, as well as for prohibited end uses.
Significant assumptions and estimates used in preparing our consolidated financial statements include those related to revenue recognition, deferred contract acquisition costs, acquired intangible assets, and income taxes. Risks Related to our Outstanding Senior Notes We have a substantial amount of indebtedness, which could adversely affect our financial condition.
Significant assumptions and estimates used in preparing our consolidated financial statements include those related to revenue recognition, deferred contract acquisition costs, acquired intangible assets, and income taxes. 44 Table of Contents Risks Related to our Outstanding Senior Notes We have a substantial amount of indebtedness, which could adversely affect our financial condition.
We believe that developing and maintaining widespread awareness of our brand, especially with developers and executives with budgetary control, is critical to achieving widespread acceptance of our software and attracting new users and customers. We also believe that the importance of brand recognition will increase as competition in our market increases.
We believe that developing and maintaining widespread awareness of our brand, especially with developers and executives with budgetary control within their organizations, is critical to achieving widespread acceptance of our software and attracting new users and customers. We also believe that the importance of brand recognition will increase as competition in our market increases.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur cybersecurity program efforts are directed by our CISO who, with the support of the chief operating officer, the chief product officer, and the chief legal officer, has the primary responsibility for assessing and managing material cybersecurity risks. The CISO along with these members of our management, acting as a group, drive alignment on security decisions across the Company.
Biggest changeOur cybersecurity program efforts are directed by our CISO who, with the support of the Chief Financial Officer, the Chief Product Officer, and the Chief Legal Officer, has the primary responsibility for assessing and managing material cybersecurity risks. The CISO along with these members of our management, acting as a group, drive alignment on security decisions across the Company.
Item 1C. Cybersecurity We face rapidly evolving and sophisticated threats of breaches of our systems and networks as well as those of our suppliers and third-party service providers. To mitigate this threat to our business, we take a comprehensive approach to cybersecurity and expend considerable resources on cybersecurity risk management, strategy, and governance.
Item 1C. Cybersecurity We face rapidly evolving and sophisticated threats of breaches of our systems and networks as well as those of our suppliers and third-party service providers. To mitigate this threat to our business, we take a comprehensive approach to cybersecurity and expend corresponding resources on cybersecurity risk management, strategy, and governance.
Our CISO has served in various roles in information technology, information security and risk management for over 27 years, including serving as the Information Security Officer and Chief Security Officer of multiple companies.
Our CISO has served in various roles in information technology, information security and risk management for over 28 years, including serving as the Information Security Officer and Chief Security Officer of multiple companies.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe believe that our current facilities are adequate to meet our current needs and that, if needed in the future, suitable additional space will be available either to expand existing offices or hubs or open offices or hubs in new locations.
Biggest changeWe believe that our current facilities are adequate to meet our current needs and that, if needed in the future, suitable additional space will be available either to expand existing offices or hubs or to open offices or hubs in new locations.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal Proceedings The information required by this Item is incorporated herein by reference to Part II, Item 8. “Financial Statements and Supplementary Data,” Note 8, “Commitments and Contingencies — Legal Matters” included in this Annual Report on Form 10-K.
Biggest changeItem 3. Legal Proceedings The information required by this Item is incorporated herein by reference to Part II, Item 8. “Financial Statements and Supplementary Data,” Note 8, “Commitments and Contingencies—Legal Matters” of our accompanying Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information for Ordinary Shares Our ordinary shares are listed on the NYSE under the trading symbol “ESTC.” Holders of Record As of May 31, 2024 there were 58 shareholders of record of our ordinary shares.
Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information for Ordinary Shares Our ordinary shares are listed on the NYSE under the trading symbol “ESTC.” Holders of Record As of May 31, 2025 there were 47 shareholders of record of our ordinary shares.
Stock Performance Graph The graph below compares the cumulative total shareholder return on our ordinary shares with the cumulative total return on the S&P 500 Index and the S&P 500 Information Technology Index for our five most recent fiscal years. The graph assumes $100 was invested at the market close on April 30, 2019.
Stock Performance Graph The graph below compares the cumulative total shareholder return on our ordinary shares with the cumulative total return on the S&P 500 Index and the S&P 500 Information Technology Index for our five most recent fiscal years. The graph assumes $100 was invested at the market close on April 30, 2020.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeYear Ended April 30, 2024 2023 2022 (in thousands) Revenue Subscription $ 1,176,606 $ 984,762 $ 798,770 Services 90,715 84,227 63,604 Total revenue 1,267,321 1,068,989 862,374 Cost of revenue (1)(2) Subscription 246,285 219,306 178,204 Services 83,794 77,320 53,990 Total cost of revenue 330,079 296,626 232,194 Gross profit 937,242 772,363 630,180 Operating expenses (1)(2)(3) Research and development 341,951 313,454 273,761 Sales and marketing 559,648 503,537 406,658 General and administrative 160,628 143,247 123,441 Restructuring and other related charges 4,917 31,297 — Total operating expenses 1,067,144 991,535 803,860 Operating loss (1)(2)(3) (129,902) (219,172) (173,680) Other income (expense), net Interest expense (26,132) (25,159) (20,716) Other income (expense), net 33,278 27,454 (3,393) Loss before income taxes (122,756) (216,877) (197,789) (Benefit from) provision for income taxes (184,476) 19,284 6,059 Net income (loss) $ 61,720 $ (236,161) $ (203,848) (1) Includes stock-based compensation expense and related employer taxes as follows: Year Ended April 30, 2024 2023 2022 (in thousands) Cost of revenue Subscription $ 9,378 $ 8,730 $ 9,049 Services 13,365 9,858 7,175 Research and development 98,174 82,628 63,227 Sales and marketing 82,023 71,363 50,085 General and administrative 47,519 38,593 21,619 Total stock-based compensation expense and related employer taxes $ 250,459 $ 211,172 $ 151,155 (2) Includes amortization of acquired intangible assets as follows: Year Ended April 30, 2024 2023 2022 (in thousands) Cost of revenue Subscription $ 12,353 $ 11,781 $ 10,503 Sales and marketing 2,143 4,887 5,280 Total amortization of acquired intangibles $ 14,496 $ 16,668 $ 15,783 57 Table of Contents (3) Includes acquisition-related expenses as follows: Year Ended April 30, 2024 2023 2022 (in thousands) Research and development $ 1,385 $ 5,875 $ 6,104 General and administrative 1,065 103 1,528 Total acquisition-related expenses $ 2,450 $ 5,978 $ 7,632 The following table sets forth selected consolidated statements of operations data for each of the periods indicated as a percentage of total revenue: Year Ended April 30, 2024 2023 2022 Revenue Subscription 93 % 92 % 93 % Services 7 % 8 % 7 % Total revenue 100 % 100 % 100 % Cost of revenue (1)(2) Subscription 19 % 21 % 21 % Services 7 % 7 % 6 % Total cost of revenue 26 % 28 % 27 % Gross profit 74 % 72 % 73 % Operating expenses (1)(2)(3) Research and development 27 % 29 % 32 % Sales and marketing 44 % 47 % 47 % General and administrative 13 % 14 % 14 % Restructuring and other related charges — % 3 % — % Total operating expenses 84 % 93 % 93 % Operating loss (1)(2)(3) (10) % (21) % (20) % Other income (expense), net Interest expense (2) % (2) % (3) % Other income (expense), net 3 % 2 % — % Loss before income taxes (9) % (21) % (23) % (Benefit from) provision for income taxes (14) % 1 % 1 % Net income (loss) 5 % (22) % (24) % (1) Includes stock-based compensation expense and related employer taxes as follows: Year Ended April 30, 2024 2023 2022 Cost of revenue Subscription 1 % 1 % 1 % Services 1 % 1 % 1 % Research and development 8 % 9 % 7 % Sales and marketing 6 % 6 % 6 % General and administrative 4 % 3 % 2 % Total stock-based compensation expense and related employer taxes 20 % 20 % 17 % 58 Table of Contents (2) Includes amortization of acquired intangible assets as follows: Year Ended April 30, 2024 2023 2022 Cost of revenue Subscription 1 % 1 % 1 % Sales and marketing — % 1 % 1 % Total amortization of acquired intangibles 1 % 2 % 2 % (3) Includes acquisition-related expenses as follows: Year Ended April 30, 2024 2023 2022 Research and development — % 1 % 1 % General and administrative — % — % — % Total acquisition-related expenses — % 1 % 1 % Comparison of Fiscal Years Ended April 30, 2024 and 2023 Revenue Year Ended April 30, Change 2024 2023 $ % (in thousands) Revenue Subscription $ 1,176,606 $ 984,762 $ 191,844 19 % Services 90,715 84,227 6,488 8 % Total revenue $ 1,267,321 $ 1,068,989 $ 198,332 19 % Subscription revenue increased by $191.8 million, or 19%, for the year ended April 30, 2024 compared to the prior year.
Biggest changeYear Ended April 30, 2025 2024 2023 (in thousands) Revenue Subscription $ 1,384,520 $ 1,176,606 $ 984,762 Services 98,776 90,715 84,227 Total revenue 1,483,296 1,267,321 1,068,989 Cost of revenue (1)(2) Subscription 282,585 246,285 219,306 Services 97,288 83,794 77,320 Total cost of revenue 379,873 330,079 296,626 Gross profit 1,103,423 937,242 772,363 Operating expenses (1)(2)(3) Research and development 365,758 341,951 313,454 Sales and marketing 617,176 559,648 503,537 General and administrative 175,186 160,628 143,247 Restructuring and other related charges 225 4,917 31,297 Total operating expenses 1,158,345 1,067,144 991,535 Operating loss (1)(2)(3) (54,922) (129,902) (219,172) Other income, net Interest expense (25,307) (26,132) (25,159) Other income, net 48,660 33,278 27,454 Loss before income taxes (31,569) (122,756) (216,877) Provision for (benefit from) income taxes 76,545 (184,476) 19,284 Net (loss) income $ (108,114) $ 61,720 $ (236,161) 56 Table of Contents (1) Includes stock-based compensation expense and related employer taxes as follows: Year Ended April 30, 2025 2024 2023 (in thousands) Cost of revenue Subscription $ 10,161 $ 9,378 $ 8,730 Services 15,669 13,365 9,858 Research and development 102,180 98,174 82,628 Sales and marketing 90,973 82,023 71,363 General and administrative 50,932 47,519 38,593 Total stock-based compensation expense and related employer taxes $ 269,915 $ 250,459 $ 211,172 (2) Includes amortization of acquired intangible assets as follows: Year Ended April 30, 2025 2024 2023 (in thousands) Cost of revenue Subscription $ 9,213 $ 12,353 $ 11,781 Sales and marketing — 2,143 4,887 Total amortization of acquired intangibles $ 9,213 $ 14,496 $ 16,668 (3) Includes acquisition-related expenses as follows: Year Ended April 30, 2025 2024 2023 (in thousands) Research and development $ 76 $ 1,385 $ 5,875 General and administrative 606 1,065 103 Total acquisition-related expenses $ 682 $ 2,450 $ 5,978 57 Table of Contents The following table sets forth selected consolidated statements of operations data for each of the periods indicated as a percentage of total revenue: Year Ended April 30, 2025 2024 2023 Revenue Subscription 93 % 93 % 92 % Services 7 % 7 % 8 % Total revenue 100 % 100 % 100 % Cost of revenue (1)(2) Subscription 19 % 19 % 21 % Services 7 % 7 % 7 % Total cost of revenue 26 % 26 % 28 % Gross profit 74 % 74 % 72 % Operating expenses (1)(2)(3) Research and development 25 % 27 % 29 % Sales and marketing 41 % 44 % 47 % General and administrative 12 % 13 % 14 % Restructuring and other related charges — % — % 3 % Total operating expenses 78 % 84 % 93 % Operating loss (1)(2)(3) (4) % (10) % (21) % Other income, net Interest expense (1) % (2) % (2) % Other income, net 3 % 3 % 2 % Loss before income taxes (2) % (9) % (21) % Provision for (benefit from) income taxes 5 % (14) % 1 % Net (loss) income (7) % 5 % (22) % 58 Table of Contents (1) Includes stock-based compensation expense and related employer taxes as follows: Year Ended April 30, 2025 2024 2023 Cost of revenue Subscription 1 % 1 % 1 % Services 1 % 1 % 1 % Research and development 7 % 8 % 9 % Sales and marketing 6 % 6 % 6 % General and administrative 3 % 4 % 3 % Total stock-based compensation expense and related employer taxes 18 % 20 % 20 % (2) Includes amortization of acquired intangible assets as follows: Year Ended April 30, 2025 2024 2023 Cost of revenue Subscription 1 % 1 % 1 % Sales and marketing — % — % 1 % Total amortization of acquired intangibles 1 % 1 % 2 % (3) Includes acquisition-related expenses as follows: Year Ended April 30, 2025 2024 2023 Research and development — % — % 1 % General and administrative — % — % — % Total acquisition-related expenses — % — % 1 % Comparison of Fiscal Years Ended April 30, 2025 and 2024 Revenue Year Ended April 30, Change 2025 2024 $ % (in thousands) Revenue Subscription $ 1,384,520 $ 1,176,606 $ 207,914 18 % Services 98,776 90,715 8,061 9 % Total revenue $ 1,483,296 $ 1,267,321 $ 215,975 17 % Subscription revenue increased by $207.9 million, or 18%, for the year ended April 30, 2025 compared to the prior year.
(Benefit from) Provision for Income Taxes (Benefit from) provision for income taxes consists primarily of income taxes related to the Netherlands, U.S. federal and state, and foreign jurisdictions in which we conduct business.
Provision for (Benefit from) Income Taxes Provision for (benefit from) income taxes consists primarily of income taxes related to the Netherlands, U.S. federal and state, and foreign jurisdictions in which we conduct business.
Net Cash Provided by Financing Activities Net cash provided by financing activities of $40.1 million during the year ended April 30, 2024 was due to the proceeds from stock option exercises and purchases under our employee stock purchase plan.
Net cash provided by financing activities of $40.1 million during the year ended April 30, 2024 was due to proceeds from stock option exercises and purchases under our employee stock purchase plan.
The transaction price is allocated to the separate performance obligations on a relative standalone selling price (“SSP”) basis. We determine the SSP based on the prices at which we separately sell these products assuming the majority of these fall within a pricing range.
The transaction price is allocated to the separate performance obligations on a relative standalone selling price (“SSP”) basis. We determine the SSP based on the prices at which we separately sell these products assuming the majority of such prices fall within a pricing range.
We also consider if there are any additional material rights inherent in a contract, and if so, we allocate a portion of the transaction price to such rights based on a relative SSP.
We also consider whether there are any additional material rights inherent in a contract and, if so, we allocate a portion of the transaction price to such rights based on the relative SSP.
In Elastic Cloud, our family of cloud-based offerings, we offer various subscription tiers tied to different features. For users who download our software, we make some of the features of our software available free of charge, allowing us to engage with a broad community of developers and practitioners and introduce them to the value of the Elastic Stack.
In Elastic Cloud, our family of cloud-based offerings, we offer various subscription tiers tied to different features. For users who download our software, we make some of the features of our software available free of charge, allowing us to engage with a broad community of developers and practitioners and introduce them to the value of our platform.
Research and development expense primarily consists of personnel and related costs and allocated overhead costs. We expect our research and development expense to increase in absolute dollars for the foreseeable future as we continue to develop new technology and invest further in our existing products. Sales and marketing.
Operating Expenses Research and development. Research and development expense primarily consists of personnel and related costs and allocated overhead costs. We expect our research and development expense to increase in absolute dollars for the foreseeable future as we continue to develop new technology and invest further in our existing products. Sales and marketing.
In instances where SSP is not directly observable, such as when we do not sell the software license separately, we derive the SSP using information that may include market conditions and other observable and unobservable inputs, which can require significant judgment.
For instances in which the SSP is not directly observable, such as when we do not sell the software license separately, we derive the SSP using information that may include market conditions and other observable and unobservable inputs, which can require significant judgment.
We apply judgment in determining the customer’s ability and intent to pay, which is based on a variety of factors, including the customer’s historical payment experience or, in the case of a new customer, credit, reputation, and financial or other information pertaining to the customer.
We apply judgment in determining the customer’s ability and intent to pay, which is based on a variety of factors, including the customer’s historical payment experience or, in the case of a new customer, the customer’s credit, reputation, and financial or other pertinent information.
This section of our Annual Report on Form 10-K discusses our financial condition and results of operations for the years ended April 30, 2024, 2023, and 2022, and year-to-year comparisons between the years ended April 30, 2024 and 2023.
This section of our Annual Report on Form 10-K discusses our financial condition and results of operations for the years ended April 30, 2025, 2024, and 2023, and year-to-year comparisons between the years ended April 30, 2025 and 2024.
See Note 13, “Income Taxes” of our accompanying Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K for additional discussion.
See Note 13, “Income Taxes” of our accompanying Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K for additional information.
Our business model is based primarily on a combination of a paid Elastic-managed hosted service offering and paid and free proprietary self-managed software. Our paid offerings for our platform are sold via subscription through resource-based pricing, and all customers and users have access to varying levels of features across all solutions.
Our business model is based primarily on a combination of paid service offerings (Elastic Cloud Hosted and Elastic Cloud Serverless) and free and paid proprietary self-managed software (Elastic Self-Managed). Our paid offerings for our platform are sold via subscription through resource-based pricing, and all customers and users have access to varying levels of features across all solutions.
We may incur net losses in the future and there can be no assurance whether, or when, we may become profitable on a consistent basis. We continue to make substantial investments in developing the Elastic Stack and expanding our global sales and marketing footprint.
We may incur net losses in the future and there can be no assurance whether, or when, we may become profitable on a consistent basis. We continue to make substantial investments in developing our platform and expanding our global sales and marketing footprint.
A discussion of our financial condition and results of operations for the year ended April 30, 2022 and year-to-year comparisons between the years ended April 30, 2023 and 2022 that are not included in this Annual Report on Form 10-K can be found in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended April 30, 2023, filed with the SEC on June 16, 2023.
A discussion of our financial condition and results of operations for the year ended April 30, 2023 and year-to-year comparisons between the years ended April 30, 2024 and 2023 that are not included in this Annual Report on Form 10-K can be found in Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended April 30, 2024, filed with the SEC on June 14, 2024.
For the years ended April 30, 2024, 2023 and 2022, revenue from outside the United States accounted for 42%, 41%, and 44% of our total revenue, respectively.
For the years ended April 30, 2025, 2024 and 2023, revenue from outside the United States accounted for 44%, 42%, and 41% of our total revenue, respectively.
As large organizations expand their use of the Elastic Stack across multiple use cases, projects, divisions and users, they often begin to require centralized provisioning, management and monitoring across multiple deployments. To satisfy these requirements, our Enterprise subscription tier provides access to key orchestration and deployment management capabilities.
As large organizations expand their use of our platform across multiple use cases, projects, divisions and users, they often begin to require centralized provisioning, management and monitoring across multiple deployments. To satisfy these requirements, our Enterprise subscription tier provides access to key orchestration and deployment management capabilities.
See “Risk Factors” included in Part I, Item 1A of this Annual Report on Form 10-K for a discussion of risks. Key Factors Affecting our Performance We believe that the growth and future success of our business depends on many factors, including those described below.
See “Risk Factors” in Part I, Item 1A of this Annual Report on Form 10-K for a discussion of additional risks. 53 Table of Contents Key Factors Affecting our Performance We believe that the growth and future success of our business depends on many factors, including those described below.
Contractual Obligations and Commitments Our principal commitments primarily consist of our purchase obligations under non-cancelable agreements for cloud hosting, subscription software, and sales and marketing, future non-cancelable minimum rental payments under operating leases for our offices, and interest payments due on our Senior Notes.
Contractual Obligations and Commitments Our principal commitments consist of our purchase obligations under non-cancelable agreements for cloud hosting, subscription software, sales and marketing, and general corporate services, future non-cancelable minimum rental payments under operating leases for our offices, and interest payments due on our Senior Notes.
Customers who reduced their annual subscription dollar value (contraction) or did not renew their annual subscription (attrition) would adversely affect the Net Expansion Rate. Our Net Expansion Rate was approximately 110% as of April 30, 2024.
Customers who reduced their annual subscription dollar value (contraction) or did not renew their annual subscription (attrition) would adversely affect the Net Expansion Rate. Our Net Expansion Rate was approximately 112% as of April 30, 2025.
With a distributed team spanning over 35 countries, we are able to recruit, hire, and retain high-quality, experienced technical and sales personnel and operate at a rapid pace to drive product releases, fix bugs, and create and market new products. We had 3,187 employees as of April 30, 2024.
With a distributed team spanning over 40 countries, we are able to recruit, hire, and retain high-quality, experienced technical and sales personnel and operate at a rapid pace to drive product releases, fix bugs, and create and market new products. We had 3,537 employees as of April 30, 2025.
Net Cash Used in Investing Activities Net cash used in investing activities of $288.0 million during the year ended April 30, 2024 was primarily due to the purchase of marketable securities of $536.8 million, business acquisitions, net of cash acquired, of $19.1 million, and capital expenditures of $3.5 million .
Net cash used in investing activities of $288.0 million during the year ended April 30, 2024 was primarily due to the purchase of marketable securities of $536.8 million, business acquisitions, net of cash acquired, of $19.1 million, and purchases of property and equipment of $3.5 million .
There is typically more than one SSP for individual products and services due to the stratification of those products and services by quantity, term of the subscription, sales channel and other circumstances. If one of the performance obligations is outside of the SSP range, we allocate the transaction price considering the midpoint of the SSP range.
Individual products and services typically have more than one SSP due to the stratification of such products and services by quantity, subscription term, sales channel, and other circumstances. If one of the performance obligations is outside of the SSP range, we allocate the transaction price considering the midpoint of the SSP range.
This increase was primarily driven by continued adoption of Elastic Cloud, which grew 29% over the prior year and increased to 43% of total revenue for the year ended April 30, 2024 from 40% for the year ended April 30, 2023.
This increase was primarily driven by continued adoption of Elastic Cloud, which grew 26% over the prior year and increased to 46% of total revenue for the year ended April 30, 2025 from 43% for the year ended April 30, 2024.
We have experienced and, if economic conditions do not reflect a sustained recovery, we may continue to experience longer and more unpredictable sales cycles, increased scrutiny of deals, slowing consumption and overall customer expenditures, and the impacts of changing foreign exchange rates with a strengthening or weakening U.S. dollar.
We have experienced and, if economic conditions deteriorate, may continue to experience longer and more unpredictable sales cycles, increased scrutiny of prospective sales, slowing consumption and overall customer expenditures, and the impacts of changing foreign exchange rates with a strengthening or weakening U.S. dollar.
However, we expect that an increase in the relative contribution of Elastic Cloud to our business will continue to have a modest adverse impact on our gross margin as a result of the associated third-party hosting costs. Growing the Elastic community.
However, we expect that an increase in the relative contribution of Elastic Cloud to our business will continue to have a modest adverse impact on our gross margin as a result of the associated third-party hosting costs. Components of Results of Operations Revenue Subscription.
At the core of the Elastic Stack is Elasticsearch - a highly scalable document store and search engine, and the unified data store for all of our solutions and use cases.
With Elasticsearch at its core, our platform is a highly scalable document store and search engine, and is the unified data store for all of our solutions and use cases.
Other Income (Expense), Net Interest expense. Interest expense primarily consists of interest on our Senior Notes. Other income (expense), net. Other income (expense), net primarily consists of interest income, gains and losses from transactions denominated in a currency other than the functional currency, and miscellaneous other non-operating gains and losses.
Other income, net primarily consists of interest income, gains and losses from transactions denominated in a currency other than the functional currency, and miscellaneous other non-operating gains and losses.
Our contracts often contain multiple performance obligations. For these contracts, we account for individual performance obligations separately if they are distinct. We apply significant judgment in identifying and accounting for each performance obligation, as a result of evaluating the terms and conditions in contracts.
Our contracts often contain multiple performance obligations. For these contracts, we account for individual performance obligations separately if they are distinct. We apply significant judgment in identifying and accounting for each performance obligation based on our evaluation of the terms and conditions in contracts.
We expect our sales and marketing expense to increase in absolute dollars as we expand our sales force and increase our investments in marketing resources. We capitalize sales commissions and associated payroll taxes paid to internal sales personnel that are related to the acquisition of certain customer contracts. Deferred contract acquisition costs are amortized over the expected benefit period.
We expect our sales and marketing expense to increase in absolute dollars as we expand our sales force and increase our investments in marketing resources. We capitalize sales commissions and associated payroll taxes paid to internal sales personnel that are related to the acquisition of certain customer contracts.
We had net income of $61.7 million for the year ended April 30, 2024, while we incurred net losses of $236.2 million and $203.8 million for the years ended April 30, 2023 and 2022, respectively.
We incurred net losses of $108.1 million and $236.2 million for the years ended April 30, 2025 and 2023, respectively, while we had net income of $61.7 million for the year ended April 30, 2024.
Our effective tax rate was 150% and (9)% of our loss before income taxes for the years ended April 30, 2024 and 2023, respectively.
Our effective tax rate was (242)% and 150% of our net loss before income taxes for the years ended April 30, 2025 and 2024, respectively.
We have experienced significant growth, with revenue increasing to $1.267 billion for the year ended April 30, 2024 from $1.069 billion for the year ended April 30, 2023 and $862.4 million for the year ended April 30, 2022, representing year-over-year growth of 19% for the year ended April 30, 2024 and 24% for the year ended April 30, 2023.
We have experienced significant growth, with revenue increasing to $1.483 billion for the year ended April 30, 2025 from $1.267 billion for the year ended April 30, 2024 and $1.069 billion for the year ended April 30, 2023, representing year-over-year growth of 17% for the year ended April 30, 2025 and 19% for the year ended April 30, 2024.
Our platform, available as both a hosted, managed service across public clouds as well as self-managed software, allows our customers to find insights and drive AI and machine learning use cases from large amounts of data. We offer three search-powered solutions – Search, Observability, and Security – that are built on the platform.
Our platform, available as either a cloud service or a self-managed software, allows our customers to find insights and drive AI and machine learning use cases from large amounts of data. We offer three Search AI-powered solutions—Elasticsearch, Elastic Observability, and Elastic Security—that are built on our platform.
We help organizations, their employees, and their customers find what they need faster, while keeping mission-critical applications running smoothly, and protecting against cyber threats. Our platform is built on the Elastic Stack, a powerful set of software products that ingest data from any source, in any format, and perform search, analysis, and visualization of that data.
We help organizations, their employees, and their customers find what they need faster, while keeping mission-critical applications and infrastructure running smoothly and protecting against cyber threats. Our platform is able to ingest data from any source, in any format, and perform search, analysis, and visualization of that data.
Our net cash provided by operating activities was $148.8 million, $35.7 million, and $5.7 million for the years ended April 30, 2024, 2023 and 2022, respectively. We had an accumulated deficit of $991.6 million as of April 30, 2024 due to losses in all prior years.
Our net cash provided by operating activities was $266.2 million, $148.8 million, and $35.7 million for the years ended April 30, 2025, 2024 and 2023, respectively. We had an accumulated deficit of $1.100 billion as of April 30, 2025 due to losses in all but one of our prior years.
Therefore, we cannot reasonably estimate the timing of such payments. We believe that these matters will likely not be resolved in the next 12 months and accordingly we have classified the estimated liability as non-current in the consolidated balance sheet.
We believe that these matters will likely not be resolved in the next 12 months and accordingly we have classified the estimated liability as non-current in the consolidated balance sheets.
We believe in the importance of an open software development model, and we develop the majority of our software in public repositories as open code under a proprietary license. Unlike some companies, we do not build an enterprise version that is separate from our free distribution. We maintain a single code base across both our self-managed software and Elastic-hosted services.
We believe in the importance of an open software development model, and we develop the majority of our software in public repositories under an open source AGPL license, as well as under a proprietary license. Unlike some companies, we do not build an enterprise version that is separate from our free distribution.
As digital transformation drives mission-critical business functions to the cloud, we believe that every company must incorporate search AI capabilities across IT and line-of-business organizations to find the answers that matter from all of its data in real-time and at scale.
Customers can also deploy our platform across hybrid clouds, public or private clouds, and multi-cloud environments. As digital transformation continues to drive mission-critical business functions to the cloud, we believe that every company must incorporate search AI capabilities across IT and line-of-business organizations to find the answers that matter from all of its data in real time and at scale.
We focus some of our direct sales efforts on encouraging these types of expansion within our customer base. 54 Table of Contents We believe that a useful indication of how our customer relationships have expanded over time is through our Net Expansion Rate, which is based upon trends in the rate at which customers increase their spend with us.
We believe that a useful indication of how our customer relationships have expanded over time is through our Net Expansion Rate, which is based upon trends in the rate at which customers increase their spend with us.
Operating Expenses Research and development Year Ended April 30, Change 2024 2023 $ % (in thousands) Research and development $ 341,951 $ 313,454 $ 28,497 9 % Research and development expense increased by $28.5 million, or 9%, for the year ended April 30, 2024 compared to the prior year as we continued to invest in the development of new and existing offerings.
Operating Expenses Research and development Year Ended April 30, Change 2025 2024 $ % (in thousands) Research and development $ 365,758 $ 341,951 $ 23,807 7 % Research and development expense increased by $23.8 million, or 7%, for the year ended April 30, 2025 compared to the prior year as we continued to invest in the development of new and existing offerings.
The net cash outflow from changes in operating assets and liabilities resulted from an increase in deferred contract acquisition costs of $102.0 million as our sales commissions increased due to increased business volume, an increase of $46.4 million in accounts receivable, and a decrease of $11.4 million in operating lease liabilities.
The net cash outflow from changes in operating assets and liabilities resulted from a $106.7 million increase in deferred contract acquisition costs as our sales commissions increased due to increased business volume, a $48.9 million increase in accounts receivable, net, a $36.1 million increase in prepaid expenses and other assets, and a $11.9 million decrease in operating lease liabilities .
These outflows were partially offset by inflows from a $95.6 million increase in deferred revenue, a net increase of $18.9 million in accounts payable, accrued expenses and accrued compensation and benefits, and a decrease of $9.8 million in prepaid expenses and other assets.
These outflows were partially offset by inflows from a $134.6 million increase in deferred revenue and a net increase of $25.5 million in accounts payable, accrued expenses, and accrued compensation and benefits.
The following table summarizes our cash flows for the periods presented: Year Ended April 30, 2024 2023 2022 (in thousands) Net cash provided by operating activities $ 148,762 $ 35,662 $ 5,672 Net cash used in investing activities $ (287,960) $ (272,952) $ (127,271) Net cash provided by financing activities $ 40,054 $ 17,471 $ 602,127 Net Cash Provided by Operating Activities Net cash provided by operating activities during the year ended April 30, 2024 was $148.8 million, which resulted from net income of $61.7 million and adjustments for non-cash charges of $123.7 million, partially offset by a net cash outflow of $36.6 million from changes in operating assets and liabilities.
The following table summarizes our cash flows for the periods presented: Year Ended April 30, 2025 2024 2023 (in thousands) Net cash provided by operating activities $ 266,168 $ 148,762 $ 35,662 Net cash used in investing activities $ (118,668) $ (287,960) $ (272,952) Net cash provided by financing activities $ 40,947 $ 40,054 $ 17,471 Net Cash Provided By Operating Activities Net cash provided by operating activities during the year ended April 30, 2025 was $266.2 million, which resulted from adjustments for non-cash charges of $430.4 million, partially offset by net loss of $108.1 million and a net cash outflow of $56.2 million from changes in operating assets and liabilities.
Users can either sign up for a free trial on Elastic Cloud or download our software directly from our website without any sales interaction, and immediately begin using the full set of features. Users can also sign up for Elastic Cloud through public cloud marketplaces.
We make it easy for users to begin using our products in order to drive rapid adoption. Users can either sign up for a free trial on Elastic Cloud or download our software directly from our website without any sales interaction, and immediately begin using the full set of features.
Customers often expand the use of our software within their organizations by increasing the number of developers using our products, increasing the utilization of our products for a particular use case, and expanding use of our products to additional use cases.
Customers often expand the use of our software within their organizations by increasing the number of developers using our products, increasing the utilization of our products for a particular use case, and expanding use of our products to additional use cases. We focus some of our direct sales efforts on encouraging these types of expansion within our customer base.
A portion of the revenue from self-managed subscriptions is generally recognized up front at the point in time when the license is delivered and the remainder is recognized ratably over the subscription term.
Our subscription agreements are either term-based or consumption-based, with the vast majority of Elastic Cloud subscriptions being consumption-based. A portion of the revenue from self-managed subscriptions is generally recognized up front at the point in time when the license is delivered and the remainder is recognized ratably over the subscription term.
We expect our revenue from Elastic Cloud to continue to increase as a percentage of total revenue, which we expect will continue to have a modest unfavorable impact on our gross margin as a result of the associated third-party hosting costs. 55 Table of Contents Operating Expenses Research and development.
We expect our gross margin to fluctuate over time depending on the factors described above. We expect our revenue from Elastic Cloud to continue to increase as a percentage of total revenue, which we expect will continue to have a modest unfavorable impact on our gross margin as a result of the associated third-party hosting costs.
Organizations are increasingly looking for hosted deployment alternatives with reduced administrative burdens. In some cases, users of our source available software that have been self-managing deployments of the Elastic Stack subsequently become paying subscribers of Elastic Cloud. For the years ended April 30, 2024 and 2023, Elastic Cloud contributed 43% and 40% of our total revenue, respectively.
In some cases, users of our source available software that have been self-managing deployments of our platform subsequently become paying subscribers of Elastic Cloud. For the years ended April 30, 2025 and 2024, Elastic Cloud contributed 46% and 43% of our total revenue, respectively.
We believe that releasing additional features of the Elastic Stack, including our solutions, drives usage of our products and ultimately drives our growth. To that end, we plan to continue to invest in building new features and solutions that expand the capabilities of the Elastic Stack.
Our revenue is derived primarily from subscriptions of Search, Observability and Security built into our platform. We believe that releasing additional features of our platform, including our solutions, drives usage of our products and ultimately drives our growth. To that end, we plan to continue to invest in building new features and solutions that expand the capabilities of our platform.
We conduct low-touch campaigns to keep users and customers engaged once they have begun using Elastic Cloud or have downloaded our software. As of April 30, 2024, we had approximately 21,000 customers compared to approximately 20,200 customers as of April 30, 2023. The majority of our new customers use Elastic Cloud.
Users can also sign up for Elastic Cloud through public cloud marketplaces. We conduct low-touch campaigns to keep users and customers engaged once they have begun using Elastic Cloud or have downloaded our software. As of April 30, 2025, we had approximately 21,500 customers compared to approximately 21,000 customers as of April 30, 2024.
Our distribution model has resulted in rapid adoption by developers around the world. We have invested, and expect to continue to invest, heavily in sales and marketing efforts to convert additional free users to paid subscribers. Our investment in sales and marketing is significant given our large and diverse user base.
Our financial performance depends on growing our paid customer base by converting free users of our software into paid subscribers. Our distribution model has resulted in rapid adoption by developers around the world. We have invested, and expect to continue to invest, heavily in sales and marketing efforts to convert additional free users to paid subscribers.
Future releases of the remaining valuation allowance, if any, would result in the recognition of certain deferred tax assets which may include a material income tax benefit for the period in which such release is recorded.
To the extent sufficient positive evidence becomes available, we may release all or a portion of our valuation allowance in one or more future periods. Future valuation allowance releases, if any, would result in the recognition of certain deferred tax assets which may include a material income tax benefit for the period in which such release is recorded.
The increase in personnel and related costs included increases of $13.4 million in stock-based compensation, $10.7 million in salaries and related taxes, and $2.0 million in employee benefits expense. These increases were offset in part by a decrease in acquisition-related compensation of $4.4 million.
The increase in personnel and related costs included increases of $16.5 million in salaries and related taxes, $3.8 million in stock-based compensation, and $3.1 million in employee benefits expense, partially offset by a decrease of $1.4 million in acquisition-related compensation.
In addition to our direct sales efforts, we also maintain partnerships to further extend our reach and awareness of our products around the world.
They focus on both seeking to obtain new customers and on pursuing additional sales to existing customers. In addition to our direct sales efforts, we maintain partnerships to further extend our reach and awareness of our products around the world.
(Benefit from) Provision for Income Taxes Year Ended April 30, Change 2024 2023 $ % (in thousands) (Benefit from) provision for income taxes $ (184,476) $ 19,284 $ (203,760) NM NM = Not Meaningful The benefit from income taxes was $184.5 million for the year ended April 30, 2024 compared to a provision for income taxes of $19.3 million for the prior year.
Provision for (Benefit from) Income Taxes Year Ended April 30, Change 2025 2024 $ % (in thousands) Provision for (benefit from) income taxes $ 76,545 $ (184,476) $ 261,021 (141) % The provision for income taxes was $76.5 million for the year ended April 30, 2025 compared to a benefit from income taxes of $184.5 million for the prior year.
These outflows were partially offset by inflows from a $134.6 million increase in deferred revenue and a net increase of $25.5 million in accounts payable, accrued expenses, and accrued compensation and benefits. 62 Table of Contents Net cash provided by operating activities during the year ended April 30, 2023 was $35.7 million, which resulted from adjustments for non-cash charges of $307.2 million, mostly offset by a net loss of $236.2 million and net cash outflow of $35.4 million from changes in operating assets and liabilities.
These outflows were partially offset by inflows from a $147.1 million increase in deferred revenue. 62 Table of Contents Net cash provided by operating activities during the year ended April 30, 2024 was $148.8 million, which resulted from net income of $61.7 million and adjustments for non-cash charges of $123.7 million, partially offset by a net cash outflow of $36.6 million from changes in operating assets and liabilities.
Sales and marketing Year Ended April 30, Change 2024 2023 $ % (in thousands) Sales and marketing $ 559,648 $ 503,537 $ 56,111 11 % Sales and marketing expense increased by $56.1 million, or 11%, for the year ended April 30, 2024 compared to the prior year.
Sales and marketing Year Ended April 30, Change 2025 2024 $ % (in thousands) Sales and marketing $ 617,176 $ 559,648 $ 57,528 10 % Sales and marketing expense increased by $57.5 million, or 10%, for the year ended April 30, 2025 compared to the prior year.
Overview Elastic, the Search AI Company, enables our customers to find the answers they need in real time, using all of their data, at scale. Our platform, combines the power of search with AI to help companies solve real-time business problems, unlock potential value, and achieve better outcomes.
Overview Elastic, the Search AI Company, enables its customers to transform data into answers, actions, and outcomes with Search AI. Our platform combines the precision of search with the intelligence of AI to help our customers and community solve real-time business problems, unlock potential value, and achieve better outcomes.
We define a customer as an entity that generated revenue in the quarter ending on the measurement date from an annual or month-to-month subscription. Affiliated entities are typically counted as a single customer. Many of these customers start with limited initial spending on our products but can significantly increase their spending over time.
The majority of our new customers use Elastic Cloud. We define a customer as an entity that generated revenue in the quarter ending on the measurement date from an annual or month-to-month subscription. Affiliated entities are typically counted as a single customer.
Other Income, Net Interest expense Year Ended April 30, Change 2024 2023 $ % (in thousands) Interest expense $ (26,132) $ (25,159) $ (973) 4 % Interest expense primarily related to interest on our Senior Notes and remained relatively flat for the year ended April 30, 2024 compared to the prior year.
Other Income, Net Interest expense Year Ended April 30, Change 2025 2024 $ % (in thousands) Interest expense $ (25,307) $ (26,132) $ 825 (3) % Interest expense remained relatively flat for the year ended April 30, 2025 compared to the prior year.
In July 2021, we issued long-term debt of $575.0 million, represented by our Senior Notes, and we may be required to seek additional equity or debt financing. In the event that additional financing is required from outside sources, we may not be able to raise it on terms acceptable to us or at all.
In July 2021, we issued long-term debt of $575.0 million, represented by our Senior Notes, and we may be required to seek additional equity or debt financing.
Our gross margin for services may fluctuate or decline in the near-term as we seek to expand our services business.
We continue to make investments in our services organization that we believe will be needed to support our continued growth. Our gross margin for services may fluctuate or decline in the near-term as we seek to expand our services business.
As of April 30, 2024, we had purchase commitments of $424.6 million related to cloud hosting services, future minimum lease payment commitments of $26.7 million, and purchase commitments of $47.8 million related to other contracts.
As of April 30, 2025, we had purchase commitments of $812.3 million related to cloud hosting services, future minimum lease payment commitments of $29.9 million, and purchase commitments of $73.2 million related to other contracts.
Critical Accounting Policies and Estimates In preparing our consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”), we are required to make estimates, assumptions and judgments that affect the amounts reported on our financial statements and the accompanying disclosures.
See Note 13, “Income Taxes,” of our accompanying Notes to our Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K for additional information. 63 Table of Contents Critical Accounting Policies and Estimates In preparing our consolidated financial statements in accordance with accounting principles generally accepted in the United States of America, we are required to make estimates, assumptions and judgments that affect the amounts reported on our financial statements and the accompanying disclosures.
This increase was primarily due to increases of $34.8 million in personnel and related costs, $12.5 million in marketing expenses, and $9.3 million in travel costs. These increases were partially offset by a decrease of $2.7 million in intangible assets amortization.
This increase was primarily due to increases of $22.2 million in personnel and related costs and $4.7 million in cloud infrastructure costs related to our research and development activities. These increases were partially offset by a decrease of $3.4 million in travel costs.
After developers begin to use our software and start to participate in our developer community, they become more likely to apply our technology to additional use cases and promote our technology within their organizations. This reduces the time required for our sales force to educate potential customers on our solutions.
Our strategy is designed to pursue what we believe to be significant untapped potential for the use of our technology. After developers begin to use our software and start to participate in our developer community, they become more likely to apply our technology to additional use cases and promote our technology within their organizations.
This increase was primarily due to an increase of $7.2 million in personnel and related costs. These costs were partially offset by decreases of $1.1 million in training and facility costs. The increase in personnel and related costs included increases of $4.0 million in salaries and related taxes and $3.1 million in stock-based compensation.
This increase was primarily due to increases of $11.8 million in personnel and related costs and $2.0 million in software and equipment expense. The increase in personnel and related costs included increases of $5.8 million in salaries and related taxes, $3.2 million in stock-based compensation, and $1.5 million in employee benefits expense.
These investments are likely to occur before we realize the anticipated benefits of such investments, such that they may adversely affect our operating results in the near term. Expanding within our current customer base. Our future growth and profitability depend on our ability to drive additional sales to existing customers.
Our investment in sales and marketing is significant given our large and diverse user base. These investments are likely to occur before we realize the anticipated benefits of such investments, such that they may adversely affect our operating results in the near term.
Our effective tax rate is affected by recurring items, such as tax rates in jurisdictions outside the Netherlands and the relative amounts of income we earn in those jurisdictions, non-deductible stock-based compensation, and one-time tax benefits or charges, including in fiscal 2024 an income tax benefit related to a release of the valuation allowance against U.S. federal and certain states’ deferred tax assets. 56 Table of Contents Results of Operations The following table sets forth our results of operations for the periods presented.
Our effective tax rate is affected by recurring items, such as tax rates in jurisdictions outside the Netherlands and the relative amounts of income we earn in those jurisdictions, non-deductible stock-based compensation, and one-time tax benefits, such as the release of a valuation allowance, or charges as well as the BEAT legislation in the United States.
For further information see Note 13, “Income taxes,” of our accompanying Notes to our Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K.
Interest on the Senior Notes is payable semi-annually in arrears on January 15 and July 15 of each year. See Note 7, “Senior Notes,” of our accompanying Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K for additional information.
Our cash, cash equivalents and marketable securities consist of highly liquid investment-grade fixed-income securities. We believe that the credit quality of the securities portfolio is strong and diversified among industries and individual issuers. We have generated significant operating losses from our operations as reflected in our accumulated deficit of $991.6 million as of April 30, 2024.
Liquidity and Capital Resources As of April 30, 2025, our principal sources of liquidity were cash, cash equivalents, and marketable securities totaling $1.397 billion. Our cash, cash equivalents, and marketable securities consist of highly liquid investment-grade fixed-income securities. We believe that the credit quality of the securities portfolio is strong and diversified among industries and individual issuers.
See Note 8, “Commitments and contingencies,” and Note 9, “Leases,” of our accompanying Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K for additional discussion of our cloud hosting obligations and future non-cancelable minimum rental payments, respectively.
See Note 8, “Commitments and contingencies,” and Note 9, “Leases,” of our accompanying Notes to Consolidated Financial Statements included in Part II, Item 8 of this Annual Report on Form 10-K for additional information. In July 2021, we issued $575.0 million aggregate principal amount of Senior Notes in a private placement.
Current Economic Conditions Macroeconomic events, including continued inflation, slower economic growth, and political unrest, continue to evolve and negatively impact worldwide economic activity. Governmental and corporate responses to these factors, including rising interest rates, unpredictable and decreased spending, and layoffs, have added to the highly volatile macroeconomic landscape.
Current Economic Conditions Macroeconomic events, including a possible resurgence in inflation, fluctuations in economic growth, changes in and uncertainty of international trade policies, and political unrest, continue to evolve and impact worldwide economic activity. Governmental and corporate responses to these factors, including changing interest rates and unpredictable and decreased spending, will continue to affect the macroeconomic conditions.
Services revenue increased by $6.5 million, or 8%, for the year ended April 30, 2024 compared to the prior year. The increase in services revenue was attributable to increased adoption of our services offerings.
Cost of services revenue increased by $13.5 million, or 16%, for the year ended April 30, 2025 compared to the prior year. This increase was primarily due to increases of $6.8 million in personnel and related costs and $6.4 million in subcontractor costs.
While each of these factors presents significant opportunities for our business, they also pose important challenges that we must successfully address in order to sustain our growth and improve our results of operations. Increasing adoption of Elastic Cloud. Elastic Cloud, our family of cloud-based offerings, is an important growth opportunity for our business.
While each of these factors presents significant opportunities for our business, they also pose important challenges that we must successfully address in order to sustain our growth and improve our results of operations. Developing new features for Elastic’s Search AI Platform. Our platform is applied to various use cases by customers, including through the solutions we offer.
These investments may adversely affect our operating results prior to generating benefits, to the extent that they ultimately generate benefits at all. Growing our customer base by converting users of our software to paid subscribers. Our financial performance depends on growing our paid customer base by converting free users of our software into paid subscribers.
These investments may adversely affect our operating results prior to generating benefits, to the extent that they ultimately generate benefits at all. Growing the Elastic community. Our strategy consists of providing access to source available software, on both a paid and free-of-charge basis, and fostering a community of users and developers.
We have historically incurred, and expect to continue to incur, operating losses and may generate negative cash flows from operations in the future due to the investments we intend to make and, as a result, we may require additional capital resources to execute on our strategic initiatives to grow our business.
We have generated significant operating losses from our operations as reflected in our accumulated deficit of $1.100 billion as of April 30, 2025. We have historically incurred, and expect to continue to incur, operating losses and may generate negative cash flows from operations in the future due to the investments we intend to make.
These expenditures were offset by cash provided by maturities and redemptions of marketable securities of $271.4 million. Net cash used in investing activities of $273.0 million during the year ended April 30, 2023 was primarily due to the purchase of marketable securities of $270.3 million. In addition, we incurred $2.7 million of capital expenditures during the year.
Net Cash Used In Investing Activities Net cash used in investing activities of $118.7 million during the year ended April 30, 2025 was primarily due to purchases of marketable securities of $549.6 million and purchases of property and equipment of $4.3 million, partially offset by sales, maturities, and redemptions of marketable securities of $435.3 million.
Other income, net Year Ended April 30, Change 2024 2023 $ % (in thousands) Other income, net $ 33,278 $ 27,454 $ 5,824 21 % Other income, net increased by $5.8 million to $33.3 million for the year ended April 30, 2024 from $27.5 million for the prior year.
Other income, net Year Ended April 30, Change 2025 2024 $ % (in thousands) Other income, net $ 48,660 $ 33,278 $ 15,382 46 % Other income, net increased by $15.4 million, or 46%, for the year ended April 30, 2025 compared to the prior year.
We sell subscriptions in various currencies, with the majority of our subscriptions contracted in U.S. dollars, and a smaller portion contracted in Euro, British Pound Sterling, and other currencies. Elastic Cloud customers may also purchase subscriptions on a month-to-month basis without a commitment, with usage billed at the end of each month.
Our subscription agreements are both term-based and consumption-based, with the vast majority of Elastic Cloud subscriptions being consumption-based. We sell subscriptions in various currencies, with the majority of our subscriptions contracted in U.S. dollars, and a smaller portion contracted in Euro, British Pound Sterling, and other currencies.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeAs a component of other income, net, we recognized foreign currency transaction losses of $3.4 million, $0.4 million, and $3.6 million for the years ended April 30, 2024, 2023, and 2022, respectively. As of April 30, 2024, our cash, cash equivalents, restricted cash, and marketable securities were primarily denominated in U.S. dollars, Euros, and British Pound Sterling.
Biggest changeAs a component of other income, net, we recognized foreign currency transaction losses of $2.5 million, $3.4 million, and $0.4 million for the years ended April 30, 2025, 2024, and 2023, respectively. As of April 30, 2025, our cash, cash equivalents, restricted cash, and marketable securities were primarily denominated in U.S. dollars, Euros, and British Pound Sterling.
An immediate 10% increase or decrease in the relative value of the U.S. dollar to other currencies could have a material effect on our revenue, operating expenses, and net income (loss).
An immediate 10% increase or decrease in the relative value of the U.S. dollar to other currencies could have a material effect on our revenue, operating expenses, and net (loss) income.
A 10% increase or decrease in exchange rates as of such date would have had an impact of approximately $10.9 million on our cash, cash equivalents, restricted cash, and marketable securities balances. 66 Table of Contents
A 10% increase or decrease in exchange rates as of such date would have had an impact of approximately $9.2 million on our cash, cash equivalents, restricted cash, and marketable securities balances. 66 Table of Contents
Item 7A. Quantitative and Qualitative Disclosures About Market Risk We have operations both within the United States and internationally, and we are exposed to interest rate risk and foreign currency risk in the ordinary course of our business. Interest Rate Risk We had cash, cash equivalents, restricted cash, and marketable securities totaling $1.087 billion as of April 30, 2024.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk We have operations both within the United States and internationally, and we are exposed to interest rate risk and foreign currency risk in the ordinary course of our business. Interest Rate Risk We had cash, cash equivalents, restricted cash, and marketable securities totaling $1.401 billion as of April 30, 2025.

Other ESTC 10-K year-over-year comparisons