ESTC - Quick Take - 7% RIF & CPO Departure

Research evidence excerpt

ESTC - Quick Take - 7% RIF & CPO Departure

Truist Securities

Equity Research Report June 24, 2026

TMT: Infrastructure Software Elastic N.V. (ESTC)

ESTC - Quick Take - 7% RIF & CPO Departure Miller Jump

212-401-4427

Miller.Jump@truist.com

Today, after the market close, Elastic disclosed a targeted workforce reduction and

leadership change centered around a broader effort to realign the organization around AI-

Junaid Siddiqui driven priorities. The company plans to reduce headcount by ~7% as part of a restructuring 212-326-6141

Junaid.Siddiqui@truist.com aimed at simplifying its organizational structure, improving decision-making speed, and

reallocating resources toward higher-growth areas. The company expects the RIF to be

largely completed by the close of 3Q27. Jonathan Ngo

212-419-4482 Despite the reduction, Elastic expects overall headcount to increase year-over-year,

Jonathan.Ngo@truist.com specifically with continued investment in customer-facing go-to-market roles and key

strategic initiatives. Management notes that a substantial portion of the associated ~

$22-25M in charges, primarily severance, will occur in 1Q27, with the remainder occurring

Current Price (Jun. 24, $58.71 in later periods. 2026)

Separately, the company also announced the departure of Chief Product Officer Ken

Stock Rating BUY Exner, noting that he exits with no stated disagreements. In conjunction with this transition,

Unchanged Elastic is flattening its product leadership structure, with core engineering leaders now

reporting directly to CEO Ash Kulkarni. This change is designed to streamline execution

Price Target $80.00 and accelerate product innovation, particularly as the company leans further into AI-related

Unchanged opportunities across search, observability, and security.