Elastic Shares Jump 16% on Strong Earnings and Outlook
The cloud software firm beat Wall Street estimates for revenue and profit, driven by a 24% surge in its cloud business.
Elastic NV shares surged more than 16% in after-hours trading after the search and analytics software company reported first-quarter earnings and revenue that significantly surpassed analyst expectations, prompting it to raise its full-year forecast.
The company announced fiscal first-quarter revenue of $415.3 million, a 20% increase from the same period last year and well ahead of the $397.3 million consensus estimate. Profitability was also a bright spot, with non-GAAP earnings per share coming in at $0.60, easily topping Wall Street’s projection of $0.42.
The strong performance was fueled by the rapid expansion of its Elastic Cloud offering, which saw revenue climb 24% year-over-year to $196 million. This growth in its cloud-based solutions underscores a successful ongoing transition for the company, resonating with customers and driving overall results. Total subscription revenue, a key metric for software firms, rose 20% to $389 million for the quarter.
Following the robust results, Elastic raised its revenue guidance for the full fiscal year to a range of $1.679 billion to $1.689 billion, signaling confidence in its business momentum despite a challenging economic backdrop.
While the quarterly performance and outlook were strong, the company’s management adopted a reserved tone regarding the coming quarters. They cited caution due to broader macroeconomic uncertainty and projected a moderation in revenue growth, which could temper some long-term investor enthusiasm. Still, the quarter’s results demonstrate solid operational execution and an ability to expand its customer base in the crucial cloud sector, positioning it to navigate potential headwinds in the enterprise IT spending environment.