Below, I’m updating my usual ESTC quarterly report: https://discussion.fool.com/estc-apr19-q-update-34224536.aspx Pardon the lines in the first column – not pretty, but it makes formatting dramatically easier for me.
I’d also like to point to Greg’s great report on ESTC’s quarter: https://discussion.fool.com/estc-conference-call-notes-34283382… Treat my info below as a supplement.
Quarter_________ Oct17 Jan18 Apr18 Jul18 Oct18 Jan19 Apr19 Jul19
Fiscal Q_________ FiscQ4 FiscQ1
Calc Bill_________ 51.3 47.5 73.3 59.2 88.5 79.8 115.4 89.4
YoY Ch%_________ 76.2% 72.5% 68.0% 57.4% 51.0%
Revenue_________ 37,038 41,681 49,572 56,644 63,575 70,835 80,599 89,710
QoQ Ch%_________ 17.0% 12.5% 18.9% 14.3% 12.2% 11.4% 13.8% 11.3%
YoY Ch%_________ 73.8% 80.2% 82.4% 79.0% 71.6% 69.9% 62.6% 58.4%
Gross Prof_______ 28,078 30,915 35,972 41,087 44,988 50,411 57,157 63,459
OpEx____________ 35,204 43,374 55,207 59,502 72,058 74,197 89,242 105,761
YoY Ch%_________ 9.6% 76.3% 78.1% 104.7% 71.1% 61.6% 77.7%
Op Loss_________ -7,126 -12,459 -19,235 -18,415 -27,070 -23,786 -32,085 -41,371
StockBasedComp__ 2,770 3,554 4,164 5,665 11,239 11,111 11,927 12,771
Customer Count___ 5,500 6,300 7,200 8,100 8,800
Cust w ACV > 100k 300 340 380 440 475
Net Expansion Rate 130%+ 130%+ 130%+ 130%+ 130%+ 130%+ 130%+ 130%+
FY Guidance_____ 258.0 267.0 403.0 412.0
YoY Ch%_________ 48.4% 51.7%
Q Guidance______ 66.0 76.0 84.0 97.0
YoY Ch%_________ 78.4% 82.3% 48.4% 52.5%
Shares Outstanding 72.30 74.60
Share price_______ 80.01 88.50
Cash (in mil)______ 298.00 315.20
TTM Revenue_____ 271.65 304.72
TTM Billings______ 342.90 373.10
EV/S____________ 20.20 20.63
EV/Billings________ 16.00 16.85
Takeaways…
Growth Rates
Calculated Billings grew 51%, and Revenue grew 58%. I was hoping for more, but there were several good explanations and hope for the future:
- Guidance for revenue growth next quarter is higher than it was for this quarter
- As DreamerDad and RetirementDough mentioned, the headwind they’ve been having in Calculated billings will be gone next quarter:
As a reminder, we launched a significant update to our SaaS services in Q2 of last year…Those changes last year present a headwind to calculated billings growth. It’s hard to precisely quantify that headwind, but we estimate that it was in the mid-single digits in terms of your over year growth…Q1 was the last quarter of this billings headwind. - As Darth mentioned a couple times, subscription growth (60%) was greater than overall growth, and within that, SaaS growth was about 70%. And prof services growth (45%) was slower that overall growth, which is good – it’s negative margin, so we want it to diminish.
https://discussion.fool.com/personal-notes-on-the-release-clouds…
https://discussion.fool.com/yes-looking-at-call-slides-subscript… - As Dreamer mentioned, SIEM revenue isn’t material yet. https://discussion.fool.com/thanks-darth-and-others-for-sharing-…
- They also said the Endgame acquisition should close in Q3, so that could have potential eventually, though they said it would be insignificant this year. They added: As a reminder, our primary investment thesis is to integrate the Endgame product into the Elastic Stack and apply our community-based go-to market model to it. Therefore, the revenue opportunity for us is much longer term in nature, and the current levels of Endgame revenue are not discreetly additive to our revenue for future years.
Expenses
Operating Expenses grew 78%, which is pretty gnarly. But as Darth mentioned a couple times, the [Expense increase] was due to timing of major Conferences moved to this quarter.
https://discussion.fool.com/a-big-impact-to-the-sampm-at-least-i…
https://discussion.fool.com/yes-looking-at-call-slides-subscript…
Here’s what they said in the call: As a reminder, we changed the timing of certain events and hosted our global all-hands meeting in Orlando in May. This was reflected in all the operating expense lines. This shift in timing towards Q1 does not impact the full-year expense total.
Even with that, the ongoing level of investment is still a bit staggering, but not unprecedented. Twilio’s OpEx spend in the most recent quarter was 162% of Gross Profit, and Elastic’s this quarter was 167%. Seems crazy high to me, but these companies are trying to take full advantage of their opportunities…so I’ll keep watching this, but not without trepidation.
My impression of the quarter
All in all, this was another great quarter. Love the lack of headwinds going forward, higher guidance, etc. Looks like wins all around. I expect Elastic to keep growing at around 60%…maybe even a little faster.
And even after the bump today, their EV/S is still below many of our others. Seems like a bargain to me. With today’s price increase, it’s now roughly tied with Mongo as my top position (12% each).
Bear