Summary
Elastic closed fiscal 2021 with fourth-quarter revenue of $177.6 million, up 44% year over year, or 39% on a constant currency basis. Growth came from broad demand for enterprise search, observability, and security, and from continued adoption of Elastic Cloud. Calculated billings were $240.9 million, up 38% year over year, or 33% on a constant currency basis. Deferred revenue was $397.7 million, up 53% year over year. Remaining performance obligations were $796.4 million, up 48.7% year over year. For the full fiscal year, revenue was $608.5 million, up 42% year over year, or 40% on a constant currency basis.
Customer momentum stayed strong. Total subscription customer count was over 15,000, compared with over 13,800 in the prior quarter and over 11,300 a year earlier. Customers with annual contract value greater than $100,000 were over 730, compared with over 670 in the prior quarter and over 610 a year earlier. Subscription revenue represented 93% of total revenue. Net Expansion Rate was consistent with the third quarter and slightly below 130%. Elastic released versions 7.12 and 7.13, which brought general availability of the frozen data tier, schema on read, and supervised machine learning. Elastic Cloud added support for the frozen data tier, autoscaling, and two new Microsoft Azure regions. The company also expanded its Microsoft integration and announced partnerships with Grafana Labs, Confluent, and Swimlane. It was recognized as a Visionary in the 2021 Gartner Magic Quadrant for Application Performance Monitoring and as a Challenger in the 2021 Gartner Magic Quadrant for Insight Engines.
Management guided for the first quarter of fiscal 2022 and for the full fiscal year. For the first quarter, total revenue is expected between $171 million and $173 million. Non-GAAP operating margin is expected between -5.0% and -4.0%. Non-GAAP net loss per share is expected between $0.13 and $0.10, assuming between 91 million and 92 million weighted average ordinary shares outstanding. For fiscal year 2022, total revenue is expected between $782 million and $788 million. Non-GAAP operating margin is expected between -5.5% and -4.5%. Non-GAAP net loss per share is expected between $0.60 and $0.51, assuming between 92.5 million and 94.5 million weighted average ordinary shares outstanding. Founder and CEO Shay Banon said continued demand puts Elastic on a path to becoming a $1 billion plus revenue company in fiscal year 2023.
Profitability remains a work in progress. Fourth-quarter GAAP operating loss was $37.1 million, and GAAP operating margin was -20.9%, up from -28.0% a year earlier. Fourth-quarter GAAP net loss widened to $43.3 million from $31.2 million a year earlier. For the full year, GAAP operating loss narrowed to $129.5 million from $171.1 million. Full-year GAAP net loss narrowed to $129.4 million from $167.2 million, and full-year GAAP net loss per share was -$1.48, compared with -$2.12. Gross margin was 74.2% in the fourth quarter, up from 72.3%; full-year gross margin was 73.5%, up from 71.3%. Operating cash flow improved to -$1.6 million in the fourth quarter from -$5.9 million a year earlier. Full-year operating cash flow was $22.5 million, compared with -$30.6 million a year earlier. Free cash flow was -$3.1 million in the fourth quarter and $18.3 million for the full year. Capital expenditures were $1.18 million in the fourth quarter, up from $0.83 million, while full-year capital expenditures were $3.91 million, down from $5.06 million.
Several risks temper the growth story. The COVID-19 pandemic has caused delays in purchasing decisions, longer sales cycles, delayed implementation of professional services, reduced renewals, and changes in pipeline generation, creating headwinds for calculated billings and Net Expansion Rate. Elastic Cloud is expected to increase as a percentage of revenue and could adversely affect gross margin because of hosting costs. The company has not been profitable to date and expects to continue incurring net losses for the foreseeable future. It also faces foreign currency exposure, with a majority of non-U.S. revenue and expenses denominated in currencies such as the Euro and British pound. In February 2021, with version 7.11, Elastic changed the license for Elasticsearch and Kibana to a dual license under ELv2 and SSPL. The company had 2,179 employees as of April 30, 2021.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q4 FY2021 | Q3 FY2021 | QoQ | Q4 FY2020 | YoY |
|---|---|---|---|---|---|
| Revenue | $177.6M | $157.1M | +13.0% | $123.6M | +43.7% |
| Gross profit | $131.8M | $115.1M | +14.5% | $89.3M | +47.5% |
| Gross margin | 74.2% | 73.3% | +0.9 pp | 72.3% | +1.9 pp |
| Research & development | $55.4M | $51.4M | +7.9% | $45.6M | +21.6% |
| Sales & marketing | $82.2M | $71.1M | +15.6% | $58.2M | +41.2% |
| General & administrative | $31.3M | $27.1M | +15.3% | $20.2M | +55.2% |
| Total operating expenses | $168.9M | $149.6M | +12.9% | $123.9M | +36.3% |
| Operating income (loss) | -$37.1M | -$34.5M | -7.6% | -$34.6M | -7.2% |
| Operating margin | -20.9% | -21.9% | +1.1 pp | -28.0% | +7.1 pp |
| Net income (loss) | -$43.3M | -$38.0M | -14.0% | -$31.2M | -39.0% |
| Net margin | -24.4% | -24.2% | -0.2 pp | -25.2% | +0.8 pp |
| Customers | 15,000 | 13,800 | +8.7% | 11,300 | +32.7% |
Risks
In February 2021 Elastic changed Elasticsearch and Kibana from Apache 2.0 to dual licensing under the Elastic License 2.0 and SSPL; the filing states this could harm adoption, and competitors such as Amazon have forked the software, potentially reducing paid customers.
The filing states the pandemic caused delays in purchasing decisions, longer sales cycles, reduced renewals, and a Net Expansion Rate that declined to below 130% at the end of fiscal 2021 as customers expanded spending more slowly.
Elastic faces competition from larger vendors in Enterprise Search, Observability, and Security, and Amazon Web Services offers SaaS products based on older Elastic Stack releases; Amazon's pricing and offerings may reduce demand and limit Elastic's pricing.
As a security solutions provider, Elastic may be specifically targeted by bad actors seeking to circumvent its security and enter customers' endpoints or networks; a breach could damage reputation, reduce customer usage, and create significant liabilities.
Elastic Cloud contributed 27%, 22%, and 17% of total revenue in the years ended April 30, 2021, 2020, and 2019, and MD&A expects Elastic Cloud's revenue share to increase, which is expected to adversely impact gross margin due to hosting costs.
MD&A notes COVID-19 created delays in purchasing decisions, longer sales cycles, delayed professional services implementation, and changes in pipeline generation without in-person events, resulting in headwinds for calculated billings and the Net Expansion Rate.
Rapid headcount growth to 2,179 employees as of April 30, 2021 and over 15,000 customers strain management and operational resources; the filing says Elastic may not be able to hire, train, and retain enough qualified employees, including sales personnel.
Subscriptions were 93% of total revenue for the year ended April 30, 2021, and much subscription revenue is recognized ratably over the contract term, so a decline in new or renewed subscriptions in a quarter is not fully or immediately reflected in revenue.
Elastic is subject to privacy, data protection, information security, anti-bribery, anti-corruption, and anti-money laundering laws, and sales to government entities add procurement and compliance risks.
Dutch proposals include an Alternative Withholding Tax on dividends to related entities in low-tax jurisdictions effective January 1, 2024, and a Dividend Exit Tax with retroactive effect from September 18, 2020 if enacted, potentially imposing 15% or 25% withholding.
Elastic has acquired and may acquire complementary businesses, such as Endgame in October 2019, and integration may divert management attention, require significant resources, and fail to realize anticipated synergies.
Revenue from outside the United States accounted for 45% of total revenue in the year ended April 30, 2021, exposing Elastic to foreign currency, regulatory, and geopolitical risks.
Elastic had an accumulated deficit of $613.3 million as of April 30, 2021 and incurred a net loss of $129.4 million in fiscal 2021 compared with a net loss of $167.2 million in fiscal 2020, a narrowed loss, but it expects operating expenses to increase substantially and may not achieve profitability consistently.
SaaS KPIs
All quarters →Summary, forecast, risks and KPIs are extracted from Elastic N.V.'s SEC filings for Q4 FY2021 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 1, 2026.