Guidewire Software (GWRE) GWRE Q1 Financial Results Summary
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Guidewire (GWRE) Q1 2026 Financial Results Summary
Release Date: December 3, 2025.
Guidewire (NYSE: GWRE) has released its financial results for the first quarter of the fiscal year 2026, which ended on October 31, 2025. The company showed strong performance across multiple metrics, exceeding its guidance for the quarter, which contributed to an optimistic outlook for the remainder of the fiscal year.
Financial Highlights for Q1 Fiscal Year 2026
Revenue
- Total Revenue: $332.6 million, up 27% compared to Q1 FY 2025.
- Subscription and Support Revenue: $222.2 million, an increase of 31% year-over-year.
- License Revenue: $42.0 million, up 12% from the same quarter last year.
- Services Revenue: $68.5 million, reflecting a 23% increase year-over-year.
Annual Recurring Revenue (ARR)
- ARR: Reached $1,063 million, a slight rise from $1,041 million as of July 31, 2025, indicating a healthy start for the fiscal year.
Profitability
- GAAP Income from Operations: $18.5 million compared to a GAAP loss of $4.7 million in Q1 FY 2025, marking a significant operational turnaround.
- Non-GAAP Income from Operations: $63.4 million, compared to $34.7 million for the same period last year.
- GAAP Net Income: $31.3 million, up from $9.1 million in Q1 FY 2025.
- GAAP Diluted Net Income per Share: $0.36, compared to $0.11 for the same period last year.
- Non-GAAP Net Income: $57.0 million, compared to $36.7 million in Q1 FY 2025.
- Non-GAAP Diluted Net Income per Share: $0.66, up from $0.43 year-over-year.
Liquidity and Capital Resources
- Cash, Cash Equivalents, and Investments: $1,409.3 million, down from $1,483.2 million as of July 31, 2025.
Business Outlook
- Second Quarter FY 2026 Expectations:
- Ending ARR: Projected between $1,107 million and $1,113 million.
- Total Revenue: Expected to range from $339 million to $345 million.
- GAAP Operating Income: Forecasted between $19 million and $25 million.
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Non-GAAP Operating Income: Anticipated to be between $68 million and $74 million.
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Fiscal Year 2026 Updated Outlook:
- Ending ARR: Anticipated to be between $1,220 million and $1,230 million.
- Total Revenue: Estimated between $1,403 million and $1,419 million.
- GAAP Operating Income: Expected to range from $72 million to $88 million.
- Non-GAAP Operating Income: Forecasted between $266 million and $282 million.
- Operating Cash Flow: Projected to be between $355 million and $375 million.
Dividend and Share Repurchase
- Guidewire did not declare a quarterly dividend or indicate any share repurchase activity in this report.
Summary of Key Metrics Growth vs. Q1 FY 2025
- Total Revenue: +27%
- Subscription and Support Revenue: +31%
- License Revenue: +12%
- Services Revenue: +23%
- GAAP Income from Operations: Transitioned from a loss of $4.7 million to a profit of $18.5 million.
- Non-GAAP Income from Operations: Increased by 83%.
- GAAP Net Income: Increased by 243%.
- Non-GAAP Net Income: Increased by 55%.
- GAAP Diluted Net Income per Share: Increased by 227%.
- Non-GAAP Diluted Net Income per Share: Increased by 53%.
Conclusion
Guidewire’s first quarter financial results for FY 2026 demonstrate significant growth across key metrics, fueling an overall optimistic outlook for the remainder of the fiscal year. The company’s ability to leverage its Guidewire Cloud Platform and other technological advancements positions it well for future growth in the property and casualty insurance sector.
Here are the extracted tables from the press release:
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in thousands except share and per share data)
| Revenue: | Three Months Ended October 31, | |
|---|---|---|
| 2025 | 2024 | |
| Subscription and support | $222,203 | $169,742 |
| License | $41,967 | $37,370 |
| Services | $68,469 | $55,789 |
| Total revenue | $332,639 | $262,901 |
| Cost of revenue(1): | ||
| Subscription and support | $63,927 | $54,024 |
| License | $644 | $881 |
| Services | $58,546 | $49,604 |
| Total cost of revenue | $123,117 | $104,509 |
| Gross profit: | ||
| Subscription and support | $158,276 | $115,718 |
| License | $41,323 | $36,489 |
| Services | $9,923 | $6,185 |
| Total gross profit | $209,522 | $158,392 |
| Operating expenses(1): | ||
| Research and development | $78,317 | $68,880 |
| Sales and marketing | $64,258 | $51,478 |
| General and administrative | $48,469 | $42,754 |
| Total operating expenses | $191,044 | $163,112 |
| Income (loss) from operations | $18,478 | -$4,720 |
| Interest income | $14,650 | $13,606 |
| Interest expense | -$3,312 | -$2,062 |
| Other income (expense), net | -$5,314 | -$4,055 |
| Income (loss) before provision for (benefit from) income taxes | $24,502 | $2,769 |
| Provision for (benefit from) income taxes | -$6,806 | -$6,370 |
| Net income (loss) | $31,308 | $9,139 |
| Net income (loss) per share: | ||
| Basic | $0.37 | $0.11 |
| Diluted | $0.36 | $0.11 |
| Shares used in computing net income (loss) per share: | ||
| Basic | 84,780,201 | 83,276,236 |
| Diluted | 86,451,737 | 85,960,868 |
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited, in thousands)
| ASSETS | October 31, 2025 | July 31, 2025 |
|---|---|---|
| CURRENT ASSETS: | ||
| Cash and cash equivalents | $492,038 | $697,902 |
| Short-term investments | $519,861 | $451,541 |
| Accounts receivable, net | $94,600 | $140,639 |
| Unbilled accounts receivable, net | $163,016 | $130,959 |
| Prepaid expenses and other current assets | $87,509 | $86,374 |
| Total current assets | $1,357,024 | $1,507,415 |
| Long-term investments | $397,365 | $333,754 |
| Unbilled accounts receivable, net | $83 | $670 |
| Property and equipment, net | $65,199 | $60,436 |
| Operating lease assets | $37,636 | $39,309 |
| Intangible assets, net | $10,704 | $12,042 |
| Goodwill | $394,300 | $393,978 |
| Deferred tax assets, net | $305,494 | $297,234 |
| Other assets | $71,526 | $76,261 |
| TOTAL ASSETS | $2,639,331 | $2,721,099 |
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||
| CURRENT LIABILITIES: | ||
| Accounts payable | $33,557 | $28,797 |
| Accrued employee compensation | $70,300 | $140,613 |
| Deferred revenue, net | $253,537 | $340,253 |
| Other current liabilities | $32,464 | $35,139 |
| Total current liabilities | $389,858 | $544,802 |
| Lease liabilities | $29,057 | $30,687 |
| Convertible senior notes, net | $675,443 | $674,568 |
| Deferred revenue, net | $2,464 | $4,533 |
| Other liabilities | $9,091 | $9,279 |
| Total liabilities | $1,105,913 | $1,263,869 |
| STOCKHOLDERS’ EQUITY: | ||
| Common stock | $9 | $8 |
| Additional paid-in capital | $2,064,255 | $2,020,393 |
| Accumulated other comprehensive income (loss) | -$7,905 | -$8,922 |
| Retained earnings (accumulated deficit) | -$522,941 | -$554,249 |
| Total stockholders’ equity | $1,533,418 | $1,457,230 |
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $2,639,331 | $2,721,099 |