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Guidewire Q1 Earnings Match Estimates, Revenues Increase Y/Y
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Key Takeaways
Guidewire reported Q1 revenue of $332.6M, up 26.5% and above its guided range.
Cloud traction and broad segment strength pushed subscription and support up 31%.
GWRE raised fiscal 2026 revenue outlook to $1.403B-$1.419B on strong performance.
Guidewire Software, Inc. (GWRE - Free Report) reported non-GAAP earnings per share of 66 cents for first-quarter fiscal 2026 (ended Oct. 31, 2025), up 53.5% year over year and in line with the Zacks Consensus Estimate.
The company reported revenues of $332.6 million, up 26.5% year over year. Revenues beat the Zacks Consensus Estimate by 4.9%. The figure also surpassed the company’s guided range of $315-$321 million. This uptick was driven by solid momentum across all business segments.
Management stated that the company continues to experience strong traction for the Guidewire Cloud Platform and has begun the fiscal year with solid momentum. As of Oct. 31, annual recurring revenues (ARR) were $1.063 billion, up 2.1% year over year. GWRE expects ARR for fiscal 2026 to be in the range of $1.22 billion to $1.23 billion.
Driven by strong revenue performance, GWRE expects total revenues for fiscal 2026 to be between $1.403 billion and $1.419 billion compared with $1.202 billion in fiscal 2025. The company earlier anticipated total revenues for fiscal 2026 to be between $1.385 billion and $1.405 billion.
Subscription revenues are now forecasted to be $891 million, while subscription and support revenues are expected to be $948 million. Services revenues are estimated at $245 million.
Non-GAAP operating income is forecasted to be between $266 million and $282 million. Cash flow from operations is now anticipated to be in the range of $355-$375 million.
In the past year, the stock has jumped 4.5% compared with the Internet Software industry’s growth of 1.4%.
Image Source: Zacks Investment Research
GWRE’s Fiscal Q1 in Details
The subscription and support segment’s revenues (66.8% of total revenues) soared 31% from the year-ago quarter's level to $222.2 million.
License’s revenues (12.6%) were up 12% year over year to $42 million.
Services’ revenues (20.6%) jumped 23% year over year to $68.5 million.
Non-GAAP gross margin expanded to 66% from 63.5% on a year-over-year basis. The subscription and support segment’s gross margin increased to 73.2% from 70.3% while the License segment’s gross margin was 98.5% compared with 97.7% in the year-ago quarter. Services’ non-GAAP gross margin was 22.8% compared with 19.7% a year ago.
Guidewire Software, Inc. Price, Consensus and EPS Surprise
Total operating expenses increased 17.1 % year over year to $191 million. Non-GAAP operating income was $63.4 million compared with $34.7 million in the year-ago quarter.
Financial Details of GWRE
As of Oct. 31, cash and cash equivalents and short-term investments were $1,409.3 million compared with $1,483.2 million as of July 31, 2025. Driven by strong collections, GWRE used $67.4 million in cash from operations in the quarter under discussion, while free cash flow used was nearly $77.4 million.
GWRE’s Fiscal Q2 Outlook
For the second quarter of fiscal 2026, revenues are expected in the range of $339-$345 million. Non-GAAP operating income is estimated in the band of $68-$74 million.
Recent Performance of Other Companies in the Same Space
Atlassian (TEAM - Free Report) came out with first-quarter fiscal 2026 earnings of $1.04 per share, which beat the Zacks Consensus Estimate of 83 cents. This compares to earnings of 77 cents per share a year ago.
Atlassian posted revenues of $1.43 billion for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 2.40%. The company reported revenues of $1.19 billion in the year-ago quarter.
Chegg, Inc. (CHGG - Free Report) reported breakeven earnings for the third quarter of 2025, which topped the Zacks Consensus Estimate but declined year over year. Net revenues topped the consensus mark but tumbled year over year.
The company’s breakeven earnings were above the Zacks Consensus Estimate of adjusted loss per share of 14 cents by 100%. In the year-ago quarter, it reported adjusted earnings per share (EPS) of nine cents.
Net revenues of $77.7 million surpassed the consensus mark of $76 million by 1.8% but declined 43% year over year.
MongoDB, Inc. (MDB - Free Report) reported third-quarter fiscal 2026 non-GAAP earnings per share (EPS) of $1.32, which increased 13.8% from the year-ago quarter and surpassed the Zacks Consensus Estimate by 67.09%.
The company’s total revenues of $628.3 million rose 18.7% year over year and beat the consensus estimate by 6.27%.
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Guidewire Q1 Earnings Match Estimates, Revenues Increase Y/Y
Key Takeaways
Guidewire Software, Inc. (GWRE - Free Report) reported non-GAAP earnings per share of 66 cents for first-quarter fiscal 2026 (ended Oct. 31, 2025), up 53.5% year over year and in line with the Zacks Consensus Estimate.
The company reported revenues of $332.6 million, up 26.5% year over year. Revenues beat the Zacks Consensus Estimate by 4.9%. The figure also surpassed the company’s guided range of $315-$321 million. This uptick was driven by solid momentum across all business segments.
Management stated that the company continues to experience strong traction for the Guidewire Cloud Platform and has begun the fiscal year with solid momentum.
As of Oct. 31, annual recurring revenues (ARR) were $1.063 billion, up 2.1% year over year. GWRE expects ARR for fiscal 2026 to be in the range of $1.22 billion to $1.23 billion.
Driven by strong revenue performance, GWRE expects total revenues for fiscal 2026 to be between $1.403 billion and $1.419 billion compared with $1.202 billion in fiscal 2025. The company earlier anticipated total revenues for fiscal 2026 to be between $1.385 billion and $1.405 billion.
Subscription revenues are now forecasted to be $891 million, while subscription and support revenues are expected to be $948 million. Services revenues are estimated at $245 million.
Non-GAAP operating income is forecasted to be between $266 million and $282 million. Cash flow from operations is now anticipated to be in the range of $355-$375 million.
In the past year, the stock has jumped 4.5% compared with the Internet Software industry’s growth of 1.4%.
Image Source: Zacks Investment Research
GWRE’s Fiscal Q1 in Details
The subscription and support segment’s revenues (66.8% of total revenues) soared 31% from the year-ago quarter's level to $222.2 million.
License’s revenues (12.6%) were up 12% year over year to $42 million.
Services’ revenues (20.6%) jumped 23% year over year to $68.5 million.
Non-GAAP gross margin expanded to 66% from 63.5% on a year-over-year basis. The subscription and support segment’s gross margin increased to 73.2% from 70.3% while the License segment’s gross margin was 98.5% compared with 97.7% in the year-ago quarter. Services’ non-GAAP gross margin was 22.8% compared with 19.7% a year ago.
Guidewire Software, Inc. Price, Consensus and EPS Surprise
Guidewire Software, Inc. price-consensus-eps-surprise-chart | Guidewire Software, Inc. Quote
Total operating expenses increased 17.1 % year over year to $191 million. Non-GAAP operating income was $63.4 million compared with $34.7 million in the year-ago quarter.
Financial Details of GWRE
As of Oct. 31, cash and cash equivalents and short-term investments were $1,409.3 million compared with $1,483.2 million as of July 31, 2025.
Driven by strong collections, GWRE used $67.4 million in cash from operations in the quarter under discussion, while free cash flow used was nearly $77.4 million.
GWRE’s Fiscal Q2 Outlook
For the second quarter of fiscal 2026, revenues are expected in the range of $339-$345 million. Non-GAAP operating income is estimated in the band of $68-$74 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
Atlassian (TEAM - Free Report) came out with first-quarter fiscal 2026 earnings of $1.04 per share, which beat the Zacks Consensus Estimate of 83 cents. This compares to earnings of 77 cents per share a year ago.
Atlassian posted revenues of $1.43 billion for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 2.40%. The company reported revenues of $1.19 billion in the year-ago quarter.
Chegg, Inc. (CHGG - Free Report) reported breakeven earnings for the third quarter of 2025, which topped the Zacks Consensus Estimate but declined year over year. Net revenues topped the consensus mark but tumbled year over year.
The company’s breakeven earnings were above the Zacks Consensus Estimate of adjusted loss per share of 14 cents by 100%. In the year-ago quarter, it reported adjusted earnings per share (EPS) of nine cents.
Net revenues of $77.7 million surpassed the consensus mark of $76 million by 1.8% but declined 43% year over year.
MongoDB, Inc. (MDB - Free Report) reported third-quarter fiscal 2026 non-GAAP earnings per share (EPS) of $1.32, which increased 13.8% from the year-ago quarter and surpassed the Zacks Consensus Estimate by 67.09%.
The company’s total revenues of $628.3 million rose 18.7% year over year and beat the consensus estimate by 6.27%.