Executive Summary
Elastic N.V. delivered a strong finish to fiscal year 2024 with Q4 2024 revenue of $335 million, up 20% year over year, and cloud revenue of $148 million, up 32% YoY. Non-GAAP operating margin reached 8.6% in Q4, supported by sustained revenue outperformance and disciplined cost management, while GAAP net income remained negative at -$41.1 million and GAAP diluted EPS was -$0.41. The company generated $60 million in free cash flow in Q4 and ended the period with a robust balance sheet, including $1.087 billion in cash and investments and net debt of roughly $50.6 million. Elastic is positioning for multi-year growth through GenAI, vector search, and the Elastic Stack, while maintaining a prudent FY25 guidance framework that does not bake in meaningful near-term GenAI revenue upside. GenAI-related usage is rapidly expanding in high-ACV accounts, with more than 1,000 paying customers leveraging vector database and Retrieval-Augmented Generation (RAG) capabilities and more than 145 customers with ACV over $100k adopting GenAI use cases. Management emphasizes that GenAI adoption remains in early stages but represents a significant long-term growth driver, complemented by ongoing platform enhancements in search, observability, and security and a multi-cloud product strategy (Elastic Cloud, upcoming Serverless). FY25 guidance calls for revenue of $1.468–$1.480 billion, non-GAAP operating margins of 11.7–12.3%, and non-GAAP EPS of $1.35–$1.47, with no meaningful near-term GenAI uplift assumed. Investors should monitor GenAI uptake, acceleration in cloud ARR, SMB softness, open AI ecosystem partnerships, and the pace of margin expansion through operating leverage.
Key Performance Indicators
QoQ: -60.71% | YoY:-6.92%
QoQ: -123.34% | YoY:12.05%
QoQ: -123.30% | YoY:14.58%
Key Insights
Revenue: $335.0 million in Q4 2024, +20% YoY; Cloud revenue: $148.0 million, +32% YoY (44% of total revenue). Gross margin: 76.6%; Operating margin (non-GAAP): 8.6%; Net income: -$41.1 million; Diluted EPS: -$0.41. Cash and equivalents: $543.1 million; Short-term investments: $544.0 million; Total cash and investments: $1.087 billion; Net debt: $50.6 million. Free cash flow (Q4, non-GAAP): $60.0 million (FCF margin 18%). Full-year 2024: Revenue growth 20% YoY; Cloud revenue growth 32% YoY; Adjus...
Financial Highlights
Revenue: $335.0 million in Q4 2024, +20% YoY; Cloud revenue: $148.0 million, +32% YoY (44% of total revenue). Gross margin: 76.6%; Operating margin (non-GAAP): 8.6%; Net income: -$41.1 million; Diluted EPS: -$0.41. Cash and equivalents: $543.1 million; Short-term investments: $544.0 million; Total cash and investments: $1.087 billion; Net debt: $50.6 million. Free cash flow (Q4, non-GAAP): $60.0 million (FCF margin 18%). Full-year 2024: Revenue growth 20% YoY; Cloud revenue growth 32% YoY; Adjusted free cash flow (FY24): $169 million. Customer metrics: >1,330 customers with ACV >$100k; >165 customers with ACV >$1m; >4,370 customers >$10k ACV; ~21,000 total subscription customers; Net expansion rate: ~110%. FY25 guidance: Revenue $1.468–$1.480 billion; Non-GAAP operating margin 11.7%–12.3%; Non-GAAP EPS $1.35–$1.47; Q1 revenue guide: $343–$345 million.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
335.00M |
19.67% |
2.15% |
| Gross Profit |
247.13M |
19.81% |
1.57% |
| Operating Income |
-41.34M |
-6.92% |
-60.71% |
| Net Income |
-41.10M |
12.05% |
-123.34% |
| EPS |
-0.41 |
14.58% |
-123.30% |
Key Financial Ratios
operatingProfitMargin
-12.3%
operatingCashFlowPerShare
$0.51
freeCashFlowPerShare
$0.5
Management Commentary
- GenAI momentum: Ash Kulkarni highlighted rapid GenAI adoption across customers, noting well over 1,000 distinct paying customers using vector database and RAG for GenAI applications, with more than 145 customers over $100k ACV already leveraging GenAI. This underscores a material, if gradual, opportunity for Elastic in the enterprise GenAI stack. - Cloud leadership and value prop: Management emphasized continued cloud consumption strength and a land-and-expand strategy, with Elastic Cloud representing 44% of quarterly revenue and Cloud revenue up 32% YoY, reflecting multi-year commitments and consolidation. - Product and partnerships: Elastic launched the Search AI Lake and Serverless, with plans to extend to all hyperscalers; enhancements to Elasticsearch open inference API (Cohere, OpenAI on Azure) and vector search performance improvements; partnerships with Azure OpenAI and Red Hat OpenShift highlighted as accelerants for platform adoption. - Guidance and capital allocation: Janesh Moorjani stressed the cautious, conservative guidance philosophy for FY25, not modeling meaningful GenAI revenue upside in the year, and a plan to reinvest operating leverage toward GenAI initiatives (engineering, sales, marketing). - SIEM and security strategy: Ash described a shift toward data-centric security analytics, leveraging AI-assisted capabilities (Attack Discovery) to displace incumbents, signaling a durable growth vector in Elastic Security alongside SIEM displacement.
Quotes from management: Ash: “In Q4, revenue grew by 20% and cloud revenue grew by 32% and we delivered an operating margin of 9%.” Janesh: “Fiscal '25 will be a year of focused investment for us as we reinvest some of our natural operating leverage back in the business, in particular towards the GenAI opportunity.”
In Q4, revenue grew by 20% and cloud revenue grew by 32% and we delivered an operating margin of 9%.
— Ashutosh Kulkarni
Fiscal '25 will be a year of focused investment for us as we reinvest some of our natural operating leverage back in the business, in particular towards the GenAI opportunity.
— Janesh Moorjani
Forward Guidance
Elastic maintains a prudent but constructive FY25 outlook. First-quarter revenue guidance is $343–$345 million, implying ~17% YoY growth at mid-point; FY25 revenue guide is $1.468–$1.480 billion, or ~16% YoY growth at the midpoint. Non-GAAP operating margin target rises to 11.7%–12.3% with non-GAAP EPS $1.35–$1.47. Management reiterates that near-term GenAI upside is not modeled, reflecting early-stage adoption and the long runway for GenAI-driven land-and-expand across enterprise and commercial segments. Serverless and broader GenAI adoption remain important catalysts but are expected to contribute meaningfully later in FY25 or beyond. Key factors to monitor include (1) GenAI adoption pace in >$100k ACV cohort and larger enterprise deals, (2) Elastic Cloud and self-managed mix dynamics as customers balance on-prem vs cloud deployments, (3) expansion within observability and security use cases, (4) hyperscaler partnerships execution (Azure, AWS, GCP), and (5) cost discipline and operating leverage translating into margin expansion. Overall, the investment thesis centers on Elastic as the integrated platform for real-time GenAI workloads, with strong cash generation underpinning optionality on future product investments.