What happened

Shares of Elastic (ESTC 1.37%) were up 21% as of 2 p.m ET Friday after the search technology company announced strong fiscal 2024 first-quarter results.

In the quarter ended July 31, Elastic's revenue climbed 17% year over year, to $293.8 million, translating to non-GAAP (adjusted) earnings of $25.4 million, or $0.25 per diluted share. Most analysts were only expecting adjusted earnings of $0.11 per share on revenue of $284.5 million.

So what

Elastic's customer count grew 6.2% year over year to 20,500 at the end of the quarter. Of that total, 1,190 customers have an annual contract value (ACV) greater than $100,000, up from 1,010 at the same point last year. Elastic's net expansion rate also remained steady at roughly 113%, indicating existing customers spent an average of 13% more on the company's solutions after their first year.

Elastic CEO Ash Kulkarni noted customers are continuing "to consolidate vendors and adopt Elastic as their AI-powered data analytics platform of choice for addressing multiple real-time search use cases." He added that the company is "very excited" for the growth opportunity presented by the rise of generative artificial intelligence (AI).

Now what

Elastic also raised its outlook to call for full fiscal year 2024 (ending April 30, 2024) revenue of between $1.242 billion and $1.25 billion, good for growth of 17% at the midpoint and compared to previous guidance for between $1.238 billion and $1.25 billion before. That should translate to adjusted earnings per share of between $1.01 and $1.11, increased from previous guidance for a per-share range of between $0.94 and $1.06.

After combining this straightforward beat-and-raise performance with excitement surrounding Elastic's status as a leading AI stock, it's hardly surprising to see shares rallying today.