Elastic partners with AWS to boost AI application development

Published 28/05/2025, 15:22
Elastic partners with AWS to boost AI application development

SAN FRANCISCO - Elastic (NYSE: ESTC), known for its Search AI technology and generating annual revenue of $1.43 billion with impressive 18% year-over-year growth, has entered into a five-year strategic collaboration agreement with Amazon Web Services (AWS) to expedite the development of AI-native enterprise applications. This alliance aims to simplify the creation of generative AI applications through joint product integrations and go-to-market initiatives. According to InvestingPro data, Elastic maintains a strong financial position with more cash than debt on its balance sheet, positioning it well for this strategic expansion.

Under the agreement, Elastic’s Search AI Platform will integrate with AWS services, enabling customers to leverage generative AI features across Elastic solutions using Amazon Bedrock’s foundation models. The collaboration will also support the migration of Elasticsearch workloads to Elastic Cloud on AWS and introduce cost efficiencies when using Elastic Cloud Serverless on AWS. With a robust gross profit margin of 74% and 22 analysts recently revising their earnings expectations upward, Elastic demonstrates strong operational efficiency and growing market confidence. For detailed analysis and additional insights, explore Elastic’s comprehensive Pro Research Report, available exclusively on InvestingPro.

The partnership is set to advance agentic AI through the Elastic and AWS collaboration on Model Context Protocol (MCP) and agent-to-agent interoperability. Additionally, it will focus on building secure solutions for highly regulated industries, including the public sector and financial services.

Ash Kulkarni, CEO at Elastic, emphasized the increasing relevance of search in the generative AI space and the combined effort to enable developers to create intelligent, context-aware applications. Ruba Borno, vice president at AWS, highlighted the collaboration’s value in transforming data and AI utilization, particularly in regulated industries.

Elastic’s existing AI Assistant, Attack Discovery, Automatic Import, Automatic Migration, Automatic Troubleshoot, and AI Playground already integrate with Large Language Models through Amazon Bedrock, enhancing customer capabilities in data analysis and decision-making.

Customers like Generis and BigID have experienced significant improvements from the Elastic-AWS partnership. Generis reported a 1000% reduction in average search times and a dramatic decrease in document production time, while BigID achieved a 120x acceleration in query performance.

This strategic collaboration follows Elastic’s recent accolades within the AWS Partner Network, including the AWS Global Generative AI Infrastructure and Data Partner of the Year award in December 2024 and AWS competency designations in government and education sectors.

The information in this article is based on a press release statement.

In other recent news, Elastic NV is preparing to release its fourth-quarter and full-year 2025 financial results, with analysts projecting a slight beat based on previous performance. Rosenblatt Securities has reiterated a Buy rating with a $140 price target, expressing confidence in Elastic’s strategic sales restructuring and platform consolidation efforts. Stifel also maintained a Buy rating at the same price target, citing improved go-to-market execution and opportunities in the Generative AI market. However, TD Cowen adjusted its outlook, lowering the price target to $105 while maintaining a Hold rating, due to cautious fiscal year 2026 guidance expectations. Similarly, Cantor Fitzgerald kept a Neutral rating with a $109 price target, noting concerns about potential conservatism in the company’s revenue guidance amid economic uncertainties. Analysts have highlighted the importance of Elastic’s upcoming earnings report and fiscal year 2026 guidance, which will be closely watched by investors for indications of the company’s future trajectory.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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