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Guidewire Software Announces Fourth Fiscal Quarter and Fiscal Year 2019 Financial Results

SAN MATEO, Calif., 5 Settembre 2019

Guidewire Software, Inc. (NYSE: GWRE), provider of the industry platform Property and Casualty (“P&C”) insurers rely upon, today announced its financial results for the fourth fiscal quarter and fiscal year ended July 31, 2019.

“Our fourth quarter performance reflects growing P&C industry demand for core system modernization and an increasing preference for cloud-based deployments,” said Marcus Ryu, co-founder and chairman of the board, Guidewire Software. “During the quarter, six insurers selected InsuranceSuite via Guidewire Cloud, representing a cross-section of the P&C industry, including insurers of multiple sizes and continents, and a mix of new and existing customers. Our strategic priority is to evolve and scale Guidewire Cloud to serve the operational and advanced analytic needs of the global P&C industry. With 65% of our new software sales in fiscal year 2019 from cloud products, we believe the industry is increasingly selecting Guidewire InsurancePlatform as its platform of choice.”

“It’s exciting to see the increasing demand and momentum for Guidewire Cloud offerings; earning the trust of industry leaders such as American Family Insurance, EMC Insurance Companies, and Gore Mutual Insurance marks a significant milestone for Guidewire and our industry,” said Michael Rosenbaum, chief executive officer, Guidewire Software.

As of the first quarter of fiscal year 2019, Guidewire began reporting results under Accounting Standards Codification Topic 606, Revenue Recognition (“ASC 606”), using the modified retrospective method. Financial results for reporting periods prior to fiscal year 2019 are presented as previously disclosed in conformity with then existing guidance and as revised to reflect the restatement more fully described in Guidewire’s Form 10-K/A for the year ended July 31, 2018, filed on June 3, 2019.

Fiscal Year 2019 Financial Highlights

Revenue

  • Total revenue for fiscal year 2019 was $719.5 million, an increase of 10% from fiscal year 2018. License and subscription revenue was $385.3 million, an increase of 25%; services revenue was $248.8 million, a decrease of 7%; and maintenance revenue was $85.4 million, an increase of 10%.

Profitability

  • GAAP income from operations was $1.5 million for fiscal year 2019, compared with a $15.6 million loss for fiscal year 2018.
  • Non-GAAP income from operations was $122.1 million for fiscal year 2019, compared with $101.5 million of non-GAAP income for fiscal year 2018.
  • GAAP net income was $20.7 million for fiscal year 2019, compared with a $26.7 million net loss for fiscal year 2018, which was adversely impacted by a net tax expense of $28.6 million in the second quarter of fiscal year 2018, as a result of the provisions of the Tax and Jobs Act (the “Tax Act”) passed in December 2017. GAAP net income per share was $0.25, based on diluted weighted average shares outstanding of 82.7 million, compared with net loss per share of $0.34 for fiscal year 2018, based on diluted weighted average shares outstanding of 77.7 million.
  • Non-GAAP net income was $119.9 million for fiscal year 2019, compared with $85.1 million non-GAAP net income for fiscal year 2018. Non-GAAP net income per share was $1.45, based on diluted weighted average shares outstanding of 82.7 million, compared with net income per share of $1.07 for fiscal year 2018, based on diluted weighted average shares outstanding of 79.5 million.

Fourth Quarter Fiscal Year 2019 Financial Highlights

Revenue

  • Total revenue for the fourth quarter of fiscal year 2019 was $207.9 million, a decrease of 13% from the same quarter in fiscal year 2018. License and subscription revenue was $127.7 million, a decrease of 11%; services revenue was $58.3 million, a decrease of 23%; and maintenance revenue was $21.8 million, an increase of 6%.

Profitability

  • GAAP income from operations was $21.1 million for the fourth quarter of fiscal year 2019, compared with $48.1 million income for the comparable period in fiscal year 2018.
  • Non-GAAP income from operations was $51.1 million for the fourth quarter of fiscal year 2019, compared with $76.6 million of non-GAAP income for the comparable period in fiscal year 2018.
  • GAAP net income was $23.0 million for the fourth quarter of fiscal year 2019, compared with $58.8 million net income for the comparable period in fiscal year 2018. GAAP net income per share was $0.28, based on diluted weighted average shares outstanding of 82.9 million, compared with net income per share of $0.72 for the comparable period in fiscal year 2018, based on diluted weighted average shares outstanding of 82.2 million.
  • Non-GAAP net income was $46.3 million for the fourth quarter of fiscal year 2019, compared with $61.3 million non-GAAP net income for the comparable period in fiscal year 2018. Non-GAAP net income per share was $0.56, based on diluted weighted average shares outstanding of 82.9 million, compared with net income per share of $0.75 for the comparable period in fiscal year 2018, based on diluted weighted average shares outstanding of 82.2 million.

Liquidity

  • The Company had $1.3 billion in cash, cash equivalents, and investments at July 31, 2019 and 2018. The Company generated $116.1 million in cash from operations during the twelve months ended July 31, 2019.

Business Outlook

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

         

(in $ millions, except per share outlook)

 

First Quarter Fiscal
Year 2020

 

Fiscal Year 2020

Revenue

 

149.0

-

153.0

 

759.0

-

771.0

License and subscription

 

78.0

-

80.0

 

443.0

-

455.0

Maintenance

 

19.0

-

20.0

 

85.0

-

87.0

Services

 

51.0

-

54.0

 

224.0

-

236.0

GAAP operating income (loss)

 

(33.8)

-

(29.8)

 

(41.4)

-

(29.4)

Non-GAAP operating income (loss)

 

(3.0)

-

1.0

 

96.0

-

108.0

GAAP net income (loss)

 

(26.5)

-

(23.4)

 

(30.7)

-

(21.7)

GAAP net income (loss) per share

 

(0.32)

-

(0.29)

 

(0.37)

-

(0.26)

Non-GAAP net income (loss)

 

0.6

-

4.0

 

92.4

-

102.3

Non-GAAP net income (loss) per share

 

0.01

-

0.05

 

1.10

-

1.22

                 

Conference Call Information

What:

 

Guidewire Software Fourth Fiscal Quarter and Fiscal Year 2019 Financial Results Conference Call

When:

 

Thursday, September 5, 2019

Time:

 

2:00 p.m. PT (5:00 p.m. ET)

Live Call:

 

(877) 705-6003, Domestic

 

 

(201) 493-6725, International

Replay:

 

(844) 512-2921, Passcode 13693887, Domestic

 

 

(412) 317-6671, Passcode 13693887, International

Webcast:

 

http://ir.guidewire.com/ (live and replay)

The webcast will be archived on Guidewire’s website (www.guidewire.com) for a period of three months.

Non-GAAP Financial Measures

This press release contains the following non-GAAP financial measures: Non-GAAP operating income (loss), Non-GAAP net income (loss), Non-GAAP income tax provision (benefit), and Non-GAAP net income (loss) per share. Non-GAAP operating income (loss) excludes stock-based compensation and amortization of intangibles. Non-GAAP net income (loss), Non-GAAP income tax provision (benefit), and Non-GAAP net income (loss) per share also exclude the amortization of debt discount and issuance costs from our convertible notes and the related tax effects of the non-GAAP adjustments. The estimated annual tax rates used in the business outlook to compute GAAP and Non-GAAP net income exclude discrete items such as forecasted tax benefits related to stock-based compensation.

Guidewire believes that these non-GAAP financial measures 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 the financial tables at the end of this press release, and not to rely on any single financial measure to evaluate the Company’s business.

Notizie su Guidewire Software

Guidewire fornisce la piattaforma per l’industria assicurativa su cui le compagnie del ramo danni (P&C) fanno affidamento per adattarsi e avere successo in un'epoca di continuo cambiamento.  Forniamo i software, servizi e un ecosistema di partner affinché i nostri clienti possano gestire, differenziare e far crescere il proprio business. Abbiamo il privilegio di servire più di 380 società in 34 Paesi. Per ulteriori informazioni, visitare l'indirizzo www.guidewire.it. Seguici su Twitter: @Guidewire_PandC.

Cautionary Language Concerning Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to, statements regarding our financial outlook, market positioning, business momentum and demand for Guidewire Cloud offerings. These forward-looking statements are made as of the date they were first issued and were based on current expectations, estimates, forecasts and projections as well as the beliefs and assumptions of management. Words such as “expect,” “anticipate,” “should,” “believe,” “hope,” “target,” “project,” “goals,” “estimate,” “potential,” “predict,” “may,” “will,” “might,” “could,” “intend,” variations of these terms or the negative of these terms and similar expressions are intended to identify these forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond Guidewire’s control. Guidewire’s actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors, including but not limited to, risks detailed in Guidewire’s most recent Forms 10-K, 10-K/A and 10-Q filed with the Securities and Exchange Commission as well as other documents that may be filed by the Company from time to time with the Securities and Exchange Commission. In particular, the following factors, among others, could cause results to differ materially from those expressed or implied by such forward-looking statements: quarterly and annual operating results may fluctuate more than expected; seasonal and other variations related to our revenue recognition may cause significant fluctuations in our results of operations and cash flows; our reliance on sales to and renewals from a relatively small number of large customers for a substantial portion of our revenue; our ability to successfully manage any changes to our business model, including the transition of our products to cloud offerings and the costs related to cloud operations; our services revenue produces lower gross margins than our license and maintenance revenue; assertions by third parties that we violate their intellectual property rights could substantially harm our business; we face intense competition in our market; our products or cloud-based services may experience data security breaches; changes in accounting guidance on revenue recognition, such as contained in ASC 606, have and may cause us to experience greater volatility in our quarterly and annual results; our ability to remediate our material weakness that arose in connection with the restatement of our financial statements for the years ended July 31, 2018 and 2017; weakened global economic conditions may adversely affect the P&C insurance industry including the rate of information technology spending; our product development and sales cycles are lengthy; the risk of losing key employees; changes in foreign exchange rates; general political or destabilizing events, including war, conflict or acts of terrorism; and other risks and uncertainties. Past performance is not necessarily indicative of future results. The forward-looking statements included in this press release represent Guidewire’s views as of the date of this press release. The Company anticipates that subsequent events and developments will cause its views to change. Guidewire undertakes no intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. These forward-looking statements should not be relied upon as representing Guidewire’s views as of any date subsequent to the date of this press release.

 

GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited, in thousands)

 

 

 

 

 

 

 

July 31,
2019

 

July 31,
2018

ASSETS

 

 

 

 

CURRENT ASSETS:

 

 

 

 

Cash and cash equivalents

 

$

254,101

 

 

$

437,140

 

Short-term investments

 

870,136

 

 

630,008

 

Accounts receivable, net

 

138,443

 

 

124,849

 

Unbilled accounts receivable, net

 

36,728

 

 

 

Prepaid expenses and other current assets

 

35,566

 

 

30,464

 

Total current assets

 

1,334,974

 

 

1,222,461

 

Long-term investments

 

213,524

 

 

190,952

 

Unbilled accounts receivable, net

 

9,375

 

 

 

Property and equipment, net

 

65,809

 

 

18,595

 

Intangible assets, net

 

66,542

 

 

95,654

 

Goodwill

 

340,877

 

 

340,877

 

Deferred tax assets, net

 

90,308

 

 

90,369

 

Other assets

 

45,554

 

 

22,525

 

TOTAL ASSETS

 

$

2,166,963

 

 

$

1,981,433

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

CURRENT LIABILITIES:

 

 

 

 

Accounts payable

 

$

34,255

 

 

$

30,635

 

Accrued employee compensation

 

73,365

 

 

60,135

 

Deferred revenue, net

 

108,304

 

 

127,107

 

Other current liabilities

 

16,348

 

 

20,280

 

Total current liabilities

 

232,272

 

 

238,157

 

Convertible senior notes, net

 

317,322

 

 

305,128

 

Deferred revenue, net

 

23,527

 

 

23,758

 

Other liabilities

 

19,641

 

 

774

 

Total liabilities

 

592,762

 

 

567,817

 

STOCKHOLDERS’ EQUITY:

 

 

 

 

Common stock

 

8

 

 

8

 

Additional paid-in capital

 

1,391,904

 

 

1,296,380

 

Accumulated other comprehensive loss

 

(7,758

)

 

(7,748

)

Retained earnings

 

190,047

 

 

124,976

 

Total stockholders’ equity

 

1,574,201

 

 

1,413,616

 

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

 

$

2,166,963

 

 

$

1,981,433

 

 

GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited, in thousands except share and per share data)

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended July 31,

 

Twelve Months Ended July 31,

 

 

2019

 

2018

 

2019

 

2018

Revenue:

 

 

 

 

 

 

 

 

License and subscription

 

$

127,711

 

 

$

143,697

 

 

$

385,322

 

 

$

309,007

 

Maintenance

 

21,822

 

 

20,548

 

 

85,424

 

 

77,337

 

Services

 

58,325

 

 

76,015

 

 

248,768

 

 

266,505

 

Total revenue

 

207,858

 

 

240,260

 

 

719,514

 

 

652,849

 

Cost of revenue:

 

 

 

 

 

 

 

 

License and subscription

 

20,948

 

 

9,955

 

 

64,798

 

 

35,452

 

Maintenance

 

4,753

 

 

3,895

 

 

16,499

 

 

14,783

 

Services

 

57,083

 

 

76,630

 

 

243,053

 

 

246,548

 

Total cost of revenue

 

82,784

 

 

90,480

 

 

324,350

 

 

296,783

 

Gross profit:

 

 

 

 

 

 

 

 

License and subscription

 

106,763

 

 

133,742

 

 

320,524

 

 

273,555

 

Maintenance

 

17,069

 

 

16,653

 

 

68,925

 

 

62,554

 

Services

 

1,242

 

 

(615

)

 

5,715

 

 

19,957

 

Total gross profit

 

125,074

 

 

149,780

 

 

395,164

 

 

356,066

 

Operating expenses:

 

 

 

 

 

 

 

 

Research and development

 

49,472

 

 

45,502

 

 

188,541

 

 

171,657

 

Sales and marketing

 

33,958

 

 

38,168

 

 

130,751

 

 

124,117

 

General and administrative

 

20,562

 

 

18,009

 

 

74,401

 

 

75,916

 

Total operating expenses

 

103,992

 

 

101,679

 

 

393,693

 

 

371,690

 

Income (loss) from operations

 

21,082

 

 

48,101

 

 

1,471

 

 

(15,624

)

Interest income

 

8,030

 

 

6,034

 

 

30,182

 

 

13,281

 

Interest expense

 

(4,476

)

 

(4,203

)

 

(17,334

)

 

(6,442

)

Other income (expense), net

 

(909

)

 

(531

)

 

(1,867

)

 

509

 

Income (loss) before provision for income taxes

 

23,727

 

 

49,401

 

 

12,452

 

 

(8,276

)

Provision for (benefit from) income taxes

 

722

 

 

(9,376

)

 

(8,280

)

 

18,467

 

Net income (loss)

 

$

23,005

 

 

$

58,777

 

 

$

20,732

 

 

$

(26,743

)

Net income (loss) per share:

 

 

 

 

 

 

 

 

Basic

 

$

0.28

 

 

$

0.73

 

 

$

0.25

 

 

$

(0.34

)

Diluted

 

$

0.28

 

 

$

0.72

 

 

$

0.25

 

 

$

(0.34

)

Shares used in computing net income (loss) per share:

 

 

 

 

 

 

 

 

Basic

 

81,977,722

 

 

80,433,450

 

 

81,447,998

 

 

77,709,592

 

Diluted

 

82,928,818

 

 

82,162,624

 

 

82,681,214

 

 

77,709,592

 

                         

Amounts include stock-based compensation expense as follows:

         

 

 

Three Months Ended July 31,

 

Twelve Months Ended July 31,

 

 

2019

 

2018

 

2019

 

2018

 

 

(unaudited, in thousands)

Stock-based compensation expense:

 

 

 

 

 

 

 

 

Cost of license and subscription revenue

 

$

1,553

 

 

$

296

 

 

$

3,011

 

 

$

1,002

 

Cost of maintenance revenue

 

455

 

 

488

 

 

1,821

 

 

1,886

 

Cost of services revenue

 

4,883

 

 

5,874

 

 

22,781

 

 

21,856

 

Research and development

 

5,655

 

 

5,595

 

 

23,420

 

 

25,440

 

Sales and marketing

 

4,819

 

 

4,619

 

 

19,245

 

 

18,387

 

General and administrative

 

5,394

 

 

4,248

 

 

21,237

 

 

21,043

 

Total stock-based compensation expense

 

$

22,759

 

 

$

21,120

 

 

$

91,515

 

 

$

89,614

 

 

GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited, in thousands)

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended July 31,

 

Twelve Months Ended July 31,

 

 

2019

 

2018

 

2019

 

2018

CASH FLOWS FROM OPERATING ACTIVITIES:

 

 

 

 

 

 

 

 

Net income (loss)

 

$

23,005

 

 

$

58,777

 

 

$

20,732

 

 

$

(26,743

)

Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:

 

 

 

 

 

 

 

 

Depreciation and amortization

 

10,813

 

 

9,494

 

 

39,953

 

 

35,611

 

Amortization of debt discount and issuance costs

 

3,112

 

 

2,944

 

 

12,194

 

 

4,512

 

Stock-based compensation

 

22,759

 

 

21,120

 

 

91,516

 

 

89,614

 

Charges to bad debt and revenue reserves

 

191

 

 

 

 

670

 

 

1,062

 

Deferred income tax

 

(2,162

)

 

(10,542

)

 

(13,998

)

 

14,150

 

Amortization of premium (accretion of discount) on available-for-sale securities

 

(2,061

)

 

(1,384

)

 

(7,757

)

 

(1,418

)

Other non-cash items affecting net income (loss)

 

(386

)

 

 

 

189

 

 

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

Accounts receivable

 

(29,826

)

 

(24,023

)

 

(15,057

)

 

(40,832

)

Unbilled accounts receivable

 

26,517

 

 

 

 

(17,341

)

 

 

Prepaid expenses and other assets

 

(10,419

)

 

(584

)

 

(16,251

)

 

(2,737

)

Accounts payable

 

5,615

 

 

12,225

 

 

(5,521

)

 

16,794

 

Accrued employee compensation

 

18,890

 

 

16,467

 

 

13,825

 

 

9,230

 

Other liabilities

 

16,815

 

 

6,472

 

 

22,600

 

 

8,858

 

Deferred revenue

 

20,011

 

 

11,816

 

 

(9,628

)

 

32,358

 

Net cash provided by operating activities

 

102,874

 

 

102,782

 

 

116,126

 

 

140,459

 

CASH FLOWS FROM INVESTING ACTIVITIES:

 

 

 

 

 

 

 

 

Purchases of available-for-sale securities

 

(431,301

)

 

(324,347

)

 

(1,209,312

)

 

(859,657

)

Sales and maturities of available-for-sale securities

 

229,634

 

 

187,457

 

 

956,736

 

 

464,143

 

Purchases of property and equipment

 

(16,175

)

 

(4,688

)

 

(44,921

)

 

(9,398

)

Capitalized software development costs

 

(1,634

)

 

(764

)

 

(3,936

)

 

(2,614

)

Acquisitions of business, net of acquired cash

 

 

 

 

 

 

 

(130,058

)

Net cash used in investing activities

 

(219,476

)

 

(142,342

)

 

(301,433

)

 

(537,584

)

CASH FLOWS FROM FINANCING ACTIVITIES:

 

 

 

 

 

 

 

 

Proceeds from issuance of convertible senior notes, net of issuance costs

 

 

 

 

 

 

 

387,239

 

Proceeds from issuance of common stock, net of issuance costs

 

 

 

 

 

 

 

220,948

 

Purchase of capped calls

 

 

 

 

 

 

 

(37,200

)

Proceeds from issuance of common stock upon exercise of stock options

 

2,103

 

 

958

 

 

3,954

 

 

2,013

 

Net cash provided by financing activities

 

2,103

 

 

958

 

 

3,954

 

 

573,000

 

Effect of foreign exchange rate changes on cash and cash equivalents

 

(269

)

 

(1,421

)

 

(1,686

)

 

(1,911

)

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

 

(114,768

)

 

(38,961

)

 

(183,039

)

 

173,964

 

CASH AND CASH EQUIVALENTS—Beginning of period

 

368,869

 

 

476,101

 

 

437,140

 

 

263,176

 

CASH AND CASH EQUIVALENTS—End of period

 

$

254,101

 

 

$

437,140

 

 

$

254,101

 

 

$

437,140

 

 

GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES

Reconciliation of GAAP to Non-GAAP Financial Measures

(unaudited, in thousands except share and per share data)

 

 

 

 

 

 

 

 

 

The following tables reconcile the specific items excluded from GAAP in the calculation of non-GAAP financial measures for the periods indicated below:

 

 

Three Months Ended July 31,

 

Twelve Months Ended July 31,

 

 

2019

 

2018

 

2019

 

2018

Income (loss) from operations reconciliation:

 

 

 

 

 

 

 

 

GAAP income (loss) from operations

 

$

21,082

 

 

$

48,101

 

 

$

1,471

 

 

$

(15,624

)

Non-GAAP adjustments:

 

 

 

 

 

 

 

 

Stock-based compensation (1)

 

22,759

 

 

21,120

 

 

91,515

 

 

89,614

 

Amortization of intangibles (1)

 

7,217

 

 

7,348

 

 

29,113

 

 

27,462

 

Non-GAAP income (loss) from operations

 

$

51,058

 

 

$

76,569

 

 

$

122,099

 

 

$

101,452

 

 

 

 

 

 

 

 

 

 

Net income (loss) reconciliation:

 

 

 

 

 

 

 

 

GAAP net income (loss)

 

$

23,005

 

 

$

58,777

 

 

$

20,732

 

 

$

(26,743

)

Non-GAAP adjustments:

 

 

 

 

 

 

 

 

Stock-based compensation (1)

 

22,759

 

 

21,120

 

 

91,515

 

 

89,614

 

Amortization of intangibles (1)

 

7,217

 

 

7,348

 

 

29,113

 

 

27,462

 

Amortization of debt discount and issuance costs (2)

 

3,111

 

 

2,944

 

 

12,194

 

 

4,512

 

Tax impact of non-GAAP adjustments (3)

 

(9,818

)

 

(28,919

)

 

(33,678

)

 

(9,777

)

Non-GAAP net income (loss)

 

$

46,274

 

 

$

61,270

 

 

$

119,876

 

 

$

85,068

 

 

 

 

 

 

 

 

 

 

Tax provision (benefit) reconciliation:

 

 

 

 

 

 

 

 

GAAP tax provision (benefit)

 

$

722

 

 

$

(9,376

)

 

$

(8,280

)

 

$

18,467

 

Non-GAAP adjustments:

 

 

 

 

 

 

 

 

Stock-based compensation (1)

 

4,222

 

 

5,107

 

 

15,800

 

 

25,296

 

Amortization of intangibles (1)

 

1,339

 

 

1,777

 

 

5,033

 

 

7,661

 

Amortization of debt discount and issuance costs (2)

 

577

 

 

712

 

 

2,117

 

 

1,160

 

Tax impact of non-GAAP adjustments (3)

 

3,680

 

 

21,323

 

 

10,728

 

 

(24,340

)

Non-GAAP tax provision (benefit)

 

$

10,540

 

 

$

19,543

 

 

$

25,398

 

 

$

28,244

 

 

 

 

 

 

 

 

 

 

Net income (loss) per share reconciliation:

 

 

 

 

 

 

 

 

GAAP net income (loss) per share - diluted

 

$

0.28

 

 

$

0.72

 

 

$

0.25

 

 

$

(0.34

)

Non-GAAP adjustments:

 

 

 

 

 

 

 

 

Amortization of intangibles (1)

 

0.09

 

 

0.09

 

 

0.36

 

 

0.35

 

Stock-based compensation (1)

 

0.27

 

 

0.26

 

 

1.11

 

 

1.15

 

Amortization of debt discount and issuance costs (2)

 

0.04

 

 

0.04

 

 

0.16

 

 

0.06

 

Tax impact of non-GAAP adjustments (3)

 

(0.12

)

 

(0.37

)

 

(0.42

)

 

(0.14

)

Non-GAAP dilutive shares excluded from GAAP net income (loss) per share calculation (4)

 

 

 

0.01

 

 

(0.01

)

 

(0.01

)

Non-GAAP net income (loss) per share - diluted

 

$

0.56

 

 

$

0.75

 

 

$

1.45

 

 

$

1.07

 

 

 

 

 

 

 

 

 

 

Shares used in computing Non-GAAP income (loss) per share amounts:

 

 

 

 

 

 

 

 

GAAP weighted average shares - diluted

 

82,928,818

 

 

82,162,624

 

 

82,681,214

 

 

77,709,592

 

Non-GAAP dilutive shares excluded from GAAP income (loss) per share calculation (4)

 

 

 

 

 

 

 

1,785,533

 

Pro forma weighted average shares - diluted

 

82,928,818

 

 

82,162,624

 

 

82,681,214

 

 

79,495,125

 

                         

(1) Adjustments relate to amortization of acquired intangibles and stock-based compensation recognized during the period for GAAP purposes.
(2) Adjustments reflect the amortization of debt discount and issuance costs related to the issuance of our Senior Convertible Notes recognized during the period for GAAP purposes.
(3) Adjustments reflect the tax benefit (provision) resulting from all non-GAAP adjustments.
(4) Potentially dilutive securities were excluded from the calculation of GAAP net income (loss) per share, as they would have an anti-dilutive effect. However, these shares have a dilutive effect on non-GAAP net income (loss) per share and, therefore, are included in the non-GAAP net income (loss) per share calculation.

 

GUIDEWIRE SOFTWARE, INC. AND SUBSIDIARIES

Reconciliation of GAAP to Non-GAAP Outlook

The following tables reconcile the specific items excluded from GAAP outlook in the calculation of non-GAAP outlook for the periods indicated below:

(in $ millions)

 

First Quarter
Fiscal Year 2020

 

Fiscal Year 2020

Operating income (loss) outlook reconciliation:

 

 

 

 

 

 

 

 

GAAP operating income (loss)

 

(33.8)

-

(29.8)

 

(41.4)

-

(29.4)

Non-GAAP adjustments:

 

 

 

 

 

 

 

 

Stock-based compensation

 

22.4

-

24.4

 

103.3

-

113.3

Amortization of intangibles

 

7.3

-

7.3

 

29.1

-

29.1

Non-GAAP operating income (loss)

 

(3.0)

-

1.0

 

96.0

-

108.0

 

 

 

 

 

 

 

 

 

Net income (loss) outlook reconciliation

 

 

 

 

 

 

 

 

GAAP net income (loss)

 

(26.5)

-

(23.4)

 

(30.7)

-

(21.7)

Non-GAAP adjustments:

 

 

 

 

 

 

 

 

Stock-based compensation

 

22.4

-

24.4

 

103.3

-

113.3

Amortization of intangibles

 

7.3

-

7.3

 

29.1

-

29.1

Amortization of debt discount and issuance costs

 

5.1

-

5.1

 

14.3

-

14.3

Tax impact of non-GAAP adjustments

 

(8.8)

-

(8.4)

 

(28.7)

-

(27.7)

Non-GAAP net income (loss)

 

0.6

-

4.0

 

92.4

-

102.3

Media Contact:
Diana Stott
Guidewire Software, Inc.
(650) 356-4941
dstott [at] guidewire.com

Investor Contact:
Garo Toomajanian
ICR, LLC
(650) 357-5282
ir [at] guidewire.com