Elastic shares drop after co-founder of Banon steps down as CEO of software company

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  • Ashutosh Kulkarni, head of product at Elastic, will replace co-founder Shay Bannon as CEO.
  • Kulkarni has held executive roles in McAfee, Informatica and Akamai.
  • The President of Elastic’s Worldwide Area Operations is leaving.

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Search software maker Elastic said on Wednesday that Ashutosh Kulkarni, who joined the company as chief product officer last year, will replace co-founder Shay Bannon as CEO.

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Elastic shares fell more than 7% in extended trading following the announcement.

Bannon is assuming the role of head of technology at the company, effective immediately, Elastic said. Statement, He held this position from 2012 to 2017.

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Bannon took Elastic to the public in 2018. The stock is up nearly 59% from its closing price of $70 on the first day of trading. It fell 15% in December after the company reported a wider-than-expected quarterly loss. Last week it was among the stocks that were caught in a major software sell-off, down 12%.

In an interview with Businesshala, Bannon, who moved back to Israel from Silicon Valley two years ago, said he told the board he wanted to make a change.

“I’m thinking about what a world would be like where I potentially wouldn’t be CEO, balancing family and everything else,” he said. “A few months ago, I realized that I would like to take on the role of CTO and not be CEO.”

Bannon said he has recommended Kulkarni for the top post.

Kulkarni joined Elastic from security software company McAfee, where he was executive vice president and chief product officer of its enterprise business group. He held executive roles earlier in his career at content-distribution network operator Akamai and data integration software company Informatica.

Kulkarni said he is focused on accelerating Elastic’s move to deliver cloud services. About a third of total revenue in the second quarter of the fiscal year came from the Elastic Cloud offering, with cloud revenue up 84% compared to a year ago.

Competitors include Amazon Web Services, which in 2015 introduced the Amazon Elasticsearch service, which was based on the Elasticsearch open-source software that Elastic made popular. a Change “Last year the open-source software license for Elasticsearch “brought the kind of clarity to the broader market that we wanted,” Kulkarni said.

AWS name changed of its product for the Amazon OpenSearch Service in September.

“There is only one Elasticsearch now, and it is from Elastic,” Kulkarni said. “Yes, there’s this thing called OpenSearch, but it’s a different name and a different platform. The platform is fundamentally different.”

Elastic said Paul Appleby, the company’s president of worldwide field operations, will be leaving the company. The sales team reports to Michael Kremen, who joined Cohesity in October as chief sales officer.

Watch: We are a leader in delivering search experience through data, says Elastic CEO

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