Guidewire Software, Inc. (NYSE: GWRE), a provider of software products to Property and Casualty insurers, today announced its financial results for the fiscal quarter ended April 30, 2018.
“We exceeded our revenue and non-GAAP profitability guidance for the third quarter of fiscal 2018 in the context of an incrementally increasing proportion of our new sales coming in the form of cloud-based subscriptions,” saidMarcus Ryu, chief executive officer, Guidewire Software. “As part of their transformation journeys, P&C insurers are seeking their trusted technology partners to shoulder an increasing share of the complexity of their core system environments. Consonant with this trend, we closed two additional InsuranceSuite cloud sales during the quarter and advanced similar conversations with both new and existing customers.”
Ryu continued, “We also completed an important capital raise that strengthens our balance sheet and provides us the means to act on investment opportunities that advance our industry platform mission.”
Third Quarter Fiscal 2018 Financial Highlights
Total revenue for the third quarter of fiscal 2018 was $140.5 million, an increase of 14% from the same quarter in fiscal 2017. License and other revenue was $50.4 million, a decrease of 15%, services revenue was $71.4 million, an increase of 50%, and maintenance revenue was $18.7 million, an increase of 11%.
Rolling four-quarter recurring revenue was $334.4 million for the period ended April 30, 2018, an increase of 10% compared to the same metric for the period ended April 30, 2017.
GAAP loss from operations was $29.2 million for the third quarter of fiscal 2018, compared with loss of $4.3 million in the comparable period in fiscal 2017.
Non-GAAP income from operations was $2.3 million for the third quarter of fiscal 2018, compared with income of $17.1 million in the comparable period in fiscal 2017.
GAAP net loss was $48.6 million for the third quarter of fiscal 2018, compared with a net loss of $1.8 million for the comparable period in fiscal 2017. GAAP net loss per share was $0.62, based on diluted weighted average shares outstanding of 78.8 million, compared with $0.02 net loss per share for the comparable period in fiscal 2017, based on diluted weighted average shares outstanding of 74.2 million.
Non-GAAP net income was $3.9 million for the third quarter of fiscal 2018, compared with a net income of $12.3 million in the comparable period in fiscal 2017. Non-GAAP net income per diluted share was $0.05, based on diluted weighted average shares outstanding of 80.4 million, compared with net income per diluted share of $0.16 in the comparable period in fiscal 2017, based on diluted weighted average shares outstanding of 75.2 million.
The Company had $1,158.5 million in cash, cash equivalents and investments at April 30, 2018, compared with $687.8 million at July 31, 2017. The increase was due to total net proceeds of $608.2 million related to the public offering of our common stock and convertible notes offering, partially offset by the use of approximately $130.1 million of cash in connection with the acquisition of Cyence.
Guidewire is issuing the following outlook for the fourth quarter and fiscal 2018 based on current expectations:
Revenue 234.0 - 240.0 647.0 - 653.0 License and other revenue 141.0 - 147.0 306.0 - 312.0 Maintenance revenue 19.0 - 20.0 76.0 - 77.0 Services revenue 71.0 - 75.0 262.0 - 266.0 GAAP operating income (loss) 45.5 - 51.5 (17.1) - (11.1) Non-GAAP operating income 78.0 - 84.0 104.0 - 110.0 GAAP net income (loss) 65.8
GAAP net income (loss) per share 0.80
Non-GAAP net income 58.8
Non-GAAP net income per share 0.72 - 0.77
1.11 Non-GAAP operating income (loss) excludes stock-based compensation expense and amortization of intangible assets. Non-GAAP net income (loss) excludes stock-based compensation expense, amortization of intangible assets, and the amortization of debt discount and issuance costs from our convertible notes and the related tax effects. The GAAP and non-GAAP estimated annual tax rates used to compute net income and EPS exclude discrete items such as forecasted tax benefits related to stock-based compensation, and are impacted by the passage of the Tax Cuts and Jobs Act.
Non-GAAP Financial Measures
This press release contains the following non-GAAP financial measures: Non-GAAP operating income, Non-GAAP net income (loss), Non-GAAP income tax provision (benefit), and Non-GAAP net income (loss) per share. These Non-GAAP financial measures exclude stock-based compensation, amortization of intangibles, and the amortization of debt discount and issuance costs from our convertible notes and the related tax effects of these adjustments for Non-GAAP net income (loss) and Non-GAAP net income (loss) per share.
Guidewire believes that these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to Guidewire’s financial condition and results of operations. The Company’s management uses these non-GAAP measures to compare the Company’s performance to that of prior periods for trend analysis, for purposes of determining executive and senior management incentive compensation and for budgeting and planning purposes. The Company believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing the Company’s financial measures with other software companies, many of which present similar non-GAAP financial measures to investors.
Management of the Company does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude significant expenses and income that are required by GAAP to be recorded in the Company’s financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by management about which expenses and income are excluded or included in determining these non-GAAP financial measures. Guidewire urges investors to review the reconciliation of its non-GAAP financial measures to the comparable GAAP financial measures, which it includes in press releases announcing quarterly financial results, including this press release, and not to rely on any single financial measure to evaluate the Company’s business.
Reconciliation tables of the most comparable GAAP financial measures to the non-GAAP financial measures used in this press release are included with the financial tables at the end of this release.
Guidewire ist die Plattform auf die Schaden- und Unfallversicherer setzen, um zu interagieren, zu innovieren und effizient zu wachsen. Wir kombinieren digitale Lösungen, Kernsysteme, Analytics und KI um unsere Plattform als Cloud-Service anzubieten. Mehr als 400 Versicherer weltweit Guidewire im Einsatz - von Start-ups bis hin zu den größten und komplexesten Unternehmen.
Als Partner unserer Kunden entwickeln wir uns kontinuierlich weiter, um ihren Erfolg zu ermöglichen. Wir freuen uns über unsere einzigartige Erfolgsbilanz bei Implementierungen mit mehr als 1000 erfolgreichen Projekten, unterstützt durch das größte F+E-Team und Partnersystem in der Branche. Unser Marketplace bietet hunderte von Anwendungen zur Beschleunigung von Integration, Lokalisierung und Innovation.