Guidewire Software Announces First Quarter Fiscal 2017 Financial Results

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 October 31, 2016.

"Revenue and profitability exceeded our guidance for the first quarter," said Marcus Ryu, chief executive officer, Guidewire Software. "We continue to see P/C insurers of all sizes undertaking transformation programs to compete in a more digital and data-driven future. Our product strategy of unifying a transactional core with digital and data solutions matches this demand, as reflected by strong interest in our new cloud-based Predictive Analytics and Underwriting Management solutions."

Ryu continued, "We were also pleased to welcome a record number of participants to our 12th annual Connections user conference in October, where we showcased the new major release of Guidewire InsurancePlatform TM and our growing ecosystem of service and technology partners. Our customers validated our focus on building an industry-standard platform to reduce technology complexity and total cost of ownership for the P/C industry."

First Quarter Fiscal 2017 Financial Highlights

Revenue
  • License and other revenue for the first quarter of fiscal 2017 was $38.7 million, an increase of 20% from the first quarter of fiscal 2016. Maintenance revenue was $16.5 million, an increase of 18% and services revenue was $38.9 million, an increase of 8%. Total revenue was $94.1 million, an increase of 14% from the same quarter in fiscal 2016.
  • Rolling four-quarter recurring term license and maintenance revenue was $272.7 million as of October 31, 2016, an increase of 21% compared to the same metric as of October 31, 2015.

Profitability
  • GAAP operating loss was $18.3 million for the first quarter of fiscal 2017, compared with an operating loss of $9.0 million in the comparable period in fiscal 2016.
  • Non-GAAP operating income was $1.0 million for the first quarter of fiscal 2017, compared with $6.5 million in the comparable period in fiscal 2016.
  • GAAP net loss was $7.9 million for the first quarter of fiscal 2017, compared with net loss of $1.6 million for the comparable period in fiscal 2016. GAAP net loss per share was $0.11, based on diluted weighted average shares outstanding of 73.3 million, compared with net loss of $0.02 per share for the comparable period in fiscal 2016, based on diluted weighted average shares outstanding of 71.2 million.
  • Non-GAAP net income was $1.1 million for the first quarter of fiscal 2017, compared with $4.8 million in the comparable period in fiscal 2016. Non-GAAP net income per diluted share was $0.02, based on diluted weighted average shares outstanding of 74.6 million, compared with $0.07 in the comparable period in fiscal 2016, based on diluted weighted average shares outstanding of 72.9 million.

Balance Sheet
  • The Company had $686.2 million in cash, cash equivalents and investments at October 31, 2016, compared with $735.8 million at July 31, 2016. The Company used $12.9 million in cash for operations in the first quarter of fiscal 2017, reflecting normal seasonal patterns, and an additional $33.6 million to complete the acquisition of FirstBest Systems, Inc.

Business Outlook

Guidewire is issuing the following outlook for the second quarter and fiscal 2017, based on current expectations:
(in $ millions, except per share outlook)      

Second Quarter Fiscal 2017
      Full Year Fiscal 2017
Revenue       106.0   -   110.0       473.0   -   483.0
License revenue 56.0 - 60.0 254.0 - 262.0
Maintenance revenue 16.0 - 17.0 66.0 - 68.0
Services revenue 32.5 - 34.5 150.0 - 156.0
GAAP operating income (6.7 ) - (2.7 ) (1.7 ) - 8.3
Non-GAAP operating income 13.5 - 17.5 77.0 - 87.0
GAAP net income (2.9 ) - (1.2 ) 0.6 - 5.0
GAAP net income per share (0.04 ) - (0.02 ) 0.01 - 0.07
Non-GAAP net income 8.9 - 11.6 52.8 - 59.4
Non-GAAP net income per share 0.12 - 0.15 0.70 - 0.79

Guidewire continues to target term license revenue growth of 20% or higher for the current fiscal year. Non-GAAP operating income and non-GAAP net income exclude stock-based compensation expense and amortization of intangible assets.

Conference Call Information
 
What:       Guidewire Software First Quarter Fiscal 2017 Financial Results Conference Call
When: Tuesday, November 29, 2016
Time: 2:00 p.m. PT (5:00 p.m. ET)
Live Call: (888) 802-2279, Domestic
(913) 312-1524, International
Replay: (877) 870-5176, Passcode 1867001, Domestic
(858) 384-5517, Passcode 1867001, International
Webcast:

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

The webcast will be archived on Guidewire's website for a period of three months.

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