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Elastic lays off 7% of employees
- puszczyk 4mo agoMakes me sad to read it as an ex-Elastic employee. AI is used to justify the redundancies, and the company still expects to grow in this fiscal year. In the SEC filling the specifically mention more “head count” in “go-to-market” roles [1]. > a reduction of approximately 7% of our workforce > Advances in AI, automation, and technology are reshaping how work gets done, and we're changing with them. (…) That's what this reorganization is for: a simpler structure, with fewer layers, less complexity, and less friction. > The changes we announced today are a sign of confidence in the business, not a retreat from it. We continue to invest in key growth areas and expect total headcount to grow year-over-year this fiscal year [the SEC filling says “ The Company plans to continue hiring in key strategic areas and locations, including continuing to grow headcount in customer-facing go-to-market functions, and expects total headcount to grow this fiscal year compared to last fiscal year, as it continues to invest in future growth opportunities”] [1]: https://ir.elastic.co/financials/sec-filings/sec-filings-details/default.aspx?FilingId=19559144 https://ir.elastic.co/financials/sec-filings/sec-filings-det...
- ai_slop_hater 4mo agoI've grown to hate executives. This is obviously an AI-generated nothing burger. They never mean what they say publicly.
- sandeepkd 4mo agoDo not want to sound like as if I am taking their side but the reality is that all these decisions are mandated by some subset of investors in one way or another. These executives are replaceable, and they would be replaced if they do not toe the line. In other words these executives happen to choose a easy and beneficial path rather than standing up for the long term right thing for the company.
- eli_gottlieb 4mo agoOk so get rid of the investors then.
- Grombobulous 4mo agoThe thing is, a profitable company that sees an obvious efficiency staring it in the face is still going to take that efficiency. I don’t think a lot of us employees will be happy to admit that AI is turning out to be a legitimate productivity aid that is allowing individuals to accomplish more work per person. We’d rather sit here and stew about companies “blaming AI for layoffs” but I imagine that is only sometimes the case. A somewhat related tangent: I have had the thought that many parts of the Japanese system of hiring for life might actually be really appropriate for the AI age. That system seems to result in a lot of companies finding ways to reshuffle employees into making some kind of product that has market value rather than the Western reaction that that seems to favor downsizing and focusing the company on a smaller set of markets in the name of ruthless efficiency. This seems to result in many Japanese firms making a wide breadth of interesting products at very high quality levels. If your company is profitable because AI is increasing efficiency (allegedly, of course), why layoff 7% of your employees when you could instead assign them to make something new or complementary to your current product line? Western companies seem to refuse to do that out of a sense of focus and efficiency, but maybe giving that strategy a go more frequently would result in unrealized opportunities.
- brianwawok 4mo agoI’d love to hire for life, but what commitment can an employee give? It can’t be one sided or it’s terrible.
- BobbyTables2 4mo agoAn AI can also regurgitate others decisions, based on a much wider knowledge base than these executives. AI hardware costs are nothing compared to executives’ stock options too…
- deleted 4mo ago[deleted]
- twelve40 4mo agothis is a bit... general? there are companies with bullshit executives for sure, then there are companies who slay it. i hate to list the details because people start picking on details, but in my mind MS under Satya made a 180 from crap to relevant. All the while i realize what kind of shit goes on inside and if you read Blind your eyes will bleed. Yet Satya took it from a pure 100% bullshit executive and made it relevant. So not all executives are equal.
- gaiagraphia 4mo ago[flagged]
- callc 4mo agoPlease write nicer comments. Everyone has their own problems and their own feelings. Their socioeconomic conditions do not invalidate them.
- gaiagraphia 4mo ago[flagged]
- christophilus 4mo agoex-Elastic here, too. It was a great place to work pre-IPO. It seems the culture has shifted a lot since the IPO, though.
- echelon 4mo agoMight've been better if AWS and GCP didn't steal your goodies and take so much meat off the bones. Fair source > Open source. Trillion dollar companies need to pay to play. Open source removes your jobs, your exit equity, and transfers it to the hyperscalers. Sucks that it happened to you guys.
- limagnolia 4mo agoElastic isn't Open Source though, they abandoned Open Source. It seems to me like this is an example of non-Open Source whatever licensing causing job loss. Or just plain bad leadership.
- echelon 4mo agoThey switched from open source when big tech stole their goodies. It was too late to stop it.
- limagnolia 4mo agoBig tech didn't steal anything. Elastic used open source software as the foundation of their product (specifically, Apache Lucene), and released their product as open source. The license allowed Elastic to do so, and likewise, the license Elastic used allowed "big tech" to use Elastics product. If it wasn't for open source, Elastic wouldn't exist. Then, Elastic whined about Amazon using Elastic under the open source license they used to build their product. They whined that Amazon wasn't contributing enough. So they switched the license to their product. So Amazon took over maintaining the open source software. Doing exactly what Elastic asked them to do. Sorry, but everything about Elastic, and especially this most recent announcement of layoffs, scream "bad leadership".
- gaiagraphia 4mo ago[flagged]
- asda_ 4mo agoFeels like you're annoyed the company ever tried to make a buck off their labor at all. Give your product away for free and this is what you get.
- tibbar 4mo agoThis seems kind of weirdly confrontational? Elastic was founded by the guy who created elasticsearch. Why shouldn't he make a living selling services around the software he created? This is a terrific success story!
- grey-area 4mo agoWhat’s also sad is looking at the quotes you posted GAI was obviously used to churn it out - it’s a simulacrum of thought, signifying nothing. This is what the CEO is trying to claim will save the company, and unfortunately this is the sort of mediocrity relying on LLMs gives you.
- ffsm8 4mo ago> This is what the CEO is trying to claim will save the company Maybe I'm misreading it, but I didn't get the "we're forced to do this" vibe, which "saving" would imply. To be this reads more like a strategic reduction in workforce as the product has stabilized.
- dzonga 4mo ago>more “head count” in “go-to-market” roles Software engineers tend to put their heads in the sand, once a company/product reaches a certain maturity - it's the time for it to be milked. You need less product people - hence why most companies end up outsourcing to India etc, "A.I" is just outsourcing to "agents". Now Salespeople - they can keep selling - and as long as they're willing buyers. this is all part of the Product Maturity lifecycle. One day the product stops being an attractive cash cow - then it gets sold to PE & finally dies or remains a zombie. as an engineer - your job is to know where in the product lifecycle the company|product you're currently working on is.
- nozzlegear 4mo agoThis announcement spends remarkably few words talking about the what (7% of the company's workforce was laid off), and a great deal of words talking about how bright the future of the company is and how they're going to hire more people.
- cyanydeez 4mo agowhich is why most corporations should be classified as sociopaths, at a minimum.
- lcnPylGDnU4H9OF 4mo agoWell, sort of. That anthropomorphizes them and allows the sociopaths running the corporations to pawn the responsibility of their decisions to the corporation, which is actually a legal fiction that is incapable of independent thought or expression.
- calgoo 4mo agoThey have already done that when giving companies right as people which then takes responsibility off the CEO.
- AngryData 4mo agoI c-suites were actually held responsible for the actions of the corporation I would agree, but I don't see that actually happening very wrong. It is so rare that when it does happen it will be in the news for months.
- yamillove 4mo agoThe corporation actually gave them a job.
- blitzar 4mo agoLook at what they make you give
- bigyikes 4mo agoWhy even bother with such a small layoff? Is there a reason to not just dial up your attrition for a while?
- trgn 4mo agoi dont understand this either. just dont hire for half a year or so, a generic globocorp gets to that 7% easily.
- Avicebron 4mo agoThat doesn't boost the stock after the announcements, why would they do it?
- trgn 4mo agoi dont think this announcement will boost the stock either, for the same reason we are wondering here why 7% is noteworthy for a globocorp.
- mh- 4mo agoOne challenge is that when the market stops hiring as aggressively, voluntary attrition retracts as well. Large companies model attrition in their financials, and those assumptions start to break when macro conditions around the job market shift like that.
- film42 4mo agoI've seen companies put a percentage of the team on a PIP as a "this is not a layoff but we do need to cut costs" situation. Hopefully Elastic is just being honest about it?
- Legend2440 4mo agoYour best employees are the most likely to leave via attrition, because they have the most opportunity elsewhere. In theory, a small layoff can target the least productive employees.
- msteffen 4mo agoI wonder if some of these CEOs are anticipating a big crash and trying to lay people off now, so that (1) they can raise/hoard cash while the money-go-round is spinning and (2) their eng organization is already lean and used to it if/when the money-go-round stops. “Because of AI” indeed.
- kev009 4mo agoI think it's just the relative cost of money. Credit, debt, raises, revenue all rely on it. The tech industry got used to zero interest rate and then Covid-era stimulus. Now, suddenly, cashflow matters, but the companies are still run by the same people that only know perception management. Eventually they too will get cycled out.
- Ancalagon 4mo agonot to mention SaaS stocks are down making the cost of borrowing against their stock more expensive
- skeeter2020 4mo agoBingo - the combination of rising interest rates and tanking SaaS valuations has left a lot of these companies - specifically PE funded with mountains of debt - in a very weak position. Funny enough I think small SaaS companies are in a good position, both ownership & their potential use of AI, while larger SaaS companies, are in a lot of trouble. Why rent SaaS when you can build applications with AI? but then, who's going to maintain them?
- trgn 4mo agobut none of this applies to elastic. it's cash flow positive, and has such a cash hoard it's doing stock buybacks.
- kev009 4mo agoThey carry $575m in debt, which is around 80-100 devs a year if they are paying something like 4.5% on it, ignoring tax write-offs on either case as well as equity comp. There is some calculus to all that, carrying some debt, doing buybacks, whatever other strategies to manage perceptions sure.
- variety8675 4mo ago[dead]
- SaucyWrong 4mo agoFunny, so many words used but my brain only hears, “I am currently mismanaging this company,” every time one of these layoffs occurs.
- yamillove 4mo ago[flagged]
- keithnz 4mo agoThis just reaffirms my view is that big companies will lose headcount because of AI, but small and medium companies will (or at least have the potential to) leverage AI to do bigger and better things. This is because big companies could always spend big money on getting what they want made while small companies always have to tradeoff what they can realistically do with the resources they have.
- wolvoleo 4mo agoAlso big companies spend tons and tons of time and money on useless busy work. I work in IT and when we needed something new we'd just implement or build it. Now we have long certification processes for anything new, checking if it complies with hundreds of pages of policies. A lifecycle management program which we constantly have to keep updated. Governance teams that are constantly looking over our shoulders. All shit that has nothing to do with IT whatsoever. As a result we spend 90% of time doing busywork jumping through hoops these guys set up for us. Only 5% is real technical work and a lot is outsourced or consulted out to a friend of the vice president who spends all day chatting in his office for 1000 bucks a day. Or a Deloitte guy who looks great in a suit and has no idea what he's talking about. Because companies hate employing people who have actual knowledge. I really hate IT work now. Not sure about the rest of the industry but this change happened about 10 years ago. Until then we still were able to do actual useful work. I can only imagine how awful a place to work it will become when they will use AI to dream up even more inhibiting policies to keep us down with. Oh and meanwhile the CEO still goes around how innovative we are even though any innovation is absolutely killed by all this bureaucracy. Most of the time we come up with a great idea it doesn't move ahead because nobody wants to deal with years of pencil pushing to get it approved. I can totally see how startups can do actual work with little money and we can't do anything.
- georgel 4mo agoThis has been the case forever in corporate environments, even before AI. I worked for 3 years on an app that in startup land should have taken a couple months at best.
- gortok 4mo agoI recommended an elastic demo for a client that would be well served by Elasticsearch. The Elastic sales folks completely torpedoed the presentation by trying to focus on their AI “capabilities” and not on the recommended talking points. This was 2 years ago.
- enraged_camel 4mo agoSo how many people? I can't find this info anywhere.
- dakrone 4mo agoThere were around 4000 employees before this announcement, so around 280 people affected.
- tracerbulletx 4mo agoBefore the 1980s layoffs were seen as a massive failure of the company and almost never happened to tenured employees unless the company was collapsing. Before we are all made to think this is normal and unavoidable behavior.
- zamadatix 4mo agoI wouldn't have nearly as many complaints about this mindset change if ones life (e.g. insurance) weren't still so deeply tied to who your current employer is.
- yamillove 4mo ago[flagged]
- outside1234 4mo agoAnd the Republicans wrecked it by getting rid of the mandate and then not funding the subsidy.
- wombat-man 4mo agoyeah, and no public option
- cramer4next 4mo ago[flagged]
- lovich 4mo agohttps://en.wikipedia.org/wiki/Efforts_to_repeal_the_Affordable_Care_Act https://en.wikipedia.org/wiki/Efforts_to_repeal_the_Affordab... > On November 2, 2017, a bill later known as the Tax Cuts and Jobs Act was introduced by Representative Kevin Brady of Texas. Included in the bill was the move to change the tax penalty for not having health insurance mandated by the Affordable Care Act to zero.[62][63] Economists said this would lower interest in obtaining health insurance coverage.[64] The bill was signed into law on December 22, 2017 by Donald Trump,[65] with the loss of individual mandate taxation being set to take effect January 1, 2019.[62]
- qwertyuiop_ 4mo agoWe're in an outstanding position and well-equipped for the future. I'm excited about the opportunities ahead and focused on making sure Elastic is positioned to lead in this next phase of innovation. - Ash Kulkarni" If they are in an outstanding position why did he make 7% of the employees lives miserable with a stroke of a pen.
- bluecheese452 4mo ago[flagged]
- wegwerper 4mo ago[flagged]
- thayne 4mo ago> Customer expectations are increasing and evolving faster than ever before Wouldn't that suggest you need those workers more?
- nobleach 4mo agoI'm sure now that they've right-sized the org, the leftover engineers + AI are really gonna grind out the best features. We should be seeing 10x any day now.
- gaiagraphia 4mo ago[flagged]
- moron4hire 4mo agoLooks like Elastic has a lazy CEO https://www.entrepreneur.com/business-news/nvidias-jensen-huang-says-that-ai-is-a-lazy-excuse-for-layoffs https://www.entrepreneur.com/business-news/nvidias-jensen-hu...
- ygouzerh 4mo agoSo true! It was the same for Gitlab, Cisco, Oracle... every-time they used the AI excuse to explain their laid-off, instead of explaining why they have bad financials. Actually, in all the cases above, the real reason when digging in the financials was the leadership and bad work culture...
- coolid 4mo agothis should we do this or no this is not right
- maxloh 4mo agoI wonder how much of the layoffs were caused by their license change in 2021. They lost a lot of goodwill back then. Some of their potential customers migrated to OpenSearch and never looked back, even after they backed down and went open-source again under AGPL.
- sergiotapia 4mo ago> this requires us to move faster and operate leaner than we have before :laughing: > To do it, we're shifting our pace of innovation, simplifying how we operate, and investing in new skills. That's what this reorganization is for: a simpler structure, with fewer layers, less complexity, and less friction. Translation: We're going to run the remaining people ragged. > That means fewer layers, broader ownership, clearer accountability, and a sharper focus on the skills we believe matter most for what's ahead. Yeah the people remaining are cooked. It's never "we're going to hire more people to build lots of cool stuff" it's always giving fewer people quadruple the responsibility expectation.
- SpyCoder77 4mo agoSaying 7% in this scenario is the wrong choice. It diminishes the absolute number of ~281 people who just had their lives shaken up by this.
- tylerjl 4mo agoIt's interesting to contrast this announcement with a similar post from the CEO in 2022 [1]: those past layoffs had much more of a victim-of-circumstances tone as ZIRP was beginning to dry up, but apparently those "bad times" versus "good times" during AI mania just accounts for a delta of +6% additional layoffs. Another commenter questioned what size bucket Elastic falls into these days; in April 2025 their SEC filing [2] cited about 3,500 employees. So not a startup any more but definitely not fully-fledged FAANG-sized. (not sure whether it even applies here; but full disclosure, I left Elastic in 2022.) [1]: https://www.elastic.co/blog/ceo-ash-kulkarni-email-to-elastic-employees https://www.elastic.co/blog/ceo-ash-kulkarni-email-to-elasti... [2]: https://www.sec.gov/Archives/edgar/data/1707753/000170775325000021/estc-20250430.htm https://www.sec.gov/Archives/edgar/data/1707753/000170775325...
- delfugal 4mo agoFor the good of the company we are reducing force by 7% even though those people we fired were instrumental in helping us grow. Insensitive PR tripe.
- ronbenton 4mo agoHere's my translation of this announcement: https://layofftranslator.com/layoffs/2026-06-24-elastic/ https://layofftranslator.com/layoffs/2026-06-24-elastic/
- Kiryous 3mo agodude, this is the work of a genius
- khurs 4mo agoNo mention of any details of the severance packages. What's normal in USA for this size of company?
- rootusrootus 4mo ago2-3 weeks per year of tenure
- dirtbag__dad 4mo ago> in some areas, especially customer-facing sales, we expect to keep adding to our teams to support future growth Can someone help me understand why sales is immune to this strategy and still is employing the “more bodies” approach. I thought we were working smarter in 2026?
- steelbrain 4mo agoIn the US at least, it is illegal to do unsolicited outbound sales with a bot. You have to have humans make these calls.
- SoftTalker 4mo agoInteresting. I'm in the US and I get half a dozen calls a day from AI bots. Where can I report this criminal activity?
- steelbrain 4mo agoI'm not from the US, but based on my knowledge of your culture, it may be worth it to write a letter to your state's Attorney General
- iwontberude 4mo agolol everyone quit using elasticsearch for opensearch. Elastic use to be pretty cool but that was over ten years ago.
- daft_pink 4mo agoI blame the hyperscalers not AI. I think open source is important and fair use is important, but I’m skeptical of the business model of gutting open source by hosting it and reselling it wholesale with a few modifications. Amazon, Google and Microsoft are getting rich just reselling hosted open source and actively competing with and gutting companies like Elastic.
- tedggh 4mo agoWhy are these decisions never easy?
- deleted 4mo ago[deleted]
- chopete3 4mo agoUnfortunately Elastic lost -60.54% market value in the last 5 years. Negative net income every year since going public. The underlying message is a lot clear - they are a public company. They have to do this and more show to net positive income to keep the market value from falling further. Companies can keep the employees with market value drop but it gets hard with negative income. Salesforce also lost ~37% value in last 5 years but they still print billions in net income every year. The same story with companies like Gitlab. They lost 75% market value and negative income since going public.
- slantedview 3mo agoAm I misunderstanding their current finances? On yahoo finance, I don't see net negative income for ESTC.
- aussieguy1234 4mo ago> The industry is changing. Advances in AI, automation, and technology are reshaping how work gets done, and we're changing with them It's never AI. In almost every case, companies that claim it's AI are doing so because reducing headcount due to "automating with AI" sounds better than the real reason, often over hiring, financial troubles and other reasons that might scare investors away. The correct term is usually AI Washing. More info: https://www.thehrdigest.com/what-is-ai-washing-and-why-has-it-been-linked-to-layoffs/ https://www.thehrdigest.com/what-is-ai-washing-and-why-has-i...
- vismit2000 4mo agoThey should layoff everybody, close down the company, and just use postrgres full text search
- Bombthecat 4mo agoSeven percent sounds about right what AI can replace
- tonyedgecombe 4mo agoThe business has been losing money for years. Perhaps 7% is better than 100%.
- elzbardico 4mo agoRight now if you're a open company, you have to keep a constant flow of layoffs in order to satisfy the wall street vampires. I don't even blame the CEOs anymore, very few of them have the fortitude or the luxury of even being able to say: "Shut up stupid monkeys, I won't do layoffs to satisfy your urges this quarter, I don't want to fuck the long term value creation ability of this company just because you want a quick orgasm now".
- Kiryous 3mo agoFounders + dual class shares. Founder-CEO is much more likely to say that to investors, especially when the class A share give him 10x voting rights.
- monicasarbu 4mo agoEx-Elastic here. At Xata, we've built a company with many of the things we loved about Elastic's culture, and several former Elasticians are already on the team. We're currently hiring Backend Engineers, a Product Marketing Lead, and a Head of Product. If you're interested (or know someone who might be), send us a message!
- alexk307 4mo agoSad but you unfortunately need to make a profit as a public company at some point. In 8 years since going public, they've had essentially one marginally profitable year surrounded by lots of losses while growing to 4000 employees. Easy to blame AI when the fault is really poor leadership.
- nipperkinfeet 4mo agoBloated POS software. Kill it off.