Elastic

Elastic N.V. is the Dutch public company behind Elasticsearch, Kibana, Logstash and Beats. The product story starts before the company: Shay Banon created the Lucene-based Compass framework after trying to build recipe search for his wife, rewrote it as a distributed JSON/HTTP search engine in 2009, and released Elasticsearch publicly in February 2010. Banon, Steven Schuurman, Uri Boness and Simon Willnauer founded Elasticsearch B.V. in Amsterdam in 2012 to support and commercialize the rapidly adopted open-source project. Schuurman served as the first CEO, Banon as CTO/product creator, and the team added Kibana visualization and Logstash ingestion in 2013. The company raised $10 million Series A in November 2012 led by Benchmark with Data Collective and Spring creator Rod Johnson; $24 million Series B in February 2013 led by Index with Benchmark and SV Angel; and $70 million Series C in June 2014 led by NEA with Benchmark and Index. That is $104 million of disclosed venture financing, not the two zero-dollar 2017 financings in the legacy row. The 2014 round reportedly valued it around $700 million. After buying managed-service provider Found and Packetbeat in 2015, Elasticsearch rebranded the company as Elastic, launched what became Elastic Cloud and expanded the ELK stack into the Elastic Stack. Paid security/proprietary features, subscriptions and support turned broad free adoption into revenue. Elastic priced seven million shares at $36 in its October 2018 IPO, raising $252 million at roughly a $2.5 billion pricing valuation; the stock opened near $70 and closed its first day around $70, implying about $4.9 billion. It trades on the NYSE as ESTC. The legal entity is a Netherlands naamloze vennootschap registered under Chamber of Commerce number 54655870 at Keizersgracht 281 in Amsterdam. Because it is distributed by design, the company says it has no principal executive office; U.S. shareholder correspondence can be directed to San Francisco. Elastic's core technology is a distributed document/search and analytics engine built on Apache Lucene. Elasticsearch shards and replicates structured, unstructured, text, numeric, time-series, geospatial and vector data across clusters, provides REST APIs and clients, performs lexical BM25, semantic/vector and hybrid retrieval, aggregations and ES|QL querying, and increasingly supplies context/retrieval for RAG and agents. Kibana is the exploration, dashboard, visualization, administration and solution UI. Logstash and Elastic Agent/Beats collect, transform and ship data; ECK/ECE orchestrate self-managed deployments. The common data/search layer powers three commercial solution groups: Elasticsearch for application/enterprise search, vector databases and Search AI; Elastic Observability for logs, metrics, traces, APM, synthetics, profiling, SLOs and AI-assisted incident analysis; and Elastic Security for SIEM, XDR/endpoint, cloud posture/workload protection, threat hunting, Attack Discovery and AI-assisted SOC workflows. Elastic Cloud is offered as hosted clusters on AWS, Azure and Google Cloud or as auto-scaling serverless projects; customers can also self-manage on premises, in private/public clouds or air-gapped environments. Free/open functionality drives developer adoption and free trials; paid Cloud consumption, annual subscriptions, self-managed proprietary features/support, consulting and training generate revenue. Sales combine product-led/community discovery with direct enterprise teams, cloud marketplaces, system integrators, OEM/MSP and technology/AI partners. Pricing is resource/consumption based rather than per user. In August 2026 Hosted tiers start around $99/month Standard, $114 Gold, $131 Platinum and $184 Enterprise for a reference 120GB/two-zone configuration. Serverless Elasticsearch meters ingest from $0.14/VCU-hour, search from $0.09/VCU-hour, ML from $0.07/VCU-hour, storage from $0.047/GB-month and egress from $0.05/GB; Security and Observability use per-ingested/retained-GB meters, and managed-LLM, inference, workflows, agents and support can add charges. Actual bills depend heavily on data volume, retention, region, replicas, compute, tier and support. Fiscal 2026 (year ended April 30) revenue was $1.739331 billion, up 17%; subscriptions were $1.634455 billion/94% of revenue and services $104.876 million. Elastic Cloud represented 48% of total revenue and grew 22%, with annual Cloud up 28%. Subscription gross margin was 81%, consolidated gross margin 76%; operating cash flow was $326.9 million. GAAP net income was $367.8 million but was driven primarily by a $370.1 million tax benefit and valuation-allowance releases, so it does not represent comparable operating profitability; accumulated deficit remained $732 million. Cash/cash equivalents/marketable securities were about $1.370 billion versus $575 million principal of 2021 senior notes. RPO was $1.982 billion and net expansion approximately 112%. Elastic had about 24,000 customers, 1,720-plus spending over $100,000 annually and 240-plus spending over $1 million, in more than 125 countries. One unnamed channel partner represented 11% of FY26 revenue, a material concentration. More than 50% of the Fortune 500 use the platform according to current company materials. The April 2026 workforce was 4,019 in 40-plus countries. On June 23/24 Elastic approved a 7% workforce reduction (roughly 281 people on that base) to realign around AI automation and strategic priorities, expecting $22-25 million of cash charges while still planning net hiring in key roles; Chief Product Officer Ken Exner separately left July 17 and engineering groups began reporting directly to CEO Ashutosh Kulkarni. That followed a roughly 13% reduction in November 2022 during customer budget tightening. Kulkarni became CEO in January 2022; Banon returned to CTO and remains an executive director; former CEO Schuurman remains a director; Chetan Puttagunta is chair/lead independent director. Navam Welihinda became CFO after Grammarly/HashiCorp finance leadership. Elastic has expanded through at least 13 directly verified acquisitions: Found and Packetbeat (2015), Prelert (2016), Opbeat and Swiftype (2017), Lambda Lab/Insight.io (2018), Endgame ($234 million, 2019), build.security, Cmd and Optimyze (2021), Opster ($23 million, 2023), Keep (May 2025) and Jina AI (October 2025). These supplied cloud hosting, lightweight shippers, ML anomaly detection, APM, site/enterprise search, code search, endpoint/XDR, cloud/runtime policy, continuous profiling, cluster AutoOps, AIOps remediation and multilingual/multimodal embedding/reranking models. A June 2026 report that Elastic agreed to acquire DeductiveAI for up to $85 million was unconfirmed by either party and is not counted as closed. The company's most consequential controversy is licensing. Elasticsearch/Kibana began under Apache 2.0; in 2021 Elastic replaced that for new source with Elastic License 2.0 and SSPL, neither OSI-approved, to restrict hyperscalers from selling the software as a managed service. AWS forked version 7.10.2 into Apache-licensed OpenSearch, fragmenting the ecosystem. Elastic added OSI-approved AGPLv3 as a source-code option before version 8.16 in 2024, but this was not a return to permissive Apache terms and official releases/higher-tier features retain Elastic licensing choices. Elastic also sued Amazon in 2019 over Elasticsearch trademarks; the parties resolved it in February 2022, Amazon removed the term from product/project names, and financial terms were undisclosed. A 2025 securities class action, Lucid Alternative Fund, LP v. Elastic N.V. et al., No. 1:25-cv-00785 (E.D.N.Y.), alleges that 2024 sales-territory/segmentation disruption and its effect on guidance were not adequately disclosed before an August 2024 forecast reduction and stock drop. Co-lead plaintiffs were appointed and an amended complaint was filed; the matter remains an allegation, and Elastic's FY26 10-K says no current proceeding is expected by management to be materially adverse. Current competitive fronts differ by use case: Amazon OpenSearch, Apache Solr, Algolia, MongoDB Atlas Search, Pinecone, Weaviate and cloud-native search/vector services; Splunk/Cisco, Datadog, Dynatrace, New Relic, Grafana, Sumo Logic and hyperscaler monitoring in observability; and Microsoft Sentinel/Defender, CrowdStrike, Palo Alto, Splunk, SentinelOne and Google SecOps in security. Strategic risk comes from free/open forks and hyperscalers, data/compute costs, consumption optimization, 11% channel concentration, search/vector commoditization, aggressive AI platform competition, the need to prove retrieval quality and agent accuracy, integration of acquisitions, licensing/community trust, cyber vulnerabilities or customer misconfiguration, $613.6 million of cloud commitments, $575 million debt, dilution/stock compensation, Dutch/U.S. governance and multinational privacy/AI/security rules. As of August 17, 2026 ESTC was $83.44 with approximately $8.861 billion market capitalization. The profile treats that as a dated public-market value, not private valuation, and preserves the identity distinction between the original open-source project, Elasticsearch B.V./Elastic N.V., U.S. subsidiary Elasticsearch, Inc., and unrelated businesses named Elasticsearch Global.

Founding story

Banon's recipe-search project led to Compass, then a 2009 rewrite designed for distributed JSON-over-HTTP search and the 2010 Elasticsearch release. Community adoption attracted Schuurman, Boness and Willnauer; the four formed a Dutch company in 2012 to support the project and build a commercial open-core business.

Business model

Open-core/search-platform model: broad free/open and source-available software seeds adoption; Elastic sells managed Cloud, premium self-managed features/support, enterprise subscriptions, consulting and training across search, observability and security.

Consumption and committed-capacity Elastic Cloud subscriptions; annual/monthly hosted/serverless and self-managed license/support subscriptions; services/training. FY26 subscriptions were 94% of revenue, Cloud 48%, services 6%.

Traction

FY26 $1.739b revenue (+17%), $1.982b RPO, 112% net expansion, 24k customers in 125+ countries, 1,720+ $100k-ACV and 240+ $1m-ACV customers; $326.9m operating cash flow; 48% Cloud mix; 4,019 employees before June 2026 7% reduction.

Latest developments

May FY26 results exceeded prior guide at $1.739b revenue. June 2026: 7% workforce reduction/$22-25m charges and CPO exit; unconfirmed report of up-to-$85m DeductiveAI deal. July-August: Elastic 9.5, Jina multimodal/multilingual models on-prem/air-gapped, deeper OpenAI enterprise AI work and continuing Agent Builder/Workflows/AI SOC investments. ESTC market cap ~$8.861b on Aug 17.