Elastic (ESTC) raises IPO price to 33 to 35


Up from 26 to 29

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Oops didnt see someone already posted this

No worries, Ace.

I did not see any posts regarding the price increase, which happened yesterday. I had to resubmit my offer in Etrade. Good thing I saw it, else the conditional offer would have been cancelled!



Is it too late for a non-Etrade buyer to get in before it hits the (Wall) street?

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Only if your broker/company still has allocation left (very doubtful)…

Does anyone know what time ESTC can be purchased tomorrow?

Thanks in advance.

Scotty G

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Some more ESTC tidbits after wading through their documents:

What they do:

Their products revolve around software that ingests and stores data from any source in any format for search, analysis and visualization. They have public, private or hybrid platforms. I know there have been comparisons to MDB on this board, but I’m not sure if they would be direct competitors. Below are some of the uses for their products:

  • Pairs Uber riders and drivers.
  • Finds the right products for your online Walgreens cart.
  • Powers algorithms for Tinder matches.
  • Helps find the right photos, fonts and colors in Adobe.
  • Logs billions of daily Sprint events for performance and network monitoring.

Whom they do it for:

  • They have a deep customer base. They list customer counts of 2,800 at end of FY17, 5,000 at end of FY18 (+78.6% YoY) and 5,500 in 80 countries for Q119.
  • They list $100K customer counts of 150 at end of FY17, 275 at end of FY18 and 300 for Q119.
  • Customers include 32% of the Fortune 500 and 21% of the Forbes Global 2000 as of 7/31/18.

Business highlights:

  • TAM $45B.
  • 350M downloads of their products.
  • They have both private and public (government sector) sales channels.
  • FY18 revs consisted of 61% from US customers and 39% International.

Some Financial Highlights:

GAAP Revs						%YoY					
	Q1	Q2	Q3	Q4	YR			Q1	Q2	Q3	Q4	YR
2017	$16.57	$21.31	$23.13	$27.17	$88.18		2017					0
2018	$31.64	$37.04	$41.68	$49.57	$159.94		2018	90.9%	73.8%	80.2%	82.4%	81.4%
2019	$56.64						2019	79.0%				

GAAP Subscription Revs					%YoY					
	Q1	Q2	Q3	Q4	YR			Q1	Q2	Q3	Q4	YR
2017	$14.70	$19.16	$21.06	$24.82	$79.75		2017					0
2018	$29.39	$34.78	$39.03	$46.18	$149.38		2018	99.9%	81.5%	85.4%	86.0%	87.3%
2019	$51.61						2019	75.6%				

GAAP Gross Margin					Subscription Revs/Total Revs					
	Q1	Q2	Q3	Q4	YR			Q1	Q2	Q3	Q4	YR
2017	76.2%	79.4%	77.6%	76.7%	77.5%		2017	88.7%	89.9%	91.0%	91.4%	90.4%
2018	76.6%	75.8%	74.2%	72.6%	74.5%		2018	92.9%	93.9%	93.6%	93.1%	93.4%
2019	72.5%						2019	91.1%				

They also listed some other highlights either generally or in regards to Q119:

  • Net revenue expansion of at least 130% for 7 consecutive Q’s. They reported 142% for Q119.

  • I could only find partial info for Calculated Billings, but the growth was impressive. Q119 was $59.22M vs Q118 at $33.65M (+76.0% YoY). FY18 was $205.72M vs FY17 at $114.57M (+79.6% YoY).

  • These are the long range rates they are targeting:
    Gross Margins 72-76%
    R&D Exp 13-17%
    S&M Exp 29-33%
    G&A Exp 7-9%
    Op Margin ~20%

  • Non-GAAP Op Loss was -$27.52M in FY17, -$31.96M in FY18 and -$11.66 in Q119.

*Free Cash Flow was -$16.95M in FY17, -$23.75M in FY18. They posted a postive $4.79 in Q119.

  • OpEx declined from 135% of revs to 105% of revs between FY17-18, so they are burning less cash but still a lot.

Their IPO documents state they would end up with ~$225M cash at an IPO of $27.50. They also stated that each $1 +/- that IPO price would be roughly $6.5M shareholders’ equity, so an IPO price of $35 would add roughly $48.75M in equity.

One comment I found particularly interesting was that they feel their business is seasonal with heaviness in Q2/Q4 and weakness in Q1/Q3. They specifically state this seasonality is somewhat masked in their present numbers by their overall revenue growth. Since they are going public with Q1 behind them, their first public quarter should be seasonally strong. Their second public quarter (Q3 on the fiscal calendar) would be seasonally weak though. Probably something they need to at least manage and message properly as they go along.