Latest news with #Guidewire
Yahoo
4 days ago
- Business
- Yahoo
Why Is Guidewire (GWRE) Stock Rocketing Higher Today
Shares of insurance industry-focused software maker Guidewire (NYSE:GWRE) jumped 16.2% in the afternoon session after the company reported impressive first-quarter 2025 (Fiscal Q3 '25) results, which blew past most of the key metrics we track including billings, annual recurring revenue, EPS, and adjusted operating income. In addition, quarterly revenue guidance outperformed Wall Street's estimates. What really stood out was subscription revenue, which rose 32%, showing that more customers are signing up and sticking around. That helped push sales up by 22%, a strong pace for a company this size. Margins also got a lift. With expenses held in check, operating income more than doubled on a non-GAAP basis. That efficiency boost powered a big jump in earnings per share, which more than tripled year-over-year. Management also raised revenue and operating income targets for the year, and guided to stronger-than-expected results in the fourth quarter. Overall, we think this was a solid quarter with some key areas of upside. Is now the time to buy Guidewire? Access our full analysis report here, it's free. Guidewire's shares are not very volatile and have only had 9 moves greater than 5% over the last year. Moves this big are rare for Guidewire and indicate this news significantly impacted the market's perception of the business. The biggest move we wrote about over the last year was 12 months ago when the stock gained 16.3% on the news that the company announced a "beat and raise" quarter. Guidewire beat analysts' revenue, billings, and ARR (annual recurring revenue) expectations. Its full-year ARR guidance also beat Wall Street's estimates. One negative was that its gross margin decreased, but it didn't matter much in the face of a "beat-and-raise" quarter. Zooming out, we think this was a solid quarter, showing the company is staying on track. Guidewire is up 49.9% since the beginning of the year, and at $254.11 per share, has set a new 52-week high. Investors who bought $1,000 worth of Guidewire's shares 5 years ago would now be looking at an investment worth $2,408. Today's young investors likely haven't read the timeless lessons in Gorilla Game: Picking Winners In High Technology because it was written more than 20 years ago when Microsoft and Apple were first establishing their supremacy. But if we apply the same principles, then enterprise software stocks leveraging their own generative AI capabilities may well be the Gorillas of the future. So, in that spirit, we are excited to present our Special Free Report on a profitable, fast-growing enterprise software stock that is already riding the automation wave and looking to catch the generative AI next.
Yahoo
4 days ago
- Business
- Yahoo
GWRE Q1 Earnings Call: Cloud Platform Drives Growth, Misses Revenue Expectations, Raises Guidance
Insurance industry-focused software maker Guidewire (NYSE:GWRE) fell short of the market's revenue expectations in Q1 CY2025, but sales rose 22% year on year to $293.5 million. Its non-GAAP EPS of $0.88 per share was 88.1% above analysts' consensus estimates. Is now the time to buy GWRE? Find out in our full research report (it's free). Revenue: $293.5 million (22% year-on-year growth) Adjusted EPS: $0.88 vs analyst estimates of $0.47 (88.1% beat) Adjusted Operating Income: $46.06 million vs analyst estimates of $39.63 million (15.7% margin, 16.2% beat) Revenue Guidance for Q2 CY2025 is $336 million at the midpoint, above analyst estimates of $332.2 million Operating Margin: 1.5%, up from -6.9% in the same quarter last year Annual Recurring Revenue: $960 million at quarter end, up 15.9% year on year Billings: $289.3 million at quarter end, up 27.8% year on year Market Capitalization: $18.3 billion Guidewire's first quarter results reflected significant customer adoption of its cloud platform and broad-based momentum across the property and casualty insurance industry. CEO Mike Rosenbaum highlighted, 'We closed 17 cloud deals, 14 for at least one of our InsuranceSuite applications, and three for InsuranceNow.' Management attributed the progress to strong execution, particularly among large insurers, and pointed to international traction in Canada, Asia Pacific, and Europe. In addition to robust cloud migrations and expansions, the company's recent acquisition of Quanti was cited as a strategic move to enhance its pricing and rating technology capabilities. The quarter also saw notable customer go-lives, including Cincinnati Insurance Company and Santa Lucia, further validating Guidewire's cloud strategy. Looking ahead, Guidewire's increased guidance is underpinned by expectations for continued growth in annual recurring revenue and accelerated adoption of its cloud offerings. Management believes that investments in product innovation, such as Guidewire Industry Intelligence and generative AI use cases, will expand the platform's relevance for both large and smaller insurers. CFO Jeff Cooper stated the company expects to maintain upper-teens annual recurring revenue growth, driven by larger, longer-term customer commitments and record-low attrition. CEO Rosenbaum emphasized the importance of international markets, with a $60 million investment planned for Japan, signaling a long-term commitment to global expansion. However, management acknowledged that execution in the upcoming quarter is critical, given the high concentration of sales activity and variability in large deal timing. Management attributed the quarter's performance to strength in cloud adoption, successful execution in large and international markets, and early traction with advanced analytics products. Cloud adoption momentum: Guidewire continued to see increased demand for its cloud platform, with 17 new cloud deals and a strong mix of migrations, expansions, and net new wins. Management emphasized that Tier 1 and Tier 2 insurers are increasingly replacing legacy systems to enable faster product launches and business agility. Expansion of InsuranceNow: The company reported three net new InsuranceNow wins, including two of the largest ever on the product. CEO Rosenbaum attributed this success to improvements in the product and closer integration with Guidewire's cloud platform, making it more competitive in the lower tiers of the insurance market. International growth and investment: Guidewire highlighted notable cloud expansion in Canada, APAC, and EMEA, and announced a $60 million investment in Japan over five years to deepen local operations and partnerships. Management views this as a strategic move to capture growing demand from Japanese insurers amid evolving regulations and market dynamics. Advanced analytics and AI initiatives: The first sale of Guidewire Industry Intelligence, a predictive analytics model embedded in the claims workflow, was positioned as an initial step toward monetizing cloud-based industry data. Management also discussed generative AI use cases in claims processing, underwriting, and developer productivity, as key areas of customer interest. Quanti acquisition integration: The addition of Quanti's pricing and rating technology is expected to enhance Guidewire's ability to support more agile actuarial and pricing strategies. The integration is underway, with management noting its applicability for both large and small insurers looking to modernize pricing processes. Guidewire's outlook is shaped by expectations for continued cloud deal momentum, product innovation, and international expansion, tempered by execution risks in large deal timing and ongoing investments. Cloud platform expansion: Management expects sustained demand for Guidewire Cloud Platform, especially as more insurers pursue core system modernization to improve agility. The company sees ongoing migrations and expansions as a key source of recurring revenue growth. Product innovation and analytics: Guidewire plans to broaden adoption of Industry Intelligence and AI-driven tools, aiming to create value for insurers lacking in-house data resources. The rollout of new predictive models and integration of Quanti's capabilities are expected to differentiate Guidewire's platform and drive incremental revenue opportunities. International market commitments: The company's investment in Japan and expansion across Europe and Asia-Pacific are intended to capture market share as global insurers seek compliant, modern technology solutions. However, management cautioned that large deal timing and the pace of international adoption could cause variability in quarterly results. In the coming quarters, the StockStory team will monitor (1) continued growth in annual recurring revenue as Guidewire targets the $1 billion milestone, (2) customer adoption and expansion of Guidewire Industry Intelligence and other analytics tools, and (3) execution of the $60 million investment in Japan and resulting traction with local insurers. We will also track the integration of Quanti's technology and progress in cloud deal momentum globally. Guidewire currently trades at a forward price-to-sales ratio of 14.4×. At this valuation, is it a buy or sell post earnings? Find out in our full research report (it's free). The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today.
Globe and Mail
4 days ago
- Business
- Globe and Mail
Guidewire's Q3 Earnings & Revenues Beat Estimates, Stock Surges
Guidewire Software, Inc GWRE reported non-GAAP earnings per share of 88 cents in third-quarter fiscal 2025 (ended April 30, 2025), up 238.5% year over year and beat the Zacks Consensus Estimate by 91.3%. The company reported revenues of $293.5 million, up 22% year over year. Revenues beat the Zacks Consensus Estimate by 2.7%. The figure also surpassed the company's guided range of $283-$289 million. This uptick was driven by solid sales activity. Guidewire Cloud continued to gain momentum in the reported quarter with 17 deal wins. Out of these deals, 14 were for various InsuranceSuite Cloud applications and three InsuranceNow deals. It closed seven core system deals with Tier 1 insurers and three with Tier 2 insurers. As of April 30, annual recurring revenues ('ARR') were $960 million, up 15.9% year over year. GWRE now expects ARR for fiscal 2025 to be in the range of $1.012 billion to $1.022 billion (previous projection: $1-$1.01 billion). Driven by strong revenue performance in the fiscal third quarter, GWRE expects total revenues for fiscal 2025 to be between $1.178 billion and $1.186 billion compared with earlier guidance of $1.164 billion to $1.174 billion. Subscription revenues are now forecasted to be $660 million, while subscription and support revenues are expected to be $724 million. Services revenues are expected to be approximately $215 million. Non-GAAP operating income is estimated between $187 million and $195 million compared with $175-$185 million expected previously. Cash flow from operations is now anticipated to be in the range of $255-$275 million (earlier range: $230-$260 million). Following the results, shares are up 11.4% in the pre-market trading session today. In the past year, shares of the company have gained 71.1% compared with the Internet Software industry' s growth of 35.6%. (See the Zacks Earnings Calendar to stay ahead of market-making news.) GWRE's Fiscal Q3 in Details The subscription and support segment's revenues (62% of total revenues) soared 32% from the year-ago quarter's level to $181.8 million. License 's revenues (19.5%) were up 2% year over year to $57.2 million. Services ' revenues (18.5%) jumped 17% year over year to $54.5 million. Non-GAAP gross margin expanded to 65.5% from 62.6% on a year-over-year basis. The subscription and support segment's gross margin increased to 70.6% from 65.6% on a year-over-year basis, attributed to higher-than-expected revenues and increases in cloud infrastructure platform efficiency, along with $4 million in credits received from its cloud service provider. Services' non-GAAP gross margin was 12.9% against negative 10.3% in the year-ago quarter. Total operating expenses increased 12.1% year over year to $178.2 million. Non-GAAP operating income was $46.1 million compared with $20.8 million in the year-ago quarter. Financial Details of GWRE As of April 30, 2025, cash and cash equivalents and short-term investments were $1,243.7 million compared with $1,412.4 million as of Jan. 31, 2025. Driven by strong collections, GWRE generated $32.4 million in cash from operations in the quarter under discussion while free cash flow was nearly $27.8 million. GWRE's Fiscal Q4 Outlook For the fourth quarter of fiscal 2025, revenues are expected in the range of $332-$340 million. Non-GAAP operating income is estimated in the range of $52-$60 million. GWRE's Zacks Rank Guidewire currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 (Strong Buy) Rank stocks here. Recent Performance of Other Companies in the Same Space CoreWeave CRWV reported first-quarter 2025 loss per share of $1.49, which was much wider than a loss of 62 cents in the year-ago quarter. Adjusted net loss for the quarter was $149.6 million compared with a loss of $23.6 million a year ago. Revenues in the quarter were a record $981.6 million, which beat the Zacks Consensus Estimate by 15.2%. Total revenues jumped 420% year over year. The top-line performance was driven by increasing demand for AI-cloud infrastructure. CRWV highlighted that AI is forecasted to have a global economic impact of $20 trillion by 2030, while the total addressable market is anticipated to increase to $400 billion by 2028. Shares of CoreWeave have skyrocketed 195% in the past month. Atlassian Corporation TEAM reported third-quarter fiscal 2025 results, wherein earnings and revenues beat the Zacks Consensus Estimate. Its non-GAAP earnings per share of 97 cents beat the Zacks Consensus Estimate by 7.8%. The figure jumped 9% from the year-ago quarter's non-GAAP earnings of 89 cents per share. TEAM's fiscal third-quarter revenues climbed 21.4% year over year to $1.36 billion and beat the Zacks Consensus Estimate by 0.72%. The top line was primarily driven by robust paid growth in Atlassian Government Cloud and Isolated Cloud, and momentum in AI-adoption. Shares of TEAM have inched up 1.4% in the past month. Zoom Communications Inc 's. ZM first-quarter fiscal 2026 adjusted earnings of $1.43 per share beat the Zacks Consensus Estimate by 10% and increased 5.93% year over year. Zoom's earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 10.33%. Revenues of $1.175 billion beat the consensus mark by 0.89% and increased 2.93% year over year. Adjusting for foreign currency impact, revenues in constant currency were $1.18 billion, up 3.4% year over year. Shares of ZM are up 3.5% in the past month. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%. Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor. Today, See These 5 Potential Home Runs >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Guidewire Software, Inc. (GWRE): Free Stock Analysis Report Atlassian Corporation PLC (TEAM): Free Stock Analysis Report Zoom Communications, Inc. (ZM): Free Stock Analysis Report CoreWeave Inc. (CRWV): Free Stock Analysis Report
Yahoo
5 days ago
- Business
- Yahoo
Guidewire's (NYSE:GWRE) Q1 Sales Top Estimates, Stock Soars
Insurance industry-focused software maker Guidewire (NYSE:GWRE) announced better-than-expected revenue in Q1 CY2025, with sales up 22% year on year to $293.5 million. Guidance for next quarter's revenue was better than expected at $336 million at the midpoint, 1.1% above analysts' estimates. Its non-GAAP profit of $0.88 per share was 88.1% above analysts' consensus estimates. Is now the time to buy Guidewire? Find out in our full research report. Revenue: $293.5 million vs analyst estimates of $286.6 million (22% year-on-year growth, 2.4% beat) Adjusted EPS: $0.88 vs analyst estimates of $0.47 (88.1% beat) Adjusted Operating Income: $46.06 million vs analyst estimates of $39.63 million (15.7% margin, 16.2% beat) Revenue Guidance for Q2 CY2025 is $336 million at the midpoint, above analyst estimates of $332.2 million Operating Margin: 1.5%, up from -6.9% in the same quarter last year Free Cash Flow Margin: 9.5%, down from 28.4% in the previous quarter Annual Recurring Revenue: $960 million at quarter end, up 15.9% year on year Billings: $286.2 million at quarter end, up 26.4% year on year Market Capitalization: $18.05 billion Founded by two individuals involved in the development of leading procurement software Ariba, Guidewire (NYSE:GWRE) offers insurance companies a software-as-a-service platform to help sell their products and manage their workflows. Reviewing a company's long-term sales performance reveals insights into its quality. Any business can put up a good quarter or two, but many enduring ones grow for years. Over the last three years, Guidewire grew its sales at a 12.6% annual rate. Although this growth is acceptable on an absolute basis, it fell short of our standards for the software sector, which enjoys a number of secular tailwinds. This quarter, Guidewire reported robust year-on-year revenue growth of 22%, and its $293.5 million of revenue topped Wall Street estimates by 2.4%. Company management is currently guiding for a 15.3% year-on-year increase in sales next quarter. Looking further ahead, sell-side analysts expect revenue to grow 13.5% over the next 12 months, similar to its three-year rate. This projection is admirable and indicates the market is forecasting success for its products and services. Software is eating the world and there is virtually no industry left that has been untouched by it. That drives increasing demand for tools helping software developers do their jobs, whether it be monitoring critical cloud infrastructure, integrating audio and video functionality, or ensuring smooth content streaming. Click here to access a free report on our 3 favorite stocks to play this generational megatrend. While reported revenue for a software company can include low-margin items like implementation fees, annual recurring revenue (ARR) is a sum of the next 12 months of contracted revenue purely from software subscriptions, or the high-margin, predictable revenue streams that make SaaS businesses so valuable. Guidewire's ARR punched in at $960 million in Q1, and over the last four quarters, its growth was solid as it averaged 14.7% year-on-year increases. This alternate topline metric grew slower than total sales, which likely means that the recurring portions of the business are growing slower than less predictable, choppier ones such as implementation fees. If this continues, the quality of its revenue base could decline. The customer acquisition cost (CAC) payback period represents the months required to recover the cost of acquiring a new customer. Essentially, it's the break-even point for sales and marketing investments. A shorter CAC payback period is ideal, as it implies better returns on investment and business scalability. Guidewire is extremely efficient at acquiring new customers, and its CAC payback period checked in at 17.7 months this quarter. The company's rapid recovery of its customer acquisition costs indicates it has a highly differentiated product offering and a strong brand reputation. These dynamics give Guidewire more resources to pursue new product initiatives while maintaining the flexibility to increase its sales and marketing investments. We were impressed by how significantly Guidewire blew past analysts' billings expectations this quarter. We were also happy its annual recurring revenue, EPS, adjusted operating income, and quarterly revenue guidance outperformed Wall Street's estimates. Overall, we think this was a solid quarter with some key areas of upside. The stock traded up 8.6% to $236.90 immediately after reporting. Sure, Guidewire had a solid quarter, but if we look at the bigger picture, is this stock a buy? We think that the latest quarter is just one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here, it's free. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
5 days ago
- Business
- Yahoo
Guidewire's (NYSE:GWRE) Q1 Sales Top Estimates, Stock Soars
Insurance industry-focused software maker Guidewire (NYSE:GWRE) announced better-than-expected revenue in Q1 CY2025, with sales up 22% year on year to $293.5 million. Guidance for next quarter's revenue was better than expected at $336 million at the midpoint, 1.1% above analysts' estimates. Its non-GAAP profit of $0.88 per share was 88.1% above analysts' consensus estimates. Is now the time to buy Guidewire? Find out in our full research report. Revenue: $293.5 million vs analyst estimates of $286.6 million (22% year-on-year growth, 2.4% beat) Adjusted EPS: $0.88 vs analyst estimates of $0.47 (88.1% beat) Adjusted Operating Income: $46.06 million vs analyst estimates of $39.63 million (15.7% margin, 16.2% beat) Revenue Guidance for Q2 CY2025 is $336 million at the midpoint, above analyst estimates of $332.2 million Operating Margin: 1.5%, up from -6.9% in the same quarter last year Free Cash Flow Margin: 9.5%, down from 28.4% in the previous quarter Annual Recurring Revenue: $960 million at quarter end, up 15.9% year on year Billings: $286.2 million at quarter end, up 26.4% year on year Market Capitalization: $18.05 billion Founded by two individuals involved in the development of leading procurement software Ariba, Guidewire (NYSE:GWRE) offers insurance companies a software-as-a-service platform to help sell their products and manage their workflows. Reviewing a company's long-term sales performance reveals insights into its quality. Any business can put up a good quarter or two, but many enduring ones grow for years. Over the last three years, Guidewire grew its sales at a 12.6% annual rate. Although this growth is acceptable on an absolute basis, it fell short of our standards for the software sector, which enjoys a number of secular tailwinds. This quarter, Guidewire reported robust year-on-year revenue growth of 22%, and its $293.5 million of revenue topped Wall Street estimates by 2.4%. Company management is currently guiding for a 15.3% year-on-year increase in sales next quarter. Looking further ahead, sell-side analysts expect revenue to grow 13.5% over the next 12 months, similar to its three-year rate. This projection is admirable and indicates the market is forecasting success for its products and services. Software is eating the world and there is virtually no industry left that has been untouched by it. That drives increasing demand for tools helping software developers do their jobs, whether it be monitoring critical cloud infrastructure, integrating audio and video functionality, or ensuring smooth content streaming. Click here to access a free report on our 3 favorite stocks to play this generational megatrend. While reported revenue for a software company can include low-margin items like implementation fees, annual recurring revenue (ARR) is a sum of the next 12 months of contracted revenue purely from software subscriptions, or the high-margin, predictable revenue streams that make SaaS businesses so valuable. Guidewire's ARR punched in at $960 million in Q1, and over the last four quarters, its growth was solid as it averaged 14.7% year-on-year increases. This alternate topline metric grew slower than total sales, which likely means that the recurring portions of the business are growing slower than less predictable, choppier ones such as implementation fees. If this continues, the quality of its revenue base could decline. The customer acquisition cost (CAC) payback period represents the months required to recover the cost of acquiring a new customer. Essentially, it's the break-even point for sales and marketing investments. A shorter CAC payback period is ideal, as it implies better returns on investment and business scalability. Guidewire is extremely efficient at acquiring new customers, and its CAC payback period checked in at 17.7 months this quarter. The company's rapid recovery of its customer acquisition costs indicates it has a highly differentiated product offering and a strong brand reputation. These dynamics give Guidewire more resources to pursue new product initiatives while maintaining the flexibility to increase its sales and marketing investments. We were impressed by how significantly Guidewire blew past analysts' billings expectations this quarter. We were also happy its annual recurring revenue, EPS, adjusted operating income, and quarterly revenue guidance outperformed Wall Street's estimates. Overall, we think this was a solid quarter with some key areas of upside. The stock traded up 8.6% to $236.90 immediately after reporting. Sure, Guidewire had a solid quarter, but if we look at the bigger picture, is this stock a buy? We think that the latest quarter is just one piece of the longer-term business quality puzzle. Quality, when combined with valuation, can help determine if the stock is a buy. We cover that in our actionable full research report which you can read here, it's free. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
