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Guidewire Software Announces First Quarter Fiscal Year 2020 Financial Results

 

Insurance industry platform provider Guidewire Software, Inc. today announced its financial results for the fiscal quarter ended October 31, 2019.

“Total revenue and profitability in the first quarter exceeded our outlook and was highlighted with the selection of InsuranceSuite Cloud by a Tier One carrier for a new, greenfield line of business,” said Mike Rosenbaum, chief executive officer, Guidewire Software. "As we build momentum into the year, we are as committed as ever to the cloud, data, and analytics transformation we are helping drive in the P&C insurance industry.”

Revenue

  1. Total revenue for the first quarter of fiscal year 2020 was $157.0 million, a decrease of 13% from the same quarter in fiscal year 2019. License and subscription revenue was $82.4 million, a decrease of 13%; services revenue was $53.6 million, a decrease of 17%; and maintenance revenue was $21.0 million, which remained relatively flat.
  2. Annual recurring revenue, or ARR, was $463 million as of October 31, 2019, up from $460 million as of July 31, 2019. Quarterly ARR results for fiscal year 2020 are based on actual currency rates at the end of fiscal year 2019, held constant throughout the year.

Profitability

  1. GAAP loss from operations was $24.6 million for the first quarter of fiscal year 2020, compared with $2.5 million of income for the comparable period in fiscal year 2019.
  2. Non-GAAP income from operations was $7.1 million for the first quarter of fiscal year 2020, compared with $33.1 million of non-GAAP income for the comparable period in fiscal year 2019.
  3. GAAP net loss was $15.0 million for the first quarter of fiscal year 2020, compared with $6.3 million of net income for the comparable period in fiscal year 2019. GAAP net loss per share was $0.18, based on diluted weighted average shares outstanding of 82.4 million, compared with net income per share of $0.08 for the comparable period in fiscal year 2019, based on diluted weighted average shares outstanding of 82.2 million.
  4. Non-GAAP net income was $11.0 million for the first quarter of fiscal year 2020, compared with $31.1 million of non-GAAP net income for the comparable period in fiscal year 2019. Non-GAAP net income per share was $0.13, based on diluted weighted average shares outstanding of 83.1 million, compared with non-GAAP net income per share of $0.38 for the comparable period in fiscal year 2019, based on diluted weighted average shares outstanding of 82.2 million.

Liquidity

  1. The Company had $1.3 billion in cash, cash equivalents, and investments at October 31, 2019, the same as at July 31, 2019. The Company used $18.1 million in cash from operations and had negative free cash flow of $29.1 million during the three months ended October 31, 2019.

Business Outlook

Guidewire is issuing the following outlook for the second fiscal quarter and fiscal year 2020 based on current expectations:

(in $ millions)

 

Second Quarter Fiscal Year 2020

 

Fiscal Year 2020

Revenue

 

162.0

-

166.0

 

759.0

-

771.0

License and subscription

 

92.0

-

96.0

 

443.0

-

455.0

Maintenance

 

20.0

-

20.5

 

85.0

-

87.0

Services

 

48.0

-

51.0

 

224.0

-

236.0

GAAP income (loss) from operations

 

(28.9)

-

(24.9)

 

(41.4)

-

(29.4)

Non-GAAP income (loss) from operations

 

5.0

-

9.0

 

96.0

-

108.0

The Company is not providing an outlook for GAAP and non-GAAP net income (loss) and GAAP and non-GAAP net income (loss) per share due to the issuance of base erosion and anti-abuse tax ("BEAT") regulations earlier this week. The Company is currently evaluating these regulations; however, the Company believes that these regulations will increase the Company's GAAP income tax provision in fiscal year 2020 but will not impact the non-GAAP income tax provision.

Guidewire delivers the industry platform that P&C insurers rely upon to adapt and succeed in a time of accelerating change. We provide the software, services, and partner ecosystem to enable our customers to run, differentiate, and grow their business.  As of the end of our fiscal year 2019, we were privileged to serve more than 380 companies in 34 countries.  For more information, please visit www.guidewire.com and follow us on twitter: @Guidewire_PandC.

 

 


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